Hill farm incomes in the UK have recently seen great decrease following drops in
lamb and
beef prices. The CAP provided production-based direct (headage) which gave incentive to stock beef cattle and sheep at high densities. This led to, in some circumstances, overgrazing which damages natural and semi-natural vegetation. Because of
overgrazing and issues with the accumulation of surpluses, the CAP was reformed. The two most recent reforms to the CAP were Agenda 2000 in 1999 and the Mid Term Review of June 2003 and April 2004. These changes are phasing out support and protections linked to production, and are providing more support on environmental and rural developments.
Single Farm Payment The
Single Farm Payment replaced the older headage payments (CAP) in 2005. Analyses of the effects of economic incentives provided to hill farmers by decoupling and the introduction of the Single Farm Payment show that although these policies cause little change in average farm incomes they do encourage change in the way hill farms run. Specifically the policies promote the reduction of stocking densities, reduction of employment of additional farm labour, movement away from reliance on beef cattle, increased specialization, and to keep farming land in “good agricultural condition” rather than farm abandonment. The EU plans to phase out and progressively reduce the SFP, and the SFP is guaranteed until 2013.
Other policies Other subsidy schemes from the British government are available to hill farmers, particularly the Uplands Entry Level Stewardship (Uplands ELS) and agri-environment schemes. The Uplands ELS replaced the prior Hill Farm Allowance in 2010. Before the HFA, hill farms we subsidized by the Hill Livestock Compensatory Allowances which were active as headage support to eligible beef cows and ewes. Because the DAs are more profitable than the SDAs, active since 2008 DAs became ineligible for funding from the Hill Farming Allowance (HFA). In addition to the Upland ELS, hill farmers in England's SDAs are supported by the Single Payment Scheme (SPS), which is the primary
agricultural subsidy scheme under the EU. Subsidies from the SPS are not dependent on production, granting greater freedom to farmers to meet market demands. The SPS also claims to specifically support hill farmers who follow environmentally friendly farming practices. In order to receive these subsidies, hill farmers must meet cross compliance rules and regulations, which mainly involves avoidance of overgrazing and unsuitable supplementary feeding on natural and semi-natural vegetation under GAEC (standard of good agricultural and environmental condition). These standards were implemented to protect significant habitats and to limit
soil erosion and other negative effects of
soil structure in the uplands. Certain upland farmers and communities also have access to funding from the Rural Development Programme for England (RDPE) team at
Defra. The reduction of farming subsidies that have taken place over the past few decades has created an uncertain future for farming in many parts of
Europe. ==Recent strain on hill farming==