Smaller farms require more help to diversify

20 July 2001

Smaller farms require more help to diversify

MORE help should be given to smaller farm businesses that need to diversify to improve their incomes, says ADAS consultant Andrew Fraser.

The Rural Enterprise Scheme – the main instrument through which grant aid for farm diversification projects is channelled – is a complex process, says Mr Fraser.

"The main problem is the detail needed in putting a business proposal together.

"To the governments credit, the scheme is very flexible and covers a huge range of projects. However, the onus is very much on the farmer to put a strong case forward, ensuring his strategy fits the regional one.

"There are more than seven pages of guidance notes telling applicants what should be included, while other feasibility and market research may also have to be carried out."

Few farmers have the time and expertise to put such a detailed proposal together, says Mr Fraser. But enlisting the help of specialists typically produces bills of £2000-£5000 a time.

"Farmers with larger units, who can dedicate the necessary resources, will continue to take up the grants. But smaller farmers, who may need a new business to survive, may not.

"The government should put more money on the table to help these people put their proposals together."

Applications should also be speeded up, says Mr Fraser. "It can take six months to get a decision. Farmers need to know more quickly so they can get their projects up and running as soon as possible."

However, Mr Fraser warns that farmers should think carefully before making the move. "They must want to diversify. If they need to, they are doing so for the wrong reasons. Business strength is vital."

In the wrong hands, diversification can detract from the main farming business, and can impact on family life.

"Farms are busy enough places as it is. Get it wrong and diversification can take 80% of the time yet make just 20% of income," says Mr Fraser.

"And many new businesses can introduce volatility which farmers have not traditionally been exposed to. They must be willing to learn new skills." &#42

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