Welsh Government’s decision to slash the Basic Payment Scheme (BPS) by 40% for 2026 overshadows much of the positive work undertaken to improve the new Sustainable Farming Scheme (SFS), says NFU Cymru.
Tuesday 15th July saw Welsh Government publish further information, including payment rates and details of the transition, for the Sustainable Farming Scheme SFS – the primary source of government support for Welsh farming starting in 2026.
Welsh Government has confirmed its intention to reduce the BPS to 60% of current payment levels in 2026, having previously reassured farmers that there would be no ‘cliff edge’ in funding through the transition to new schemes. Last November, Welsh Government reiterated that it was still its intention to phase out the BPS during the transition period through an incremental reduction in value (20% per year) starting in 2026. NFU Cymru believes that reneging on this commitment in today’s announcement overshadows much of the positive work undertaken to improve the SFS following the highly controversial ‘Keep farmers farming’ consultation of late 2023 / early 2024.
NFU Cymru President Aled Jones said:
“This unwelcome decision by Welsh Government is extremely worrying for farmers in Wales who had previously been informed that those opting not to enter the new Sustainable Farming Scheme in 2026 would receive 80% of their BPS. Farming businesses have forward planned on this basis.
“This development is even more of a blow given significant guidance and technical detail is yet to be published which farmers need if they are to make informed decisions about whether to enter the scheme from 1st January 2026. With harvest well underway and next year’s cropping and livestock purchases already in motion, many farmers will not be able to pivot their business to join the new scheme from January. Farming families are also grappling with difficult conversations and decisions on how to restructure their businesses to address the changes being forced upon them by the introduction of the UK Government’s family farm tax from April 2026.With Welsh Government now slashing the first year of the tapered transition from the BPS, many will feel they are now stuck between a rock and a hard place.”
Nine years ago, NFU Cymru set out a key set of principles to form the foundations of a new ‘made in Wales’ farming policy to deliver on the union’s vision for a productive, profitable and progressive Welsh farming industry1. It is against these principles and framework that NFU Cymru judges today’s announcement.
NFU Cymru President Aled Jones said:
“Since Welsh Government launched its first consultation ‘Brexit and our Land’ some seven years ago, NFU Cymru has undertaken an unprecedented level of engagement with its members and the wider supply chain. This culminated in the powerful and deeply moving 5,500 pairs of wellies placed on the steps of the Senedd in March 2024, each pair symbolising a farmer or farm worker who would have lost their career in farming based on an impact assessment of earlier SFS proposals.
“NFU Cymru has worked tirelessly on behalf of its members in meetings with the Deputy First Minister and his officials. The Deputy First Minister has listened and acted on a number of our concerns. Changes secured following NFU Cymru lobbying have addressed many of the ‘thorny’ issues we have grappled with; the 10% Tree cover scheme requirement has been removed; the unique circumstances of our tenants and common land rights holders have been considered; the number of universal actions (UAs) have been consolidated and positive changes have been secured to a number of the conditions attached to these UAs.
“Despite this, the level of detail, constraints, administration, costs and bureaucracy attached to the SFS is significant and far greater than anything seen before. We remain deeply worried about the burden this scheme will place on a sector low in confidence and already dealing with a mountain of red tape.
“NFU Cymru has long highlighted the need for the SFS to provide at least the same level of stability to farm businesses, our rural communities and the supply chain as the BPS does currently. We are pleased that Welsh Government has confirmed a social value payment recognising the wider benefits provided by farming.
“However, without publication of Welsh Government’s impact assessment and modelling, it is impossible to understand the impact the scheme will have on farm businesses and the supply chain. This information must be made available as soon as possible and there must be a commitment from Welsh Government to change the scheme if certain sectors or areas are disadvantaged, or the scheme is shown to hamper and harm our ambition to continue to grow the Welsh food sector from farm to fork.
“NFU Cymru has consistently called for Welsh Government to commit to a well-funded, multi-annual budget for the scheme matching the scale of the ambition we have for sustainable growth of the food and farming sector, alongside the delivery of key environmental outcomes for society. This support must also recognise that the existing budget for farming needs to increase to over £500m just to keep pace with inflation. Whilst we welcome the budget allocation of £238m to the scheme’s universal action layer in 2026, we will be looking to the next Welsh Government to commit to increase the overall budget for the scheme – and to the universal layer – to match our ambition and ensure Welsh farming can continue to deliver for food, nature, climate and communities.”
