More help needed for small businesses

By Olivia Cooper

 THE GOVERNMENT is not doing enough to help small and family farms survive in the wake of CAP reform, according to an influential cross-party group of MPs.

The Committee of Public Accounts will today tell DEFRA that it must do more to support small- and medium-sized farms and strengthen rural communities. In its 12th report, obtained by farmers weekly, the committee said that DEFRA would spend 250m on support measures between 2000 and 2006, much of which could be better targeted.

“It needs to direct more of this support at those small- and medium-sized farm businesses – essentially, family farms – that need it most,” said chairman Edward Leigh. “This will help strengthen rural communities and provide consumers with a wider range of the foods they actually want to buy.”

To date, DEFRA had largely relied on capital grants to help farmers, said Mr Leigh. “DEFRA”s own evaluations suggest these grants are of questionable value.” Instead, it should offer better advice and assistance, including loan guarantees, to help farmers diversify and connect with the marketplace.

DEFRA also needed to help farmers focus on the supply chain and form local co-operatives, said Mr Leigh. “Farm businesses need help to survive in this new market-led environment. DEFRA should make it simpler for farmers to get support by reducing the number of programmes and streamlining the application process.”

 The department was wasting almost half of scheme funding on running costs in some cases, said the report. Simpler schemes and better use of IT should help to reduce costs by 40%, it added. It was also essential that farmers had a greater say in the design and running of development schemes.

 “Over the next few years, the department will need to establish a new set of farm business support measures for the period 2007-2013. This will provide a significant opportunity for the department to implement the committee”s recommendations.”

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