Farming: ‘New formula will cut funding for Welsh farmers’

It is “nonsense” to base funding support for farmers on population figures because Wales has more farms than England per capita, a union has said.

Previously funded via the European Union on a needs basis, the move to a new formula will see funding rolled in to the Welsh government’s budget – which will be allocated according to population.

Guto Bebb, the Farmers’ Union of Wales (FUW)’s chief executive, also called the move “concerning”.

The UK Treasury said Wales would receive an “above population” settlement in 2025-26, while the Welsh government said the budget would provide Welsh agriculture with “significantly more funding” than that provided in 2024-25.

Speaking on BBC Radio Wales Sunday Supplement, Mr Bebb said: “This latest decision is very concerning because if there is any future increase in farm funding, Wales will be allocated a population based 5.2% rather than the needs based that we previously had.”

According to the FUW, this will mean a reduction from 9.2% to 5.2%.

The new rule on moving to the Barnett formula was announced in last October’s UK Budget.

Under Barnett, the Welsh government receives about 5% of spending increases on matters in England, such as health and education, that ministers in Cardiff are responsible for in Wales.

Mr Bebb said it was imperative that farming unions and farming communities make sure that the Welsh government is aware of the need to carry on supporting a “crucial part of the rural economy” in Wales.

In February, First Minister Eluned Morgan said the UK change to future funding support rules for Welsh agriculture was of “huge concern” as the move to a funding formula could see Wales losing out.

Addressing the Welsh Affairs Committee at Westminster, she said: “If you just do a Barnett consequential, you’re talking about a 5% [increase] whereas, actually, when it comes to agriculture we should be significantly higher than that.

The Welsh government said it welcomed the “full discretion” over the level of agricultural support it can provide, thanks to an agreement with the UK government.

A spokesperson said: “Our budget provides over £366m for agricultural support this year.”

“This is significantly more than was provided in 2024-25, the final year in which farm funding was ringfenced by the UK government.”

An HM Treasury Spokesperson said: “At the Budget, the Chancellor announced the largest real-terms settlements for the devolved governments since devolution.

“The Welsh government is receiving over 20% more per person than equivalent UK government spending in England, that translates into over £4bn more in 2025-26.

“We have baselined the full amount of agricultural funding provided to Wales in 2024-25 into the Welsh government’s settlement in 2025-26, which is an above population share.”