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One North East urged to help farmers more; Now the dust has settled and the nitty-gritty of the Chancellor's Pre-Budget Report has been dissected. But what did farmers and rural business make of Alistair Darling's plans?

Byline: Karen Dent reports

THIS week's Pre-Budget Report missed a number of vital opportunities to help agricultural businesses, according to the farming community.

The NFU said Alistair Darling's package of measures that were designed to stimulate the economy had "limited value" to farmers and the Chancellor had overlooked vital chances to help agricultural and rural enterprises.

NFU president Peter Kendall said: "It is a shame, however, that the Government appears again to have ignored our plea for greater fiscal incentives to encourage farmers to invest in environmentally beneficial capital works."

That view was echoed by Stoker Frater, the NFU's council member for Northumberland, who farms at Aberwick near Alnwick.

"I would have liked to have seen some sort of incentive grant for farmers like the old Farming Horticultural Development Scheme (FHDS), where individual farmers could put in a three-year plan and get grants to do things like walls or roads or buildings," he said.

"It finished in 1984/5 and they have never really done anything else. We need some sort of capital grants scheme like they have in Scotland and Wales with the devolved governments to give farmers an incentive to build, and that would hand on that work to suppliers.

"It would have boosted the rural economy, it would have benefited everybody and saved jobs as well. If we are going to keep the countryside alive, we need some sort of scheme like that."

He pointed out that sizeable funding was available north of the border for capital works, whereas English farmers had to pay for similar schemes out of their own pockets.

"There is an awful lot of people who are on the edge of nitrate vulnerable zones. In Scotland they get a 40% grant to put up slurry stores. We get nothing. Where is the incentive to do anything?" he said. "I think that's where One North East can help because they are a Government agency.

"They've got all of this cash and no one can access it.

"Albeit we are subsidised, the money doesn't stay in the farms, it's always handed on. Ninety percent of the subsidies I get, I spend within a 20-mile radius of this farm."

He dismissed the temporary cut in VAT from 17.5% to 15% as having no benefit for agricultural businesses because farmers were able to claim VAT back, and said exempting empty commercial buildings with a rateable value below pounds 15,000 from business rates for one year would make little difference.

"It won't give them the incentive to fill them again," said Mr Frater.

"There are not that many businesses running off farms in this area, probably more round the urban fringes. It might help but in a very small way."

However, farmer and businessman Ian Brown, who runs the Lee Moor business park near Alnwick, welcomed the measure.

"Something like that helps me greatly because I am managing a rural business park in collaboration with Northumberland Estates. From time to time, there are vacancies and filling vacancies in a recession is much harder. More and more farms have that diversification. That's good news, hats off to them for doing that."

However, Angus Collingwood-Cameron, North East director of the Country Land and Business Association, believes the Chancellor should have gone further on this issue.

He said: "We would have liked to have seen that instead of the empty business property rates being suspended for one year, we would have liked to have seen that made permanent.

"This sort of tax is going to delay any future regeneration and people will be less willing to make that sort of investment in the future."

The VAT reduction will have limited effects, he believes, and pointed to the additional work required to change prices to implement the alteration in time for Monday's start date.

"The VAT change for many small businesses is just a nuisance and a cost. The 2.5% reduction will no nothing to stimulate demand because it is such a small amount," he said.

Mr Collingwood-Cameron said the Government could have boosted the economy on a number of different levels by investing a broad-reaching house-building scheme.

"We would have liked to see a widespread programme of affordable and social housing, which would have the benefits of addressing a very pressing need and stimulating demand across a range of sectors, and creating assets which could have been utilised later on," he said.

Over all, the measures designed to help small businesses received the thumbs up from the NFU.

Peter Kendall said: "Farming is an integral part of the SME community and in this respect we welcome proposals for a temporary tax relief on vacant property, to delay the payment of tax bills, to introduce a substantial small business finance scheme and allowing SMEs to offset losses against profits made in the past three years. Proposals to delay and decrease the rate of increase of higher Vehicle Excise Duty (VED) for 4x4s are welcome - these proposals would have disproportionately impacted on farmers who rely on such vehicles in their businesses." Stoker Frater was keen to point out that farming has not been as affected by the downturn as other parts of the business community.

He said: "We are weathering the situation better than most. Cattle and sheep prices are quite buoyant. Fuel has come down, fertiliser's started to come back a bit.

"I'm amazed how quickly the rest of the economy is going down. I haven't heard of any farm layoffs at all, in fact labour is quite hard to get. We as farmers have got to tell people that. When we are not hurting, we don't want to be whingeing even more.

"We are steady as you go. For that, we've got to be grateful."

One North East have got all of this cash and no one can access it...we need incentives


ENVIOUS OF SCOTS Stoker Frater, chairman of Northumberland NFU.; BACKING THE NFU Angus Collingwood-Cameron.; PLEA IGNORED Peter Kendall, the NFU president.; ANOTHER VIEW Farmer and businessman Ian Brown.
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Title Annotation:Features
Publication:The Journal (Newcastle, England)
Geographic Code:4EUUK
Date:Nov 29, 2008
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