Changes to hardship scheme could impact hardest hit dairy farmers

Dairy farmers in the UK who’ve struggled amidst the pandemic could lose out on the Government’s coronavirus dairy fund after Defra changed the qualifying criteria.

The UK’s dairy industry was one of the hardest hit during COVID-19, so when the Government announced its ‘hardship’ scheme to provide financial support to dairy farmers back in May, it was welcome news. The fund meant English dairy farmers could apply for up to £10,000 in cash payments, receiving 70% of income lost during April and May, to allow them to continue operating and sustain their production without impacting animal welfare.

NFU’s dairy board had been working closely with Defra to fine tune the scheme, which was originally announced on 6th May, and to offer more clarity to desperate farmers. After weeks of waiting for the scheme to come into effect, the industry was surprised by the announcement of an apparent switch in the qualifying criteria when the Government recently released details of the fund.

According to the new details, eligible farmers who have lost more than 25% of their income over April and May owing to coronavirus disruptions will be eligible to access funding for those qualifying months, with no cap set on the number of farmers who can receive the support, or on the total funding available.

The fund is due to start paying out from 18 June. However, the amended criteria means that some farmers on split-price contracts could miss out, and the new criteria could impact farmers who acted responsibly in the wake of lockdown, and reined in milk production.

Speaking about the recent details, NFU dairy board chairman Michael Oakes said: “We welcomed the original announcement of the package, and since then, the NFU has been talking to Defra about how the scheme could be delivered and the eligibility criteria that should govern it.

“Following today’s announcement we are seeking to understand the apparent switch from the scheme’s eligibility based upon loss of income, now to pence per litre milk price and how that might have a bearing on the number of farmers able to apply. COVID-19 has caused widespread disturbance in the dairy market and there is a danger that the scheme will fall short of what the NFU, and many in the industry, had anticipated when we saw the announcement last month.

“However, many farmers will benefit and we will be helping our members through the application process. As we improve our understanding of how the scheme is landing on farms, we will be seeking further discussions with ministers and officials.”

Oakes has said that the union is seeking further clarification from Defra, and hopes the department will deliver something more amenable to farmers to offer them the support they need.