The new agricultural and horticultural levy board, and its sector companies, will be located at the Royal Show showground, Stoneleigh, Warwickshire from April 2009, it was announced this week.
It was also announced that the new board’s name will be the Agriculture and Horticulture Development Board (AHDB).
The decision to move to purpose-built facilities at Stoneleigh, rather than take over an existing site belonging to one of the current levy boards, was the result of a cost-benefit analysis, chair designate of AHDB John Bridge explained.
“We did consider the Meat & Livestock Commission’s offices at Milton Keynes – the only site held by a levy board that was suitable for our needs – but Stoneleigh offered a better deal for levy payers.”
He said an investment appraisal performed by consultants Accenture demonstrated a Net Present Value of £12.7m over five years for Stoneleigh compared to £12.4m for Milton Keynes.
“This saving of almost half a million pounds per annum can be ploughed back in to front-line services for levy payers,” he said.
The future of the MLC’s office is yet to be decided, but it is likely it will be sold with vacant possession after the move to Stoneleigh is completed.
He added that more detailed accounts performed by Accenture estimated the total savings from merging the levy boards would be in the region of £3.4m per year – about £2.5m per year more than originally envisaged by Rosemary Radcliffe in her levy board review of 2005.
It is anticipated that there will be 176 redundancies.
NFU president Peter Kendall welcomed the news. “It is an enormous benefit that the sector companies will be able to work together in many areas, creating synergies and increasing efficiencies.
“While the move will inevitably cause some disruption, it is the right decision for the future. This is a very visible indication of a fresh start.”
* Confusion over the VAT status of the new Board has been resolved. Levies will in future be subject to VAT, allowing the Board to reclaim VAT on its purchases, potentially saving it £6m a year. All VAT-registered farmers will be able to reclaim the VAT on their levies.