Agricultural reform: environmental report - strategic environmental assessment

Non-Technical Summary

Introduction to the Emerging Agricultural Reform

The Scottish Government is currently developing their Agricultural Reform changing how the government will support farming and food production in Scotland.

The Agricultural Reform involves the development of a new policy framework to deliver the ‘Vision for Agriculture’ which establishes the long-term vision for Scotland to become a global leader in sustainable agriculture. The new policy framework will replace the current Common Agricultural Policy and the Scottish Rural Development Programme (SRDP). It will support the delivery of the Vision for Agriculture [See reference 1].

The Agricultural Reform Route Map [See reference 2] sets out the process for changing to the new agricultural support framework, outlining key dates for change, future measures being considered, when existing schemes will end and how farmers should prepare for change.

The Vision for Agriculture introduces a new four-tiered Support Framework which is undergoing development. The first changes were introduced on 1 January 2025 and future measures will be introduced on a phased basis over several years:

• Tier 1 Base and Tier 2 Enhanced are direct payments
  • Tier 1 Base will provide direct payments to support active farming. Scottish Government will start off using the current Basic Payment Scheme (BPS) and add new conditions over time. Receiving this support will require meeting what will be called essential standards (e.g. Cross Compliance, Statutory Management Requirements, etc.).
  • Tier 2 Enhanced will support farmers and crofters to do even more for climate and nature. It will build on the standards established in Tier 1 and provide additional measures to reduce greenhouse gas emissions and restore and improve nature for those who opt to go further.
• Tier 3 Elective and Tier 4 Complementary are indirect payments
  • Tier 3 Elective will support action that protects habitats or species or improves business sustainability. It will focus on funding targeted actions for climate change and nature restoration. This could be specific to a particular species or habitat, support conversion to alternative forms of agriculture such as organic production, encourage innovation and provide supply chain support.
  • Tier 4 Complementary will help to grow skills and capabilities. This will include training and advice. It will focus on ensuring applicants are prepared for the suite of management options, new practices and innovation under Tiers 1-3.

The first Tier 1 changes were introduced on 1 January 2025, as follows:

• Introduction of the Whole Farm Plan;
• a new calving interval requirement for the Scottish Suckler Beef Support Scheme; and
• new protections for peatlands and wetlands, with new conditions added to Good Agricultural and Environmental Conditions (GAEC) 6: Maintenance of soil organic matter.

Measures which will take effect from 1 January 2026 include initial changes to requirements for the management of Ecological Focus Areas (EFAs) under Tier 2: Enhanced Greening. The Future Farm Investment Scheme (FFIS), was a capital grant scheme for farmers and crofters under Tier 3: Elective, which was announced 19 June 2025 and was open for applications 14^th July-22^nd August 2025. Other measures for Tier 3: Elective and Tier 4: Complementary will be introduced from 2027, meanwhile existing support mechanisms remain in place.

What is Strategic Environmental Assessment?

Strategic Environmental Assessment (SEA) is a way of considering the environment when preparing public plans, programmes and strategies. It identifies potential significant environmental effects and, where necessary, describes how these effects can be avoided or reduced. Through consultation, SEA also provides an opportunity for the public to express their views on proposed policies and their potential environmental impacts.

In this case, SEA is being used to assess the likely environmental effects of the emerging Agricultural Reform.

How was the Strategic Environmental Assessment undertaken?

This SEA is an assessment of the likely significant environmental effects of the emerging Agricultural Reform and the alternatives to it. The Environmental Report considers the environmental effects of Agricultural Reform as they would influence activities across Scotland. The SEA is required to consider the likely significant effects in relation to the following topics (referred to as the ‘SEA topics’): biodiversity fauna and flora; population and human health; soil; water; air; climatic factors (adaptation and mitigation); material assets; cultural heritage including architectural and archaeological heritage; and landscape, townscape and seascape; as well as the inter-relationship between the topics.

The assessment identifies positive and negative environmental effects and the significance of these; and notes where they would arise in the short, medium or long term. It also distinguishes between effects arising directly from the Agricultural Reform and any ‘secondary’ effects, which would indirectly impact on the environment.

Which reasonable alternatives have been considered?

The Environmental Assessment (Scotland) Act 2005 requires that the likely significant environmental effects of reasonable alternatives of a plan, programme or strategy are assessed as part of the SEA process.

Consideration of alternatives was undertaken in discussion with the Scottish Government. The extent to which alternatives for the emerging Agricultural Reform could be considered ‘reasonable’ was influenced by the following factors: the legislative framework for the document and the proportion of committed policy and action embodied in the document.

The Scottish Government identified several detailed scheme-level options which were considered during the development of Tiers and component schemes. The following alternative options for schemes within Tiers 1 and 2 were identified by the Scottish Government during development of these individual schemes:

• Options for new protections for peatlands and wetlands:
  • Adoption of a different definition for peatland (related to peat-depth).
  • Adoption of stocking density measures
• Delivery options:
  • Options for the Scottish Beef Suckler Support Scheme:
  • Payment framework options
  • Options to mitigate impacts of the new requirements on small herds
• Options for Enhanced (Tier 2):
  • Use of an alternative existing CAP scheme as the delivery mechanism for Enhanced instead of Greening.

Alternatives options for the schemes within Tiers 3 and 4 were not identified by the Scottish Government. These Tiers remain at earlier stages of development.

In addition to reasonable alternatives related to the delivery of individual schemes, two strategic, high-level alternatives were identified through discussion with the Scottish Government and Consultation Authorities:

• The ‘do nothing’ scenario
• Options for the potential pace of budget allocation shift between Tiers within the support framework.

What are the key environmental challenges relevant to the Agricultural Reform

In terms of climatic factors, Scotland’s total emissions of the seven greenhouse gases (GHGs) in 2022 were estimated to be 40.6 million tonnes of carbon dioxide equivalent (MtCO₂e), a decrease of 0.1%% from 2021 [See reference 3]. In 2023, agriculture was the second largest source of net emissions in Scotland at about 7.5 MtCO₂e, including carbon dioxide (CO₂), methane (CH₄), and nitrous oxide (N₂O) [See reference 4]. The agriculture sector consists of emissions from livestock, agricultural soils, stationary combustion sources and off-road machinery. The agriculture sector has seen a 1.1 MtCO₂e (13.0 per cent) fall in emissions between 1990 and 2023. Between 2022 and 2023 agricultural emissions essentially remained constant at a level of 7.5 MtCO₂e, falling marginally by 0.1% [See reference 5]. According to the Scottish Greenhouse Gas Statistics 2023, methane was the main net gas emitted in agricultural emissions (4.5 MtCO₂e). Methane emissions in the agriculture sector have, however, fallen by 1.1 MtCO₂e between 1990 and 2023 (a 13.0% reduction), mainly due to a decrease in livestock numbers, particularly cattle and sheep. Agriculture is also by far the main contributor to emissions of nitrous oxides in Scotland. These are largely produced by agricultural practices on soils, and to a lesser extent by animal manure. Emissions of nitrous oxide in this sector have fallen by 0.6 MtCO₂e between 1990 and 2023, a 23.9% reduction [See reference 6] .

In terms of population and human health, the estimated population of Scotland in 2024 was 5.55 million [See reference 7]. Projections forecast that the population will continue to rise and will peak at around 5.8 million in 2047. Approximately 91% of Scotland’s people live in urban areas, which accounts for just 2.3% of Scotland’s land surface [See reference 8]. Key findings from the 2020 Scottish Index of Multiple Deprivation show that 14 areas have been consistently among the 5% most deprived in Scotland since the 2004 Index [See reference 9]. In terms of Scotland’s agricultural workforce, the June 2024 Agricultural Census [See reference 10] reported a modest rise in the agricultural workforce in Scotland. The total number of people working on agricultural holdings increased by 0.5% compared to the five-year average, reaching 67,400 in 2024.

Air pollution can result in adverse impacts on human health and can significantly affect many aspects of quality of life. The quality of the air around us is affected by the pollutants released into the atmosphere through human activities. Certain pollution hotspots in Scotland have been declared Air Quality Management Areas (AQMAs). With a reduction in large-scale industry, the influence of transport, agriculture and other non-industrial sources continue to be significant sources of air pollution. Ammonia emissions from agriculture are a precursor to PM (particulate matter) 2.5 in cities [See reference 11] and agriculture is responsible for 92% of ammonia emissions [See reference 12].

Soil is a non-renewable resource and is fundamentally one of Scotland’s most important assets. It is estimated that Scotland’s soils store an estimated 3,000 million tonnes of carbon, which is over half of the UK’s total soil carbon stock [See reference 13]. Degraded soil can act as a net carbon emitter, soils in good condition protect the carbon store and, depending on the vegetation cover, can continue to sequester carbon. Land use change and management practices can impact significantly on soil carbon stores and sequestration. This includes agricultural practices which exert compaction pressures on soil quality. Peatlands are of particular importance for mitigating climate change by acting as carbon ‘sinks’. Approximately 1.6 billion tonnes of the carbon stored in Scottish soils is within peat. It is estimated that over 80% of Scotland’s peatlands are degraded [See reference 14].

In recent years, Scotland has continued to see improvements in the condition of its water environment. The 2023 State of Scotland’s Water Environment report [See reference 15] shows that 67.9% of all water bodies are now in good or better condition.

Most of Scotland’s seas, coasts, and estuaries are in good or excellent condition and the majority of Scotland’s groundwaters are in good condition. Around a third of surface water bodies in Scotland are in moderate, poor or bad condition [See reference 16]. Agriculture and the legacy of industrial activity are the main causes of regional-scale groundwater pollution problems. Changes in precipitation including drought can impact on water availability, with negative effects on communities, business and industry and habitats. Agriculture is often one of the first sectors to be impacted by drought due to its high water demand and dependency on the weather, with water scarcity posing risk of crop failure and to animal welfare, impacting farm and croft profitability [See reference 17]. Flooding can also have significant and long-lasting impacts on people, communities, and businesses. Flood Risk Management Strategies and Plans co-ordinate action to tackle flooding in Scotland. Scotland's peatlands play an important role in natural flood management. Woodland and forestry can help prevent flooding by intercepting precipitation, reducing surface water runoff through increased infiltration, and increasing the use of water through evapotranspiration.

In terms of biodiversity, flora and fauna, Scotland’s protected areas include 243 Special Areas of Conservation (SACs) [See reference 18], 162 Special Protection Areas (SPAs) [See reference 19], 51 Ramsar sites [See reference 20] and two Biosphere Reserves [See reference 21]. There are further national level designations including 1,422 Sites of Special Scientific Interest (SSSIs) [See reference 22] and 247 Marine Protected Areas [See reference 23]. The Scottish Biodiversity List [See reference 24] is a list of animals, plants and habitats that Scottish Ministers consider to be of principal importance for biodiversity conservation in Scotland. This includes 42 terrestrial habitats, 1,948 terrestrial species, 20 marine habitats and 159 marine species. By March 2025, the proportion of natural features on protected nature sites reported as being in a “favourable” condition decreased by 0.9% in the last year from 76.4% to 75.6%. This represents a stable trend since the current protocols were established in 2007 (-0.4% from 76.0%) [See reference 25].

Scotland’s historical sites are unique and irreplaceable. While these assets are distributed widely throughout Scotland there are clusters of sites in and around our settlements and also around our coastlines. Designated assets in Scotland currently include seven World Heritage Sites, 6,762 Listed Buildings, 8,078 Scheduled Monuments, 672 Conservation Areas, 390 Designed Gardens and Landscapes, 8 Historic Marine Protected Areas, 8 Scheduled Wrecks, and 40 Nationally Important Battlefields [See reference 26]. However, most of the historic environment is undesignated (90-95%), with numerous archaeological sites, monuments, gardens, historic landscapes, woodlands, and routes, such as drove roads, remaining unprotected by law. Development, land use change and land management, climate change, pollution and tourism/visitors are key pressure on the historic environment, both directly in terms of damage and degradation, and potential indirect impacts on their setting.

Scotland's distinctive landscapes are a significant part of the country’s natural and cultural heritage and make a significant contribution to both the country’s economic performance and the well-being of its people. There are currently two National Parks (Loch Lomond and the Trossachs, and the Cairngorms) and 40 National Scenic Areas in Scotland. Over 13% of Scotland’s land area has been classified as a National Scenic Area [See reference 27]. Scotland’s landscapes are constantly changing and evolving in response to both natural processes and the changing demands of society. Changes in landscape tend to occur over long periods of time and gradual change can be difficult to determine [See reference 28].

Scotland’s natural resources are also material assets. This includes those related to Scotland’s land use, agricultural productivity and food production. Scotland’s land use is also changing over time. For example, the total area used for cereal production has declined slightly by 0.8%, compared to the five-year average, mainly due to a decrease in winter crops. However, an increase in spring crops such as barley and oats has partially offset this decline [See reference 29].

Additionally, soil sealing, loss of prime agricultural land, and soil erosion in Scotland threaten crop productivity and ecosystem health [See reference 30]. About 86% of Scotland’s agricultural land, equivalent to over 5 million hectares, is designated as Less Favoured Area (LFA) [See reference 31]. These areas are primarily suited to extensive livestock farming, especially sheep and cattle grazing. Livestock farming is a major component of Scotland’s rural economy and land use, with cattle and sheep representing the dominant livestock types. However, livestock systems also contribute to greenhouse gas emissions (notably methane), nutrient pollution, and ammonia emissions.

Waste management, transportation and efficiency in energy generation are also important to the agricultural sector and have the potential for environmental impacts. Heating makes up approximately half of Scotland’s energy consumption (48.2%) compared to transport (27.6%) and electricity (21.1%) making up approximately a quarter each [See reference 32]. In the first half of 2024, 76.4% of all renewable electricity generated in Scotland was from wind [See reference 33].

Which existing environmental protection objectives are relevant?

There are many established environmental protection objectives within international and national level policies and strategies, which form the context for the assessment. These include:

• climatic objectives focused on reducing Scotland’s greenhouse gas emissions to net zero by 2045;
• objectives for population and human health aiming to prevent or limit exposure to environmental harm and nuisance such as air pollution;
• objectives for water and air aiming to reduce pollution, and to reverse the effects of past emissions;
• soil and geology objectives seeking to protect prime quality agricultural land and valuable soil resources including the protection of peatlands and remediation of contaminated land;
• biodiversity objectives focused on protecting habitats and species from damage and disturbance and improving natural heritage networks;
• cultural heritage objectives ranging from the protection of designated sites to the recognition and management of more locally important buildings and archaeology, and their wider setting;
• landscape objectives reflecting the importance of all landscapes and the need to help to improve those that have become degraded;
• objectives for material assets supporting sustainable development, reducing greenhouse gas emissions, a circular economy and making the best use of Scotland’s land, resources and existing infrastructure.

Strategic Environmental Assessment findings

The Agricultural Reform applies nationally across the 69% of Scotland’s land used for agriculture so the potential scale of change for biodiversity is considerable. Based on the strategic direction set for farming, significant positive effects for Biodiversity, flora and fauna are expected in the long-term. However, while this sets a positive aspiration for agriculture, the magnitude and timescales for delivery of cumulative positive effects will be dependent on the actual measures adopted and implemented by the Agricultural Reform towards meeting its strategic objectives.

Many of the measures introduced by the emerging Agricultural Reform are expected to contribute towards protecting and enhancing biodiversity. Overall, new measures being introduced across all the Tiers are expected to slightly strengthen existing positive environmental effects being delivered by previous CAP schemes, introducing a greater focus on the protection and enhancement of biodiversity. Some schemes, such as introducing new protections for peatlands and introduction of the Whole Farm Plan are expected to deliver significant positive effects for biodiversity due to their widespread applicability, delivering more consistent approaches to biodiversity protection. Other actions within Tiers 2, 3 and 4 are more directly focused on delivering positive outcomes for nature. However, these Tiers are less widely available. Many of the scheme changes are expected to slightly strengthen positive effects resulting in a continuation of minor positive effects for biodiversity, flora and fauna. Although some measures will bring short term effects, others will take longer for the benefits for biodiversity to be fully established.

Some minor negative effects are also identified across a number of tiers where agricultural actions present risks to habitats. For example, measures which focus heavily on climate efficiency may encourage land-use intensification and associated adverse effects on nature.

Although cumulative positive effects for biodiversity are expected to be significant, the change in effects introduced by existing measures outlined within the Agricultural Reform are expected to deliver minor cumulative positive effects with regard to SEA objective 1: biodiversity, flora and fauna. These effects are expected to be delivered in the medium to long term and are considered to be relatively stronger than pre-existing CAP schemes.

Population and human health

Enabling rural communities to thrive is a key objective of the Act, which translates into the Agricultural Reform strategic outcomes framework through the focus on support for thriving businesses and a just transition, encouraging skills development, knowledge exchange, wellbeing and mental health and access to services. While this sets a positive long-term aspiration for agriculture, the magnitude of change and timescales for delivery of positive effects is dependent on the actual measures adopted and implemented by the Agricultural Reform in meeting its strategic objectives.

Overall, most scheme changes introduced by the Agricultural Reform are expected to deliver a continuation or slight strengthening of pre-existing positive effects in relation to population and human health. Indirect positive environmental effects are enhanced by encouraging sustainable land management practices which will deliver improvements in landscape, air and water quality, providing associated health and wellbeing benefits in the short to longer term. Direct positive effects for population and human health are attributed to support for agricultural businesses and opportunities for innovation and skills development. There is potential for significant positive effects associated with the delivery of a new integrated AKIS and CPD system. However, these are uncertain as the outcomes delivered are dependent on knowledge sharing, training, innovation and behaviour change. The budget allocated to Tier 4 is also currently uncertain, which will influence the scale and reach of positive environmental effects.

Overall, most environmental effects consist of a continuation or a slight strengthening of pre-existing positive effects. The overall cumulative effect is expected to be minor positive, with the magnitude of change by measures introduced by the Agricultural Reform expected to deliver minor positive cumulative effects for SEA objective 2: populations and human health, delivered in the medium to long term.

Climate mitigation

The objectives of the Act and the strategic outcomes of the Agricultural Reform place considerable focus on the reduction of greenhouse gas emissions. Agriculture is the second largest source of emissions in Scotland, so action in this sector has significant influence on meeting the 2045 net zero target. While significant positive effects are expected regarding the strategic direction for the Agricultural Reform and the long-term vision for agriculture, the strength of positive effects will be dependent on the magnitude and speed of change being delivered through the Agricultural Reform.

The majority of scheme changes being introduced by the Agricultural Reform are expected to deliver a slight strengthening of positive effects in relation to SEA objective 3a: Climate change mitigation. In some cases, positive effects will be considerably strengthened due to actions which reduce greenhouse gas emissions and protect and enhance carbon stores. For example, the proposed review of permanent grassland requirements (Tier 2) that the Scottish Government are considering to take forward could deliver significant positive effects due to their widespread applicability given the coverage across Scotland, as grassland is a key carbon store.

However, in most cases effects will be limited to a slight strengthening and continuation of pre-existing minor positive environmental effects. For example, continuing to deliver previous schemes such as AECS which provide direct opportunities for delivering climate mitigation activity. Significant negative effects are also identified as continuing in relation to the SSBSS scheme which directly sustains emissions-intensive production, although these are slightly reduced by the introduction of the new calving interval requirement.

Overall, the change introduced by the Agricultural Reform is expected to deliver minor positive cumulative effects for SEA objective 3: Climate change mitigation in the medium to long term, delivered in the medium to long term.

Climate change adaptation

Climate adaptation is included within one of the five key objectives of the Act, and this is translated into the strategic outcomes of the Agricultural Reform. Scotland faces major risks from flooding, drought and heat stress. Measures that increase resilience in soils, water, and ecosystems are expected to provide widespread climate adaptation benefits over time. While the strategic vision for the Agricultural Reform could deliver significant positive effects in the long-term, the strength of positive effects will be dependent on the magnitude and speed of actual changes implemented by the Agricultural Reform.

Across the Agricultural Reform, most new measures are expected to slightly strengthen pre-existing positive environmental effects in relation to climate change adaptation. Some new measures, such as cross-compliance protections for peatlands and wetlands, are expected to deliver additional significant positive effects due to the role that peatlands and wetlands play in flood risk management. Most other schemes offer some benefits for climate change adaptation, associated with the promotion of land management practices that improve the capacity of farmland to withstand climate risks such as flooding and drought. However, in many cases the scale of change from pre-existing schemes is only expected to deliver minor change, associated with encouraging sustainable farming practices and continuing to deliver schemes such as AECS which provide direct opportunities for delivering climate adaptation measures.

Overall, the change being introduced by the Agricultural Reform is expected to deliver minor cumulative positive effects overall in relation to SEA objective 3b: Climate change adaptation, delivered in the medium to long term.

Air

Air quality is not specifically identified in the objectives of the Act however it is acknowledged within the Agricultural Reform strategic outcomes framework under ‘nature restoration’. Agriculture accounts for 90% of ammonia emissions in Scotland, which is a significant contributor to poor air quality and PM2.5 pollution. Reducing emissions will therefore support cleaner air, but changes are expected to be indirect and gradual. While the strategic vision for the Agricultural Reform could deliver significant positive effects in the long-term, the strength of positive effects will be dependent on the magnitude and speed of actual changes implemented by the Agricultural Reform.

Many of the scheme changes implemented by the Agricultural Reform encourage sustainable agricultural practices, promote nature restoration and reduce emissions. Effects identified under most of the Tiers are limited to a continuation or slight strengthening of minor positive effects. Many of these effects are indirect and associated with the delivery of positive effects for nature and climate, delivering local improvements in air quality, rather than air quality being the primary policy aim. Some schemes are expected to result in direct minor positive effects associated with encouragement of more efficient agricultural practices, reducing reliance on chemical pesticides and fertilisers, and mitigating greenhouse gas emissions, but which can bring about change in the short to medium term.

Overall, minor positive effects are expected to continue to be delivered for SEA objective 4: Air however the magnitude of change introduced by the Agricultural Reform is expected to deliver minor positive cumulative effects, with most impacts identified as being indirect and gradual, delivered in the medium to long term.

Soil

Soil health is identified as a key objective of the Act and is reflected in the Agricultural Reform’s strategic outcomes framework. Scotland’s soils store around 3,000 million tonnes of carbon so protecting and restoring these soils therefore helps to address broader significant environmental issues. Improvements in soil condition will take time, so positive effects identified for the Agricultural Reform are expected to be delivered in the medium to long term. While the strategic vision for the Agricultural Reform could deliver significant positive effects in the long-term, the strength of positive effects will be dependent on the magnitude and speed of actual changes implemented by the Agricultural Reform.

Measures such as the introduction of the Whole Farm Plan support a systematic approach to improving fertility, soil structure and carbon storage. New cross-compliance protections for peatlands and wetlands strengthen the conservation of carbon-rich soils and reduces erosion, degradation and nutrient loss. These Tier 1 measures will be applicable to a significant number of farms and a large proportion of Scotland’s land area, thereby delivering significant positive effects. The proposed review of Permanent Grassland requirements (Tier 2) could deliver significant positive effects due to their potential widespread applicability, helping to ensure more consistent and proactive protection and enhancement across over 4 million hectares of permanent grassland, should these measures be introduced. Other measures introduced by the Agricultural Reform are expected to deliver continued or slightly strengthened minor positive effects for soil health, quality and quantity by encouraging good practices that protects soils from erosion and degradation and continuing to deliver schemes such as AECS which provide opportunities for enhancement. These measures deliver positive effects in the short and longer term.

Overall, the measures being introduced by the Agricultural Reform, particularly associated with the widespread applicability Tiers 1 and 2, are expected to deliver significant positive cumulative effects overall for SEA objective 5: Soil, delivered in the medium to long term.

Water

Water quality is not specifically identified in the objectives of the Act however it is acknowledged within the Agricultural Reform strategic outcomes framework under ‘nature restoration’. 40% of Scottish surface water bodies are at risk of failing environmental targets due to diffuse pollution from agriculture. While the strategic vision for the Agricultural Reform has the potential to deliver significant positive effects for the water environment in the long-term, the strength of positive effects will be dependent on the magnitude and speed of actual changes implemented by the Agricultural Reform. Benefits for water are likely to emerge gradually as farming practices change.

The majority of scheme changes within the Agricultural Reform are expected to deliver a slight strengthening of minor positive effects for the water environment. Some measures, such as new protections for peatlands and wetlands (Tier 1) are expected to deliver significant positive effects associated with their strengthened protection and broad geographic coverage of applicability. Similarly, the proposed review of permanent grassland requirements (Tier 2) could reduce diffuse pollution, limit nutrient losses and protect riparian areas across a large area, delivering significant positive effects gradually across Scotland’s river catchments in the short, medium and longer term. However other Agricultural Reform measures are only expected to result in continued, or slightly strengthened, minor positive effects for the water environment. This includes continuing to deliver schemes such as AECS (Tier 3) and other more targeted support options.

Overall, the Agricultural Reform is expected to deliver positive effects for the water environment. However, the magnitude of change introduced by Agricultural Reform measures is expected to deliver minor positive cumulative effects for SEA objective 6: Water, delivered in the medium to long term.

Cultural heritage including architectural and archaeological heritage

Cultural heritage is not directly mentioned within the Act’s objectives or within the Agricultural Reform strategic outcomes framework. Agriculture is a key pressure on cultural heritage, with risks such as damage to buried archaeology, erosion around historic field systems, or impacts from land-use change. Scotland’s agricultural landscapes comprise many important designated and undesignated heritage assets. Designated assets are protected by other legislation however this leaves many undesignated assets vulnerable to loss and damage by agricultural activity. Future actions introduced by the Agricultural Reform may also have the potential to adversely affect cultural heritage assets due to its omission from the strategic objectives of the Agricultural Reform which will guide future measures. It also may miss opportunities to promote the positive management of heritage assets through agricultural practices.

Many of the effects identified for the changes introduced by the Agricultural Reform reflect continued pre-existing effects. Some strengthening of minor positive effects are identified, associated with the role sustainable practices can play in preserving traditional land-use patterns and schemes play in supporting crofting, which is a unique aspect of Scotland’s cultural heritage. Minor negative effects are also identified where agricultural practices may have adverse effects on heritage assets and landscapes. However, the majority of these effects remain a continuation of effects associated with pre-existing schemes, with no new policy measures introduced that directly promote the sustainable management of heritage assets within agricultural practice.

Overall, the cumulative effect of the change is negligible with regards to SEA objective 7: Cultural heritage, including archaeological and architectural heritage.

Landscape, seascape and townscape

Landscape is not a direct policy focus of the Act or the Agricultural Reform’s strategic outcomes framework. However, delivering positive outcomes for nature and climate deliver multifunctional benefits, including the protection and enhancement of the visual character of rural areas. The Agricultural Reform has impacts across the farmed landscape, which covers a large proportion of Scotland, so positive management practices that promote good land management, help restore habitats and support sustainable grazing will deliver widespread positive impacts. This includes for protected and valued landscapes. While the strategic vision for the Agricultural Reform has the potential to deliver significant positive effects for landscapes in the long-term, the delivery of positive effects will be dependent on the scale and speed of actual changes implemented by the Agricultural Reform. Benefits for landscape will likely emerge gradually as practices shift over time, however there is potential for positive landscape-scale effects due to the widespread applicability of the Agricultural Reform.

Changes introduced by the Agricultural Reform include measures which focus on support for climate mitigation, adaptation and nature restoration which will help support the resilience of Scotland’s landscapes. Across most changes introduced by the Agricultural Reform, a slight strengthening of positive effects is identified where schemes are considered to provide indirect landscape enhancement through improved land management and encouraging nature restoration. There is also potential for secondary benefits for landscape. For example, schemes which support soil quality, such as restoration of peatlands, as an integral part of Scotland’s landscape. In some cases, minor negative effects were identified associated with potential impacts of activities on the appearance and management of some landscapes. As with current schemes, the impact of changes introduced by the Agricultural Reform on landscape are expected to be indirect and realised over the medium to long term, as landscape improvements and ecological changes take time to manifest.

Overall, the changes introduced by the Agricultural Reform are expected to deliver minor positive cumulative effects for SEA objective 9: landscape, seascape and townscape, delivered in the medium to long term.

Material assets

Efficient use of resources through sustainable and regenerative practices is a key focus of the Act and is reflected in the Agricultural Reform’s strategic outcomes framework. Outcomes relating to food production, business profitability, and emissions reductions promote more efficient and sustainable use of land, inputs, and machinery. However, the Agricultural Reform interacts with the competing demands on Scotland’s land, which is a finite resource. While the ambition for adopting an integrated approach to sustainable land use is clear at strategic level, how this can be achieved in practice remains uncertain, meaning that outcomes for material assets may depend heavily on how future implementation of the Agricultural Reform is designed and delivered.

Several schemes are expected to deliver negligible effects, and many positive effects reflect a continuation of effects from previously existing schemes. In some cases, a slight strengthening of minor positive effect is identified. For example, implementation of the Whole Farm Plan (Tier 1) requires audits which will highlight inefficient use of resources across the business. However, they do not require corrective actions meaning benefits depend on voluntary follow-up management decisions and positive effects are limited. Other Agricultural Reform schemes promote measures which generally encourage less intensive farming practices and efficient use of resources, reducing waste. Minor negative effects are also identified where schemes are expected to impact land available for agricultural production or continue to support production systems with high demands on resources.

While minor mixed effects are identified for material assets overall, the changes introduced by the Agricultural Reform are not expected to result in significant change with regards to resource use and waste production. Overall negligible cumulative effects are identified for SEA objective 10: material assets as most effects introduced by the Agricultural Reform are expected to be minor.

Cross cutting policy proposals

In addition to the cumulative, secondary and synergistic effects identified from the change introduced by the Agricultural Reform, there are also strong interlinkages with cross cutting policy proposals. This includes the forthcoming Rural Support Plan which will support the delivery of the objectives of the Act, encourage sustainable land use practices, climate mitigation and adaptation, bring positive effects for biodiversity, flora and fauna, water and soils.

What measures could be put in place to avoid, reduce or manage the environmental effects of the Agricultural Reform?

The 2005 Act states that ‘the measures envisaged to prevent, reduce and as fully as possible offset any significant adverse effects on the environment of implementing the plan or programme’ are outlined within the Environmental Report. These measures are often referred to as mitigation measures. The following text summarises the mitigation measures identified from the assessment.

Agriculture and Rural Communities (Scotland) Act Objectives and Agricultural Reform Outcomes

There is opportunity to strengthen the positive effects of the Agricultural Reform by providing more detail within the Agricultural Reform objectives, setting a clear direction of travel across all the SEA topics. This may include:

• Expand the detail within objectives, ensuring key environmental issues (such as water quality, water scarcity, flood risk, ammonia emissions) are identified at a high level as strategic priorities to be fed through future programme reforms.
• There is no mention of the historic environment in the strategic outcomes of the Agricultural Reform. Its inclusion in the strategic objectives of Agricultural Reform will help ensure it is identified as priority to be considered in individual Agricultural Reform actions. Farming and land management play an important role in the protection of heritage assets and can help deliver the positive management of historic features.
• In addition to supporting agricultural businesses and helping to deliver a just transition, there is an opportunity to acknowledge the role of agriculture in conserving and enhancing the countryside and promoting responsible public access, thereby delivering positive effects for communities, health and wellbeing.

Alongside the Agricultural Reform:

• Ensure that the Code of Practice on Sustainable and Regenerative Agriculture is kept up to date and strengthened as a key mitigation and enhancement tool. It should provide clear detail on how to undertake the actions to achieve the most positive environmental benefits and make the best use of the land. This could include expanding sections on water quality, ammonia reduction, soil management, climate resilience, and cultural heritage. As a living document reviewed on a five-year cycle, it should reflect new science, industry feedback and monitoring evidence from Agricultural Reform delivery. Linking the Code more clearly to Whole Farm Plans, CPD modules and cross-compliance requirements would help embed best practice across all tiers of support.

Tier 1 (Base)

Whole Farm Plan

Requirements for the Whole Farm Plan were introduced in 2025 and have therefore been adopted. However, opportunities to enhance positive environmental effects include:

• Add water-management planning (usage, storage, drought planning).
• Bring the Nutrient Management Plan forward (not just “recommended” until 2028).
• Include a requirement for a soil health plan.
• Introduce specific ammonia-reduction measures such as covered slurry stores, low-emission slurry spreading equipment (e.g. trailing shoe or injection), and timing applications to avoid high temperatures.
• Require farms to include basic waste and resource efficiency measures in their plan, such as recycling farm plastics, re-using materials where possible, and improving fuel, fertiliser and water use efficiency.
• Link Whole Farm Plan requirements to existing GAEC/cross-compliance rules by including a basic check for historic environment features before farm works. Farmers could be incentivised to record and protect heritage assets on their land, with this information feeding into the Whole Farm Plan.
• Use audits to signpost appropriate action in other Tiers of the Agricultural Reform.
• Collect farm audit data for monitoring of delivery against Agricultural Reform outcomes and reward/incentivise delivery of Agricultural Reform outcomes by monitoring WFP outcomes.
• Phase in selected Tier 2 and 3 measures (such as habitat features or low-emission technologies) into Tier 1 from 2026 onwards, so that all farms begin to deliver more consistent and impactful environmental improvements in the short to medium term.

Scottish Suckler Beef Support Scheme

Requirements for the SBSSS were introduced in 2025 and have therefore been adopted. Through the assessment, a number of wider farm management improvements were noted. These are therefore more closely recognised as WFP recommendations, although originally emerged from the SSBSS assessment. Opportunities to enhance positive environmental effects include:

• Require SSBSS claimants to include a basic herd fertility plan in their Whole Farm Plan, to ensure improved herd management.
• Build on existing good practice in managing indoor calving areas by encouraging improved bedding, secure muck storage and runoff controls, as evidence [See reference 34] shows these measures reduce water pollution risks and improve animal welfare.
• Plan for water supply in dry summers.
• Promote good handling and calving area management (e.g. regular muck removal, well-drained surfaces, and sheltered calving pens where possible) to help reduce emissions and improve animal welfare.

Cross-compliance – new protections for peatlands and wetlands

New cross-compliance measures were introduced in 2025 and have therefore been adopted. However, opportunities to enhance positive environmental effects include:

• Strengthen grazing controls - including controls on stock, tracks and rutting on wet ground.
• Provide alternative watering points/mineral sites to protect peatland.
• Support small water storage outside peat areas (helps with drought).
• Require farms to have a basic wildfire plan and to check for historic environment features before carrying out peatland management or restoration on peatland.
• Provide a clear link to the Wildlife Management and Muirburn Bill when enacted to support cross compliance.

Scottish Upland Sheep Support Scheme

Through the assessment of SUSSS, a number of related farm management improvements were noted. Similar to the recommendations for SSBSS these are more closely recognised as WFP recommendations:

• Link payments under the WFP to basic grazing plans that set out herd/flock numbers, seasonal grazing patterns, and resting periods for sensitive pastures, helping to prevent overgrazing and protect soils, peat and biodiversity.
• Improve water supply and distribution on hills through WFP measures, so animals don’t impact springs in dry spells.
• Implement no-supplementary-feeding on peat requirement and wet-weather herding routes as part of WFP to protect peatland and soils.

Other

• Incorporate a small unit support package into Tier 1, helping small units manage the challenges they face with meeting the requirements of the Agricultural Reform. Allowing small units, such as crofting communities, to comply with a simpler set out rules may offer positive environmental effects, as a disproportionate amount of valued natural capital is located on small units.

Tier 2 (Enhanced)

EFA changes

• Provide guidance and advice to encourage farmers to choose EFA options with the greatest environmental benefits for their system (for example, field margins, fallow, low input grassland), while recognising that final choices remain with the farmer.
• Ensure clarity to farmers in fertiliser rules across different EFA types (fallow, margins, hedges, nitrogen-fixing crops, catch crops) to ensure consistent nutrient management and avoid unintended emissions.
• Consider adding EFA options that provide wider resilience benefits (e.g. riparian shade, small ponds), which support biodiversity and water quality, with potential co-benefits for drought resilience in line with Scotland’s National Water Scarcity Plan [See reference 35]
• Ban fertiliser/manure use on EFAs to help cut ammonia emissions.
• Make sure new features such as hedges, margins or ponds are designed and located so that they avoid harm to heritage assets or the character of historic environments.
• Support knowledge and information sharing with farmers on the historic environment to ensure that new EFA features (such as hedges, margins or ponds) are designed and located to avoid damaging designated heritage assets, while still delivering biodiversity and climate benefits.

Permanent grassland requirements

• Strengthen rules on stocking and poaching to protect soils and water.
• Promote the appropriate and effective planting of diverse grass and clover mixes, including native and deep-rooting species, to help enhance carbon sequestration, air quality and drought resilience.

Less Favoured Areas Support Scheme

• Tie support more clearly to basic grazing and nutrient plans to mitigate negative effects on local soils and water.
• Encourage riparian buffers, peat protection and hill-slope planting to support climate, water and biodiversity.
• Add light-touch nutrient requirements to address ammonia.

Tier 3 (Elective)

• Increase budget weighting in favour of Tier 3 activities.

AECS, Future Farming Investment Scheme, other targeted capital support and Innovation pilot and landscape-scale collaboration pilot

• Opportunity to better integrate protection of the historic environment landscape into AECS, grant funding and future pilot schemes. For example, prioritising funding of proposals which have complementary benefits for the natural and historic environment (e.g. proposals addressing removal of scheduled monuments from ploughing, control of soil erosion over historic assets, etc.); and support for repair/re-use of traditional and historic buildings, repair and retention of traditional and historic routeways, field boundaries and landscape features.
• Opportunity to integrate management or enhancement of recreational access into AECS, grant funding and future pilot schemes. While not aligned with the outcomes/objectives of the Agricultural Reform, recreational access to the countryside is important in delivering benefits for local communities, health and wellbeing, access to nature, and enhancement of cultural heritage and landscape assets, and should be considered within the measures implemented within the Agricultural Reform.
• Similarly, future capital funding schemes should aim to align and take in all SEA criteria.

Forestry Grant Scheme

• Encourage riparian planting and shelterbelts.
• Prioritise woodland in riparian zones and flow pathways to provide shade, reduce run-off and support water retention in summer.
• Use tree belts/shelterbelts near livestock areas to help capture ammonia and particulates.
• Support measures to reduce deer impacts, helping to protect regenerating woodlands and biodiversity.
• Incentivise green technology and sustainable forestry supply chains to strengthen rural development benefits.
• Increase support for the sustainable management of existing forests, ensuring they deliver a wider range of climate, nature and community benefits.

Innovative and landscape-scale collaboration pilot

• Ensure schemes are developed with the widest possible reach.

Tier 4 (Complementary)

Improved AKIS and integrated CPD system

• The magnitude of positive effects in relation to Tier 4 will be dependent on the specific structure, content and requirements of the new integrated AKIS and CPD system. While the model is expected to align with the Agricultural Reform objectives, training, access to data and CPD should ensure they are focused on key issues across all of the SEA topics (for example, including positive management of heritage assets, water use efficiency, etc.)
• CPD system should be inclusive and accessible to all, reaching a wide audience. This should include targeted actions and support hard to reach crofters and farmers, varied levels of digital connectivity, IT access, learning styles and demographics.

What monitoring is proposed?

Monitoring significant environmental effects is a statutory requirement within the 2005 Act. Monitoring seeks to ensure that plans avoid generating unforeseen adverse environmental effects and enables the responsible authority to undertake appropriate remedial action.

An Agricultural Reform monitoring and evaluation framework is under development by Rural and Environment Science and Analytical Services Division (RESAS). It will set out how the programme intends to monitor and evaluate actions taken by the Scottish Government through Agricultural Reform to meet outcomes.

The approach to developing the monitoring and evaluation framework for the Agricultural Reform is grounded in the requirements of the Agricultural and Rural Communities (Scotland) Act 2024. The Agricultural Reform’s strategic outcomes framework forms the backbone of the emerging monitoring and evaluation approach in assessing the overall effectiveness of the programme and potential learning. The proposed approach will create a suite of metrics and indicators assigned to the outcomes in order to link modelling results to outcomes which will allow them to be quantified. This will include alignment, where possible, to National Performance Framework (NPF) indicators.

Until a new M&E framework is developed, the Scottish Government will continue to use existing CAP metrics to monitor the Agricultural Reform.

The development of a new M&E framework offers key opportunities to incorporate the monitoring of unforeseen environmental effects. As the Scottish Government develops the detail of the Agricultural Reform monitoring, this should reflect environmental indicators which reflect the SEA topics. This should include measures that are not currently reflected in the Agricultural Reform strategic outcomes framework, such as cultural heritage. The proposals for monitoring will be addressed and further outlined within the post adoption statement at the end of the SEA process.

How can I comment on this Environmental Report

Consultation responses to the Environmental Report can be submitted via email to: ARPEngage@gov.scot or by post to: James Muldoon, D Spur, Saughton House, Broomhouse Drive, Edinburgh, EH11 3XD.