There will be no significant change to the current area-based farm support scheme in the UK for several years after Brexit, Defra Farming Minister George Eustice has said.

Speaking to MPs on the NI Affairs Committee in Westminster on Wednesday, Eustice maintained that the current Basic Payment Scheme will be rolled into UK law after Brexit and subsequent changes will be made gradually.

“From 2020 onwards we could make some modest changes, but we intend to proceed cautiously with a transition over a period of years,” he said.

“It will be at least three years before we see substantive change to the fundamental design of agricultural policy,” Eustice added.

He said that changes to agricultural policy in devolved regions of the UK, and the pace at which they are made, will be up to devolved administrations and not the UK government.

“NI might want to be more cautious about the pace of change and it would be open for them to do that,” Eustice said.

He added that it was likely that NI would continue to keep the current area-based scheme if there remained political deadlock and no functioning executive at Stormont into the future.

“I suspect what DAERA would choose to do is stick with a scheme that tracks very closely with the current Single Farm Payment [Basic Payment Scheme] until there is an administration in place that gives political direction of any changes it wants to make,” Eustice told MPs.

During his presentation, the MP for Camborne and Redruth appeared well briefed on the main differences between farming in NI compared with other parts of the UK. He said that although longer term agricultural policy would be under a broad UK framework, a future NI executive would have significant flexibility in designing farm support schemes.

“I would imagine that a future NI administration might want to have closer regard to what the Republic of Ireland is doing with policy, to ensure they are not doing anything that would put their own farmers at a disadvantage,” Eustice said.

Tax review

He was also asked about the issue of conacre land leasing arrangements in NI and what could be done to encourage longer-term leasing.

In response, Eustice said that an ongoing review of Agricultural Property Relief (APR) by the Office of Tax Simplification could dis-incentivise short leasing arrangements.

“Some argue that the way APR works at present is as a tax avoidance tool for inheritance tax and people that are not farmers try to shelter their money in agricultural land,” he said.

He referred to a call from the Tenant Farmers Association for non-farming landowners to only be eligible for APR if they lease land in longer-term tenancies. However, he pointed out that there could be unintended consequences from changing the law, and it could lead to less land being available for renting.

The Office of Tax Simplification is due to report this autumn. It is not expected to bring forward any major changes at this stage, but could recommend a more detailed investigation into APR.