Environmental sustainability: Transforming the United Kingdom’s agricultural sector

Have agri-environment schemes simultaneously achieved their sustainability objectives and improved the agro-sector? The study assessed the impact of agri-environment schemes on the value of agricultural production in the United Kingdom. It used the autoregressive distributed lag – error correction model considering structural breaks. The data used were a 1990-2023 annual time series of agri-environment scheme coverage, value of agricultural production, agricultural producer price index, total factor productivity index, value of agricultural exports and agricultural nitrous oxide, methane, carbon dioxide and ammonia emissions. The results showed short and long-run relationships between the variables, with speed of adjustment of 0.17 and 0.23 for agri-environment scheme coverage, 0.79 and 0.83 for value of agricultural production, and 0.83 and0.94 for value of agricultural exports. The study showed the possibility of quantifying the impact of agri-environmental schemes, the context in which they counter greenhouse gas emissions and the overall effects on agricultural production and trade. The study concluded that there exists short and long-run relationship between the agri-environment scheme coverage, the value of agriculture and agricultural exports. There was a shorter response to shock for agri-environment scheme coverage compared to the value of agriculture and agricultural exports, respectively. It is recommended that farmers should be incentivized to participate in the schemes, that the mix of the schemes should reflect the realities of the farmers and that the schemes should be flexible and holistic to take account of production and market dynamics.