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https://defrafarming.blog.gov.uk/2022/06/01/a-fresh-start-for-new-entrants/

A fresh start for new entrants

Posted by: , Posted on: - Categories: Funding, New entrants
Photograph © John / Adobe Stock

It's hard to get started in farming, or any related land-based business.

Newcomers to the industry (usually known as "new entrants") face all sorts of barriers. It's challenging for them to find land, secure finance and progress their businesses.

When we published the Agricultural Transition Plan towards the end of 2020, we said that we would establish a support scheme for new entrants, and make the whole process easier.

At a time when economic and environmental challenges make innovation and fresh thinking more valuable than ever, we want to do what we can to encourage new entrants to the industry, with all the new ideas and new business models they can bring.

We're also keen to encourage investment and growth in all manner of land-based businesses. This is not just about arable or animal farming, but also horticulture, agro-forestry and provision of environmental services, such providing livestock for arable farms as part of an agroecology system. When businesses use land for growing food and/or environmental benefits, we want creativity to be the lead.

This blog post is an update on what we've learned so far by working collaboratively with people across the sector, and the next steps.

Working with the right people

Early on in the process, we set up a steering group to bring in external expertise, made up of landowners, estate managers, support providers and some recent new entrants.

We've also been working with trade associations, banks, unions, research institutions and Young Farmers’ groups, just to name a few, as well as hosting a series of webinars to share the rich knowledge out there.

Among other things, we have learned that:

  • Starting in farming is a long game; it can take 5-10 years to get a business established, so newcomers need support that takes that timescale into account.
  • There are fewer council farms these days and support for new entrants varies around the country; council farms have traditionally provided an easier path into the industry.
  • Although ownership and tenancy models are widespread in the sector, there are lots of different business models available for farming entrepreneurs.
  • New entrants often struggle to get loans because they don't already have land or other assets to offer as security and generally lack a track record. Early-stage finance can help businesses establish themselves and grow.
  • Local support exists, but the amount and quality on offer varies. We’ve learnt that support, such as mentoring, peer group learning and applied business skills training, is valuable, but new entrants can't be certain that they'll have access to suitable support in their area.
  • Even after getting started, it's hard to grow a farming business and obtain more land because landlords see newcomers as risky investments.

Testing solutions – pilot incubators

Our collaborative work has also begun to identify potential solutions, which we now want to test.

This month we are putting out a call for proposals from organisations to lead pilot incubator projects over the coming autumn and winter. These incubators will provide tactical support to young businesses through the early stages of development, nurturing would-be entrepreneurs to further develop a business idea, and fostering innovation and growth.

The pilot incubators will support new entrants of any age, at different stages of their journey: those with practical experience now looking to start-up their own land-based business and those wanting to scale-up their business in the first 10 years. These incubators will cover a reasonable geographical spread and both rural and peri-urban situations, which tend to pose different challenges.

We want to use these pilots to see what works in terms of increasing the chances of new and recent entrants’ accessing the land and finance they need to develop innovative new land-based businesses. Landowners and finance providers want to support fresh, innovative business thinking, and we want to work with them to understand how to make new entrants less risky as an investment.

While the incubator work is very important, it is not the only work that will feed into the design of the final scheme. For instance, we want to look at how to attract a more diverse range of people into land-based businesses. This is not the only government activity in this space, as we have also funded The Institute for Agriculture and Horticulture to work to develop a comprehensive career development platform for people in land-based businesses, whether they are starting their own business or not.

If you would like to apply for this opportunity for your organisation to lead a pilot incubator project this autumn and winter, please respond on the Defra e-tendering portal.

To find out more about co-design, or take part in future co-design sessions and webinars, please email us at: ffcpcodesign@defra.gov.uk

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5 comments

  1. Comment by Simon Ward posted on

    It is not so much a problem of new entrants but new entrants with different experiences and culture that is the industry weakness. The larger farming businesses offer excellent training and provide routes for those into the industry (in the same way as larger retailers provide training in the retail sector) but there are few of these. I think the objective is entrepreneurship and the awareness of other industries to transfer technologies and new entrants in itself is not the solution.

    Reply
  2. Comment by James Hedger posted on

    I found the old Agricultural Training Board a marvellous organisation with excellent hands on training at a very low cost. Non residential courses at agricultural college were also an important part of CPD. Of course guidance from neighbours was indispensable too. I hope your new Institution will be as practical as the ATB was.(I came from a non agricultural background)

    Reply
    • Replies to James Hedger>

      Comment by Kate Mason posted on

      James totally agree but many of the groups no longer exist in there old format, but there are some excellent independent training providers out there. You just need to find them and let them know what you need. Funding for these providers would be invaluable an allow us all to deliver great practical as well as managerial training.

      Reply
  3. Comment by John Metcalfe posted on

    There must be changes to Farm Business Tenancies which offer more security to young entrants. Security of Tenancy for 3 generations is not the answer but there has to be an incentive for a tenant to invest in a farm business for the longer term.
    Likewise the owner must be rewarded in some way for supporting a new starter. Some form of tax break for a new entrant tenancy and for any shared investment in farm infrastructure is an option.

    Reply
  4. Comment by Tim Luker posted on

    As much as training and experience is an import aspect, the greatest blockade by far, for new entrants (as I am trying to be) is finance. As a home owner and purchased with a sizeable deposit as well as improving the value, I cannot use the property as collateral! The reason; we cannot be made homeless if the enterprise goes ‘belly up’! A complete startup on 400 acres (the size holding we applied for) required £380k for asset purchases as well as operating capital! That was with a ‘realistic’ rental proposal too! To that end, how can anyone make a start? Working a second job in the proposal proved little value too! A government backed loan scheme would help those trying to get their first hold of the ladder, as no other organisation is willing or prepared to help! If there is help available, I’d really be grateful to know as I’m about to be sidelined for the second year because of it!

    Reply

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