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Delinked Payments and Farm Diversification

The introduction of delinked payments in 2024 means that farmers will no longer be required to submit BPS applications to the Rural Payments Agency (RPA) to receive their farm entitlements.

Farmers are being encouraged to seek expert legal advice about the complexities involved in phasing out of the Government’s Basic Payment Scheme (BPS) which will see remaining entitlement payments being delinked from farmland over the next three years. Payments from 2024-2027 will be based on the average received during the ‘reference period’ of the years 2020-2022, significantly lower than previous entitlement payments.

But what does this mean for farmers?

Put, from a legal perspective the process has been simplified.

Payments due to farmers are now ‘delinked’ from land, meaning that entitlements can no longer be traded, and any sale of farmland or farm assets will no longer need to deal with the transfer of farm entitlements to a buyer of such land.

Naturally, with increasing financial pressures and economic uncertainty farmers are now looking at diversifying their use of farmland and assets to increase their profitability. We are seeing an increased appetite for the development of land to create boutique farms and coffee shops, leasing of land to provide camping/glamping sites and an interest from energy providers to go green and install solar wind farms, amongst many more.

There are many complexities to overcome when negotiating any such farm diversification ventures and Larken & Co’s expert commercial property team are well-placed to guide farmers through the process every step of the way.

Land sales to Developers and Biodiversity Net Gain

You might have heard of Biodiversity Net Gain (BNG), but what is it and how could it affect farmers looking to sell land for development or turn a profit from unused BNG units on their own land?

Under the new mandatory regime, any new development of land will need to deliver a minimum of 10% BNG before developments can commence. In short, this new regime ensures that all new housing, commercial and infrastructure building projects in England will need to restore any biodiversity lost to habitats during the building phase and deliver a 10% minimum boost to the area’s biodiversity.

So, how can farmers benefit from BNG in relation to their land?

All developers will be required to design a BNG plan which will be supported by a statutory calculation prepared by an ecologist, which will show the level of biodiversity before the development commences and how the minimum 10% uplift in biodiversity will be achieved.

Farmers can take proactive steps to appoint an ecologist ahead of any potential land sale to create a formal habitat management and monitoring plan and agree habitat creation/enhancements to their land to help them to better understand the projected number of biodiversity units that will be delivered on their land if sold for development.

Luke Tattersall-Smith, Head of Commercial Property at Larken & Co, said that “farmers making BNG gains can greatly increase the value and appeal of land to be sold which is earmarked for development. Alternatively, such BNG units can be sold to a third-party developer if they cannot achieve BNG on their own development sites, by acquiring off-site BNG gains from adjoining land owned by farmers”.

Of course, making BNG enhancements to your land does not come cheap or easy, and does include a significant amount of land management, monitoring and reporting to ensure that any local planning authority accepts the same as part of any planning process.

Any such BNG enhancements should be formally recorded on the national biodiversity gain register and on any local authority registers, and there are a wide variety of other legal agreements that may also be needed.

It would be prudent to appoint a solicitor with expertise in this area of law, which is where Larken & Co can help. Our expert team of lawyers would be happy to undertake a review of your legal title in relation to any potential BNG site, and further to represent your interests in securing the project, perhaps via a planning obligation (known as a ‘section 106 agreement’) or a conservation covenant with a responsible body.

For further information about BPS payments, BNG or any other commercial property issue, please call Luke at Larken & Co on 01636 703333 or email This email address is being protected from spambots. You need JavaScript enabled to view it.