The value of all Basic Payment Scheme (BPS) entitlements for the 2024 scheme year has been cut by 9%, DAERA has confirmed.

The money will be used to fund the new headage payment for beef cattle, known as the Beef Carbon Reduction Scheme.

Some of the funds will also be used for the initial roll-out of the new Suckler Cow Scheme, which is due to begin in January 2025.

A further cut to entitlement values will be applied next year, to fund the Suckler Cow Scheme in full. After that, more deductions will occur in subsequent years, to pay for the new Farming With Nature Scheme.

For anyone who needs extra entitlements to claim BPS on clean land this year, Omagh-based auctioneer Roy McCracken suggests the best option could be to lease them for one year, as the exact value of entitlements after 2024 remains unknown.

“Leasing is a safer bet. It is more of a gamble to buy entitlements. It all depends on how much comes off entitlements to fund these new schemes and we don’t know that yet,” he said.

Existing BPS entitlements will form the basis of a new area-based scheme, known as the Farm Sustainability Payment (FSP). This scheme will be rolled out in full in 2026, with a transition year occurring in 2025.

Market changes

McCracken points out that aside from the reducing value of entitlements, other factors are coming into play over the next few years, which could affect the market for trading entitlements.

One issue is changes to land eligibility rules, which will allow all land, except for the likes of lanes and yards, to be eligible for the new FSP.

Entitlements are not being re-based across all eligible land, so most farmers will have slightly more eligible land than entitlements and this could increase demand for entitlements on the market.

Another factor is that landowners who had no farming activity in 2020 and 2021 will not be eligible to claim FSP and will not be allocated entitlements. It is expected that many of the landowners affected by this change will sell their entitlements before they are lost.

“If these two changes happened at the same time, then the rise in supply of entitlements on the market could be balanced out by the increased demand from farmers with extra land. Hopefully any unevenness in the market would be levelled out,” McCracken said.

2024 trading

The online portal on the DAERA website for transferring entitlements for lease or sale opens on 1 March and closes on 2 May.

According to McCracken, deals for trading entitlements can vary significantly – it is not as simple as saying that an entitlement is traded at a fixed percentage of the value.

“If someone is leasing out entitlements worth £200 and another person has ones at £400, then the ones at £400 will bring in more money and so they are worth [proportionately] more on the market,” he said.

Muir commits to suckler headage payment plan

The confirmation that BPS entitlement values will reduce to fund new beef and suckler headage payments, indicates that Agriculture Minister Andrew Muir is on board with the plan.

Minister Muir, who took on the DAERA portfolio earlier this month, had the power to change the two schemes which were initially set in motion by his predecessor Edwin Poots.

“These schemes are significant elements of my Department’s new farm support and development programme to be added for 2024/25 and are aimed at improving the efficiency of the beef sector and reducing greenhouse gas emissions,” the Alliance MLA said.