Uncertainty caused by the 2024 Autumn Budget leads to record attendance at Larking Gowen Autumn Farming Conference

With the farming industry still reeling from the Chancellor’s announcements on Inheritance Tax in the 2024 Autumn Budget just a few days earlier, tickets for the 2024 Larking Gowen Autumn Farming Conference sold out as farmers and rural advisers sought clarification on numerous issues.

Since its inception in 2022 this annual event has grown in stature and significance, each year attracting an increasing audience of farmers, landowners and growers, as well as those from the wider agricultural and rural business sector. After two successful events in East Suffolk, the 2024 Autumn Farming Conference on Tuesday 5 November moved west to All Saints Hotel, Fornham St. Genevieve, near Bury St Edmunds. Organised by Larking Gowen, a major regional independent accountancy partnership, it was supported by the Country Land and Business Association (CLA), with sponsorship from Alan Boswell Group, Ashtons Legal and Virgin Money.

Bruce Masson, the Larking Gowen partner who originated the event, stated: “The recent Autumn Budget has introduced new pressures for farmers. With a range of legislative and financial challenges, farming businesses are facing significant hurdles that are likely to continue. Looking ahead, the Government’s new ‘environmental’ tax on imported industrial goods under the Carbon Border Adjustment Mechanism (CBAM), set to take effect on 1 January 2027, may increase fertiliser prices by £50 per tonne.”

CLA East Director, Cath Crowther, added: “The Labour Party gave repeated reassurances over the last twelve months that they would not tamper with Inheritance Tax Relief (IHT) or alter Agricultural Property Relief (APR). The Chancellor’s

recent actions broke all their pre-election promises. In a CLA poll which asked, ‘Were you optimistic for the future of farming in the UK before the Budget?’ 53% of farmers answered ‘yes’. Now, just 18% say ‘yes’, 64% ‘no’ and 18% ‘not sure’.

Gavin Lane, Deputy President of the CLA and Norfolk farmer, added: “In her Budget, Chancellor Rachel Reeves stated that only 27% of farms and estates will be affected and that this is a small number. However, CLA data paints a much different picture. We estimate 70,000 farms could be affected by this tax at any one time, and therefore it will have a much broader, far-reaching impact on the rural economy, which is why we are actively contesting the Chancellor’s statement.”

LOOKING FOR POSITIVES

Environmental and financial sustainability were other key issues at the 2024 Autumn Farming Conference, with three of the speakers setting out some options, with practical information and advice to help farmers put their businesses on a solid footing for the future.

On a positive note, Brown&Co Consultants, Abigail Maynard (Agricultural Environmental Consultant, Divisional Partner) and Emma Griffiths (Town Planner – Divisional Partner), discussed options available under Environmental, Social and Governance (ESG) and Biodiversity Net Gain (BNG) schemes, which they see as providing opportunities for farms.

“Biodiversity Net Gain (BNG), which was introduced by the National Planning Policy Framework and the Environment Act, became a legal requirement on 12 February 2024. It may be a storm in a teacup, but there is potential for big, special or easy projects,” Abigail outlined.

“Nutrient neutrality, which encompasses measures to mitigate nitrogen and phosphorus to help protect Special Areas of Conservation (SACs), offers a range of incentives, with a six-year conversion of 40ha from arable to grass being worth £250,000 over that period. Having an area of SFI (Sustainable Farming Incentive) is a complete ‘no-brainer’ worth £4,000 to a 50ha farm in the first year, with no farming actions required, so every farm should have an SFI agreement. New Countryside Stewardship schemes are on their way and, with Landscape Recovery still developing, farmers should maintain a watching brief,” Abigail advised.

The reduction in farming subsidies creates a need to think differently to generate revenues, Emma Griffiths emphasised. Agricultural diversification is supported nationally and through local planning policies. Existing farm buildings and land are assets which can be developed. Outlining the framework for Prior Approval Applications, Emma outlined Permitted Development for the conversion of agricultural buildings, together with the process for Land Promotion, engaging with local plans and neighbourhood plans for residential or employment development.

Michelle Masson, a Fellow Chartered Accountant (FCA) trained in landed estates and associated business, has worked across many sectors in recent years, providing support in SECR (Streamlined Energy & Carbon Reporting) and developing carbon baseline reporting. Currently working in one of the country’s largest let estates, with a unique portfolio of land, property and assets, she outlined the ‘why’ and ‘how’ of ‘Sustainability and Carbon Reporting,’ helping to clarify a complex area which will be new to many in the farming industry.

PERSEVERANCE PAYS OFF

“If you don’t enjoy what you do, don’t do it,” advised Sam Steggles, owner of award-winning farm business, The Goat Shed, at Honingham in Norfolk. Detailing his inspirational diversification journey over the last 15 years, Sam gave a fascinating account of how he went from dreaming about becoming an artisan cheese producer, to starting cheese production after purchasing his first 10 goats in 2009, to now running an award-winning, customer-focused, farm-based business employing 50 people.

It hasn’t been easy, with many setbacks along the way. The impact of COVID-19 lockdowns in 2020, for example, had an immediate and devastating impact when large, high-profile customers cancelled orders almost immediately as their own businesses were affected, leading to a 90% reduction in turnover for his business. But through sheer determination, hard work and innovation new opportunities have emerged. This year has seen the biggest evolution in the Goat Shed’s history; the farm shop has doubled in size with a new deli, bakery and butchery being added, together with a paddock area and maize maze which help connect visitors to the animals and land.

“If I had to do it all again, I wouldn’t do anything different, as the hurdles we have had to overcome and the support of customers have shaped our decisions, making us what we are today,” Sam stated. “My advice to anyone starting a new venture is to think long and hard about whether it is something that you are passionate about and want to do, as it’s not for the faint-hearted. Then surround yourself with the right people and have the right people in the right position and roles. It is paramount to have your systems and procedures in place and crucial that you and your whole team follow them. As an owner, be prepared to do a little bit of everything, roll up your sleeves and lead by example. As a business, we have faced and overcome numerous challenges over the years, but the measures announced in the Autumn Budget will have a huge negative impact going forward, will knock £100,000 off our bottom line and impact succession planning.”

RESEARCHING ALTERNATIVE CROPS

‘Expect the unexpected’ is the motto adopted by Edward Vipond, Farms Director for Troston Farms Ltd in Suffolk, which is owned by the Claas family, one of the world’s largest farm machinery manufacturers.

“Never in my career has there been a more profound change to the farming support system than now,” Edward stated. “Over the last 30 years there has always been some element of direct support for farming, but in the last few days it has become evident that it will end far more quickly than we had expected or had planned for. On the day of the Autumn Budget, Defra also announced changes to the Basic Payment Scheme (BPS) which will mean that the financial support Troston Farms receives will fall to just £8,000 next year. That gap will never be filled, so my job is to forget direct support, make best use of assets and not expose us to undue risk.”

Outlining how the business for which he is responsible is positioning for the future by using technology to help balance the requirements of food production and the environment, Edward, who in 2021 won both the Farmers Weekly’s ‘Farmer of the Year’ and ‘Farm Manager of the Year’ Awards, added: “Troston Farms has expanded rapidly, adding 1,000ha in the last 10 years. Now we farm 1,800ha across a wide range of soil types, from Breckland blow-away sand to heavy clay. We grow winter wheat (457ha), winter and spring barley (436ha), sugar beet (176ha), potatoes (49ha), onions (22ha), combining rye (131ha), forage rye (51ha), maize (117ha), winter beans (64ha) and sunflowers (52ha), with additional land for Countryside Stewardship Scheme (45ha), grass (35ha) and pigs (32ha).

Edward said, “Cropping has had to change and will continue to change. Oilseed rape has become far too risky to grow, and although we still have a considerable area of rye for crispbread or pig feed production, it is becoming more challenging to find new markets. We are heavily white strawed crops on the heavy land and that causes me trouble.

“With drought conditions becoming more common, no longer are we keen to grow sugar beet on light Breckland sand, and alternatives are needed for unirrigated land. We grow 52ha of sunflowers, the ethos being to reduce risk; if everything goes wrong, the only costs incurred are for seed and drilling, which we do ourselves, plus a small amount of herbicide – there’s no contractor to plant expensive sugar beet or maize seed, no fertiliser and no insecticide. But the crop has its challenges and will not be for everyone.

“We drill sunflowers in mid-May and once the crop has germinated it requires no rain for the remainder of the season, flowers in August and can usually be combined in October. Every year we learn something new, such as how taking just the sunflowers’ heads off when combining improves the sample exponentially. Currently, they go for supplementary feeding, such as bird food, but we are working to develop other markets.

“BPS support will cease in 2027, there will be no direct support thereafter and, ultimately, the level will be 40 to 50 per cent of the original figure. Whether that gap will widen and what Troston Farms will look like in five or ten years is almost impossible to predict. We must focus on what we grow and how we grow it, maximise the return on low-risk land, minimise the risk on high-risk land and focus on indirect costs as much as direct costs. Three-year terms for SFI are difficult to integrate into a long-term plan for the farm and, with no guarantee of roll-over, do not fill me with confidence. Attractive payments are available for Landscape Recovery projects, but a 20-year term represents a huge commitment on land that you may or may not get back for agricultural production at the end of it, so we are not heading into rewilding, planting large areas with trees or locking up large areas into landscape recovery

“Evolution is key to a profitable farm business, but I am not prepared to alter our system to chase grant payments that could lower productivity. The short-term nature of SFI causes me trouble but I am trying to stack and layer options where possible. As an example, we grow cover crops and claim an SFI payment for that, which leads into a companion crop, into which we drill sunflowers and for which we can claim an insecticide-free payment. I can nett, give or take, £60/ha by layering my scheme on top of sunflowers. That is the way I see the future, because who is to say whether, at the end of three years, the Government will roll over SFI, change the options or restrict it. We just don’t know, but politicians lack a good track record when it comes to keeping promises.”

The Autumn Farming Conference concluded with presentations from Bruce Masson on Capital Gains Tax (CGT), Furnished Holiday Lets (FHL), Inheritance Tax and Succession, with a session on Inheritance Tax and Succession Planning by Sally Key (Director/Financial Planner) and Mark Ward (Chartered Financial Planner) from Alan Boswell Group.

All profits from the Larking Gowen Autumn Farming Conference will be shared between its charity partners, YANA (You Are Not Alone), which provides mental health support for the farming and rural community, and RABI, which provides practical, financial and emotional support to the farming community.

Speakers at the 2024 Autumn Farming Conference were (left to right): Sam Steggles (The Goat Shed), Gavin Lane (CLA), Abigail Maynard (Brown&Co), Cath Crowther (CLA), Michelle Masson (Consultant), Emma Griffiths (Brown&Co), Edward Vipond (Troston Farms), Sally Key (Alan Boswell Group), Bruce Masson (Larking Gowen).