£233m SFI26 Window 2 opens for applications

Farmers can now apply for a £233 million second round of Sustainable Farming Incentive funding, with the application window set to close once the available budget has been allocated.

SFI26 Window 2 opened on Tuesday 22 September and is available to eligible farmers and land managers across England.

Defra said it expects “strong demand” in the early stages and will publish updates when 25%, 50% and 75% of the available funding has been allocated.

Rural Payments Agency chief executive Oliver Munn said the response to the first window had shown significant interest in the scheme.

“The response to the first window shows strong demand, and our teams have been working at pace to turn applications into agreements and payments.

“As the second window opens, our focus is on giving applicants clear guidance, predictable processes and the confidence to apply when they are ready.”

The £233 million pot includes £180 million originally allocated to Window 2, an additional £50 million previously announced as part of wider government support for farmers facing drought and rising costs, and £3 million left unallocated from Window 1.

To apply, farm businesses must be registered with the Rural Payments Agency, have a Single Business Identifier and at least three hectares of eligible agricultural land linked to the business.

Farmers are being advised to check the SFI26 rules and guidance before beginning an application.

The timing of applications could prove important because Window 2 does not have a fixed closing date. It will close once enough applications have been received to allocate the full budget.

Defra said applications that have been started but not submitted by the time Window 2 closes will not be accepted.

Farmers who began an application during Window 1 but failed to submit it before that round closed may still be able to complete it during Window 2.

Most unfinished Window 1 applications have been retained on the system, with the RPA contacting affected farmers directly. However, some applicants will need to start again.

This applies where a farmer requested a mapping update after starting their original application, meaning a new application is needed to reflect the revised land details.

It also applies where an existing Environmental Land Management revenue agreement expires on or before 28 February 2027.

A new “apply early” option has been introduced for farmers and land managers with eligible ELM agreements approaching their end date.

It covers eligible agreements including SFI23, Countryside Stewardship Mid Tier, Countryside Stewardship Higher Tier and Higher Level Stewardship agreements that expire on or before 28 February 2027.

The change means eligible farmers can apply for SFI26 actions on land that is still covered by an existing agreement, rather than having to wait until that agreement ends.

Where possible, farmers will also be able to receive and accept their SFI26 agreement before the existing agreement finishes, with the new agreement beginning afterwards.

Defra said the change is intended to give farmers and land managers greater certainty over the continued management of their land.

The 28 February cut-off reflects the requirement for SFI26 agreements funded from this financial year’s budget to begin by 1 April 2027.

Farmers whose relevant agreements end from 1 March 2027 onwards may instead be able to apply to future SFI offers.

Defra has also confirmed plans to offer another SFI scheme in 2027.

The department said it will work with farming representative organisations and the wider sector after Window 2 to consider how the scheme could be refined ahead of the next offer.

Ministers have also committed to keeping the main design of SFI stable for the duration of this parliament, with further details on the 2027 scheme expected to be announced later.