With stark differences between the Conservative and Labour manifesto pledges for UK Agriculture and indeed approaches towards Brexit negotiations, it’s not clear at this stage what, if any, a change of political direction from a hung parliament could mean for a British or Domestic Agricultural Policy.
However, what we do know and can speculate with some degree of certainty, is that uncertainty will damage the strength of sterling – which overall is probably good news for Agriculture – making imports more expensive and boosting our competitive ability to export and supply our domestic market with UK product. Yes imported Ag inputs and Ag machinery costs may rise as a result; but if we are all focused on our farm outputs being of greater value than inputs within our farm businesses; this should be a net gain for UK NFI.
Interest rates remaining low and weak sterling are an opportunity for UK agriculture to invest in projects and equipment/enterprises to boost productivity, improve efficiency and diversify (where location and skills allow) from pure ag production revenues and become less reliant on BPS support. There are and we predict will remain, a flurry of grant aid opportunities around the general framework of efficiency improvements, innovation, diversification, tourism, adding value to farm gate production, skills training and employment creation. Combined with next generation planning and strategy for the longer term business sustainability without BPS; we suggest these are all areas that every farm business should be looking at hard at present – whatever the government. The environment will feature high on any new Domestic Ag policy for the UK, and the direction of travel is likely, in our view, to lead to greater Stewardship funding in the future (at the expense of BPS) and so the remaining window of opportunity for the September Stewardship applications under the current scheme should be taken where applicable.
Our message for the new government and perhaps the opportunity of a more inclusive debate around the terms of a Brexit deal will be:
•Remain within the Single Market and Customs Union – to maintain trade and export market access;
•Provide an access system to a seasonal agricultural labour market;
•Support British Business and British Farming - to grow more, sell more and export more – as per the Tory pledge; export market creation incentives and assistance, but at a trade, not a bureaucracy level;
•Enhance a workable Environmental Stewardship programme that is workable at farm level and delivers benefit to the environment with proper compensation for lost production capacity;
•Provide stimulus for capital investment including writing down allowances for efficiency improvements such as infrastructure, buildings and reservoirs (non-of which are currently deductible to income tax)
•Provide incentives for science and agriculture linkage at a commercial level – to stimulate adoption of scientific improvement and innovation.
•Maintain ongoing improvement in the Planning process to facilitate investment, commercial and residential development (including in fill) and employment creation in rural areas;
•Maintain the Defra Growth Programme grant funding and focus on a more straight forward application and approval process that encourages commercial engagement and grant delivery and cuts bureaucracy from the process.
Grant opportunities are still available to British farmers, giving your business the ability to fund projects to develop your business and make your farm fit for the future. If you would like to discuss the opportunities that are available to your business, then do not hesitate to contact your local Brown & Co team.
The team at Brown&Co can assist on all fronts with individual farm businesses large and small. Whatever the flavour of our Government, prioritising a plan and progress for individual farm businesses and their proprietors, whether tenants or landlords, large or small, stock or arable, is what we do – day in day out, and our rural consultancy team are here to help on all fronts.