Under the CAP farmers received a 'basic payment' with larger scale farmers getting more. How this was spent was only loosely constrained so in practice it could be used for consumption as well as investment in the farm business.
Michael Gove came up with the idea of 'public money for public goods'. In other words, farmers should be subsidised to farm more sustainably and benefit the environment. (Note that we are talking just about England, policy in the devolved regions is different).
It took far too long to get the Sustainable Farming Incentive up and running and now it has been closed without the required six weeks notice because the money (£1.8 billion) has run out. Uptake covers just 50 per cent of funding against a 70 per cent target.
Defra is not a 'protected' department and the Government is short of money as it tries to ramp up defence expenditure. Nevertheless, some calculations suggest there could be headroom of £400m in the Defra budget. Perhaps some extra money could be found, certainly wildlife groups hope so. For a fuller critique: https://www.thetimes.com/article/510e633d-69f1-40fc-bba8-78ef0ce8d9c4
I think that farmers are increasingly realising that the Treasury is not going to back down on the changes to inheritance tax. Some farmers are talking of going 'full French', but any government that surrenders to direct action risks its authority.
Personally I would have looked at reducing or eliminating the capital gains tax rollover relief for farmland sold for development, but that might be seen at odds with housing policy.
Farmers will still pay half the prevailing rate of inheritance tax and get 10 years back to pay the bill free of interest, a privilege the rest of us don't get.
