With the Basic Payment Scheme (BPS) winding down and farming budgets feeling tighter than ever, the Government’s Sustainable Farming Incentive (SFI), which is reopening in June 2026, is more than just another scheme announcement, it’s an opportunity.

For farms across England, the SFI offers a chance to secure predictable income, reward good land management and plan ahead in a landscape where uncertainty has become the norm.

Waiting until the last minute could mean missing out, so now is the time to assess your land, understand your options, and get ready to make the most of this funding window.

What is the Sustainable Farming Incentive (SFI)?

The SFI is part of the Government’s Environmental Land Management (ELM) programme.

In simple terms, it pays farmers for carrying out certain environmental and land-management actions, things like soil protection, grassland management, hedgerow work and other practices that support long-term sustainability.

Unlike older stewardship schemes, SFI is designed to be:

• More flexible
• More accessible
• Integrated into commercial farming rather than replacing it

Previous rounds have been popular, so popular, in fact, that the scheme closed early once budgets were fully allocated.

That experience is one of the reasons this June 2026 reopening matters.

What’s changing to farming subsidies in 2026?

The Government has confirmed that SFI will reopen with a structured application window, rather than remaining open until funding runs out.

The first window is expected to open in June 2026, with a particular focus on:

• Smaller farms
• Farms not already in SFI or similar schemes

A wider application window is expected later in the year.

The key message here is simple. Being prepared early may matter and farms that wait to “see how it goes” risk missing out if demand once again exceeds the available funding.

Why this matters more now for farmers than ever

At Nicholsons, we work with a wide range of farming businesses, and one common theme keeps coming up in conversations, “What replaces BPS?”

There is no single replacement. Instead, farms are increasingly relying on a mix of:

• Environmental schemes (like SFI)
• Diversification projects
• Renewable income
• Contract farming or restructuring

With BPS payments reducing year on year, doing nothing is no longer a viable option.

SFI won’t suit every acre or every enterprise, but for many farms it can provide predictable annual income.

The SFI can reward farmers for documenting work they are most likely already undertaking, providing much needed cashflow stability.

SFI payments in the past year have really bolstered the farm income in preparation for the significant drop in the BPS, plugging the hole that this will leave next year when it drops further.

This new scheme is becoming a much bigger part of the wider diversification strategy and needs to be looked at alongside other areas of the farm primed for diversification.

SFI is not there to replace income but it helps to reduce the risks associated with farming and gives a guaranteed income.

Although the application window opens in June 2026, the preparation really starts much earlier, with now being an ideal time to start the planning process.

Farmers should:

• Understand which land parcels may be eligible
• Know which actions fit the farming system to work in harmony with current operations
• Check how SFI interacts with existing agreements or tenancy terms

Leaving this until the window opens can limit options and increase the risk of rushed decisions.

Given how quickly previous rounds filled up, there is also a very real possibility that early applicants are better placed than late ones.

The direction of travel is clear. Direct support payments are being phased out, and future funding is increasingly linked to:

• Environmental outcomes
• Land stewardship
• Broader public benefit

Whether farmers agree with that direction or not, adapting to it is now part of running a resilient farm business.

SFI is not a silver bullet, but for many farms, it is becoming a core part of the post BPS income mix.

If you would like guidance on the SFI scheme or need help with making an application, please get in touch with our experienced farming specialists at Nicholsons.