8pgs, On the 23rd June 2016, the UK referendum on European Union (EU) membership resulted in a vote to leave the EU. This departure, should it occur, would see the implementation of a new agricultural policy within the UK which will most likely see the removal of direct financial support to farmers. In this study, we use combined agricultural survey and rural payments data to evaluate the extent of reliance upon Pillar 1 payments, based on a sample of 24,492 (i.e. 70%) of farm holdings in Wales. This approach eliminates some of the variation found in the Farm Business Survey through the delivery of a more comprehensive picture on the numbers and types of farm holding potentially facing economic hardship and the quantities of land and livestock associated with those holdings. We estimate ˜34% of our sampled Welsh farm holdings face serious financial difficulties and show ˜44% of agricultural land on sampled farm holdings in Wales being vulnerable to land use change or abandonment. Based on our results, we consider the potential social and ecological impacts that the removal of direct payments may have on land use in Wales. We also discuss the use of a more balanced approach to land management that could support governmental visions to keep farmers on the land, improve productivity and deliver high quality ‘Public Goods’.
