Farming Investment Fund – good news for the environment?
Esther Woolford, Partner and Head of Agriculture comments on the recently launched Farming Investment Fund (the FII).
Spilt into two parts, the Farming Equipment and Technology Fund and the Farming Transformation Fund, the FII is designed to provide grants to farmers, foresters and growers to invest in items to enhance the natural environment and improve productivity. At face value, its launch is welcome news for the agriculture sector.
Following consultation with the sector, the Farming Equipment and Technology Fund is based on the previous small productivity grants scheme but with a number of important additions. The size of grants has changed to a lower threshold of £2,000 and a higher ceiling of £25,000 whilst the items on the list have increased from 85 to 120.
Further changes include the addition of agricultural contractors to the list of eligible funding applicants and an offer for farmers to upgrade their slurry management systems. From an environmental perspective, the ability to apply for support to improve slurry management, as well as grants for additional infrastructure and equipment in later rounds of the fund, is most welcome.
The second part of the wider FII focuses on transformational activities in water management. Targeted at both horticultural and arable businesses which either grow or intend to grow irrigated food crops, ornamentals or forestry nurseries, it will provide grants ranging from £35,000 to £500,000 to improve irrigation productivity and efficiency.
The total FII pot of £27 million, may only benefit a limited number of agricultural businesses and whilst there are other funding opportunities with an agricultural focus, the sector is facing significant pressure to improve productivity and efficiency, particularly in the wake of a challenging recruitment market, rising costs and continuing tight margins, not to mention environmental improvements.
The UK has committed to ambitious net zero targets and rightly so. The agricultural sector has had a long history of innovation by rising to the challenges of the day and environmental considerations are high on many a farmer’s agenda. The NFU has pledged to achieve net zero in the industry by 2040, some ten years earlier than targeted by the government. Further significant investment is needed to assist the industry in other low carbon solutions and opportunities with further consideration given to supporting the rural economy in improving the environment and reducing its carbon footprint through continued diversification and utilisation of new technology. The FII does provide support and should be seen as another welcome, albeit small stepping stone to improving productivity, efficiency and the environment.
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