Following the Autumn Budget on 30th October, Defra has released more details about delinked payments for the 2025 scheme year. With the reductions to delinked payments confirmed, what does this mean for you and your farming business in 2025?
The transition away from direct payments
The reductions continue the move away from previous schemes, where 50% of payments went to the largest 10% of farms. The announced reductions to 2025 delinked payments are part of the transition to more targeted public investment, supporting farmers to boost nature and sustainable food production. There has been increased uptake in the Environmental Land Management schemes over the last year, and more than half of farmers now have land management agreements.
How your 2025 delinked payment will be calculated
Your delinked payment for 2025 will be your reference amount minus progressive reductions. As the Rural Payments Agency (RPA) did last year, they will calculate your reductions using your reference amount (not the value of your 2024 payment). Your reference amount will be split into payment bands to do this. The planned reduction percentages for 2025 are shown below. There has been no indication given as to the progressive reduction rates beyond 2025.
Payment band for reference amounts
£30,000 or less – reduction percentage 76%
Amounts above £30,000 – reduction percentage 100%
These are not reduction percentages to the value of your 2024 payment.
Example 1:
A reference amount of £20,000 will have a 76% reduction applied (a reduction of £15,200). The payment will be £4,800 (£20,000 minus £15,200). For comparison, for 2024 the payment for this reference amount was £10,000.
Example 2:
A reference amount of £40,000 will have a 76% reduction applied to the first £30,000 (a reduction of £22,800). A 100% reduction will be applied to the next £10,000 (a reduction of £10,000). The payment will be £7,200 (£40,000 minus £32,800). For comparison, for 2024 the payment for this reference amount was £19,500.
You can use the RPA’s delinked payments calculator to see how these reductions could affect your payment for the 2025 scheme year.
The RPA plans to pay 2025 delinked payments as one payment from 1st August 2025 rather than splitting it into two instalments. This means you will recieve the whole payment sooner rather than receiving a second instalment later. The RPA intends to take the same approach in 2026 and 2027.
You can read more about delinked payments and reference amounts on GOV.UK.
Check if you’re eligible for delinked payments
To receive delinked payments, you must:
- Be eligible – this means you must have claimed, and been eligible for, BPS payments in England in the 2023 scheme year (or inherited eligible land after 15 May 2023). Read the BPS rules for 2023 for information about eligibility for BPS
- Have a reference amount
Your reference amount will normally be your average BPS payment in the reference period, which is the BPS 2020 to 2022 scheme years. If you did not claim BPS in the reference period, you will only have a reference amount if BPS reference data has been transferred to you.
So long as you are eligible for delinked payments, the value of your payments for 2024 to 2027 will not be affected if:
- Your farm size changes
- You change what the land is used for, after BPS 2022 (the last year of the reference period).
You can receive delinked payments even if you choose to stop farming after the BPS 2023 application deadline (15 May 2023).
You will not be eligible for delinked payments if you have received a payment under the Lump Sum Exit Scheme.
Other funding available
Read ‘Funding for farmers, growers and land managers’ on GOV.UK for information about grants and other funding to increase productivity, manage your land to benefit the environment and support your agricultural business.
Help & advice
For further help and advice, please contact our Agricultural Compliance team on 01981 590514