Facebook Twitter Instagram
    • FREE Email Newsletters
    • About Us
    • Advertise
    • Contact Us
    • Magazine Subscriptions
    •  
    Twitter LinkedIn
    Podcast
    Farm Contractor & Large Scale Farmer
    • News
      • Arable & Agronomy
      • Dealership News
      • Environmental Land Management Scheme/Policy
      • Event News
      • Health & Safety
      • Machinery
      • People
      • World News
    • Farm Machinery
      • Amenity & Maintenance
      • Cultivations
      • Drilling
      • Grassland Equipment
      • Harvesting
      • Muck & Slurry
      • Sprayers
      • Telehandlers
      • Tractors
      • Tractor of the Year
      • Tyres & Tracks
    • Precision Farming
    • Markets & Policy
    • Profiles
      • Company Profiles
      • Reader Profiles
    • Livestock
      • Beef
      • Dairy
      • Sheep
    • Podcast
    • Events
    Farm Contractor & Large Scale Farmer
    Markets & Policy

    Half of farmers could face ruin from subsidy cuts, warns business specialists

    Matthew TiltBy Matthew TiltOctober 25, 20214 Mins Read
    Facebook Twitter LinkedIn Email
    Cashflow,-,Cube,With,Letters,,Money,Sector,Terms,-,Sign

    Rural business experts are warning that up to half of farmers could see their profits wiped out within three years as subsidies are reduced unless they take action soon. Under pressure growers and landowners are being urged to seek immediate help to weather the cuts.

    Victoria Ivinson, head of the agricultural team with tax and accountancy firm Douglas Home & Co, said: “For many farmers, these subsidy payments prop up the business. Our estimate is that at least 50% of farmers could see their profit wiped out. While most may break even, many will be running at a loss once the subsidies are cut.

    “That is a horrifying prospect. At the moment, this money is essential to help them smooth out the challenges posed by major weather events, fluctuations in yields and grain prices and many other unpredictable variables.”

    The firm’s assessment is based on decades of experience within the rural sector, with more than 1,000 of its 3,100 clients operating as rural businesses. As part of Brexit, the Basic Payment Scheme is being phased out between 2021 and 2028, meaning that farmers could lose between 50-70% of their subsidy by 2024. Deeper cuts and further changes will also continue beyond 2024.

    Ms Ivinson, whose husband is a beef and sheep farmer in Penrith, Cumbria added: “We are entering a decade of massive change across farming and the rural economy. Brexit, climate change and major labour shortages are already causing sleepless nights.

    “Yet subsidy cuts are an even bigger threat to survival, particularly for those with no other income stream or alternative financial support. Frankly, some farmers are terrified.”

    She said that many farmers are overawed by the complexity of the replacement system, which has not yet been fully fleshed out or explained by the government. Regulations also differ slightly between Scotland and England, although all UK farmers face a similar prospect.

    Another issue is that many are unaware of which parts of their business are profitable and which are not. Ms Ivinson’s team has therefore drawn up a three-step plan to help farmers make the difficult decisions needed for survival.

    She added: “We can help farmers to get in front of this now. By facing up to difficult questions, making proactive changes and planning ahead, they can secure their farming future. The hits will keep on coming as environmental regulations ramp up – getting fit for purpose now is essential.”

    Victoria-Ivinson
    Victoria Ivinson is a rural and farming expert with accountancy firm and tax specialist, Douglas Home & Co.

    The three-step plan was presented at two Future of Farming events, alongside the Cumbria Farmer Network in Penrith and Kendal during August.

    Step one sees Douglas Home & Co’s agricultural team helping farmers understand their numbers, like labour costs and profit and loss across different aspects of the business. This allows farmers to understand the profitability of each individual farm enterprise.

    Step two involves carefully assessing ways for struggling farms to bridge the income gap. However, step three is the most crucial part, as the team can help farmers discuss how to adapt particular enterprises so they are more profitable, or can suggest proactive diversification opportunities which will broaden the number of income streams to the business.

    Ms Ivinson added: “It can be challenging to change long-standing farming practices, particularly for those who are passionate about traditional methods. In some cases, farmers may need to move away from old enterprises and embrace a new farming mix. However, this ability to adapt and change can help a business survive during such uncertain times.

    “Starting now is vital because this is just the tip of the iceberg. We are in the midst of a climate emergency which means more Government regulation is coming. Acting now could help farmers reduce the sting for years, if not decades to come.”

    For more information go to www.douglashomeandco.co.uk

    Tweet
    Share
    Share
    Pin
    Share. Facebook Twitter LinkedIn Email
    Previous ArticleAgritechnica to showcase startups and young innovative company
    Next Article Joskin revamps Wago TR bale trailer
    Matthew Tilt
    • Twitter
    • LinkedIn

    Machinery editor for Farm Contractor & Large Scale Farmer. Matt has worked as an agricultural machinery journalist for five years, following time spent in his family’s Worcestershire contracting business. When he’s not driving or writing about the latest farm equipment, he can be found in his local cinema, or with his headphones in, reading a good book.

    Read Similar Stories

    Delay to import checks is unacceptable according to NFU

    May 4, 2022

    GLOBALG.A.P launches IFA v6, GRASP v2, and smart farm assurance solutions

    May 4, 2022

    The NFU’s new agri-food export strategy

    May 2, 2022
    Most Popular Stories

    NFU raises more than £6,000 for rural mental health charity

    May 17, 2022

    RHASS members react positively to Royal Highland Show reservation system

    May 17, 2022

    MaterMacc introduces new pneumatic drill

    May 17, 2022
    Farm Contractor & Large Scale Farmer

    The UK's leading agricultural machinery journal

    Twitter LinkedIn
    © 2022 Lewis Business Media. All Rights Reserved.
    Lewis Business Media, Suite A, Arun House, Office Village, River Way, Uckfield, TN22 1SL

    Privacy Policy | Cookie Policy | Terms & Conditions

    • AA Farmer
    • Farm Business
    • Poultry News
    • Pig World
    • OvertheCounter

    Type above and press Enter to search. Press Esc to cancel.

    We use cookies on our website to give you the most relevant experience by remembering your preferences and repeat visits. By clicking “ACCEPT ALL”, you consent to the use of ALL the cookies. However, you may visit "Cookie Settings" to provide a controlled consent.
    Cookie SettingsREJECT ALLAccept All
    Manage consent

    Privacy Overview

    This website uses cookies to improve your experience while you navigate through the website. Out of these, the cookies that are categorized as necessary are stored on your browser as they are essential for the working of basic functionalities of the website. We also use third-party cookies that help us analyze and understand how you use this website. These cookies will be stored in your browser only with your consent. You also have the option to opt-out of these cookies. But opting out of some of these cookies may affect your browsing experience.
    Necessary
    Always Enabled
    Necessary cookies are absolutely essential for the website to function properly. These cookies ensure basic functionalities and security features of the website, anonymously.
    CookieDurationDescription
    cookielawinfo-checkbox-advertisement1 yearSet by the GDPR Cookie Consent plugin, this cookie is used to record the user consent for the cookies in the "Advertisement" category .
    cookielawinfo-checkbox-analytics1 yearSet by the GDPR Cookie Consent plugin, this cookie is used to record the user consent for the cookies in the "Analytics" category .
    cookielawinfo-checkbox-functional1 yearThe cookie is set by GDPR cookie consent to record the user consent for the cookies in the category "Functional".
    cookielawinfo-checkbox-necessary1 yearSet by the GDPR Cookie Consent plugin, this cookie is used to record the user consent for the cookies in the "Necessary" category .
    cookielawinfo-checkbox-others1 yearSet by the GDPR Cookie Consent plugin, this cookie is used to store the user consent for cookies in the category "Others".
    cookielawinfo-checkbox-performance1 yearSet by the GDPR Cookie Consent plugin, this cookie is used to store the user consent for cookies in the category "Performance".
    PHPSESSIDsessionThis cookie is native to PHP applications. The cookie is used to store and identify a users' unique session ID for the purpose of managing user session on the website. The cookie is a session cookies and is deleted when all the browser windows are closed.
    Functional
    Functional cookies help to perform certain functionalities like sharing the content of the website on social media platforms, collect feedbacks, and other third-party features.
    Performance
    Performance cookies are used to understand and analyze the key performance indexes of the website which helps in delivering a better user experience for the visitors.
    Analytics
    Analytical cookies are used to understand how visitors interact with the website. These cookies help provide information on metrics the number of visitors, bounce rate, traffic source, etc.
    CookieDurationDescription
    _ga2 yearsThe _ga cookie, installed by Google Analytics, calculates visitor, session and campaign data and also keeps track of site usage for the site's analytics report. The cookie stores information anonymously and assigns a randomly generated number to recognize unique visitors.
    _gat_gtag_UA_31822138_191 minuteSet by Google to distinguish users.
    _gid1 dayInstalled by Google Analytics, _gid cookie stores information on how visitors use a website, while also creating an analytics report of the website's performance. Some of the data that are collected include the number of visitors, their source, and the pages they visit anonymously.
    Advertisement
    Advertisement cookies are used to provide visitors with relevant ads and marketing campaigns. These cookies track visitors across websites and collect information to provide customized ads.
    CookieDurationDescription
    OAID1 yearThis cookie is set when an AdsWizz website visitor have opted out the collection of information by AdsWizz service or opted to disable the targeted ads by AdsWizz.
    Others
    Other uncategorized cookies are those that are being analyzed and have not been classified into a category as yet.
    SAVE & ACCEPT
    Powered by CookieYes Logo