Row of cows at farm in Shropshire

The Welsh Agriculture Act – sustainable land management for the future

16/11/23The Welsh Agriculture Act – sustainable land management for the future

The Agriculture (Wales) Act 2023 (AWA 2023) is a huge change for Wales and a significant moment in devolved Welsh governance and history.

The bill has received Royal Assent and, as of 17 August 2023, it has become law. This is the first post-Brexit agricultural support scheme to update its landlord and tenant legislation, as the framework for this is part of the Agriculture Act 2020 introduced in November 2020.

We have offices in Wrexham and Pembrokeshire, covering the whole of Wales. As a business that works in partnership with many local agricultural estates and landowners, we have read the details with interest and here’s a summary of what we’ve discovered.

The Agricultural (Wales) Act 2023 comprises six parts, which outline future national agricultural policy. Some of the act’s key points cover Sustainable Land Management, Transition and Agricultural Tenancies. Although the AWA 2023 is related to the Agriculture Act 2020, one of the big differences is in respect to dispute resolution for agricultural tenants.

Objectives and results

The agricultural policy is primarily based on Sustainable Land Management (SLM), which has four objectives. They are to produce food and other goods in a sustainable manner; address and adapt to climate change; maintain and enhance the resilience of ecosystems and their benefits; and conserve and enhance the countryside and its cultural resources, thereby promoting public access to and engagement with them. An essential element to this is sustaining the Welsh language and promoting and facilitating its use.

The end result of the Act’s delivery will be the Sustainable Farming Scheme (SFS). How the Welsh government is going to implement SFS is yet to be determined, as ministers will publish a final consultation later in 2023. This will focus on more detail at the final proposals for SFS, the transition time and stability payments, among other things.

A transitional period

As the Basic Payment Scheme Payments (BPS) continues to be phased out, the AWA 2023 allows Welsh Ministers to continue making agricultural support payments to farmers until 31 December 2024. After this, a four-year transitional period (1 April 2025 to 31 March 2029) will allow the Welsh Government to make a ‘stability payment’ to farmers who are already claiming BPS, regardless of whether they plan to enter into SFS. There is no guarantee in the amount available to farmers beyond the 2024-25 financial year, as it’s dependent on future funding. As with ‘delinked payments’ in England, farmers can expect the stability payment to be reduced over the transition period.

An interim scheme: Habitat Wales

As to existing Glastir contracts, the Welsh Government has chosen to extend Glastir Advanced, Commons and Organic contracts to the end of December 2023 but no further, which means there will be a gap between 1 January 2024 and the introduction of SFS in 2025. Wales currently has some 3,000 farms in Glastir agreements that will now come to an end. To bridge the gap, the Welsh Government is introducing an interim agri-environment scheme, called the Habitat Wales Scheme, to protect habitats on agricultural land during this period. Announced in July, by Minister for Rural Affairs Lesley Griffiths MS, the scheme will provide another means of support to eligible farmers and Grazing Associations. As it includes Glastir Advanced, Commons and Organic farmers, more farmers will be able to take part and protect land, while maintaining progress made by Glastir. Contracts for this interim scheme will start in January, with Glastir closing at the end of the year.

What will the Habitat Wales Scheme do?

Habitat Wales will:

Find full details of the guidance on the Welsh Government Habitat Wales Scheme page.

Arbitrary decisions

Of particular interest to us is the policy relating to Agricultural Tenancies. The Welsh Government has ensured that tenants of Agricultural Holdings Act 1986 (AHA 1986) tenancies and Agricultural Tenancies Act 1995 (ATA 1995) tenancies have a way to resolve disputes. This will allow them the opportunity to override the terms of their tenancy agreements in certain circumstances. Sometimes tenancy agreements contain covenants that prevent them from entering into subsidy schemes and from carrying out certain activities, that will be required as part of entry into such a scheme – like creating new woodland. Tenants require landlords’ consent to enter into these schemes.

Chapter 4 (Section 24) of AWA 2023 amends section 19A of the AHA 1986, to apply to Wales’s financial support scheme. In this way, AHA tenants can override tenancy restrictions, with any disputes being resolved by arbitration or third-party determination. Wales is also affording ATA 1995 tenants the same opportunity, with new clause 8A being added into the ATA 1995. Tenants are permitted to refer disputes concerning requests for consent – or variations in the terms of a tenancy –  to arbitration. Legislation will bring into force Chapter 4 of the AWA 2023 in due course.

If you’d like to find out more about the Agricultural (Wales) Act 2023, and how it might affect you, then get in touch with us today

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