Freeze on LEADER grants for food entrepreneurs

FARMERS are giving up on diversifying into consumer food ideas because of a freeze on LEADER funding.

Some are persevering with their ideas and seeking other funding avenues, after the freeze put them on hold, with the fear that their considerable investment of time and money researching and developing their business ideas may have to be written off.

Funding applications for food-related projects are not being considered for the time being, because it is thought some Irish farm-food may have been funded from the wrong stream or axis of the EU’s €96.3 billion European Agricultural Fund for Rural Development.

“While the issue is with primary production, the embargo is on all farm-based food projects in the interim,” said Isobel Fletcher of LEADER Food Initiative which has been established to support rural food businesses and establish LEADER as the key support agency for people to turn to when starting or running a food business in rural Ireland.

“We have certainly lost applications to other potential funding areas,” said Fletcher.

There have been suggestions that LEADER applications made by companies may be allowable for food-related projects. “It’s to do with the Single Farm Payment especially, if applications are made by a limited company, then they could be eligible,” said a consultant.

However, Isobel Fletcher cautioned that a limited company would have to show significant separation between its directors and the farms involved in production, processing or preparation of food for the business named in the application for LEADER support.

In the meantime, some farmers are considering diversification into non-food areas such as tourism, renewables, accommodation, walks, and cycleways, instead of food.

A Department of Community, Equality and Gaeltacht Affairs spokesperson said: “Farmers can still apply under the diversification measure for projects that do not relate to the processing of agricultural products. Tourism, business creation and other diversification projects can still be applied for”.

“The problem is purely related to the processing of agricultural products. Farmers can apply like anyone else under the other measures of the programme if they have eligible ideas.”

However, tourism or business ideas applied for must not involve food products.

One of the many consultants who apply for LEADER aid on behalf of farmers revealed that Irish LEADER companies are trying to find examples from elsewhere in the EU of where food funding was drawn down in the same way which has now been barred by the EU Commission. “But until someone tests the case there may not be much progress”.

The consultant complained about the difficulty in the LEADER application process, and variable knowledge levels among LEADER staff.

“It’s my business to get people through the hoops of applying for LEADER funding, but I shouldn’t have to do this. It shouldn’t be so difficult to apply that people have to come to me”.