FARMERS who lose out under the single farm payment system may recoup some of their lost income through new environmental schemes.

Ciaran Gannon, adviser with Defra's rural development service in London, said the entry level and higher entry level could provide the means to claw something back.

Mr Gannon was addressing last week's North Yorkshire Farming and Wildlife Advisory Group forum at the Angel Inn, Topcliffe.

At £30 a hectare the entry level environmental scheme could prove a big incentive and help, he said.

The exact size of the single farm payments are not yet known but estimates put the severely disadvantaged area rate at £65-£86/ha (£26-£34/acre) and the non-SDA rate at £210-£230/ha (£85-£93 an acre).

"The SDA will have a lower flat rate than non-SDAs in recognition of the lower stocking density and the significantly lower historic payment per hectare," he said.

There would be winners and losers. The sheep farmer with 1,000 acres on top of the moor, with a stocking rate of one ewe/ha at £13 per ewe, would get significantly more under the new system. Beef and dairy farmers in the SDAs would lose out.

Elsewhere, intensive producers, who tended to be based in buildings rather than on hectares, would be worse off, but potato growers, and fruit and vegetable producers, who had received nothing in the past, would all get a lot more.

A survey of the SDA in England, which is mainly in the North, showed it involved more than 16,000 farms. Of those, there were almost 1,200 dairy farms, on improved grassland not heather moor; 145 cereal farms; 32 general cropping; 236 horticulture units (hardy nurseries); 412 pig and poultry; 8,300 beef and sheep farms; 340 mixed units and almost 6,000 other very small units.

Mr Gannon said the SDA classification was originally introduced in recognition of areas where stock could not be fattened nor milk produced. "I guess technology has changed things," he said, referring to some of today's farm types.

Mr Gannon, who farmed before joining Defra, said the mid-term review proposals were far more radical than had been envisaged, but he pointed out that the EU model of agriculture recognised farming provided a lot more than just food - there were landscape and environmental benefits.

"There is always going to be support for farmers in Europe because of that," he said.

Under the flat rate, area-based system, which will come in over an eight-year transitional period, payments would also depend on farmers meeting agri-environmental cross-compliance conditions. Land would have to be kept in good agricultural and environmental condition to avoid abandonment or marginalisation.

Mr Gannon said areas in the North suffered from overgrazing but, following the reforms, there could be a real risk of undergrazing; the new system talks of minimum stocking rates.

He said that, in the decoupled world, there was no need for set-aside. It would, however, remain for environmental reasons.

He believed the cross-compliance conditions were common sense and practical. "It may take some fine tuning of your rotation but it will not be onerous," he said.

Mr Gannon said there was much to be done before the scheme was ready for its launch on January 1, 2005. "Decoupling from the subsidy will be more important than how the single farm payment is calculated," he said.