The Agriculture Act 2020: an overview

The passing of the Agriculture Act in November 2020 marks the start of a transition period towards implementing the principle of “public money for public goods”. The reformation of the agriculture sector envisaged by the Agriculture Act, is one of the key mechanisms deployed by the Government to achieve the goals set by the 25 Year Environment Plan and to deliver on the commitment to net zero emissions by 2050.

The headline features of the Agriculture Act 2020 are set out below.

Reforming Farming Subsidies

Currently, farming subsidies are predominantly delivered through Direct Payments under the Common Agricultural Policy (CAP). The Agriculture Act phases out Direct Payments over a seven year transition period beginning in 2021 replaced by payments under the Environmental Land Management Scheme (ELMS) due to commence in 2024. The ELMS is described by DEFRA as the “cornerstone of the Government’s new agricultural policy”.

ELMs implements a plan for financial assistance for farmers and land managers for delivering public goods and environmental outcomes including:

  • Cleaner air;
  • Clean and plentiful water;
  • Thriving plants and wildlife through environmentally beneficial land and water management;
  • Public access to and enjoyment of the countryside, farmland and woodland;
  • Maintaining, restoring and enhancing cultural or natural heritage;
  • Management of land, water or livestock to mitigate or adapt to climate change;
  • Protection from environmental hazards;
  • Improvements to animal health and welfare;
  • Protecting or improving the quality of soil; and
  • Improving the productivity of agriculture, forestry or horticulture.
There is a duty on the Secretary of State when devising the financial assistance schemes to have regard to encouraging productivity in an environmentally sustainable way. Food Security The Act places a duty on the Secretary of State to produce a report for Parliament on UK Food Security every three years. The data to be included in the report is likely to cover global food availability, supply sources for food and resilience of the supply chain. The first report is due at the end of 2021.
 

Transparency and fairness in the agri-food supply chain

The Act grants powers to the Secretary of State to collect data for specific purposes including;

  • increasing productivity and managing risks and market volatility;
  • improving transparency and fairness in the supply chain;
  • improving animal health, welfare and traceability;
  • improving plant, fungi and soil health and quality;
  • minimising adverse environmental effects;
  • minimising waste from agri-food supply chains; and
  • monitoring or analysing markets connected to agri-food supply chains.

The Act also grants powers to introduce both general and sector-specific obligations that promote fair contractual relationships across the supply chain.

Trade – standards and welfare

Despite widespread calls to do so, the Act did not enshrine a requirement that all future trade agreements include an obligation for agricultural imports to meet the same health, welfare and environmental standards as domestic producers. Instead the Government has indicated its backing of British farmers and food producers by strengthening the remit of the Trade and Agriculture Commission and placing it on a statutory footing. In addition, there is a requirement for the Secretary of State to report to Parliament on whether and to what extent, any Free Trade Agreement provides for the maintenance of UK standards as they relate to agricultural products before it is signed off. There remains uncertainty as to the extent of protection that will be afforded to domestic agriculture products as against imports produced to a lower standard.

Is the Agriculture Act 2020 a positive step for sustainability in agriculture?

The Agriculture Act recognises the importance of the agriculture sector to our environment, our mental and physical health as well as our economy. It does not, however, go as far as providing concrete standards necessary for the protection of the environment, tackling climate change and restoring biodiversity. The financial provision provided by the ELMS will need to effectively incentivise sustainable practices in agriculture to support farmers in meeting the objectives envisaged by the Act.
 
Further detail regarding the implementation of the Agriculture Act is expected to follow.
 
For a comprehensive review of the Landlord and Tenant reforms under the Agriculture Act 2020 see: Agriculture Act 2020: Landlord and Tenant Reforms - Now and Later