Research helps farmers make effective succession plans
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Manage family farms like football clubs to survive in tough world market
University of Exeter Rural policy researcher Professor Matt Lobley advises on succession planning in family farms
Failure to manage succession is putting the future of British farms at risk, warns Professor Matt Lobley, Co-Director of the Centre for Rural Policy Research, at University of Exeter.
Speaking at the annual lunch of the British Guild of Agricultural Journalists, sponsored by NFU Mutual today, Prof Lobley, called for farmers to re-think farm succession planning by separating farm ownership from management of the business.
“The process of planning the future of farm businesses can be made less daunting and be more readily managed if management and ownership are considered separately,” he said.
“Football clubs are constantly changing managers. Each new manager is the successor to the previous occupier of that position but ownership of the club hasn't changed.
“While farms and football clubs are very different organisations the UK agricultural sector needs to face up to the succession challenge.
“Because most farms are family homes as well as businesses, succession planning is a very difficult challenge involving multiple generations and the desire to avoid conflict all too often leads to failure to start planning for the full involvement of the next generation.”
He warned that in order to recruit the best and brightest people, farming had to be an appealing career choice – and waiting until their 50s before gaining significant managerial responsibility was not attractive to prospective successors.
“Planning the future of the farm means having potentially difficult conversations. However, failing to make plans in a timely manner risks breaking up both the business - and potentially the family.”
Leading rural insurer NFU Mutual is funding a project at Cornwall’s Rural Business School and the University of Exeter’s Centre for Rural Policy Research to help farmers make effective succession plans.
The project will include a series of seminars around the UK in 2016 to provide farmers with information on the options available to them to hand on their farms while treating all family members fairly.
The need for more information and practical help on farm succession planning was highlighted by recent research commissioned by the insurer in conjunction with Farmers’ Weekly which revealed that 54% of UK farmers have not made succession plans. This equates to more than 40,000 farms nationwide.
Date: 9 October 2015