Labour’s proposal to loosen planning regulations for farmers will deluge rivers with chicken faeces, environmental campaigners have warned.

The environment secretary, Steve Reed, promised farmers on Thursday they would be able to build larger chicken sheds, but experts have said this would create “megafarms” and contribute to river pollution.

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Speaking at the annual Oxford Farming Conference, Reed was attempting to rebuild confidence with farmers after widespread anger over changes to inheritance tax and cuts to subsidies. A small protest formed outside the Examination Schools in Oxford where he was speaking and tractor horns partially drowned out his speech.

Reed said: “Planning rules have got in the way for too long. We will speed up the system so you can grow and diversify your farm business, such as chicken producers who need a larger shed to increase the amount of food they produce.”

Craig Bennett, the chief executive of the Wildlife Trusts, said the plans would result in more chicken waste in the UK’s rivers. He said: “The last thing we need in parts of the country like the River Wye is yet more chicken sheds to result in yet more chicken shit going into our rivers, causing yet more pollution. While all of us want to make it easier for farmers to make a decent living out of producing good quality food, we don’t need yet more of a particular form of polluting farming.”

Chicken production has boomed in England in recent years, and has been blamed for the ecological death of rivers including the River Wye. This is because the large sheds full of chickens produce a huge amount of faecal waste, which is spread on the land and leaks into rivers when it rains. This causes problems for wildlife as the excess nutrients from chicken waste cause the growth of algae and vegetation, which chokes out other life in the rivers.

The Guardian recently revealed more than 51m chickens were being industrially farmed in the river valleys of the Severn and Wye – the equivalent of 79 chickens for every person in the region.

David Walsh, the head of public affairs at WWF-UK, said: “Intensive poultry production, such as with megafarms, are one of the leading causes of river pollution from the Wye to Norfolk. Simplifying planning rules without increasing the resources of environmental regulators would be a recipe for disaster. More intensively re ared, low-quality meat fed on imported soy would be at odds with our global environmental commitments to cut emissions and end the UK’s contribution to deforestation overseas.”

Anthony Field, the head of Compassion in World Farming UK, said: “This is an extremely worrying announcement. Rather than relaxing planning rules, the government should be tightening them up, to stop the spread of industrial farming.”

Reed also apologised for the handling of inheritance tax changes brought in at the budget which mean many farmers will be taxed on their assets after death for the first time in decades. The changes caused huge protests, including one in Westminster featuring at least 10,000 farmers.

He said: “We were shocked by the size of the financial black hole [left by the previous government] and I’m sorry some of the actions we had to take shocked you in return.” But, he added, “the tax policy was announced in the budget and it stands”.

Reed said farmers do not make enough money from their food – figures show many are making a 0.5% return on their assets and that the average farmer’s income is about £30,000 a year. Reed said: “Right now too many farmers do not make enough money for the food they produce. We will act on supply chain fairness so food producers and growers are not forced to accept unfair contracts.”

The National Farmers’ Union president, Tom Bradshaw, said these proposals did not go anywhere near far enough and farmer confidence in the government had been lost.

He said: “I think [the government] needs to rapidly recognise that this situation could spiral and that they really should sit down around the table. So the chancellor is who we need to speak to, and so far, she’s refused to engage.”

Bradshaw added that Reed “has to regain the confidence of farmers” and said that if the government did not spend the nature friendly farming budget to make up for the subsidy cuts, “we’ll be asking serious questions about whether we have confidence in Defra as a department”.