Topics

Archive

29 January 2018

King West

Common Agricultural Policy Uncertainty Post-Brexit: Is Farm Diversification the Answer?

Common Agricultural Policy Uncertainty Post-Brexit: Is Farm Diversification the Answer? 

Since the EU referendum and subsequent announcement that the UK would be leaving the European Union, farmers have been concerned for how their subsidies will be affected in the future. The UK will soon no longer form part of the EU’s Common Agricultural Policy (CAP), which provides subsidies to many of Britain’s farmers. This poses concern for many as to what the future will hold for their finances.

One potential solution for farmers seeking to secure their incomes going forward is farm diversification. At current, around 62% of farmers in the UK have at least one form of diversification business and this could generate a greater proportion of farmers’ incomes in the future, thus negating the current dependence on existing subsidies, the future of which remains uncertain.

There is said to be a lucrative market for farmers within the tourism and hospitality industries, with many converting old and unused farm buildings into commercial or holiday lets. Full planning would most likely be required in the conversion of existing buildings for alternative purposes, but the rules regarding this are said to have been relaxed and should support feasible, sustainable proposals.

Any farmers looking into diversification should first construct a business and financial overview before undergoing any project. It would also be advised to conduct a market analysis on the newly chosen market and the existing competition within it, in order to ascertain the actual business potential of the project. It will be vital to undertake a sufficient appraisal of the market, including the formation and implementation of set objectives and timelines, to ensure a successful venture.

Finance can be of significant concern when undergoing a diversification project. However, grants of up to 40% are available from Rural Development for England through LEADER funding or the RDPE Growth Programme. This can lower the financial burden of diversification and means that direct costs can be lessened for certain projects.

Farmers looking at diversification will need to approach lenders in pursuit of competitive offers, keeping in mind both their own borrowing capabilities and the fact that a sole trader, partnership or limited company status may be more suited for specific enterprises.

For those requiring assistance with their farm diversification venture, King West is able to offer support with everything from planning permissions to applications for funding through schemes like the RDPE Growth Programme. Those seeking advice should, in the first instance, call King West on 01858 435970, or email; hepsom@kingwest.co.uk

 

 

 

 

 

 

 

 

 

 

Our website uses cookies so that we can provide a better browsing experience. Continue to use the site as normal if you're happy with this, or find out how to manage cookies

Accept