Tier 1 of the Farm Business Investment Scheme (FBIS), coming with a grant worth up to 40% of costs for machinery and equipment designed to improve output and efficiency on NI farms, has been allocated an initial budget of £15m.

That is a budget allocation which is slightly ahead of the total pot of money that was paid out under the Farm Modernisation Programme (FMP) under the last Rural Development Programme. Over three tranches, the scheme paid out £13.83m. It is understood that the list of eligible items and machinery in Tier 1 of the FBIS will be similar to the list under the FMP. However, while the total amount of grant support under the FMP was limited to £4,000 with a minimum spend of £1,250 (£500 of grant), Tier 1 of the FBIS is expected to be more ambitious, with a minimum project spend of £5,000 to a maximum of £30,000.

There is also Tier 2 of the FBIS, for larger construction-type projects, which will offer a grant of up to £250,000. Both tiers of the FBIS are expected to open this autumn.

It is understood that the initial budget allocation for Tier 2 of the scheme is in the region of £25m, giving a total initial allocation from the Department of Finance of around £40m. That obviously is well short of the £200m promised by the Stormont Executive to fund a capital grant scheme designed to stimulate industry growth, but it is a case of bidding for, and spending the money in stages rather than all at once.

If there is a good level of uptake, there is a stronger case to go looking for more funding.

Tender

Last week, DAERA put out a tender seeking an external contractor to deliver Tier 1 of the FBIS. Under the FMP, the scheme was delivered by Countryside Agri-Rural Partnership, a consortium led by Countryside Services Ltd in Dungannon (the commercial arm of the UFU), working with the Rural Development Council and AI Services.

The latest tender comes with a contract lasting up to 42 months, and is worth an estimated £2.23m. Responses are sought by 5 September.

It is expected that administration and delivery of the Tier 2 scheme will mostly be conducted in-house by DAERA.

Groups

Also currently out for tender is a document originating from CAFRE, which is looking for an external contractor to help deliver elements of knowledge transfer through farmer business development groups (BDG). The tender is for an initial period of two years, but could be extended for another four. The estimated value of the tender is put anywhere between £6m and £12.6m.

The original plan was to get 3,000 farmers into 160 groups, and with 2,941 farmers currently participating across 154 groups, this target has largely been met.

However, getting facilitators in place for each group has not proved to be straightforward and has stretched CAFRE resources.

Original tender

It has not been helped by an original tender that was put out in February 2016 being subsequently withdrawn.

It means that a significant number of the groups are still without a permanent facilitator, and limited progress has been made in drawing up business plans or collating benchmarking information.

The deadline for this tender is next week. Assuming a contractor is subsequently appointed, it will probably take another couple of months for staff to be recruited and to start working with farmer groups.