Farmers Reeling as Government Freezes Sustainable Farming Incentive Funding

The UK farming community is in uproar following the government's sudden freeze on new applications to the Sustainable Farming Incentive (SFI), a flagship post-Brexit scheme designed to support environmentally friendly agriculture. For many, this decision represents not only a financial blow, but a step backwards in the UK's net zero journey.

What Is the Sustainable Farming Incentive (SFI)?

Introduced as part of England's Environmental Land Management Schemes (ELMs), the SFI was developed to reward farmers for sustainable practices such as soil health improvement, reduced pesticide use, hedgerow management, and wildlife habitat restoration. The scheme aimed to replace the EU's Common Agricultural Policy with payments tied to environmental outcomes, aligning agriculture with climate and biodiversity targets.

Since its rollout, thousands of farmers had signed up, attracted by its promise of predictable, environmentally supportive income streams.

Why Was the Funding Frozen?

In March 2025, Defra abruptly paused new applications to the SFI, citing a surge in uptake and the need to review budgeting and capacity. While the department claims that existing agreements will be honoured and that spending is at a record high, the halt has left thousands of prospective applicants stranded.

According to Farmers Weekly, the freeze was driven by fears of budget oversubscription, but critics argue this points to poor planning and a lack of political will to back long-term green policies (source: fwi.co.uk).

Impact on Farmers - Livelihoods in Jeopardy

Mounting Financial Pressure

Many farmers had banked on SFI payments for their 2025 operational plans. The freeze leaves those who delayed applying - particularly smallholders and recent entrants - without vital income. The National Farmers' Union (NFU) described the decision as "the cruellest betrayal yet", underscoring the sense of disillusionment in the sector.

One organic grower shared that they are now facing a £20,000 shortfall, having planned soil health and biodiversity projects under the assumption they would qualify for funding this spring.

Environmental Projects Halted

The decision has triggered an immediate stall in sustainability efforts. Initiatives such as hedgerow planting, cover cropping, and pollinator-friendly field margins have been put on ice. Vineyards and regenerative farms across the UK have already cancelled cover crop plans, threatening soil quality and biodiversity.

As reported by Vinetur, UK vineyards are now "facing a crisis", with sustainable expansion halted midstream (source: vinetur.com).

Environmental and Climate Ramifications

The freeze deals a heavy blow to the UK's climate strategy. By disincentivising nature-positive farming, the move threatens progress toward 2050 net zero emissions targets. Projects tied to carbon sequestration, water retention, and pesticide reduction are in jeopardy, creating long-term setbacks.

The Nature Friendly Farming Network (NFFN) warns this could derail the UK's biodiversity recovery, calling for an interim support mechanism to prevent a rollback on years of progress.

Disproportionate Impact on Small and New Farmers

Smaller farms and new entrants are particularly vulnerable. Unlike large estates with diversified income or access to Countryside Stewardship alternatives, many of these operators were depending solely on the SFI for stable funding.

This disparity risks further consolidating land ownership and undermining a diverse, resilient agricultural landscape.

Calls for Accountability and Alternatives

Policy Backlash

Farmer organisations and environmental groups have called on Defra to reverse the freeze or introduce transitional arrangements. Many accuse the government of prioritising short-term Treasury savings over long-term food security and climate resilience.

What Can Farmers Do Now?

While new SFI applications are paused, other schemes remain open. The Countryside Stewardship programme offers some overlap in support, though it lacks the scale and accessibility of the SFI.

The NFFN has urged the government to introduce a bridging mechanism - potentially in the form of a basic environmental income - to plug the funding gap and maintain trust.

Looking Ahead - What Does This Mean for Sustainable Farming?

The uncertainty surrounding agricultural policy is shaking confidence across the sector. Farmers are now wary of committing to future environmental initiatives without guarantees of support.

If the government fails to restore clarity and confidence, the SFI freeze could mark a wider retreat from green agriculture, with lasting effects on nature, food security, and rural livelihoods.

Conclusion - A Fork in the Furrow

The frozen SFI funding is more than a budgetary hiccup - it is a pivotal moment for UK farming. Will the government reaffirm its commitment to a greener agricultural future, or will this pause become a permanent step backwards? As farmers, environmentalists, and rural communities await answers, one thing is clear: sustainable farming must remain a priority if the UK is to meet its environmental obligations and secure the future of food.