Jeremy's Blog 23rd February 2024: Support for Farming as a Business

This article by Jeremy Moody first appeared in the CAAV e-Briefing of 22nd February 2024

The Government went in strength to this week’s NFU AGM: the first Prime Minister’s visit for 16 years as well as the new Secretary of State, Steve Barclay, and Farming Minister Mark Spencer. Always an occasion for announcements, more were made than usual, fleshing out policy development and schemes. Following Steve Barclay’s speech to the Oxford Farming Conference, the theme for England is now strongly of farming as a business. This year’s decisions on support are focussed on productivity, business residence and trade. The environmental policies and demanding targets, of course, continue.

There may not have been new money and some schemes are already announced but, with the halving and more by 2024 of what was Basic Payment, the synthesis of how the £427 million of grants for 2024/25 is allocated sends a message. The language around business and the focus on it matter.

The Oxford speech saw modern farming techniques added to SFI in conjunction with its environmental offers. This week’s announcements develop a blend of promoting business productivity and answering environmental challenges that is necessary if we are to manage the transition to producing more from less. Recognising the place of business in this is an important signal.

As one part of answering our productivity challenge, the announcements pull several strands of work together for modernising innovation, reacting to risk and supporting public goods:

• £70 million for an expanded Farming Equipment and Technology Fund, with applicants able to apply for combinations of productivity aid, slurry equipment and animal health work.
• £70 million for the Farming Innovation Programme for innovation with research and development.
• £50 million for the Improving Farming Productivity Fund for
• robotics and automation for modern techniques and potential assistance with labour issues
• farm rooftop solar projects creating on-farm energy resilience.
• £15 million for Water Management Grants for projects assisting the critical water issues of climate change such as on-farm reservoirs and works to improve irrigation.
• £116 million on the Slurry Infrastructure Grant Scheme, now much increased from initial plans to assist nutrient management as well as water and air quality.
• £91 million on the Animal Health and Welfare Pathway where welfare is a public good but animal health a key to productivity.
• £15 million was announced for IDBs flood measures.

This month’s second and tenth anniversaries of Russia’s invasions of Ukraine emphasise the importance of improved productivity and resilience to the concern for food security. They are also the necessary complements to environmental policies and response to climate change with its extreme weathers challenging food production across the world. However, domestic production cannot be the only answer any more than it was in 1940, whether for volume or spreading risk. The support for exports recognises that policy must also include trade.

The business-focused announcements went further than food production, enlarging the Oxford’s speech’s references to greater permitted development rights. Following last year’s consultation, greater freedom to convert buildings to commercial use, and perhaps more, are to come from April. Such relaxations can strengthen farm businesses, multiplying income sources, and give opportunities to the wider rural economy.

Though language may have shifted over time, England’s post-Brexit policies have been strikingly consistent: for the activity of farming to be a business making decisions based on markets not direct payments but re-using the ex-CAP money to support productivity and buy public goods. The intended policy transition from BPS has now effectively happened in just three years; the business transition is now underway. It is worth looking positively at what these grants offer for assistance now, in adapting to the changing future and to be ready for when some are replaced by regulation.