England opens first SFI application window for small farms and new ELM entrants

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England SFI for small farms

Highlights

England opens the first Sustainable Farming Incentive window with £60 million available, targeting farms between three and 50 hectares and new ELM entrants.
New scheme reforms include a £100,000 annual agreement cap, a single agreement per farm, and the removal of the SFI management payment to encourage wider access.
The SFI26 iteration is backed by £240 million for new agreements, contributing to the government's £11.8 billion funding commitment for sustainable farming through this parliament.

Window 1 eligibility and funding terms

As reported by GOV.UK, eligible farmers across England can now apply for Window 1 of the revised Sustainable Farming Incentive, which is aimed at farms with between three and 50 hectares of agricultural land and larger farms above three hectares that do not already hold an ELM revenue agreement.

SFI pays for practical on-farm actions intended to support sustainable food production and environmental outcomes, including improving soil health, protecting waterways, creating habitat for wildlife and reducing reliance on synthetic fertilisers. The scheme runs on a standard three-year agreement and lets farmers choose from 71 actions suited to their land and business.

The government sets aside £60 million for this first window, with any unspent funding due to roll into Window 2, scheduled to open in September 2026 for all farmers and land managers in England. The application round is demand-led and is expected to stay open for around two months, although it may close earlier if the allocation is fully used.

Reforms aim to widen access across the sector

Officials say the revised structure is designed to make funding distribution fairer and give more farm businesses access to support. Changes include a £100,000 annual agreement cap, a single agreement per farm business, removal of the SFI management payment and a new limit on adding land to rotational actions after Year 1, which the government says should provide greater budget certainty.

Environment Secretary Emma Reynolds says the earlier model did not distribute funding fairly, with a quarter of support going to 4% of farms, and describes the new version as simpler and less complex. Rural Payments Agency Chief Executive Oliver Munn says the application process is intended to be straightforward and gives smaller farms and first-time ELM applicants an early chance to enter the scheme.

SFI26 is backed by £240 million for new agreements, adding to more than £560 million already committed, and sits within the government's £11.8 billion plan for sustainable farming and food production over this parliament. From Window 2, farmers with ELM agreements nearing expiry, including SFI23 or Countryside Stewardship Mid Tier, will be able to apply for land before those agreements end, a feature that may lead some small farms to delay applying because only one SFI26 agreement is allowed.

In our earlier article, we covered growing scrutiny of UK water companies after regulatory data suggested several utilities underspent their allowed investment budgets over 2010–2025. We noted that the spending gap, alongside large dividend payments and rising debt, has added to concerns about ageing infrastructure, sewage spills, outages and drought resilience, even as major new investment plans are approved.

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