What is SFI?

The incentive was introduced in England in 2021 to reward farmers for delivering public goods – things like cleaner water, healthier soils, more wildlife, and climate change mitigation – alongside food production.

After Brexit, the UK moved away from the EU’s Basic Payment Scheme (BPS), which paid farmers largely based on land area. The current approach aims to drive outcomes beyond land acreage and benefit society.

SFI is one of the three main parts of the Environmental Land Management schemes (ELMs) in England, alongside

• Countryside Stewardship
• Landscape Recovery

SFI has been positioned as the most accessible and flexible of the three, with everyday, practical actions that most farms can adopt.

How has SFI evolved over the years?

2021-2022: the pilot phase

Only a limited number of farmers could join the first iteration, which focused on soil standards with tiers of difficulty. It was a cautious start, but many farmers felt it was too narrow in scope.

2023: a major restructure

The most notable change in 2023 was the structure. The 2022 SFI employed ‘standards’ – introductory and intermediate levels – which resulted in differing rates of funding.

In its place, a more flexible ‘pick and mix’ approach was introduced. Actions were broken down into three components: plans, plots, and prescriptions. This restructuring gave farmers a lot more flexibility. However, it was not without its problems – there were IT issues, and the government also introduced a cap on certain options of 25% of farmed area following significant take up.

SFI 2024 introduced additional actions such as variable rate fertiliser spreading and led to some farms having more than one agreement with differing end dates.

2024-2025: an unexpected pause

SFI 2024 introduced additional actions such as variable rate fertiliser spreading and led to some farms having more than one agreement with differing end dates.

In March of 2025, the government suddenly closed the scheme to new applications. This caused a lot of concern for farmers and landowners, and contributed to a loss of confidence in the government.

For farmers who were already moving in the direction of regenerative techniques, the SFI provided an opportunity to be rewarded for doing so. 

2026: new offer announced

At the National Farmers’ Union conference, secretary of state Emma Reynolds announced more details of the Sustainable Farming Incentive 2026 offering.

The scheme will be simplified to 71 actions, down from 102 in the SFI24 offer, with agreements capped at £100,000 per year.

The first application window will open in June for smaller farms (3-50 hectares) and those not already in ELM schemes, followed by a wider window in September.

What does the latest announcement mean for farmers?

The announcement was welcome news to those farmers who were not in a scheme; however, many questions remain. For example, those with Countryside Stewardship agreements terminating in December 2026 or SFI agreements terminating later in the year will be at the mercy of the computer system as to when they can apply. There is also concern that caps or closures could happen with little notice.

While the £100,000 cap is more positive than first envisaged, the devil will be in the detail of how those with substantial environmental schemes across large landholdings will manage. 

Further information

Contact Georgina Sweeting or Chloe Gimson