The Department for Environment, Food and Rural Affairs (Defra) has had its budget cut by 2.7% in the government’s spending review. This is not as bad as farming and nature groups had feared, however.
The statement from the government reads: “This settlement maintains the government’s steadfast commitment to farming, food security, and nature’s recovery. The government will invest more than £2.7 billion per year in sustainable farming and nature recovery from 2026‑27 until 2028‑29. Farmers will benefit from an average of £2.3 billion through the Farming and Countryside Programme and up to £400 million from additional nature schemes.”
The government has largely protected Defra’s core funding, according to Sustain’s blog, with its total Departmental Expenditure Limit (DEL) falling by 0.7% in real terms over the spending review period to 2028/29. So, key policy delivery plans – including support for sustainable agriculture and nature recovery – are “mostly maintained”.
“This is a much-needed show of commitment for nature-friendly farming,” said Sustain’s sustainable farming coordinator Will White. “The funding commitment for Environmental Land Management (ELM) schemes is a vital signal that the government recognises the central role of farmers in delivering climate action, restoring nature, and ensuring food security.”
However, the department’s administrative budget, which covers staffing and internal running costs, will be cut by 15% in real terms by 2029-30 as part of broad government efficiency targets across all departments.
Farming groups were more conservative in their support for the review. Sanjay Dhanda, senior economist at the NFU, said Defra’s overall budget was £7.3 billion in 2024/25 and is set to rise to £7.4 billion in 2028/29. “When adjusted for inflation, this represents an average annual real-terms cut of 2.3%,” he explained, adding: “Against a backdrop of sharp input cost inflation in agriculture, where prices have risen by 29.5% since January 2020, this further erosion in real spending power for the department presents a serious concern.”
Indeed, the NFU has identified that farming and countryside programmes like the Sustainable Farming Initiative face a £100m cut within the review. There was also no U-turn on the inheritance tax changes that have angered farming groups.
NFU President Tom Bradshaw said: “While the Defra secretary of state has listened and managed to maintain the overall funding for farming and nature recovery, from what we can see so far, the £100 million cut to farming means farmers and growers will need to do more with less. The devil will be in the detail,” he added.
The government also confirmed that it would provide £410m per year by 2028-29 to expand free school meals eligibility to all pupils in England with a parent receiving Universal Credit (see last week’s Digest for more on that).
