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Defra’s organic agri-environment scheme

The Department for Environment, Food and Rural Affairs and Natural England have not optimised value for money for the almost £200 million scheme to encourage farmers into organic farming and deliver environmental benefits, according to a National Audit Office report published today.

The Organic Entry Level Stewardship scheme is overseen by the Department and run by Natural England and the Rural Payments Agency using EU money and matched funding from UK taxpayers. Defra’s forecasts for expenditure of EU funds assumed a constant rate of take-up each year, which the NAO considers over-optimistic, and present a risk that EU funds will not all be utilised.

The scheme pays organic farmers for managing their land in ways that will protect or enhance the natural environment or historic landscape. The scheme is likely to have achieved environmental benefits by supporting organic farming, and the money paid to farmers for adopting environmental land management measures has had some impact, but this could be increased.

Farmers can choose which environmental measures to implement and, according to the NAO survey, 57 per cent chose some measures that involve managing features already in place on their farm. Many of the more challenging options are rarely implemented. Defra is now taking steps to improve the environmental impact of the scheme by promoting better targeted measures.

Take-up of the scheme broadly reflects take-up of organic farming methods in the farming industry as a whole. The scheme benefits larger farms, especially in the beef and dairy sectors, more than smaller farms.

Farmers are happy with the quality of service provided by Natural England in administering the scheme. It has considerably reduced the time it takes to process scheme applications and the time taken to process payments since the start of the scheme, but IT costs do still remain high.

"Defra should learn from this scheme and get a lot better at putting credible measurement arrangements in place to demonstrate whether public funds are being used properly. It appears likely that Defra’s scheme helped to deliver environmental benefits by encouraging organic farming, but we can’t draw a similar conclusion on the land management measures and I would have expected a greater environmental benefit for the taxpayer’s funding contribution."

Amyas Morse, head of the National Audit Office

Notes for Editors

  • The Organic Entry Level Stewardship scheme is one of three agri-environment schemes which make up Environmental Stewardship, which is part of the Department for Environment Food and Rural Affairs’ Rural Development Programme for England. The schemes are overseen by defra and administered by Natural England. The Rural Payments Agency makes payments and carries out compliance inspections.
  • The scheme requires certification as an organic farmer, and adoption of additional land management measures chosen from a list of options. It pays farmers £30 per hectare per year to maintain organic certification and £30 per hectare per year for the cost of implementing environmental management measures, such as hedgerow management and the preservation of archaeological features or historic buildings. Farmers converting their land to organic farming methods can claim a further £175 per hectare per annum for two years and £600 per hectare per annum on ‘top fruit’, such as apples and pears, for three years.
  • The Government has set aside £1.7 billion of EU funding and an estimated £1.2 billion of UK matched funding for all agri-environment schemes. EU funds that are not used by the end of 2015 cannot be claimed.
  • Press notices and reports are available from the date of publication on the NAO website, which is at www.nao.org.uk. Hard copies can be obtained from The Stationery Office on 0845 702 3474.
  • The Comptroller and Auditor General, Amyas Morse, is the head of the National Audit Office which employs some 900 staff. He and the NAO are totally independent of Government. He certifies the accounts of all Government departments and a wide range of other public sector bodies; and he has statutory authority to report to Parliament on the economy, efficiency and effectiveness with which departments and other bodies have used their resources.

PN: 24/10