How will EIP25 affect the rural sector?

The Environmental Improvement Plan 2025 (EIP25) was updated on 1 December last year. It is a five-year framework and the first update of the original Environmental Improvement Plan 2023 (EIP23) published in 2023, which was an initial revision of the 25 Year Environment Plan. 

EIP25 aims to create a strategy to meet stringent Environment Act 2021 requirements, revisiting existing targets from the EIP23 and introducing two new interim targets.

EIP25 has ten goals and 91 commitments setting out how long-term targets will be met, assessed, monitored and reported on in annual progress reports. The commitments are accompanied by actions, annotated to show who is responsible for them. The most relevant goals to farmers, land managers and landowners in this instance are as follows.

• Goal 1: Restored nature – aims to create more resilient habitats to help nature thrive.
• Goal 4: Chemicals and pesticides – focuses on environmental quality.
• Goal 6: Resources – looks at driving forward a circular economy through improvements in waste handling, disposal and resources.
• Goal 10: Access to nature – involves increasing people's access to nature. 

Following a pause after the unexpected closure in March 2025 of the Sustainable Farming Incentive (SFI) scheme, the most widely available and taken up scheme, Secretary of State for Environment, Food and Rural Affairs Emma Reynolds has announced the details of SFI 2026. We expect that there will be two SFI windows this year: in June for small farms (under 50ha) and those currently without an ELMs agreement and then in September for all farms.

The second new interim Environment Act 2021 target, Goal 9: Biosecurity, includes an aim to eradicate bovine tuberculosis by 2038. Commitment 81 includes halving the establishment of invasive non-native species (INNS) by 2030, compared to levels in 2000.

In EIP25 the government has stated its intention to consult on the potential for the Environmental Permitting (England and Wales) Regulations 2016 (EPR 2016) to be extended to dairy and intensive beef sectors, partly to reduce ammonia emissions in commitments 19–21. 

In particular, commitment 91 refers to a 16% reduction in ammonia emissions by 2030 compared to the 2005 baseline level. Presumably, smaller dairy units would be exempt from the need for permitting, as is the case currently with pigs and poultry.

However, compliance may require additional investment and increase the red tape for farmers, both for existing and new sites. As well as a focus on ammonia, the plan also mentions that the Department for Environment, Food and Rural Affairs (DEFRA) is planning to work with industry to reduce methane emissions, which might involve encouraging the take-up of new technologies such as methane-suppressing food additives.

The government is expected to continue to support farmers to invest in low-emission slurry-spreading equipment and enhanced slurry-storage capacity, which seems to indicate the continuation of the Slurry Infrastructure grant and the Farming Equipment and Technology Fund (FETF) in the future.

A new round of FETF has been announced, opening on 17 March. This scheme has been especially popular in previous rounds due to the breadth of items it funded, particularly machinery or equipment not previously supported, such as shallow injection systems and real-time nutrient analysis of slurry.

In Goal 3: Water, EIP25 also refers to maintaining a commitment to 'reduce nitrogen, total phosphorus and sediment pollution from agriculture by at least 40% by 2038', with 'at least 12% by December 2030 compared to 2018 levels'. Commitment 26 states that this be reduced 'by at least 18% in catchments containing protected sites in unfavourable condition due to nutrient pollution'. These targets have been increased from 10% and 15% respectively from EIP23.

Extending the remit of Environmental Permitting Regulations 2016 permits may be one way in which this is achieved. Funding for Environment Agency inspections will also be doubled, introducing a stick as well as a carrot. This will ensure that farmers are complying with environmental regulations and therefore afford protection to our wildlife and rivers.

The government has promised further financial support in EIP25 for both the Green Finance Institute and the Ecosystems Knowledge Network to support commercial readiness of nature-based projects.

This is essential to help develop private markets for farmers and landowners, which are currently lacking in accessibility but also regulation. EIP25 recognises that nature enables, drives and protects economic growth with threats to nature potentially shrinking our gross domestic product (GDP) by 3% over the next decade if we do not act, according to the Green Finance Institute.

Alongside EIP25, in December last year, DEFRA announced a commitment to provide £500m towards Landscape Recovery projects over 20 years. This is a reduction on what was promised, and purportedly one-third of the £2.4bn per year farming funding pot. 

The inclusion of a one-year break clause, meaning that DEFRA can terminate contracts with a year's notice, is likely to make attracting top-up private finance challenging.

Particularly relevant to 'active farmers' as defined in Baroness Batters' Farming Profitability Review 2025: an independent review, commitment 57 promises to bring at least 40% of England's agricultural soil into sustainable management by 2028, increasing to 60% by 2030.

In commitment 2, the plan promises that the 48 Responsible Authorities in England will publish their local nature recovery strategies (LNRS) 'by the end of 2025, or shortly after'. 

While the LNRS do not provide funding themselves, aside from providing an uplift to biodiversity net gain (BNG) units, each LNRS will publish a map showing which habitats are suitable for creation, extension or restoration, which may attract private finance.

Commitment 38 refers to a review of sewage sludge spreading regulations that is set to take place after the public consultation by the Independent Water Commission.

This will ensure that sludge applications to land do not detrimentally affect water quality or food safety. In particular it will look at the environmentally persistent poly- and perfluorinated substances (PFAS). Actions will be set out in a PFAS plan, expected to be published later this year.

Under the Clean Power 2030 Action Plan, nature recovery is embedded into new energy infrastructure, including creating new wildlife corridors under or alongside power pylons. This may provide opportunities for funding for landowners in addition to the public schemes.

Delivery will be supported through grant-funded schemes, such as the Forestry Commission's England Woodland Creation Offer (EWCO), Landscape Recovery, BNG and other private funding.

The designation of a new national forest in the Oxford–Cambridge corridor last year may also provide funding opportunities for tree planting in this area. Competition for a third national forest in either the Midlands or the north of England is set to be released in spring.

In 2023, the Environmental Audit Committee found that the rate of planting was less than half the government's target – to plant 30,000ha every year by March 2025. However, in the 2023/24 planting season, more than 20,000ha of new woodland was planted in Britain – the highest figure for 35 years. 

The 2030 target is ambitious and likely to be held back by barriers to domestic tree production, according to the Strong Roots report.

We are still also awaiting publication of the Land Use Framework (LUF), which was consulted on during last summer. The LUF is urgently needed to link components of the revised EIP.

The Planning Reform Working Paper: Development and Nature Recovery, updated in February 2025, describes how the government wishes to accelerate development while meeting environmental obligations and contributing to nature recovery. The aim is to balance a 'pro-growth' planning system to meet targets to build 1.5m homes and take forward 150 major infrastructure projects versus mitigating environmental impacts at scale.

BNG has been mandatory since February 2024 under Schedule 7A of the Town and Country Planning Act 1990 (as inserted by Schedule 14 of the Environment Act 2021), meaning that developers must deliver a biodiversity uplift of 10% beyond that lost as a result of the development.

However, shortly after publication of EIP25, the government also announced that following consultation on the National Planning Policy Framework (NPPF), sites smaller than 0.2ha would be exempt from the requirement to offset biodiversity loss through the compulsory BNG mechanism.

The government also previously consulted regarding the current implementation of BNG on minor and medium brownfield developments sites, meaning that sites of up to 2.5ha could also become exempt if written into policy.

As well as being detrimental to natural capital markets and therefore the opportunities for farmers and landowners, the resultant reduction in demand for off-site BNG units cumulatively could negatively affect nature recovery.

With the Countryside Stewardship capital grant scheme still closed, there is currently little incentive for landowners to plant new, or to gap up existing, hedgerows.

Critics of the revised EIP say that while it is more detailed than the last, it is still far too vague. Plans to restore or create 250,000ha of habitat outside protected sites by 2030 are welcome, but with this deadline just four years away, EIP25 lacks detail as to how this can be achieved, especially with public schemes such as Landscape Recovery not currently open for applications and Natural England struggling for staff and resource capacity to provide the Countryside Stewardship Higher Tier scheme. Private finance is also currently underdeveloped.

The plan references future reviews and consultations, but there is little time to do this, which means the likelihood of meeting Environment Act 2021 targets is at even greater risk. 

Landowners, farmers and rural surveyors will be responsible for balancing food production with the government's aims for farmers to adopt ELM actions to benefit farm wildlife on at least 7% of their land. They will need to carefully select the least productive land to set aside.

Furthermore, permanent land-use change such as tree planting or reversion of arable land to grassland will affect land values. Careful consideration should be given to any new land use decisions that may affect future generations.

However, proactive farm businesses will likely be able to stay ahead of the curve. While a lot of the commitments in EIP25 are voluntary actions for farmers and landowners at present, implications may become mandatory and legislative over time. Showing ability to adapt will mean greater business resilience.