Sustainable Farming Incentive (SFI)

England

Current Update:

The SFI scheme is closed to new applications as of March 2025 due to budget limits.

Existing agreements will continue as normal, and pending applications submitted before closure will be processed.

A revised SFI offer will launch in 2026, with clearer guidance and improved payment structures. Defra has confirmed that the relaunch will align more closely with other schemes like Countryside Stewardship, ensuring a more streamlined approach to environmental land management.

Overview of Previous SFI Agreements

Pilot Phase (2021):
Tested initial standards for soil health, grassland management, and integrated pest management.

SFI 2022:
Limited rollout with a small set of actions focused on soil health and planning.

SFI 2023 Offer:
Launched in October 2023 with 23 actions, including soil management, herbal leys, cover crops, and hedgerow management.

Popular actions included:

IPM4: No insecticide use on arable/permanent crops (430,000 ha)
SAM3: Establish and maintain herbal leys (175,000 ha)
SAM2: Multi-species winter cover crops (124,000 ha)
HRW2: Hedgerow management (34,000 km under management)
By April 2024: 13,900 live agreements, covering 2 million hectares.

SFI 2024 Expanded Offer:
Introduced in June 2024, combining SFI 2023 actions with Countryside Stewardship Mid Tier and adding over 100 actions.

Included agroforestry, organic conversion, species-rich grassland management, and precision farming (e.g., variable rate nutrient application).
Some actions required endorsement from Natural England or the Forestry Commission.

Key Features of Previous Offers

Rolling application windows and quarterly payments for flexibility.

Most actions were three-year commitments, with some five-year options for endorsed actions.

Focus areas included:

Soil health and nutrient planning (SAM1, NUM1)
Integrated pest management (IPM1, IPM4)
Hedgerow and woodland management (HRW1, HRW2)
Habitat creation and low-intensity grazing
Agroforestry and organic farming options
Precision farming techniques (PRF1

For help and assistance with any existing agreement or applying for new SFI agreements in 2026, please contact a member of our rural team:

Gareth Wall

Andrew Edwards

Katie Bufton

Peter Kirby

Bob Bowen

Tara Boulton

Beth Gilbert

Amelia Crofts-Hill

Charlotte Watson

Wales

BPS is continuing in Wales with the Sustainable Farming Scheme (SFS) to be introduced from 1st January 2026. The scheme will require an annual SAF to be completed by 15th May each year.

The Scheme will be made up of 3 layers –

1) Universal Layer (compulsory) with 12 Actions

2) an Optional Layer (14 actions)

3) a Collaborative Layer, which is aimed at working with more landowners/wider groups

A Universal Code will apply to all farms within the SFS. It includes a series of requirements which are to be applied across the whole farm, which are broadly similar to cross-compliance. They are designed to protect environmental assets and features on the farm.

Only payment rates for the Universal Layer have been announced. Optional and Collaborative Layer payment details are to be announced on 1st January 2026.

Payments under the SFS

The Universal Payment rates for the first year of the scheme are expected to be:

Whole Farm Payment - £70 per hectare for the first 70 hectares of eligible land, and then £2 per hectare for all remaining eligible land.

Habitat Maintenance Payment - £69 per hectare for all habitat maintained as part of UA5: Habitat maintenance or for habitat created under UA6: Temporary habitat creation on improved land to meet the Scheme Requirement for 10% habitat on each farm.

Woodland Maintenance Payment - £62 per hectare for all woodland maintained as part of UA9: Woodland maintenance (excluding those tenants who do not have full management control of the woodland).

Social Value Payment - £107 per hectare for all eligible land.

Advance payments will be paid in October, with the remainder in December each year. RPW will publish the payment mechanisms and rates for the Optional and Collaborative Actions as they are made available.

BPS Tapering:
BPS will become a legacy scheme, and payments will reduce over three years: