Review sees freeze on new entries for HLS

Natural England, the stewardship grants administrator for the Department for Environment Food and Rural Affairs, announced the freeze this week.

When announcing its Spending Review settlement, the Government said the budget for HLS would grow 83 per cent by 2013/14.

But at least some of the extra money was expected anyway, to pay for transfers from older agreements, and it is now clear that the settlement amounts to a cut in ambitions.

As well as pressing the pause button, Natural England has admitted conditions for HLS membership will become tighter.

The Government conceded this week that the HLS budget for next year would be down, although it would then go up. A DEFRA spokesman said no figures had previously been set for the years after this one.

It was said the total rural development budget would be "maintained", but it was not clear if that meant fully maintained against inflation and expectations.

The wording also raised the question of what would pay for the overall rise in HLS.

DEFRA said the extra would come largely from a bonus in the EU contribution, arising from favourable exchange rates between the pound and Euro, but the NFU said a lot of capital grant funding also looked likely to be sacrificed.

A DEFRA spokesman said: "The HLS budget is going up by 83 per cent. The HLS budget for 2010/11 is 84m. This will increase by 83 per cent by the end of the spending review period to just under 154m."

Dorothy Fairburn, regional director of the Country Land & Business Association, said: "Clearly, some sacrifices are going to be made somewhere. We do believe the Secretary of State is doing her best but we are advising our members that HLS is going to be harder to earn and capital works funding should be taken while it is still there if possible. Apart from the squeeze on money, Natural England is losing staff and regional offices, which is going to mean less time for every application."

A Natural England spokesman said: "We have suspended further approvals while we assess with DEFRA the effects of the new budget profile. New commitments made this year impact on the budgets for subsequent years. Farmers who have already been formally offered HLS agreements will not be affected. HLS remains open for business and farmers are encouraged to continue applying.

Land business advisers have warned that the Feed-in-Tariff for renewable energy for the national grid – introduced in April this year –is likely to be reduced by April 2013 as a result of the spending review.

CW 30/10/10