Rural tourism boom predicted as farmers look to diversification

AN insurance broker has predicted a boom in new rural tourism ventures across the South West next year as farmers in the region seek to “protect their financial futures”.

Rupert Wailes-fairbairn, Lycetts’ rural division director, has said he believes 2022 could be the year that farmers choose to reinvent their businesses, amid ongoing changes to how the sector is funded.

Direct payment subsidies to farmers in England are being phased out as part of a seven-year transition period away from the EU’S Common Agricultural Policy.

The Government has begun introducing a new system that rewards sustainable farming practices, as it said the previous Basic Payment Scheme offered payments that “were poor value for money” and were skewed towards those with the most land.

According to figures from the Department for Environment, Food and Rural Affairs, total income for farmers in the South West fell by £135m last year to £509m in 2020. Around 33 per cent of that income – £166m – came from diversified business activities, such as camping and wedding venues.

Mr Wailes-fairbairn said: “As farmers face burgeoning financial challenges and a period of unprecedented industry change, many will be planning now to protect their financial futures over the next 12 months.

“To help them achieve this, a range of new business activities are likely to be embarked upon, from the hosting of experience days to putting non-productive land to revenuegenerating use with the introduction of glamping pods, tent pitches, shepherd huts or yurts.

“Renewable energy projects also promise lucrative opportunities, with operators paying rents of up to £1,000 per acre.”

Mr Wailes-fairbairn recommended farmers they first seek advice from specialists to ensure the best risk management procedures were in place.

Mr Wailes-fairbairn said: “Due diligence and prudent steps should be taken to avoid falling foul of unexpected financial pitfalls,”

“Tourism-related projects will invariably involve members of the public setting foot on farmland. Health and safety risk assessments, along with measures and procedures to ensure a safe environment, are therefore essential considerations at the design stage.

“Public liability insurance is a must - and insurers may request site inspections to ensure standards and requirements are being met.

“Insurable risks for renewable energy projects, meanwhile, can range from those faced during construction, commissioning and testing - including damage during the build, start-up delays and advanced loss of profits – through to a scheme’s day-to-day operation.”