Smaller farms will be prioritised for nature funding, the environment secretary is to announce, in a shake-up of post-EU nature subsidies.

Emma Reynolds is expected to tell the Oxford Farming Conference on Thursday that in June an application window for the Sustainable Farming Incentive (SFI) will be opened solely for smaller farms and new entrants to the scheme, with larger farms only allowed to apply from September.

The SFI is part of a package of payments that replaced the EU’s common agricultural policy and paid land managers for the amount of land in their care, with the aim of paying farmers to look after nature, soil and other public goods, rather than simply for farming and owning land. The common agricultural policy payments and their successors have often been what has kept farms profitable during inflationary pressures and extreme weather events such as floods and droughts.

The money for the SFI is limited, meaning that when enough applications for it come in, the scheme is closed. Farmers were outraged when the scheme was abruptly shut in March last year and it later emerged that 3,000 farms had been wrongly blocked from applying after the money ran out.

Reynolds is expected to say in her speech: “Farmers are at the heart of our national life – for what you produce, the communities you sustain, and the landscapes and heritage you protect.

“We will work with you – through our new Farming and Food Partnership Board, through peer-to-peer networks, through community-led change, and through engagement on the detailed changes to SFI.

“You will have the certainty you need to plan – clear budgets, clear timelines, clear future roadmap, and growth built on strong foundations.”

Defra has been making the case to the Treasury that the nature schemes are good value for money, and not subsidising rich landowners, in order to keep the budget untouched during difficult economic times. During the spending review last year, the budget was slashed by £100m.

The Guardian revealed last year that ministers were looking at how the dwindling funding pot could be reserved for those farms which are less profitable, with plans to cut richer farms from the scheme.

The Country Land and Business Association president, Gavin Lane, said: “It is essential that all farmers can access the Sustainable Farming Incentive scheme as soon as possible, regardless of farm type or size, to deliver the greatest benefits to the environment.”

Martin Lines, the chief executive of the Nature Friendly Farming Network, said: “It’s good to finally have some clarity, even if June still feels a long way off. We particularly welcome the commitment to prioritise smaller farms. Too often in the past, England’s agri-environment schemes have been a race to be first over the line, favouring those with the time and money to navigate complex applications. Many smaller, highly active farms are working flat out and simply don’t have the capacity to play that game.

“We’ve long advocated for a reward system that properly reflects the real public value delivered by smaller production systems. It’s encouraging to see government recognising the role of small farms in supporting social cohesion, keeping people on the land, and ensuring public money for public goods genuinely rewards those systems.”