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Embracing positivity for the year ahead

Mon 6 January 2020

We close the door on 2019 and enter 2020 with the hope of a stable UK Government and finally leaving the European Union. Without trying to sound cynical, the year ahead is, again, likely to be dominated by short-term uncertainty which will affect many of our business decisions. However, it is simply down to you as to whether you positively embrace this period, and use it wisely, to ensure your business is prepared for change…

What is going to change?

Financial support from the government is likely to change which will affect the Basic Payment Scheme (BPS) as we know it; the most likely move is to an environmentally focussed system along the lines of the Environmental Land Management Scheme (ELMS) which was proposed within the Agriculture Bill to take affect in 2021. It is expected that landowners will be paid for providing “public goods” with a focus placed on issues such as soil and water management, public access to the countryside and environmental improvement.

With this in mind, we suggest starting off 2020 by applying a brutal test to your farm budgets, removing direct subsidy payments entirely. Will your business be able to cope with the changes anticipated in 2021? If not, what changes can you make in other areas of your business in order to make up, or even increase, the difference?  

Taking advantage of current opportunities

Can you see opportunity in other areas of your business? Now is the time to take advantage of the available grants that provide financial incentives to carry out work or to develop rural businesses as the UK government has guaranteed the ongoing funding of all grant agreements entered into prior to 31 December 2020.

The Rural Growth Programme reopened in November 2019, with a deadline for expressions of interest of 16 February 2019. This grant offers a total of £35 million of funding to small rural businesses for new projects which will create jobs and growth in the rural economy such as farm diversification. The Programme offers grants of a minimum of £20,000 – allowing smaller and micro-business projects to benefit too.

We are also expecting another round of the Countryside Productivity Small Grant Scheme (CPSGS) to open next year. In previous rounds, this scheme has offered grants to farmers to purchase new pieces of equipment for livestock and arable sectors.  

The Countryside Stewardship Scheme (CSS) offers opportunities to benefit from a guaranteed source of income whilst also providing environmental benefits. One off capital grants are available as part of this scheme for items such as hedgerow gapping up, stone wall restoration, woodland creation and works to improve water quality. In addition, some farmers with existing entry level and higher-level stewardship agreements due to terminate this year may be offered extensions to their existing agreements, providing a simple option to continue receiving this source of income. We will release further updates throughout 2020 as the various application windows open.

Planning for the Future

Now is also good time to start succession planning, or at least long-term planning for your business. This can be a seen as a sensitive topic, but one which is intended to bring with it new opportunities for growth whilst also protecting the future viability of your business.

Whilst we enter a period of change, bringing with it uncertainty, it is clear that there are schemes to take advantage  of and actions you can put in motion to ensure that your rural business is in the best possible condition to enter into the new agricultural world.

To discuss your farm or rural business development plans, or for advice on testing your business resilience, please get in touch with Joanne Metcalfe on joanne.metcalfe@youngsrps.com or by calling 01740 622 100.