Agriculture and Climate Change: Evidence on Influencing Farmer Behaviours

5. Approaches Taken By Governments to Influence Farmer Behaviours in Relation to Climate Change, and What is Known About Their Effectiveness

5.1 Policy and economic mechanisms available to policy makers

A range of policy approaches is available to governments to influence environmental behaviour among farmers. Dwyer et al (2007) provide a useful summary of these types of mechanisms and the evidence relating to them:

Regulation - places restrictions on what farmers are legally allowed to do and prohibits undesirable management practices:

• This can be effective to promote enhanced environmental behaviour. It works best in situations where the target group is (or can be) persuaded that the regulated actions fall below an acceptable 'reference level' of responsible farming practice
• The act of persuasion (using advice, information, peer pressure and other tactics) can be critical to ensure successful regulation and/or cross compliance. This may be more important than the severity of sanctions if farmers fail to comply.

Economic incentives - taxes and subsidies (environmental payments) are the most widely used and analysed instruments:

• These are important to increase farmers' participation in environmental management, in particular if payments and schemes are tailored to local natural and agronomic conditions. However, it is not yet known whether payments and schemes have a long term positive impact on farmer behaviours.

Market-led and 'voluntary' approaches - promote environmentally beneficial management practices to encourage higher standards of environmental behaviour among farmers:

• These have significant potential to encourage higher standards of management practice on farms
• They are attractive because they offer 'win-win' options to motivated producers seeking to increase or consolidate their markets through adopting demonstrably higher management standards.

Education and/or information provision - raise awareness of environmental issues, what can be done to address them and (if relevant) why this could be beneficial to the farmers involved:

• This approach works in tandem with any/all of the above mechanisms as stimulants to influencing behaviour.

Each of these approaches has different advantages and disadvantages in terms of cost, success at influencing behaviours, speed of implementation etc. Providing economic incentives or prohibiting by regulation are unlikely to be sufficient, on their own, to promote positive environmental behaviour. Success almost always depends on a range of other factors. Understanding the interplay between the different elements within a particular policy or commercially-driven approach can be a crucial factor in understanding how and why they succeed or fail, in different situations (Dwyer et al, 2007).

5.2 Agricultural policy context in Scotland

Common Agricultural Policy

Agricultural policy in Scotland is dominated by the EU Common Agricultural Policy (CAP), which provides a level of income security to farmers. Currently the CAP is based on a two pillar structure: Pillar 1 support includes direct payments to farmers, while Pillar 2 focuses on rural community development, including agri-environment programmes and less favoured area support^[12].

To date, the main approach to climate change mitigation through the CAP has been to encourage desired farmer behaviours with financial incentives, through making the size of single farm payments dependent on specific environmental actions (cross compliance), and incentivising environmental actions that should then deliver efficiency (and thus financial) savings to farmers (agri-environment schemes).

Farming for a Better Climate (FFBC)^[13]

Launched in September 2009, this is currently the only policy initiative in Scotland set up by the SG with the specific aim of mitigating climate change in agriculture. It is a targeted communication strategy designed to encourage farmers to adopt efficiency measures that reduce emissions, and help them adapt to climate change, while having an overall positive impact on business performance. The strategy targets five key areas for action:

• Using energy and fuels efficiently
• Developing renewable energy
• Locking carbon into the soil and vegetation
• Optimising the application of fertilisers and manures
• Optimising livestock management and storage of waste.

FFBC has been developed jointly by the SG and the Scottish Agricultural College (SAC). SAC hosts a dedicated website which provides farmers with a list of practical measures that can be taken in each of these areas:

http://www.farmingforabetterclimate.org

Climate Change Focus Farms

Four farms have been selected as FFBC focus farms, demonstrating how to tackle avoidable GHG emissions, while balancing sustainable food production and maintaining a competitive farming industry. The focus farms represent three agricultural sectors (dairy, upland livestock and arable). The fourth farm is a diversified farm business and can be used for education and public demonstration. The programme will run until 2013 to establish best practice and monitoring and reporting procedures. Participating farms open their books and SAC advisers work with them to decide how best to facilitate savings and reduce emissions. Farm accounts are monitored, so that change can be measured. Open days and demonstrations take place on the farms, with the aim of showing how emissions can be cut while improving the efficiency and therefore profitability of farm businesses: http://www.sruc.ac.uk/info/120200/climate_change_focus_farms

Climate change case studies

A number of case studies have been made available on the FFBC website. The case studies highlight the environmental issues affecting agriculture and demonstrate how different farming enterprises are addressing the effects of climate change in the five key action areas:

http://www.sruc.ac.uk/downloads/120175/farming_for_a_better_climate

Scotland Rural Development Programme

Many of the measures encouraged by FFBC potentially qualify for grant funding through the Scotland Rural Development Programme (SRDP): http://www.scotland.gov.uk/Topics/farmingrural/SRDP

The SRDP is a programme of up to £1.5 billion of economic, environmental and social measures designed to develop rural Scotland. The 2007-13 SRDP brings together wide-ranging measures into a single programme of support. The programme contributes to:

• Improving the competitiveness of agriculture and forestry by supporting restructuring, development and innovation (Axis 1)
• Improving the environment and the countryside by supporting land management (Axis 2)
• Improving the quality of life in rural areas and encouraging diversification of economic activity (Axis 3).

The most relevant eligible measures include:

Manure/slurry storage and treatment - supports capital investment in:

• improved storage and handling facilities for manures and slurry, to improve water quality
• structures, machinery and equipment for the anaerobic digestion of slurry, to produce biogas and/or compost: http://www.scotland.gov.uk/Publications/2010/05/05134234/88. Biogas fuels a generator which produces electricity and heat either for use on the farm, or for sale to the national grid.

Support for renewable energy in agriculture - contribution to the initial capital investment in the technology and equipment required to establish renewable energy capacity: http://www.scotland.gov.uk/Publications/2010/05/05134234/90

Treatment of run-off of nutrients and other pollutants - to increase the efficiency and environmental performance of the agriculture and forestry sector through targeted capital investments to reduce and treat run-off of nutrients and other pollutants from farm and forest holdings:

http://www.scotland.gov.uk/Publications/2010/05/05134234/99

Broader initiatives in relation to renewables (Example - Feed-In Tariff (FiT) Scheme)

The FiT is a financial subsidy for renewable electricity generators below 5MW. It offers a payment per kWh produced each year, depending on the technology and size of generation. If farmers install electricity generating technology from renewable technology, they can bepaid forthe electricity generated, even if they use it themselves, as well as for any surpluselectricity exported to the grid. Technologies that qualify for the scheme include:

• Solar electricity (roof mounted or stand alone)
• Wind turbines (building mounted or free standing)
• Hydroelectricity
• Anaerobic digesters
• Micro combined heat and power.

Initiatives that support the implementation of agricultural and climate change policy in Scotland (Example - Future Proofing Scotland's Farming)

Future Proofing Scotland's Farming (2011-14) is delivered by Soil Association Scotland in partnership with Quality Meat Scotland, with support from the National Farmers Union of Scotland and the Scottish Agricultural Organisation Society. The aim of the programme is to help farmers and other land managers:

• Minimise the negative impacts of climate change and capitalise on opportunities through appropriate adaptation measures
• Implement practical measures to cut on-farm GHG emissions and reduce dependence on expensive inputs
• Create sustainable and profitable agricultural enterprises based on low carbon principles.

Farmers are offered practical advice on how to raise the financial performance of their businesses and benefit the environment. On-farm events and written/on line advice and guidance cover a range of areas such as nutrient management; water and wetland management; woodland management and biomass; anaerobic digestion; low carbon farming.

5.3 Voluntary and mandatory approaches

As indicated above, to date the Scottish Government has largely utilised voluntary initiatives to address environmental goals. To successfully meet emissions targets, it may become necessary to broaden the scope to include more mandatory measures.

Both voluntary and mandatory approaches have advantages and disadvantages, and it is not necessarily straightforward to determine which will be most effective in a given situation or, indeed, to attribute outcomes to specific instruments. As summarised by Davies (2006), pricing mechanisms for conservation goods (voluntary) not only offer the power of exchange, but send clear signals about the value from the public perspective of the goods that are being offered for exchange. Information provision (voluntary) can help to identify cost savings or profit opportunities that in turn bring their own rewards. Regulatory instruments (mandatory) backed up with the threat of prosecution also send a signal about what is ethically valued, as do market-based instruments (voluntary) aimed at delivering similar quality targets through more flexible mechanisms.

Research by Barnes et al (2007) included a number of findings that are useful when considering mandatory policy measures in Scotland, and their impact on farmers' attitudes and behaviour. Specifically, the work highlighted that farmers involved with mandatory environmental schemes may be more likely to have negative attitudes towards the environment. If there is a possibility that regulation is adversely impacting the environmental views of farmers then there is clearly a need for further research to assess to what extent this is 'spilling over' into other domains and whether mandatory policies remain beneficial overall, or if they are ultimately counterproductive (Barnes et al, 2007).

5.4 A tool for considering all the factors required to influence behaviours

Given the range of policy approaches available and the importance of achieving the right mix of options for achieving specific policy goals, it is useful to focus on addressing both internal and external barriers to change. A tool has been developed by Defra for use within a policy context^[14]. To establish new and more sustainable ways of working and producing, policies need to:

Enable - make it easier for people to change(systems and capacity)

There is no point asking people to change if they do not know how to, or if they know what to do, but what they need to do it is not available. The challenge for policy is to help people make responsible choices by providing them with the appropriate education, skills and information, and making choices easy, with accessible alternatives and suitable infrastructure.

Encourage - give the right signals(incentives and disincentives)

Policy should consider the most effective techniques to encourage and, where necessary, enforce, behaviour change. This might include taxes or other ways of giving price signals, peer pressure, league tables, funding or regulation. There is also scope for positive initiatives to reward desired behaviours.

Engage - get people involved (co-production)

People need to be involved in policy development from early on - so that they take full responsibility for what they do. Consultation and engagement over a long period helps to identify what people care about and real-life examples they can relate to. Targeted communication (such as face to face contact, rather than remote messages from government) should be part of a larger process of involving the public, coordinated with other interventions, such as regulation.

Exemplify - lead by example

The government (and its agencies) should be seen to be carrying out its own operations in the ways it expects its stakeholders to act; policy making should be consistent and policies joined up.

The principles underlying this tool can be translated into actions at each step within the policy development process. Depending on what the policy is intended to do, and the current situation for the target population, the four types of levers (the '4 Es') can be used individually or in combination.

It may be helpful to apply the tool to identify which types of levers are used as part of existing agricultural policies. This would allow policy makers to consider whether they are using the range of levers and/or the most appropriate types of levers. Table 5.1 represents an initial attempt to map measures onto the four potential policy levers. Boxes are shaded where the specific policy measure currently employs the relevant lever. Table 5.1 also includes an indication of whether farmers are being encouraged by the use of incentives (+) such as funding schemes, or disincentives

(-) such as regulation.

Table 5.1: Mapping measures onto types of levers used to influence farmers' environmental behaviours

The focus is primarily on enabling and encouraging, with only the climate change focus farms which are part of FFBC using all four types of policy levers. This may be appropriate; however, it might be worth considering opportunities for more engagement to involve farmers in policy development, and ways to exemplify best practice.

In the next sections, UK and international evidence, and messages from the opinion former interviews, relating to each of these measures is discussed. Where information is available, each section is structured as follows:

• Introduction to the measure
• Types of policy levers used
• Farmer attitudes and behaviours in relation to the measure
• Approaches to implementation
• What is known about the effectiveness of the measure
• Messages from the opinion former interviews
• Some implications for policy development and delivery.

Naturally the types of evidence relating to each measure vary a good deal, so each section is slightly different from the others. In addition, there is no specific evidence relating to Future Proofing Scotland's Farming, and the opinion formers did not mention the initiative, although the type of activities which are part of it were frequently highlighted as being popular with and useful to farmers. It is included here as an example of a non-SG initiative that supports the implementation of agricultural and climate change policy in Scotland, and because it uses three of the four available policy levers.

5.5 Cross Compliance

Introduction

Cross compliance was introduced in the UK in 2005, setting obligations for farmers to manage their farms in sustainable ways, in order to receive their Single Payment. There are two elements: Good Agricultural and Environmental Condition standards largely relating to the protection of soils, habitats and landscape features; and Statutory Management Requirements, which are either pre-existing legislative requirements or those that Member States must implement under EU law. The aim of cross compliance measures is to achieve a common minimum standard, rather than to maximise environmental benefits.

Farmers must in any case comply with all legislation affecting their businesses. The significance of cross compliance is that farmers' receipt of direct aids depends on their doing so. Failure to comply can result in deductions from, or cancellation of, the subsidies farmers receive. For the vast majority of farmers, who cannot afford to risk losing their subsidy, cross compliance is effectively mandatory.

Types of policy levers used

In terms of the types of policy levers used, cross compliance primarily uses encouragement, with the disincentive of setting environmental obligations for farmers, backed by regulation and the potential loss of subsidy. Farmers need to keep up to date with information on regulatory requirements, which may make them more proactive in seeking out advice: enabling activity.

Farmer attitudes to cross compliance

Since farmers are obliged to adopt cross compliance measures in order to receive subsidies, it is not possible to establish their opinions of the measures by simply monitoring rates of uptake. They may adopt the measures out of financial necessity, rather than because they are supportive of environmental goals.

Davies and Hodge (2006) carried out research to investigate whether farmers endorse the basic principle of cross compliance. The research (a survey of 100 farmers in East Anglia) found that several factors may influence the perceived acceptability of cross compliance as a governance mechanism:

• Economic advantage - as cross compliance does not itself increase income, and increases management costs for the farm business, it might be expected that farms would reject such a policy on principle. However, farmers may perceive an indirect economic advantage - to establish a competitive advantage for UK producers in the global market, for example
• Viability - farmers' ability to meet cross compliance requirements is key to their willingness to endorse it as a general principle. Two important concerns are:
  • Current financial stress, as an indicator of the ability of the farmer to bear any increased burden on the farm business
  • 'Situational stress' on the farm, in terms of the current difficulties encountered in managing the overall farm production environment
• Perceived legitimacy of cross compliance - three sets of attitudinal factors come into play:
  • The level of confidence farmers have in conventional, chemical-intensive, farming methods, and whether such methods are associated with benign or negative effects on the environment
  • Farmers' views on environmental maintenance and a management ethic of environmental stewardship (as farmers indicate higher levels of concern for a stewardship role for farming, their support for cross compliance is likely to increase)
  • The relative priority farmers assign to financial management and profit in their overall approach to farming (a more economically rational focus being associated with a decline in support for the principle of cross compliance).

It should be noted that the Davies and Hodge research was carried out in 2001, at a time when the concept of cross compliance was highlighted in a number of policy fora, but was a principle for which farm financial and management implications were both still uncertain. However, the findings indicate the range of factors potentially influencing farmers' attitudes to cross compliance and, in particular, the importance of two distinct cognitive aspects - technological beliefs, and a normative 'stewardship' motivation - in making the judgement on policy acceptability. The authors suggest that if government is engaged in convincing farmers of the rationale for cross compliance, it might achieve some success with certain sections of the farming population by changing either of these factors, but that both need to be addressed to bring about acceptability across the farming population (Davies and Hodge, 2006).

What is known about the effectiveness of cross compliance

The European Court of Auditors investigated the effectiveness of cross compliance as a policy in 2008. The audit set out to determine whether cross compliance is effective, by analysing its setting up and implementation by the Commission and a sample of Member States. The audit concluded that:

• The objectives and scope of cross compliance are not well defined, making it unclear what cross compliance is designed to achieve
• The complex legal framework poses considerable difficulties
• Cross compliance and rural development are not well adapted to one another
• Data provided by the Member States on checks and infringements is not reliable and the Commission's performance monitoring was found wanting.

The audit only included a sample of seven Member States (not including the UK) so it is not clear to what extent the criticisms apply more broadly. However, an evaluation of cross compliance in England was carried out for Defra by ADAS (also in 2008). This set out to assess the effectiveness of cross compliance in England in meeting its objectives; the nature and magnitude of the costs imposed on farmers and any others in meeting cross compliance conditions; whether the policy represents value for money; whether there are any unintended consequences; and whether there has been a change in farmer behaviour in response to the introduction of cross compliance.

Using a review of secondary evidence and collection of primary data via a farmer survey (300 respondents), the research highlighted generally high levels of compliance, although there was considerable variation across the measures. Generally, standards relating to legislation that had been in place for some time were found to be well observed. The main unintended consequences in terms of the impacts of cross compliance were:

• Additional engagement of farmers with advisers
• Increased awareness of existing legislative requirements
• Disproportionate impact on small farms (fixed cost component)
• Some farmers incurring unnecessary costs by over-reacting to standards
• Anxiety (which is possibly unnecessary) on the part of some farmers in terms of the risk of penalty
• The limited scale of penalties may cause some to risk being caught rather than comply, notably where high capital cost is needed to comply with regulation.

The key behavioural issue identified by the evaluation was the negative attitudes held by farmers, due to perceived additional costs arising as a result of cross compliance. However, where farmers reported high costs, these related largely to compliance with underlying regulations rather than cross compliance per se (ADAS, 2009).

Mandatory measures: messages from the opinion former interviews

Concerns about mandatory measures

The opinion formers were unanimous in their view that farmers have negative attitudes towards compulsory initiatives: 'No farmer likes the word 'mandatory'.' The following issues were also highlighted:

• The additional regulation associated with cross compliance measures can have a negative impact on production. The more time and money that farmers spend adhering to regulations, the less they can spend on creating and selling produce (although regulation may also bring other benefits). Better regulations and clearer instructions would make it easier for farmers to comply
• Variations between cross compliance measures across the EU mean that some regulations apply in the UK, but not elsewhere in Europe
• Some farms currently gain a competitive advantage by voluntary adoption of high standards. If particular behaviours are mandatory, they lose their market advantage.

Looking to the future, opinion formers noted several concerns about increasing the number of mandatory actions, and focusing more explicitly on climate change mitigation:

• Currently, farmers are penalised for unambiguous breaches of cross compliance measures that are straightforward to measure, such as uncovered pesticide. Actions to mitigate climate change may be less easy to see, measure, and penalise.
• Cross compliance measures need to consider 'acts of God.' For example, if a farmer puts nitrogen in a field, and then there is torrential rain, much of this could be lost into watercourses through no fault of the farmer.
• Some farmers are already struggling in relation to awareness of current cross compliance measures
• Some interviewees urged for better, rather than more, regulations.

Support for mandatory measures

Opinion formers acknowledged that some compulsory measures are necessary, and can even be beneficial for farmers. For example, cross compliance can assist in ensuring that the British brand is associated with good quality. Specific areas where mandatory measures were considered acceptable by opinion formers included tree planting, health and safety, and compulsory set-aside. It was suggested that it may be necessary to adopt a mandatory approach to tree planting because trees take up valuable land, and require many years to grow, so the financial incentive is not there in the short term: 'their children would benefit, but they need the money now.'

There was some acknowledgement that, as farmers receive public money, there should be a basic good practice standard. Opinion formers also felt that a minority of farmers will not adopt climate change mitigation measures if they are optional. However, some argued that, if mandatory measures are implemented, it is vital that they are proportional, that they are not an obstacle to business, and that disregarding them has real consequences. The guidance that farmers receive should be clear, so that they are not penalised for missing, or misunderstanding information.

Achieving 'buy in' from farmers

A number of interviewees expressed the opinion that making mitigation measures mandatory does not persuade farmers of their merit, and the measures may be perceived as 'box ticking,' or 'just another hurdle.' Voluntary measures, on the other hand, are usually adopted because farmers have been convinced that the measures have value. However, if farmers can see the impact of mandatory measures - the reasons that they are necessary and/or beneficial - then they are more likely to be supportive of them.

Impact of reduced single farm payment

Some interviewees felt that if the single farm payment (SFP) was reduced, a minority of farmers would reconsider whether meeting the criteria for the subsidy was worth the effort. However, the majority opinion was that lowering the SFP would be unlikely to reduce adherence to cross compliance measures for three main reasons:

• The SFP is so important to the survival of farm businesses that farmers would not take any action that could put it at risk. Lowering the level of the subsidy would make the remaining sum even more valuable, and could even increase adherence to cross compliance measures
• Some cross compliance measures represent good practice, so many farmers would carry them out even without subsidy (although there might be some impact on less immediately profitable measures)
• Even with reduced SFP, measures would still be compulsory, so not adhering to them would be a risk for farmers (assuming that disobeying the regulations has real consequences).

Implications for policy development and delivery

Findings from the audit and the evaluation highlight a potential need for more attention to be paid to the principles of cross compliance in the provision of support by advisers, and better links with the inspection agencies, to ensure a more balanced view of the policy and its implementation. The evaluation concluded that two clear messages need to be made more effectively:

• Clarification of the rationale for a number of the standards
• There are actually good reasons for the rules, eg public goods such as water quality and access to the countryside; preventing animal disease or weed spread (ADAS, 2009).

Given that the pressure of keeping up to date with changing regulatory requirements can cause stress and worry for farmers (Report of the independent Farming Regulation Task Force, 2011), making it easier for farmers to comply and giving them a better understanding of the principles of cross compliance would enhance enabling levers and would be likely to have a positive effect. The evidence also indicates that farmers need to feel more engaged in policy development.

5.6 Nitrate Vulnerable Zones

Introduction

Nitrate Vulnerable Zones (NVZs) were established throughout Europe in an attempt to address the issue of diffuse pollution (particularly through agriculture). If nitrate levels in groundwaters are found to be above a given reference point (50mg N/l) then EU member states are obliged to take steps to reduce these levels, although they have some flexibility in how they address the issue. NVZs can be designated at either a regional or national level and, across European member states, there are examples of both approaches underway. Scotland is among the countries adopting a regional approach: four nitrate vulnerable zones have been designated since 2003 covering 14.2% of land area. Actions to reduce nitrate pollution are as follows:

• Detailed record keeping on the use of all organic and inorganic nitrogen fertilisers
• Nitrogen application limits
• Closed periods when nitrogen cannot be applied
• Practical application restrictions (for example: land type, distance to watercourse)
• Ensuring enough capacity to store slurry/ poultry manure during the closed periods.

The NVZ rules are one of the Statutory Management Requirements for cross compliance under the Single Farm Payment Scheme. Failure to ensure that the NVZ Action Programme is implemented in required areas is a criminal offence, and the farmer could be punished with a fine or conviction on indictment to a fine of an unlimited amount. Furthermore, failure to adhere to the NVZ rules can lead to a deduction to farmers' SFPs^[15].

Types of policy levers used

At present, encouragement through legislation is the primary policy lever being used in Scotland specifically in relation to NVZs. Enabling activity includes the provision of accessible guidance for farmers about their NVZ responsibilities.

Farmer attitudes and behaviours in relation to NVZ measures

NVZ measures are effectively mandatory, so there is little focus in the literature on factors affecting uptake. It is generally taken for granted that farmers will comply with these regulations, due to the penalties involved for disregarding them. However, to fully abide by the NVZ measures requires farmers to have a thorough understanding of exactly what they entail. Therefore, information provision and education and advice have important roles to play.

The attitudes and behaviours of farmers affected by NVZ regulations received little attention in the literature before 2007. A study was carried out by Barnes et al to address this data gap and maximise the impact and efficiency of advice to farmers operating within NVZs. The research included interviews with 376 Scottish farmers, and intended to achieve a balance between those within and outwith NVZ regions.

NVZ farmers demonstrated attitudes which were more orientated towards production and profit and, compared with non NVZ farmers, showed a higher level of disagreement with environmental and social goals. However, NVZ farmers' knowledge of NVZ rules was sporadic, and their main negative comments were directed towards the unfairness of the designations, along with scepticism over the scientific basis. In addition, they perceived that they experienced an undue burden in record-keeping requirements (Barnes et al, 2007).

The work of Barnes et al also demonstrates a statistically significant relationship between farmer attitudes and behaviour. The ethical attitudes of farmers, such as an awareness of and concern about water quality issues, drive farmer goals for conservation and nitrate reduction. In turn this impacts on the propensity of farmers to practise good water management. The authors suggest that, if ethical attitudes are raised, through, for example, providing appropriate levels of information about the benefits of NVZ, then this may engineer some behavioural change towards positive societal outcomes (Barnes et al, 2007).

Research has also considered the attitudes of farmers in a region of Scotland which was about to become an NVZ, before the date of designation. This was a small, qualitative study, but the findings indicated that farmers rarely considered environmental issues beyond the boundaries of their farms unless the productive capacity and economic viability of their farms were affected. Despite evidence to the contrary, farmers did not believe that they were responsible for water quality problems (Macgregor and Warren, 2006).

More recent work by Barnes et al (2011) aimed to develop a typology based on the attitudes and values of farmers before and after the introduction of NVZs. This is useful because it focused more specifically on attitudes to nitrogen management, agricultural practice and environmental damage; and changes in farming practice since designation as an NVZ. Three distinct clusters of farmers were identified: multifunctionalists, 'resistors' and 'apathists':

Multifunctionalists

• Appreciated that agricultural land has many uses
• Least likely of the three groups to have received post-school education
• More likely than other groups to pass the farm on to other family members
• Favoured using agricultural advisers and Government sources for information concerning water pollution management.

Apathists

• Responsible for smaller than average farms
• Lower median income; low level of off-farm investments
• Neither disagreed nor agreed with the majority of statements on environmental factors, responsibility, regulations and farm management, and seemed to be disengaged from the regulations
• Less likely than other groups to be dependent on income from the SFP
• Less inclined to seek advice from external bodies.

Resistors

• Generally slightly younger
• Higher median incomes
• Managed larger areas than the other groups.
• Mostly negative to NVZ regulations, which were seen as having a detrimental impact on income and increasing workload.
• Sceptical about the connection between water quality and their farms' activities
• Responsive to information seeking and consulted with agricultural advisers on a frequent basis.

Farmers were asked to identify any voluntary changes in their management practice since designation that would be beneficial to water quality. Although some polarised views were expressed between the 'resistors' and the 'multi-functionalists' towards the regulations, both types had significantly higher levels of activity compared to the 'apathists.' Thus, even though the 'resistors' had an underlying negative perception towards water quality management, they were the most likely to use external consultants and advisors, which may explain their adoption of voluntary tools such as buffer strips and manure management software (Barnes et al, 2011).

What is known about the effectiveness of NVZs

Most of the available evidence is science based (relating to the effectiveness of NVZs in achieving their objectives, without specific consideration of their impact on farmer behaviour). However, one study in 2007 compared adoption processes in Denmark (where the whole country level designation was applied) and England (where a regional approach has been taken). The research included the perspectives of respondents from significant actor groups in the implementation process (Nimmo Smith et al, 2007). Overall, respondents from both countries considered that whole country designation was a more effective policy instrument for the following reasons:

• Ease of enforcement
• Economic efficiency
• Political expediency
• Environmental effectiveness
• Farmer equity.

The research identified one disadvantage of the whole country system: it is not possible to differentiate between very sensitive regions and those with no NVZ issues. In general, however, Nimmo Smith et al concluded that successful implementation is likely to depend on a range of factors in addition to the type of designation. These include:

• The process for deciding designation type (the lengthy, complex and costly designation of distinct zones in England was criticised by the majority of respondents)
• Strong political will and levels of environmental awareness amongst society as a whole (Denmark acted swiftly and decisively, and the designation of the whole country as an NVZ reflected severe water quality problems throughout the country, including contamination of its drinking water source and coastal pollution).

In Scotland, research has identified that the regional approach to NVZ regulations has led to a feeling of victimisation amongst farmers in the affected areas (Macgregor and Warren, 2006). Many farmers who took part in the research commented that NVZ designation was just another set of unnecessary bureaucratic controls. They stressed that they already adhere to codes of good practice for quality assurance: 'If we don't then we can't sell our grain.'

Macgregor and Warren also stressed the point that, unlike point source polluters (who may be able to pass on the economic impacts to their consumers) farmers have to bear most, or all, of the costs themselves. This is because the prices for agricultural commodities are largely controlled by global pricing structures or by supermarket chains, 'both of which pay little regard to the costs of production.'

Implications for policy development and delivery

If farming practices are to be influenced, farmers need to be convinced by the science (both in relation to identifying areas of NVZ in the first place and actions within the programme), be able to access clear advice and information about the regulations, and be willing to take action.

The 2011 research by Barnes et al concludes that farmers in the 'apathist' group are likely to present the greatest challenge to policy makers, since these farmers' aversion to information seeking and indifference towards production-led goals may lead to wider problems of low efficiency and low take-up of environmental initiatives. Barnes et al suggest that newer channels of transfer for scientific and management-related information might attract farmers who do not actively seek information. However, this may not prove cost-effective for all farmers operating within the NVZs and, while more group level information transfer can be directed at the other two types, an increased share of the budget and a more individualist approach may be needed for the 'apathists'. Although the farmer sample for this study was relatively small (184) there are useful messages on engagement and provision of advice that are likely to be relevant to farmers in NVZ regions more generally.

The 2007 research by Barnes et al included workshops where farmers expressed their frustration with (what they perceived to be) the overly-centralised and general nature of NVZ rules. They sought greater flexibility in three main areas:

• Customisation of closed periods at farm level, to better reflect seasonal changes, local conditions, farmer knowledge and weather conditions
• The spread of farmyard manure and nitrate applications to be determined by farmers, based on their own experience, judgement and knowledge
• Imposing limits on use of fertiliser can restrict potential crop yields and impact on profits.

Farmers are the actors responsible for the practical delivery of broad environmental aspirations, yet the evidence makes it clear that farmers' attitudes to environmental protection and conservation are diverse, and are likely to affect their adoption of other measures. As noted earlier, guidance is published by the SG about farmers' NVZ responsibilities, but this guidance is no longer available in hard copy. Also, it is a lengthy document, although it can be downloaded in the form of separate booklets. Enabling activity could focus on ensuring both the delivery method and content meet farmers' needs. There are clear messages from the evidence about the need for better information on water pollution, for example. Better engagement with farmer perspectives in relation to NVZs would also help to make farmers feel more involved in decision making processes.

5.7 Monitor Farms and Focus Farms

Introduction

The 'Monitor Farm Programme' in New Zealand was set up in 1991 to strengthen links between farmers and their communities. The key to monitor farms is that they are driven by local community ownership and commitment, combined with the input of specialists and industry to aid planning and implementation. Local community groups select a facilitator and monitor farmer who is relevant and applicable to the local region, both geographically and in the issues being addressed by the farm business. A business plan is then developed and implemented, along with associated monitoring plans, over a defined period. Monitor farmers are assisted through the process by a community group, comprising local businesses, farmers, vets, scientists, financiers, processors and consultants. The purpose is to 'learn through sharing and doing,' although the learning is focused on farm viability and competitiveness, rather than environmental management. The evidence base suggests that monitor farms are effective at influencing farmers' behaviours and are regarded by the industry as a successful programme (Dwyer et al, 2007).

In 2003, the monitor farm model was launched in Scotland, and by 2011 there were 11 monitor farms across Scotland^[16]. The programme seeks to improve the performance and profitability of a commercial farm, typical of the local area, over a three year period. Monitor farms in Scotland are funded and facilitated by agri-business related organisations such as Quality Meat Scotland, Enterprise Network, Highland Council, Scottish Agricultural College (SAC). Facilitators are responsible for writing reports and taking minutes, as well as organising trials, speakers and press. Participating farms hold a number of meetings each year specifically for other farmers, as well as an open day, for the wider community.

The four climate change focus farms established in Scotland as part of the FFBC programme work by the same principles as monitor farms, but with a greater emphasis on achieving environmental outcomes. SAC work with the farms to show the benefits that can be gained by minimising harmful GHG emissions. The programme lasts for three years, and includes the input of SAC specialists, focus farmers and farmer discussion groups. Measures being explored at the farms are the key actions which are part of FFBC (or as many of these as are relevant to particular farms). Farmer discussion groups meet approximately five times a year and cover a range of topics designed to improve the farm business and reduce GHG emissions. Reports on the discussion at each meeting are posted on the SAC website, along with news of forthcoming meetings, and a quarterly newsletter is circulated, following progress on all four focus farms^[17].

Types of policy levers used

The FFBC focus farms initiative is currently the only agricultural policy measure in Scotland that uses all four types of policy levers: enabling through the provision of a range of advice and information; engaging through a number of mechanisms including discussion groups, personal contacts/enthusiasts, opinion formers and wider networks; encouraging through recognition; and exemplifying by leading by example.

What is known about the effectiveness of monitor farms/focus farms

An investigation into the role and effectiveness of Scottish monitor farms (ADAS, 2008) found that the programme had been effective in bringing about business improvements on the monitor farms themselves, among community group members and in the wider farming community. The analysis estimated multiplier effects from programme spend. The evidence suggested that, in relation to organisation, a strong farmer chairman, supported by a committee with the facilitator and monitor farmer, provides a clearer focus to managing the programme and in setting objectives. The bottom up approach and the involvement of community group members in decision making was viewed as a very positive aspect of the programme, as it fostered both ownership and commitment.

At the stage that the research took place, the programme was largely technically oriented, with a focus on improvements in output and efficiency, in line with farmers' wishes. The research also examined the potential for a monitor farm approach to deliver wider benefits, but concluded that if group members did not see the need, benefit or purpose of learning about a wider agenda, attempts to impose this on the process could potentially undermine the business improvement benefits already achieved.

In England, a government funded project Forward Farming (2002-2004) established separate pilots to test different ways of using demonstration to encourage change at farm level. One of these pilots was a network of monitor farms; another was farms demonstrating integration between agriculture and the local community, landscape and markets. Evaluation of the pilots highlighted the different potential of the models:

• 'On-farm demonstration activity' stimulates the process of learning. At a demonstration event, farmers can see particular technologies or management practices in operation on a working farm. If a specialist in that technology is present at the demonstration, the event brings together two complementary sources of information and ideas: the credible expert and the practical experience of farmers
• Monitor farms are based on the premise of ongoing interaction with and within a defined group of farmers. This makes it possible to demonstrate the application of a specific technology/combination of technologies over time, allowing monitoring and comparison in a specific context. They may not necessarily demonstrate best practice, but farmers, facilitators and the wider farming community have the opportunity to learn from the process and impact of change.

The evaluation found that the monitor farms were successful in attracting farm businesses that already access sources of advice and information, and in stimulating ideas for change. However, the authors concluded that, while there is a strong economic argument for public funding of demonstration, this does not necessarily require a permanent network of fixed farms. They suggested that funding to support demonstration activities from a wide range of providers, and to stimulate demand for them among farmers, would provide a more flexible option for the future (Bailey et al, 2006).

The parallels between monitor farms and focus farms might suggest that the latter approach will be similarly successful. However, monitor farms are commercially oriented and there is currently little evidence to indicate whether such an approach is equally effective in promoting environmental measures. Burton et al (2006) note that removing the direct business imperative of the scheme is likely to make it function very differently. They raise three important issues for consideration:

• The key to success is a combination of industry and community interests - all with a commercial imperative. When the commercial imperative is diminished, would the interest of the farming community remain?
• Systems are able to ride on established community structures which are likely to have existing informal networks. Focusing on environmental improvements is likely to appeal to a completely different group of farmers.
• If such an approach were to be based on financial payments for environmental work, the 'bottom-up' drivers of the scheme might be threatened.

There has not yet been a comprehensive evaluation of the focus farms programme in Scotland. However, research was commissioned by the Scottish Government in 2011 to scope out the data needs for monitoring the implementation of Farming for a better climate more generally, in order to understand the extent to which farm management practices are changing in line with FFBC recommended actions. The research concluded that the ability of existing data to describe the uptake and GHG impact of the mitigation measures prescribed by the FFBC is reasonable, although attributing uptake and impact to the FFBC programme is likely to be more problematic (ADAS, 2011). Findings are discussed further in Chapter 6.

Farming for a Better Climate: messages from the opinion former interviews

Across the sectors, knowledge of the FFBC programme is 'mixed'. Opinion formers reported that, while some farmers are very aware and enthusiastic, others have never heard of the initiative.

Those farmers who are familiar with FFBC feel it is relevant to them; however, their level of understanding varies considerably. For example, there is much better knowledge of how to use energy and fuels efficiently, develop renewable energy, and optimise application of fertiliser and manures, but substantially less awareness of other action areas such as locking carbon into the soil and vegetation, and optimising livestock management and storage of waste. In other words, there is greater knowledge of the aspects that are seen as immediately profitable.

It was reported that even farmers who adopt the measures recommended by FFBC do not necessarily agree with, or connect with, attempts to mitigate climate change. The five key actions are all seen as good practice, so farmers looking to increase their efficiency would be likely to implement them anyway.

Implications for policy development and delivery

Although the evidence relating to monitor farms is generally positive, the Forward Farming pilot evaluation highlighted a number of considerations relevant to using demonstration to encourage change at farm level. To be effective at a national level would require many host farms, connected by strong networks. The authors suggest that it would be more efficient and flexible to establish a regional capacity to allocate public funds for facilitating both the demand for, and supply of, demonstration and monitoring initiatives to meet both national policy goals and take account of regional gaps in provision to meet identified needs. In choosing host farms, the criteria and process will differ for one-off demonstration, a fixed site demonstration farm, and a monitor farm. For the latter two, the process should be bottom-up, with a facilitator working with the local industry to identify one of their number to be a host farm for either demonstration or monitoring or both. For one-off demonstrations, the main criterion is the appropriateness of the farm for demonstrating the particular practice or system. The authors also highlight the importance of:

• Setting clear objectives which are relevant to all stakeholders and which can be communicated clearly; and recruiting or selecting the right facilitators or co-ordinators
• Involving stakeholders in the setting up and management of demonstration farms
• Limiting the life of demonstration/monitor farms (possibly a maximum of five years)
• Within any project or scheme, there should be opportunity for groups to go to other farms for one-off events, if they can better demonstrate a particular issue
• Achieving a trade-off between the continuity of a consistent presence (host farmer or facilitator) and expertise specific to the issue being demonstrated (for example credible sources valued by farmers, such as independent consultants, other farmers with experience of the issues, veterinary surgeons and other professionals)
• Choosing issues to address on the farm that balance local demand and interests with the national interest implicit in a centrally-funded initiative that seeks to achieve public policy goals
• Using appropriate promotion and marketing. The target or minimum number of attendees will vary with the nature of the event. A demonstration that aims to spread awareness of a new practice or system should be able to cater for several hundred attendees; discussion-based activity should aim for an optimum 15-20, since farmers get more out of being in a small group.

Since the FFBC focus farms aim to improve the efficiency of farm businesses by adopting measures to reduce GHG emissions, the issues noted in relation to tensions between the commercial imperative and environmental measures may not all be relevant to the focus farm approach. In addition, as the reform of the CAP beyond 2013 is likely to include increased emphasis on environmental cross compliance measures, and the cost of fuel is likely to continue to rise, environmental measures may have financial implications that will be of increasing interest to farmers.

As noted earlier in this section, the FFBC focus farms initiative already uses all four types of policy levers. The above messages from the evidence base may be helpful in fine-tuning the instruments used.

5.8 Agri-Environment Schemes (AESs)

Introduction

The role of farmers in conserving the landscape and as protectors of natural resources has been officially recognised in the CAP since the beginning of the 1990s. Agri-environment schemes provide economic incentives for farmers to take up specific environmental measures, and compensate farmers financially for the associated loss of income. Farmers are not intended to profit directly from such schemes. However, if schemes increase efficiency/productivity or open up new markets, they should ultimately increase profits for the farm business.

A variety of agri-environment schemes have operated in Scotland since 1987. The Environmentally Sensitive Areas Scheme (ESA) was introduced to help conserve specially designated areas of the countryside where the landscape, wildlife or historic interest is of particular importance, and where these environmental features can be affected by farming operations. Although the scheme is still operating, it has been closed to new applicants since 2000. Other schemes have included three Farm Woodland Schemes, the Habitats Scheme, several schemes aimed at single-species protection, the Countryside Premium Scheme, the Rural Stewardship Scheme and the Organic Aid scheme^[18]. The majority of the agri-environment schemes available in Scotland are currently contained within Rural Priorities, an integrated funding mechanism which is part of the Scotland Rural Development Programme (SRDP) 2007-2013^[19]. Rural Priorities is intended to deliver targeted environmental, social and economic benefits, and regional priorities have been established to aid the delivery of the five key outcomes of the SRDP: business viability and competitiveness; water quality; adaptations to mitigate climate change; biodiversity and landscapes; thriving rural communities.

Types of policy levers used

Policy levers being used at present in relation to AESs are primarily encouraging, through economic incentives, and enabling, through the provision of information.

Farmer attitudes and behaviours in relation to AESs

Entry into AESs has always been voluntary, and dependent on farmers' willingness to deliver the environmental benefits associated with a given option for a set payment. Understanding what motivates farmers to participate in AESs is therefore crucial to any investigation of the effectiveness of these schemes.

At the end of the 1990s, Wilson and Hart conducted a major study (including 1000 farm households in nine EU countries and Switzerland), to investigate factors influencing participation (and non-participation) in AESs.

The research found that, for most farmers in the EU, decisions whether to participate are driven by financial imperatives and, to a lesser extent, by the 'goodness of fit' of schemes with farm management plans. Most EU farmers appear to be influenced by similar sets of factors in their decisions to join schemes. Key factors are:

• Farm size - farms larger than the regional average are often more likely to participate
• Tenure - freehold farmers are more likely participants
• Farm type - extensive grassland farms are more likely to participate than arable farms
• Level of education - farmers who completed their schooling are more likely to participate than those with no full time education
• Dependency on income - farmers who are largely, but not entirely dependent on the farm for income are more likely to participate
• Inter-scheme continuity - farmers who were in earlier schemes are more likely to participate in current AESs
• Information availability about schemes - farmers who have been well informed are more likely to participate.

The researchers applied statistical methods to the results of their survey, to develop a 'participation typology.' This resulted in four distinct categories:

• Scheme enthusiasts - were likely to see scheme objectives as financial. They were strongly dependent on the farm for income, and saw 'carrying on the family tradition' as important. Scheme participation had changed their attitude to farming towards more conservation-oriented beliefs
• Neutral adopters - were not interested in reducing farming activity and did not perceive schemes as a secure source of income. They were 'neutral,' both about the financial imperative for entering AESs and about conservation more generally. Scheme membership did not fit well with their farm management plans, and had not changed their attitudes towards farm management
• Uninterested non-adopters - rated scheme-related factors as 'unimportant' in their decision making process about joining schemes (for example, scheme payments were not a factor). They saw scheme objectives as conservation oriented (despite many schemes being 'sold' as 'income support' schemes). In general, they disagreed with legislative measures to control farmers' environmental management practices; and were not dependent on the farm for income. They often expressed more conservation-oriented attitudes than 'scheme enthusiasts,' but felt they could contribute more to environmental conservation outside AESs
• Profit-maximising non-adopters - disagreed with regulatory mechanisms such as 'maximum stocking rates.' They favoured market solutions for solving environmental problems in the countryside. They saw farmers as 'stewards of the land.' They had a high dependency on the farm for income, and usually farmed economically successful farms. They felt that AESs could not compensate them for potential income losses.

The same research highlighted geographical differences in attitudes towards AESs, particularly between farmers in northern member states and farmers in Mediterranean countries. The authors suggested that this could be partly because of the longer experience of northern member states with AESs and partly because Mediterranean farmers are more focused upon increasing productivity and maximising profits, in order to catch up with their northern counterparts. Low uptake in Mediterranean countries could also be a result of lack of advice provided to farmers on AES schemes (Wilson and Hart, 2000).

What is known about the effectiveness of AESs

Measuring the effectiveness of AESs presents a number of challenges, due to the complexity of the interface between agricultural activities and the environment, the variability of environmental issues and their local/regional relevance, and the implementation approach selected by policy makers at the EU level (Christopoulos and Vlahos, 2011). Evidence available from the evaluation of UK schemes (Boatman et al, 2008) indicates that the strengths of the agri-environment scheme approach include:

• The ability to provide a positive management incentive through payment, and supporting advice and facilitation to encourage farmer learning and active management of valued environmental resources
• The ability, increasing over time, to negotiate and agree tailored management activities which are sensitive to individual needs and opportunities in each locality, and in respect of individual farm businesses
• A medium to long term commitment to sensitive management and the delivery of environmental benefits, between both parties to the contract, which is explicit and binding
• Compatibility with continuing commercial management of land, in the overwhelming majority of cases.

However, a voluntary, payment-based approach to environmental enhancement also has limitations, which include:

• Lack of funding for sufficiently high levels of uptake to achieve environmental goals
• Vulnerability to competitive pressures from other land management drivers, particularly agricultural prices.

Boatman et al concluded that the schemes operating in the UK appear best-suited to providing the detailed and positive aspects of environmental protection and enhancement which work comfortably alongside day-to-day commercial land management. The authors suggest that the key to maximising their effectiveness is to seek to work with their strengths by using them in an integrated way alongside other mechanisms, including regulatory protection and advice and information, supported by strong legislative back-up to protect features and resources of the highest importance (Boatman et al, 2008).

Given the widespread uptake of voluntary agreements, the length of time of their existence and their visible impact on some European landscapes, it would be reasonable to expect noticeable changes in farmer attitudes, and even farming cultures, from participation in AESs. However, this does not appear to be the case. The evidence relating to Austria, Finland, Ireland, Switzerland, the Netherlands and the UK is summarised by Burton et al (2008) in the introduction to a study which investigates cultural capital in agriculture.

The authors note that voluntary AESs are predicated on the 'provider gets principle:' the underlying concept that society has to compensate farmers who produce positive externalities. This assumes that farmers have the right to carry out the most profit-maximising activity on their land, irrespective of the external costs and benefits of doing so, and assumes a like-for-like exchange of economic capital between farmers and the government. Following this assumption, it has been suggested that farmers experience more than financial losses when changing their farming activities. To investigate the non-economic rewards of farming, Burton et al consider the concept of cultural capital. This exists:

• In institutionalised forms, such as educational qualifications. By providing qualifications from formalised institutions, institutionalised cultural capital offers individuals a certification of cultural competence, which is consistent and thus directly comparable across a range of agents, such as breed societies
• In an objectified state, as in the possession of high status cultural goods (visible in conventional farming cultures largely through symbols of production, such as modern machinery or the presence of quality livestock or crops). A key aspect of objectified cultural capital is that its value is not in the object itself, but is instead dependent on its use in accordance with a specific purpose
• In an embodied state. This involves the labour of self-improvement on the part of the investor and cannot be transmitted instantaneously, as can property or money. Embodied cultural capital helps form the 'habitus' of the individual.

The authors argue that three conditions are required if a farming activity is able to display embodied cultural capital to other farmers. First, the activity must require a skilled role performance capable of differentiating 'poor' and 'good' practice - that is, it must embody the level of cultural capital of the operator. Secondly, there must be outward signs that effective action has been performed - for example, straight plough lines in the landscape. Thirdly, these outward signs of skill must be visible or otherwise accessible to other members of the farming community (Burton et al, 2008).

Understanding how agri-environment schemes interact with farming culture therefore becomes a matter of exploring how the adoption of new practices alters the nature of capital generation within the farming field. If financial loss is compensated by agri-environmental payments, but new land uses and activities are unable to generate symbolic cultural capital, then the net results could be that farmers lose significant amounts of capital, despite generous financial compensation.

As the authors point out, the issue for AESs is clear. If environmental attitudes and behaviour are to become established in the culture of conventional agriculture, then AESs must also contribute towards the generation of cultural capital on the farm - that is, they must enable farmers to enact and display skilled behaviour. The analysis of the research, which included interviews with farmers in Aberdeenshire, identified several key components of voluntary AESs that can influence their integration into the farming culture.

The prescription of field management requirements. While schemes are voluntary, in that participation, management options and area entered are optional, the government is effectively contracting a service from farmers. Therefore specific management requirements, such as when fields are allowed to be mown, are generally codified and prescribed. Consequently, schemes do not promote any voluntary actions for environmental protection, or reward farmers for doing anything more than the minimum necessary to qualify for the subsidies. Skills are involved in the setting up of the AES - for example by erecting fences and determining how best to make use of the land - but, once the scheme is established, the farmer's ability to display skill through conservation work is limited. In terms of their ability to display 'good farming' skills to other farmers, a conservation project thus becomes 'a static display in the landscape - radically different from the renewable seasonal display possible with cropped land uses.'

The designation of specific areas of land for agri-environmental work. The designation of specific areas for AES work is a key component of many AESs. However, findings from the research suggest that, by effectively taking responsibility for part of the farm, AESs allow farmers to disown personal responsibility for scheme areas while concentrating on production in the remaining areas of the farm.

Other inherent features of conservation areas: viewing the quality. Within ordered, 'tidy' landscapes, the practice of roadside farming of symbols is relatively easy, as farmers are able to drive past others' fields and assess (at a glance) basic patterns in the landscape, or healthy appearance of the livestock. For AESs, on the other hand, reading symbols in the landscape is exceptionally difficult. While the schemes themselves are highly visible, the quality of the scheme is often very hard to assess. Potential symbols of 'good conservation,' such as the number of bird nesting sites, the diversity of species or the density of hedgerows, are not immediately obvious to other farmers (Burton et al, 2008).

Scotland Rural Development Programme: messages from the opinion former interviews

Awareness of SRDP measures is not widespread amongst farmers and few of the interviewees spoke in detail about the opportunities offered by SRDP schemes. It was noted by interviewees that schemes were considered to be promising at the outset, but there was a general view that they had not been as successful as they could have been, particularly now that less money is available. There is a perception that good ideas have been rejected, and this has led to a degree of cynicism amongst farmers.

A number of interviewees criticised SRDP measures as overly complicated and requiring guidance from consultants to fill in the forms properly. Another potential barrier was the transaction costs associated with time spent on paperwork and farm management changes etc (see Chapter 7).

It was noted that SRDP initiatives are not marketed as climate change mitigation measures. When farmers apply for funding, their interest is primarily in benefiting their own businesses, although a minority may select options because of their potential environmental impact.

Implications for policy development and delivery

The evidence suggests that there are changes to AESs which would help to strengthen farmers' support for environmental objectives. Farmers could be allowed more opportunity for innovation in their conservation practices, to determine how specific conservation goals should be obtained, and to learn through experience the connection between their management skills and environmental outcomes.

The designation of specific areas for AES work allows the protection of vulnerable sites. However, such designation encourages farmers to partition conservation work off from agricultural work. Farmers are currently able to indicate to others through, for example, the presence of encircling fences, that they have no responsibility for the management of this area of the farm. Setting species targets would allow farmers to be able to see (and measure) the tangible changes resulting from their management practices. They would also be able to compare these figures with those of other farmers to measure self improvement. Burton et al (2008) suggest that this would encourage farmers to learn more about each others' management practices and learn to value the skills required for managing diversity. They also note that, as more farmers become engaged in conservation provision, non-participating farmers would increasingly be seen as 'free-loading off other members of the community and thus come under increasing social pressure to participate.'

The research by Wilson and Hart (2000) found that conservation-oriented motivations for AES participation were playing an increasingly important part in farmers' decision making processes. It was suggested that the findings had a number of implications for policy refinement, including the provision of:

• Higher payments for the first few hectares entered into a scheme (to avoid disadvantaging smaller farms)
• Improved targeting of environmentally damaging intensive farming in lowland areas (by providing higher payments for participation of intensive arable farms, for example)
• Better terms for tenant farmers, who may be reluctant to enter schemes because they are uncertain about long-term tenancy agreements, and because landlords may be unwilling to share agri-environment benefits with their tenants
• Encouraging 'newcomers' into AESs, rather than relying on high uptake rates based on farms that already had previous AES agreements.

The suggestions from the research focus mainly on using levers that encourage environmental behaviours. For example:

• Setting species targets would send out signals to the industry and stimulate peer pressure
• Measures to improve targeting would allow a wider population of farmers to apply for entry to AESs.

Cultural capital is also a recurring theme. At present, once AESs are established, there is little opportunity for farmers to demonstrate 'good farming practice' to their peers. This may be part of the reason why there has been no discernable shift in farmer attitudes to AESs, despite the length of time they have existed and despite widespread uptake. Better engagement to involve farmers in schemes, and considering opportunities for farmers to demonstrate their expertise within schemes might help farmers to take more pride in participation.

5.9 Renewables

Introduction

The above section on agri-environment schemes focuses on farmers being encouraged to take specific environmental actions that are not in themselves financially beneficial to those farmers. Naturally there is a range of agriculture and environment initiatives that do have the potential to generate income (wind turbines; anaerobic digestion; for example), and this possibility is likely to sharpen the financial incentive for farmers. Contribution to the initial capital investment required to establish renewable energy capacity is available through the Scotland Rural Development Programme, and the Feed-In Tariff Scheme (FiT) provides a financial subsidy for renewable energy generators.

Types of policy levers used

Renewables initiatives are primarily enabling, through giving information and removing barriers; and encouraging, through financial subsidies.

What is known about the effectiveness of renewables initiatives

Although there is a growing evidence base on community renewables initiatives, there is currently very little that relates specifically to farmers. One research project, carried out in 2011, investigated the potential for the development of anaerobic digestion (AD) on farms, as well as farmer attitudes to AD. A survey of 2,000 farmers in England, undertaken as part of the research, found that the two most important benefits of installing AD were seen by respondents as 'improving farm profit' and 'reducing pollution/contamination risk.' Potential barriers to adoption were seen as the high establishment costs, low returns, and the perceived difficulty of obtaining planning permission. The authors acknowledge that the response rate to the questionnaire was 20%, and was slightly biased towards larger farms and owner occupiers. However, findings relating to 'possible adopters' of AD support the established profile of an early adopter (from larger farms; more likely to be owner occupiers; younger; left full time education later) (RELU, 2011; Tranter et al, 2011).

The researchers suggested a number of ways in which governments could support the development of more anaerobic digestion on farms. These included:

• Promoting AD as a 'green technology' that makes use of farm and urban wastes
• Providing local planning authorities with better guidance and information to help in making planning decisions
• Committing themselves in the longer term to providing subsidy for capital investment in farm-based digestion
• Introducing incentives to specifically promote on-farm co-digestion of agricultural and urban wastes and reduce dependence, for economic viability, on the use of energy crops
• Designing systems and procedures to promote anaerobic digestion at a farm scale (RELU, 2011).

Recent research refining cost equations to estimate the costs of AD plants indicated that both capital and operating costs are likely to be higher in terms of power output than originally estimated (Macleod et al, 2010). This may make AD a less attractive proposition, although farmers do have the option of growing energy crops such as maize in order to improve the economics of the digester. However, as has been pointed out (Bywater, 2011), many smaller farms lack the capacity to use their land in this way.

No evidence relating to other types of renewables initiatives, in the context of agriculture, was identified during the literature review. However, the opinion former interviews indicated high rates of awareness of, and interest in, the FiT scheme in particular.

Feed in Tariffs: messages from the opinion former interviews

Of all the initiatives available which focus on climate change mitigation, those relating to renewables were by far the most commonly discussed amongst interviewees. In the main, renewables initiatives were referred to in very positive terms.

Opinion formers across the sectors stated that farmers have very high awareness of these schemes and that, over recent years, there has been a 'sea change' in farmers' perceptions of them. Over a very short period, a 'huge interest' has arisen in renewables and interest levels are continuing to rise. The FiT scheme was considered to be particularly well-publicised and well understood in the farming community.

Amongst the FiTs options, wind turbines were by far the most popular, with interest being described as 'phenomenal.' There was also some interest in photo-voltaics, anaerobic digesters and hydro electricity. Farmers' enthusiasm for renewables initiatives was felt to be influenced by the potential to have a useful additional income stream, rather than helping to mitigate climate change. FiTs are thought of 'in the same way as converting a cottage into a B & B rather than environmental terms.'

Some barriers to the adoption of renewables measures were also noted:

• Farmers feel that the planning system is a 'hassle' and an 'obstacle' and consider the levels of time/paperwork involved to be a deterrent
• Setting up renewables schemes requires a substantial capital outlay
• Individual farm factors such as location, elevation and size have an impact on a farm's suitability for renewables schemes. Farm size was considered the most influential of these factors, as owners of larger farms not only have more spare time to investigate such initiatives, but are also more likely to have the space to house them, and have a greater chance of successfully accessing funding.

Some implications for policy development and delivery

Renewable energy is one area where policy may be pushing against an open door as far as farmers are concerned. Although agriculture-specific evidence in relation to renewables is lacking, a clear messages from the opinion former interviews is that farmers are both aware and interested in renewables initiatives, mainly due to the potential additional income they provide. However, farmers face (or perceive that they face) substantial transaction costs in the adoption of renewables measures. In addition, farm size is a major consideration in the decision-making process. It may be that clearer information and better signposting to available support are required to increase uptake of renewables schemes. Another option may be to encourage farms to adopt a collaborative approach to adoption of initiatives, to make it easier for small farms and tenant farmers (for example) to participate.

5.10 Future Proofing Scotland's Farming

Introduction

This three year initiative (2011-2014) is delivered by Soil Association Scotland in partnership with Quality Meat Scotland (QMS), with support from the National Farmers Union of Scotland and SAOS Ltd. The programme was awarded funding through SRDP with an industry contribution from QMS. It is intended to engage practically with farmers and focus on increasing efficiencies, rather than explicitly seeking to mitigate climate change.

The aim is to boost producers' bottom lines through improving efficiency, productivity and performance at farm level, including the use of green technologies. Through a range of online resources and events, farmers are offered practical advice on how to raise the financial performance of their businesses and benefit the environment.

Types of policy levers used

Policy levers being used at present as part of this initiative are primarily enabling, through the practical advice offered to farmers; engaging, through events which give opportunities for interaction with other farmers and practical demonstrations; and exemplifying, through using farmer champions to demonstrate good practice.

5.11 Can Scotland learn from initiatives operating elsewhere in the UK?

As part of the evidence gathering process, information was collected about key programmes aiming to influence farmer behaviours which operate elsewhere in the UK. These were considered in terms of the types of policy levers they are using. Programmes were identified in England and Wales. There is currently no dedicated programme in Northern Ireland, although there are plans to integrate climate change-related advice and guidance with existing efficiency advice messages.

Farming Futures (England)

Farming Futures is a major communication initiative aimed at influencing English farmers' behaviours in relation to climate change^[20]. The programme was set up in 2007 to help the UK farming industry respond to the combined challenges of climate change and the sustainable efficient production of food, through the use of innovative communication methods to inform and inspire farmers, food producers and land managers about the risks and opportunities ahead. Currently, Farming Futures is a collaboration between a range of public and private sector organisations, and is managed by the Centre of Excellence for UK Farming.

Innovative media are used to personalise message delivery to farmers, as well as enabling them to participate in actions. There is a dedicated blog where farmers and industry can share ideas and debate the latest issues; an interactive map enables farmers to view events, case studies and short fact sheets specifically related to their region. More than 15 films are available on the Farming Futures website, to provide information and demonstrate best practice; and there is a free monthly newsletter designed to let farmers know about events and resources and keep them up to date with 'all of the latest news about profitable farming in our changing environment.'

Events: a series of targeted on-farm events around England are intended to explore and find practical solutions to issues around climate change and the future of farming. Topics covered include renewable energy generation, precision farming, livestock emissions, nutrient management, water management. The Farming Futures website also advertises other industry events.

Case studies: good practice exemplars are interviewed on topics including their farming background, the benefits of particular approaches in terms of environmental and economic impact, and challenges faced. A wide variety of farming issues are covered, including anaerobic digestion, renewables and soil management. Over 30 of these case studies are available on the website.

Signposting and technical information are provided to farmers in relation to specific actions they can take, funding opportunities, news of recent events; latest 'buzz words,' links to useful documents and reports.

In terms of policy levers, Farming Futures appears to use all four, since the initiative seeks to:

Enable through raising awareness of viable alternatives to farmers' current practice; providing advice and information, on-farm training and demonstration of new technology

Engage through providing online fora/networks for discussion; bringing farmers together to share best practice

Encourage through recognition of best practice, particularly through case studies, and consequent exertion of social pressure to emulate the examples

Exemplify through demonstrations by innovators and leaders in the field.

Farming Connect (Wales)

Farming Connect is the Welsh Government's flagship support, guidance and skills development programme which helps farm businesses across Wales to be more efficient and reduce input costs. It is funded through the Rural Development Plan 2007-2013 which is financed by the European Agriculture Fund for Rural Development and the Welsh Assembly Government. Support, guidance and training are delivered by Menter a Busnes on behalf of the Welsh Government^[21].

The programme offers a range of fully-funded services to all farmers who have registered with Farming Connect:

• Development programmes: to give farmers the opportunity to learn from others and share best practice by joining discussion groups, visiting demonstration farms and attending sector-specific open days
• Strategic awareness events: to keep people up to date with topical issues of key importance to farm and forestry businesses
• Planning surgeries to help farmers address on-farm planning issues and understand the processes
• An action learning programme to bring farming families together on a group basis to discuss and take forward business ideas.

Other services include a knowledge transfer programme to assist the agricultural industry to exploit the latest scientific knowledge to meet current and future challenges and to ensure that all farm businesses in Wales are supported to reach their potential. This also includes a specific service to provide women with the support and encouragement they need to capitalise on their role as key influencers and operators in many farm businesses. One-to-one support, demonstration farms and case studies, and information about relevant conferences are also provided.

Farming Connect appears to use at least three of the four policy levers, since it aims to:

Enable through provision of advice, information, guidance

Engage through bringing farmers together via demonstrations, discussion groups, workshops and other events to engage with advisers and share best practice

Exemplify through the use of farmer champions and demonstration farms.

Some implications for policy development and delivery in Scotland

It is clear that in the rest of the UK governments are seeking (either through directly delivered initiatives or through the agency of stakeholder organisations) to influence farmer behaviours. The Farming Connect approach, in particular, appears to focus specifically on farm profitability, with climate change messages well buried. The message from Farming Futures, on the other hand, may be summarised in the quote used earlier in relation to profitable farming 'in our changing environment:' i.e. acknowledging the context but focusing on the business advantages.

Without specific, detailed, evaluative evidence from the initiatives, it is not possible to indicate whether and which elements are proving successful, with which types of farm and farmer. Many activities being carried out as part of the initiatives are already going on in Scotland, but it might be useful to look at how Farming Connect works with women and younger farmers. The Farming Futures fact sheets appear to be a useful resource. They are short and clearly written; use shaded boxes and bullet points to communicate key information; focus on the perspectives of 'your customers' and 'what the scientists say;' and include lists of challenges and opportunities.

5.12 Opportunities for change: CAP reform

Current proposals for the reform of the CAP beyond 2013 provide a number of opportunities for using additional policy levers, or strengthening levers already in use. Examples include:

• Potential for specific climate change mitigation measures, including some of those encouraged in FFBC, to be made mandatory through the cross compliance regime that links farming practices to subsidy payments
• Additional investment in research and innovation, and steps to translate research results into practice, potentially provide opportunities for more effective, targeted, communication with farmers, and for farmers to share their experience and expertise
• Measures to stimulate entrepreneurship in rural communities provide potential for more collaborative approaches between farms and groups of farmers
• Expansion of the Farm Advisory Service to offer advice on the activities farmers must undertake as part of the additional greening payment component of direct payments, as well as additional requirements relating to climate change mitigation

The ongoing debate on the future of the CAP, and the consultation process itself, provide a range of opportunities for farmer involvement in policy development and delivery.

CAP reform: messages from opinion former interviews

Interviewees suggested that:

• Amendments to the CAP, in relation to climate change, should be linked explicitly with the Farming for a Better Climate five key actions
• The CAP should have a greater focus on 'sustainable intensification,' i.e. both increasing production and reducing negative environmental impacts, including those that have an impact on climate change mitigation efforts.

It was also suggested that both SRDP and CAP are currently overly focused on conservation, and should be rebalanced, to acknowledge the pressing nature of issues such as food security, diffuse pollution and climate change.

Plans to require permanent grassland as part of the CAP greening measures were highlighted as a less practical measure. Interviewees felt this approach 'locks up land' and limits the flexibility a farmer might need.

Policy and economic mechanisms available to policy makers

A range of policy approaches is available to governments to encourage positive environmental behaviour among farmers:

• Regulation - placing restrictions on what farmers are legally allowed to do and prohibit undesirable management practices. This works best in situations where the target group is already, or can quickly be, persuaded that the regulated actions fall below an acceptable 'reference level' of responsible farming practice
• Economic incentives - taxes and subsidies are the most widely used and analysed instruments
• Market-led and 'voluntary' approaches - promoting environmentally beneficial management practices to encourage higher standards of environmental behaviours among farmers. These have significant potential to encourage higher standards of management practice on farms and are attractive because they offer 'win-win' options to motivated producers, but are likely to be insufficient to drive enhanced management of the countryside as a whole
• Education/information provision - raising awareness of environmental issues, what can be done to address them and why this could be beneficial to farmers. This works in tandem with any/all of the above mechanisms.

Each approach has different advantages and disadvantages in terms of cost, success at influencing behaviours, speed of implementation etc. Success almost always depends on a range of factors. Understanding the interplay between these different elements within a particular policy or commercially-driven approach can be crucial to understand how and why they succeed or fail in different situations.

The SG is currently using a range of policy mechanisms to influence farmers' environmental behaviours. However, only the focus farms which are part of Farming for a Better Climate use the four types of policy levers available to influence behaviours: making it easier to change; giving the right signals; getting people involved; and leading by example.

Key points from the literature

• Cross compliance - farmers need clear information about the rationale for cross compliance measures and why the rules are needed. It is important to make it as easy as possible for them to keep up to date with regulatory requirements
• Nitrate vulnerable zones - although there is resentment among farmers about NVZ designation, and a widespread feeling that others should share the costs, the evidence suggests that farmers who are disengaged present a greater challenge to policy than farmers who are resistant
• Focus farms - there is no evidence to date on the effectiveness of focus farms in Scotland, although they follow a model (monitor farms) which has been evaluated positively. Potential tensions between the commercial imperative and environmental measures may be alleviated if CAP reform includes increased emphasis on environmental cross compliance measures
• Agri-environment schemes - farmers' decisions to participate in AESs are influenced by factors such as farm type and size, tenure arrangements and previous experience of participation. Refining policy to improve targeting might help to encourage 'newcomers,' small farms and tenant farmers. Giving farmers more opportunity to innovate within schemes, and setting targets that would allow farmers to see, measure and communicate their conservation progress, would meet their needs to enact and display their skills to their peers
• Renewables - farmers are aware of and interested in renewables initiatives, and the potential additional income they provide. However, there are (or are perceived to be) substantial transaction costs involved in the adoption of renewables measures. Clearer information and better signposting to available support could help to increase uptake of schemes. Farmers could also be encouraged to collaborate with each other in the adoption of initiatives.

Opinion formers also wished to stress that:

• The more time and money farmers spend complying with regulations, the less they can spend on creating and selling produce (although regulation may also bring other benefits). Better regulations and clearer instructions would make it easier for farmers to comply
• Making mitigation measures mandatory does not persuade farmers of their merit, whereas voluntary measures are usually adopted because farmers have been convinced that they have value. However, if farmers can see why mandatory measures are necessary and/or beneficial, they are more likely to support them
• The five key actions encouraged through FFBC are all seen as good practice, so farmers looking to increase their efficiency would be likely to take them up anyway
• The process of applying for grant funding through SRDP is perceived to be over complicated
• Farmers are aware of, and interested in, renewables initiatives and the Feed-in Tariff Scheme, in particular.

Some implications for policy development and delivery

• Farmers need to be convinced by the science, particularly the science supporting cross compliance measures
• Farmers who do not engage present the greatest challenge to policy makers - using newer channels of information transfer may attract farmers who do not actively seek information
• Learning from initiatives elsewhere in the UK - many of the activities being carried out as part of Farming Futures (England) and Farming Connect (Wales) are already going on in Scotland, but it might be useful to look at how Farming Connect works with women and younger farmers. The short fact sheets produced as part of Farming Futures appear to be a useful resource, for their focus on a breadth of perspectives (including 'what the scientists say'), and their lists of challenges and opportunities
• Current proposals for CAP reform beyond 2013 provide a number of opportunities for using additional policy levers, or strengthening levers already in use. Examples include expansion of farm advisory services; additional investment in research and innovation, and steps to translate research results into practice; and measures to stimulate entrepreneurship in rural communities.