Government and Policy - Agri-EPI Centre - Precision Innovation

Government and Policy

Working with the agriculture, horticulture and aquaculture sectors, at Agri-EPI we explore and deliver precision farming engineering, technology and innovation in the UK.

Updating our members and wider interested sectors on evolving Government directives, regulation and policy, we also support seek to inform, educate and influence policy with research, new technology and empirical data.

Get inventive and take control of tax

The agricultural sector is taking undeniable initiative when it comes to innovation. But many farming and agri-businesses are missing out on a big opportunity to claim tax relief.

R&D is not all white lab coats and PhDs; farmers often carry out activities that are claimable under the R&D Tax Credit Scheme – a retrospective exercise which offers up to 33% of R&D costs as a tax credit.

Financial consultancy Leyton is working with agri-tech enablers, Agri-EPI, to make more UK farmers aware of the scheme and its potential to provide important cashflow, while aiding the improvement of operational efficiencies.

“The scheme can be applicable to work that is happening on farms day to day – but there is huge value underclaimed within agriculture because farmers don’t classify what they are doing as R&D and don’t fully understand their eligibility,” says George Stuffins, Business Development Manager at Leyton.

Broadly speaking, R&D occurs when farmers make improvements based on three key questions: How do they increase the quality of produce? How do they increase yield? And how do they become more sustainable?

Examples range from poultry farmers experimenting with feeding times and lighting concentrations to improve feed conversion or growth rates, to arable farms engineering weed control equipment to reduce reliance on chemicals and improve soil biology. Rewardable R&D is within the realms of every farm business and can be very lucrative, he says.

“Failed projects can qualify too, not everything goes right first time, and in HMRC’s eyes such work can still add significant value to knowledge in the sector.”

So how do farm businesses qualify for R&D tax credits?

Matilda Hayward, senior R&D technical consultant at Leyton, says that conversations with prospective applicants begin on farm with the aforementioned three key questions.

“It drives the project and outlines the business’ main goals, then looks at what R&D is already occurring on the farm and what other R&D strategies could be explored to capitalise on the R&D tax credit scheme.”

Criteria include:

  1. It must seek a scientific or technological advancement,
  2. It must be meeting a scientific or technological challenge to get the results or determine unfeasibility,
  3. It must show a systematic approach and be your own activity.

Eligibility is not exclusive to large scale businesses – it is entirely based on a business’ project meeting the key criteria – nor is there a maximum number of project claims.

So what can farm businesses claim?

As a retrospective scheme, applicants claim back money spent on innovative projects over the past two years at the end of a financial year.

The bulk of an R&D claim covers PAYE salaries but there is a rate for contracted staff like seasonal workers and consultants. A portion of utility costs are also claimable – albeit quite nominal, as are software licences.

However, high value claims come from projects using a lot of consumables like feed, medicines and artificial insemination products and services.

“The claim could also include a proportion of costs in relation to mortality within the R&D trial,” says Dr Hayward.

Businesses can’t claim capital costs under the scheme – but there are still opportunities under the Capital Allowance Scheme and through grants, says Mr Stuffins.

How the tax benefit is received depends on tax position as well as the amount the business is claiming back. But a misconception is that businesses in a loss-making position can’t claim.

“Businesses in this position can actually claim for a higher percentage of qualifying expenditure as cash,” he explains.

Looking forward, if a business decides to move ahead, then they need to treat it like an R&D project, says Dr Hayward.

She recommends keeping all the project details and data in one place, including trial results and analysis, when the trials took place, who was involved and the time spent on each activity.

“HMRC now looks for better audit trails so it’s about making sure it’s documented in the right way to make the most of tax credits,” she says. “And it also benefits the business because it can better justify claimed costs.”

Farmers often have a bank of information that can be used, like health monitoring, soil analysis, and data from audits and surveys.

“A consultant can help a business collate the retrospective data for work they didn’t even consider as an R&D project, as well as the best way to collect and collate data going forwards,” she explains.

“Farmers can claim directly. But involving a consultant takes the pressure off the farmer and gives them the security that the claim is compliant and includes all possible business improvements for maximum return.”

Agri-EPI appoints farming industry experts to its Board

Agri-EPI has appointed three farming industry experts to its Board: Sarah Calcutt, Tom Hind and Allan Stevenson.

Sarah Calcutt has spent 25 years working in food and farming. Sarah’s experience gives a unique insight into the business development needs and opportunities open to the British food and farming community.

In addition to running her successful business growth and communications consultancy, Partners in Produce Ltd, Sarah holds a number of executive, non- executive and voluntary roles. These include Non-Executive Director of the Covent Garden Market Authority, Executive Chair of the National Fruit Show and membership of City Harvest’s Food Council. She is a monthly columnist in Southeast Farmer and a regular contributor to a range of food and farming publications.

 

Tom Hind was born in Sheffield and now lives in North Yorkshire. He brings a wealth of experience drawn from across the food and farming sector in terms of policy, industry dynamics and commercial drivers. His career in farming has spanned more than 20 years in a variety of leadership roles at the NFU, Tesco and AHDB. He is a recognised expert in agricultural policy and has a significant track record in strategy development and influencing government and the wider food and farming industry.

Having left the farming industry in 2020 Tom is now CEO of the North York Moors National Park Authority where he leads a team of over 130 people charged with conserving and enhancing the landscape, cultural heritage & natural beauty of the North York Moors, one of ten National Parks across England.

 

Allan Stevenson was brought up on a Scottish arable farm and has enjoyed a varied career as a chartered accountant in a broad range of private and public sector business roles. He brings a diverse range of experience and expertise to Agri-EPI. He is a past Chairman of the Farmers Club, and currently Chairman of two pension schemes, advisor/consultant to a few agri-tech companies and running Luffness Mains Farming, an arable enterprise in East Lothian.

After a business and law degree in Edinburgh his accountancy career took him abroad and then to England where he worked in finance and commercial roles in growing private international businesses, finally returning with his family to buy out the family farming enterprise in Scotland.

Back in Scotland, he acquired a portfolio of NED roles, including Chair of AHDB Potatoes and SCRI which merged into the new James Hutton Institute, both these appointments taking him into the agriculture and science policy environment, with an interest in the sustainability of food, farming and technology. These involved some time developing relationships in China and elsewhere on matters concerning the global potato industry.

Agri-EPI Chair Vince Gillingham said: “I am delighted to welcome Sarah Calcutt, Tom Hind and Allan Stevenson to Agri-EPI as Non-Executive Directors. They bring an invaluable mix of skills to the Board, including boots on the ground farming, extensive policy experience and many decades of business experience. As Agri-EPI moves into the next phase of its growth, they will add huge value to the organisation, help deliver impact across agriculture and help us strengthen our connections to the sector’s front line.”

Agri-EPI Centre featured as supporter of Midlands tech innovators in UK Government campaign

As part of a UK Government campaign encouraging UK companies to export their goods, the Department for International Trade has released a short video which we were delighted to see featured Agri-EPI Centre, our partners and our Midlands Innovation Hub.

An Introduction to the new Agricultural Transition Plan

As a member of the British Agri-Tech community, Kasi McReddie has literally been on the edge of her seat waiting for DEFRA’s announcement which sets out Government’s plans for the transition from the Common Agricultural Policy (CAP). The announcement, of which details can be found at The Path to Sustainable Farming: An Agricultural Transition Plan 2021 to 2024, lays out plans for adaptation in the English farming community over the next seven years. Kasi is Agri-EPI’s Business Development Manager Livestock and Aquaculture and has formulated what this means for farmers and the agri-tech community and what opportunities there are for agri-tech companies going forward.

Farmers in England will see a phased-out reduction in Direct Payments over 4-years starting in 2021, with money saved in reduced BPS payments being used to fund grant and schemes to boost farmers’ productivity and reward environmental improvements.

What does the announcement mean for the agri-tech community?

One of the main barriers to the uptake of technology on farm is cost. In my experience, farmers are very good business people and, quite rightly, are rarely convinced to purchase a novel or innovative piece of equipment. The Agricultural Transition Plan gives us more details of some schemes which aim to financially incentivise farmers to look towards technology to improve the sustainability of their production.

Looking forward, the Environmental Land Management (ELMs) will include the Sustainable Farming Incentive (beginning 2022), which will support approaches to farm husbandry that deliver for the environment, such as actions to improve soil health, hedgerows and integrated pest management.

Future plans will also include the Farming Investment scheme, which is aimed at improving productivity in agriculture, addressing the underlying causes by supporting businesses to invest in equipment, technology, and infrastructure.

This will include:

  • Farming Equipment Technology Fund – small grants to contribute towards the purchase of a list of specified items
  • Farming Transformation Fund – larger grants towards the cost of more substantial investments in equipment, technology or infrastructure

The Farming Investment Fund for Equipment and Technology and Transformation will be open for applications in autumn 2021. From 2022, farmers will also benefit from an increased investment in agricultural Research & Development that will enable more farmers and agri-food businesses to drive innovation.

What does the announcement mean for farmers?

Under the new plan, farmers will be encouraged and incentivised to embrace changes to production techniques and practices which will reduce any negative environmental impacts. Significant emphasis is being put on innovation over the several years ahead. Farmers will be incentivised to explore how technology can be used to improve productivity whilst simultaneously delivering for the environment.

Agri-EPI have a unique network of 27 ‘Satellite Farms’ – a group of forward-thinking farmers who have welcomed the use of technology on farm and are paving the way for a more sustainable future. From milking robots to animal health sensors, and from infrared technology to drones, Agri-EPI have delivered innovation to the British farming community in this way. The Satellite Farm network is a thriving example of how the adoption of technology can support the productivity, efficiency, and sustainability of food production.

How can Agri-EPI support tech companies?

The report states that, by 2028, all farmers should be “managing their whole business in a way that delivers profitable food production and the recovery of nature, fusing the best modern technology available today with the rediscovery of the traditional art of good farm husbandry”.

As an example, technology to improve animal health will be eligible under the new Farming Investment Fund. Agri-EPI are working with a number of innovators to enable the development of solutions for monitoring the health of calves, adult cows and pigs using motion sensors, 3D imagery, augmented reality and more. Such solutions allow ‘early detection’ of health issues before a farmer could with the naked eye, thereby enabling early intervention leading to improved animal welfare, improved productivity, and efficiency. and cost savings on-farm.

Agri-EPI combines technical expertise, technology, and on-farm ‘test beds’ to provide a unique offering to support tech developers and farmers alike to co-develop solutions to some of farming’s most prominent challenges. The Government have now clearly laid out plans which will underpin our mission, by providing grants to farmers to purchase innovative solutions.

Agri-EPI also provide business support, project management and access to world-class research and innovation facilities and research assets, and builds links between research, agri-tech innovation, industry and the value chain, through its membership of >150 companies across agriculture, technology and the value chain.

The announcement should be welcomed by the farming and agri-tech community alike, with shifting policy clearly focussed on incentivising the use of innovation on-farm.

The industry faces unprecedented challenges, the likes of which some will only experience once in a lifetime. During the coming period of change, Agri-EPI will continue to support innovation in agriculture.

More information

If you want to learn more about how we you can get involved in R&D, learn more about our Satellite Farm network, or simply contact us to find out more about how we can support your own business.

Agri-EPI CTO among expert speakers at UK food security forum

The potential of digital innovation to support food resilience and security will be the focus of a keynote speech by Agri-EPI’s Chief Technical officer, Dr Shamal Mohammed, when he speaks at the high-profile Westminster Food and Nutrition Forum on Monday November 30.

Shamal, who is one of the UK’s leading experts on agricultural technology and science, is part of a high profile panel featuring speakers from farming, business and policy and R&D, taking part on the event, titled Food security – UK priorities, supporting domestic production and driving innovation.

Shamal will be discussing the sustainable productivity and the challenge and opportunity for smart technologies to improve food security and environmental sustainability.

Shamal said:

“The shift from a linear model of food production systems to a more circular model can significantly reduce environmental impact and also contribute to a net zero carbon economy by sequestering more carbon in our soils, improving biodiversity and helping to sustain our natural capital.

“Smart technologies play an important role in enabling the transition towards a sustainable production system by increasing monitoring and decision-making power, transparency, and intelligence -driven processes. In my talk, I will be explaining in more detail how such technology can enable more resilience, diverse and integrated food production systems.”

Other keynote speakers at the event include John Ingram, Food Systems Transformation Programme Leader at the Environmental Change Institute and NFU President Minette Batters. David Linden MP, Co-Vice Chair, All-Party Parliamentary Group for Food and Drink and Baroness Osamor, Member of the UK Parliament’s Food, Poverty, Health and Environment Committee, are chairing the event.

For full details of the event and to register, visit the Westminster Forum website.

Agricultural productivity key to unlocking future opportunities

Technology and UK farming

A new report published this week by the Food & Drink Sector Council (FDSC), to which the UK’s Agri-Tech Centres contributed, highlights the critical role of technology in the transformation of the UK’s farming industry.

Agricultural Productivity

The report was prepared for the FDSC by the Agricultural Productivity Working Group (and associated Task and Finish sub-groups), on which Agri-EPI CEO Dave Ross represented the Joint Centres. The report states that the industry and government must together seize the opportunities presented by new policy frameworks and technology to lead the transformation.

With the UK leaving the EU, imminent changes to agricultural policy and the pressure to achieve net zero emissions, the report highlights the steps that industry and government can take together to overcome the productivity challenge that has long faced the British farming industry.

Agri-EPI’s Dave Ross said:

“Alongside fellow industry experts, I worked on this report to outline the priority steps we believe must be taken to maximise agricultural productivity during this unprecedented time for UK agriculture.

“As our report highlights, there is a fundamental need for farming to become more data-driven, allowing performance measurement and the sharing of data for comparison between farms. This will require a range of actions around safe and effective data sharing and use. The report’s further recommendation for an Evidence-Based Farming (EBF) Initiative will be a key part of developing data use in agriculture. I am confident that Agri-EPI’s existing Satellite Farm network, along with the other Centres’ extensive networks, will play an important role in a new EBF programme.”

Speaking on behalf of the UK’s four Agri-Tech Centres (Agri-EPI Centre, Agrimetrics, CHAP and CIEL) Lyndsay Chapman, Chief Executive of CIEL, said:

“We very much welcome the recognition given in this new report to the critical role of agri-tech innovation and data.  As farming faces unprecedented challenges, it is essential that farmers and food businesses have access to accurate information, allowing them to make the best management decisions. The Centres’ shared vision is to drive greater efficiency, resilience and wealth for UK farmers and the wider agri-food sector.”

Read the full report on the FDSC website here.

Stay informed

Keep up to date with the latest impact and results of our work, plus, news, innovation and approaches across the sector. Read our latest news and Agri-EPI blogs.