Policy paper

Independent review into labour shortages in the food supply chain: government response

Published 9 May 2024

Foreword

I would like to thank John Shropshire and the expert panel for their important review into workforce shortages in England’s food supply chain.

The insights this provides are invaluable and the government has set out our response to the review’s recommendations around recruitment, retention, skills and automation.

Our food supply chain contributes over £128 billion to the UK economy every year, provides employment for over four million people, and puts high quality, homegrown food on our plates.

It is vitally important we take stock of this review and take action to make sure we have the skills, technology and domestic workforce in place so we can continue to produce world-class British food and strengthen our food security.

Our response sets out our intention to work with the sector, supported by the Food and Drink Sector Council, to attract, train and retain British workers in our food supply chain, reducing our historic reliance on workers from overseas and promoting a high-skilled, high-wage economy.

I also want to see more investment in automation in horticulture and so my thanks go to Professor Simon Pearson for his review into this area. We have a huge opportunity before us to modernise the food supply chain through automation, unlocking higher skilled, more attractive jobs for British workers while also improving productivity, product quality and capacity.  

To capitalise on this, we will increase support for agri-innovation by up to £50 million by launching an ambitious programme to automate packhouses in horticulture. We will also fast-track research and development of robotic crop harvesters, building on the exciting innovation already emerging within the sector.

We recognise, however, that the full benefits of automation will not be realised overnight, and we will extend the Seasonal Worker visa route from 2025 to 2029 to give the sector the certainty they need to plan for their businesses. Yet, we are clear that visa allocations must fall as the benefits materialise, and we will work with the sector to ensure this happens as quickly as possible.

Sustainable food production and food security remain firm priorities for this Government. We are at an exciting crossroads for the agri-food sector, with the chance to drive positive change for future generations by unleashing the benefits of automation and attracting new domestic talent to the workforce.

Government and industry must work together to make this happen. The Shropshire Review has been an important catalyst, and we must all take heed of its recommendations and lose no time in pressing ahead with this vital work.

Steve Barclay, Secretary of State for Environment, Food and Rural Affairs

Introduction

The government welcomes the publication of the independent review into labour shortages in the food supply chain, along with its recommendations. We thank John Shropshire for his work chairing the review, and the expert panel for their valuable contribution.

The government would also like to thank Professor Simon Pearson of the University of Lincoln for his work co-chairing the review of automation in horticulture, whose findings and recommendations have also helped inform this response.

It is a priority of this government to have an innovative, productive, secure, and competitive food supply chain. That means investing in people and skills and ensuring the sector’s resilience.

Recent international events such as the COVID-19 pandemic and Russia’s illegal invasion of Ukraine have placed pressure on the UK’s food supply chain and increased the costs of its inputs. This has highlighted the importance of strong domestic production to the UK’s food security, and the potential vulnerability of sectors that have traditionally relied on migrant labour. We also need to consider the long-term future of the Seasonal Workers Scheme, having left the EU.

Recruitment and retention of a skilled domestic workforce has become imperative, along with the shift towards greater use of automation technology. But as John Shropshire’s review highlights, businesses are finding this challenging for a combination of reasons.

The independent review was commissioned to evaluate the extent of, and reasons for, labour shortages in the food supply chain in England. It made ten recommendations across four themes: recruitment, retention, skills and automation.

The government agrees that these challenges cannot be addressed in isolation and that a coordinated approach between government, industry, and education and training providers is necessary to overcome them, coupled with innovative, long-term strategies.

This response sets out how we will achieve this. Structured using the four key themes, the response outlines our support for the sector to access the workforce it needs. It also sets out the actions required to reduce the sector’s reliance on migrant labour, including through automation and promoting domestic labour procurement and training, meeting the Prime Minister’s commitment from the UK Farm to Fork Summit in May 2023.

The government welcomes the role that the Food and Drink Sector Council (FDSC) will play in helping to coordinate this approach and deliver these long-term strategies. The FDSC brings together senior leaders representing the whole of the agri-food chain to address strategic issues and seize opportunities. Its work will be in partnership with government, to deliver our shared objectives.

Much of this work is already underway. The FDSC’s Workforce sub-committee, supported by the Department for the Environment, Food and Rural Affairs (Defra) and Institute of Grocery Distribution (IGD), has prioritised three workstreams on sector attractiveness, future skills and automation. These workstreams have dedicated project groups which will be crucial as engines of delivery for this important work.

Both the independent review into labour shortages in the food supply chain (hereafter referred to as the Shropshire review) and the review of automation in horticulture served to better understand how to transition to a more stable and sustainable workforce and accelerate the uptake of automation.

The ambition is to give businesses the certainty and confidence they need to plan for the future, meet production targets, better evaluate their labour needs and, in turn, incentivise long-term capital investments in automation technology.

This response is an important tool towards delivering this ambition.

Recruitment and retention

In response to the Shropshire review’s recommendations 1 to 3:

1. Implement a comprehensive strategy to enhance sector attractiveness

2. Access to migrant labour

3. Invest in domestic workers

Sector attractiveness

To address the recruitment and retention challenges facing the agri-food supply chain, the Shropshire review recommended improving the awareness of opportunities in the sector and greater investment by employers in career development and training of their workers.

The government agrees with these recommendations and calls on the sector and its employers to do more to attract and retain British workers.

To help achieve this, the Food and Drink Sector Council’s (FDSC’s) Sector Attractiveness Project Group, in collaboration with Defra, will in its first year deliver a programme of work to improve the awareness of, and engagement with, the diverse range of opportunities and career paths across the UK food chain.

This work has already begun, with clear industry endorsement and committed action, which the government welcomes.

As part of this work, the FDSC’s workforce sub-committee will collaborate with relevant government departments, education providers, trade associations and companies of all sizes from across the food chain, to foster strong links with local communities and ultimately build lasting, skilled talent pipelines, that meet the future needs of the industry.

Seasonal worker visa route

The UK Horticulture sector is vibrant and diverse, but it is also one of the most labour-intensive sectors in our economy, with many of its crops still harvested and packed by hand.

Each year approximately 60,000 seasonal workers are required for these roles, of which fewer than 5% are British, 60% are migrant workers on 6-month visas from the Seasonal Worker visa route, and the remainder are EU workers with Settled Status and Ukrainians on extended visas.

The demand for migrant workers via the Seasonal Worker visa route has increased dramatically, with the visa quota for horticulture rising from 2,500 in 2019 to 45,000 in 2024 (including an additional 10,000 visas should they be required), plus a further 2,000 visas for poultry workers to meet their pre-Christmas surge in demand.

With the numbers of EU settled status workers and Ukrainian workers on extended visas returning to horticulture anticipated to reduce over the next 5 years, unless we act now, future harvests will be even more reliant on low-skilled workers from overseas.

It is this government’s ambition to help the horticulture sector transition away from seasonal migrant labour and, while we view automation as the key to this transition, we also recognise that the development and adoption of high value automation technology will take time.  

Therefore, alongside our plans to turbo-charge investment in automation in horticulture, outlined in the automation section, we will extend the Seasonal Worker visa route for another 5 years from 2025 to 2029.

The number of visas available to the horticulture sector in 2025 will be set at 43,000, with another 2,000 visas for poultry. This represents a reduction of 2,000 visas in addition to removing the extra 10,000 visas potentially available if sector demand had required. This is appropriate given the uptake of visas in 2023 and 2024, the anticipated effect of productivity improvements and the need to signal a serious direction of travel alongside our automation challenge. Both the horticulture and poultry visas will remain separate, as we recognise the complexities of bringing poultry roles within the scope of the horticulture visa.

The government expects both these sectors to reduce demand for migrant worker visas in the 5-year period through increased training and recruitment of domestic workers and a greater uptake of automation, with an expectation that by 2029 the number of migrant workers required by these sectors will be lower.

Further detail of the quota levels from 2026 to 2029 will be set out later in 2024, alongside our announcement of additional packages of support for automation following discussion with the sector.

The government is aware the Shropshire review also recommended several changes to the running of the visa route, and that the Migration Advisory Committee’s ongoing inquiry into the Seasonal Worker visa route is due to be published in summer 2024.

The government remains open to making improvements to the visa route throughout its 5-year extension and will explore the feasibility of potential improvements in due course.

Worker welfare

In committing to the extension of the Seasonal Worker visa route the government will remain unwavering in its commitment to reduce the risks of labour exploitation and modern slavery.

To support this, the government will continue its growing liaison with the governments of the countries that we recruit from, working with worker’s sponsors and the International Organisation for Migration and other NGOs to ensure workers are fully aware of what to expect when working on farms in the UK before they arrive and how to avoid paying unnecessary costs and fees.

The Gangmasters and Labour Abuse Authority (GLAA) has entered into memorandum of understanding agreements with key source countries, committing to joint activities to reduce risk of exploitation of migrant workers. We will consider extending this approach to other countries where there is significant recruitment by sponsors.

Understanding and monitoring the experience of workers themselves is another vital part of our commitment to worker welfare. On 25 January 2024 we published the results of our survey of workers who applied for visas in 2022, which showed how the vast majority (over 90%) of the 4,000 workers who responded to the survey had a good experience and were keen to return in future.

The survey also highlighted, however, some important areas where improvements are needed, and we remain committed to working in partnership with the sector to address them. 

This includes our commitment to investigating the use of the Employer Pays Principle for the Seasonal Worker visa route. Doing so would represent a significant step towards alleviating some of the financial burdens that workers can incur in paying for their visas and travel to the UK. However, before making any decision to adopt such a principle, we will first seek more evidence of the potential impacts across the supply chain, as well as on consumers and workers. The government is proud to be working on this research proposal with the Seasonal Worker Taskforce – an industry-led taskforce focused on improving the welfare of migrant workers – and we have committed funds for economic modelling in support of this project.

The government will work with sponsors and growers to explore a more effective routing of complaints, so that poor treatment, pay issues or working conditions can be reported and dealt with more effectively. In addition, we will work with the sector to improve worker accommodation.

The Home Office sponsor licencing system places clear and binding requirements and obligations on the scheme sponsors to safeguard seasonal workers coming to the UK through the visa route. These ensure that workers have a safe working environment and are treated fairly and paid properly.

Should any of the selected sponsors fall short in these duties, action will be taken, up to and including the revocation of their sponsor licence.

A new team within the Home Office compliance network is now focused on ensuring sponsors are abiding by workers’ rights, by improving training and processes for compliance inspectors and creating clear policies and guidance for robust action for scheme sponsors where workers are at risk of exploitation.  

Sponsors of the scheme are also licensed by the GLAA, making sure that migrant workers are adequately protected against modern slavery and other labour abuses. GLAA licensing ensures all workers are placed with growers that adhere to all relevant legislation, including paying the National Minimum Wage. 

Skilled worker visa

The Skilled Worker visa recognises the positive impact of high-skilled migration that can boost growth, support vital industries and public services, and drive the international competitiveness of the UK’s high-growth innovative businesses.  

To ensure that our immigration system is focused on attracting skilled, highly paid talent from around the world, the government has announced that from 4 April 2024, the earnings thresholds for those arriving on the Skilled Worker visa route will increase, with the minimum salary required rising by 48%, from £26,200 to £38,700.

This 48% rise is part of a package of measures announced on 4 December 2023 to help deliver the government’s goals of cracking down on rising migration, reducing pressure on public services and ensuring that British labour is not undercut by overseas workers. It strikes an appropriate balance between allowing employers access to the skills our economy needs and encouraging investment in the resident workforce.  

The government acknowledges industry desire to have more regular reviews of the Shortage Occupation List (SOL). The government has announced that, from early April 2024, the SOL will be replaced with a new Immigration Salary List (ISL), removing the 20% going rate discount for occupations on the SOL.

On 17 January 2024 the government commissioned the Migration Advisory Committee (MAC) to carry out a rapid review of the SOL to inform which occupations should be temporarily added to the Immigration Salary List from early April 2024. Placement on the ISL will give occupations a 20% discount on the general salary threshold, subject to not reducing salaries below the level of the occupation-specific threshold. The MAC completed their Rapid Review on 23 February 2024, and the government is accepting the MAC’s recommended ISL in its entirety, other than the exclusion of two fishing occupations (5119 and 9119).

The government equally notes the concerns around visa cost and English language requirements of the Skilled Worker visa. It is the government’s policy that those who use and benefit most from the immigration system should contribute towards the cost of operating the system, reducing the burden on the UK taxpayer. Fees for visa routes, including the Skilled Worker visa, are therefore set on a cost-recovery basis. 

English language is important in allowing workers to effectively communicate at work, including in relation to health and safety, and to integrate and function in wider society. It is not solely about what is needed for the job.

The importance of English language requirements, including for mitigating the risks of labour exploitation, has also been recognised repeatedly by the MAC. 

Investing in domestic workers

The government agrees that more could be done by employers to improve pay, staff benefits, work conditions, and attract harder-to-reach and disengaged individuals. We call on sector businesses to take the lead here, with a particular focus on increasing diversity.

In tandem, we will support more people getting into work across the food supply chain.

To initiate this, Defra will work with the Department for Work and Pensions (DWP) to deliver regional recruitment strategies that utilise the DWP’s Jobcentre Plus network, foster strong local links between employers and work coaches, and give jobseekers the skills and knowledge they need to enter roles across the food and farming sector.

Summary – Recruitment and retention

1. there will be a dedicated FDSC Sector Attractiveness Project Group to drive greater awareness of and engagement with the opportunities and career paths available across the food supply chain
2. government will extend the Seasonal Worker visa route by 5 years
3. government will deliver regional recruitment strategies to support more people to enter roles in the sector

Skills

In response to the Shropshire review’s recommendations 4 to 7:

4. Reform the Apprenticeship Levy

5. Build on skills supply collaboration

6. Support food career curriculum delivery

7. Produce a workforce data strategy

Apprenticeship levy

The apprenticeship levy is an important part of the apprenticeship reforms, incentivising larger businesses to develop and invest in their own apprenticeship programmes, whilst ensuring the availability of funding for smaller employers wanting to offer apprenticeships. The apprenticeship levy has supported the increase in apprenticeships investment in England to over £2.7 billion.

The Department for Education (DfE) is supporting employers to make greater use of apprenticeships. There are now nearly 700 high-quality employer-designed apprenticeship standards available, providing a range of options for employers in the food supply sector to choose from to meet their business’s needs. The DfE have created flexible training models such as flexi-job and accelerated apprenticeships to make apprenticeships more accessible to all sectors. Employers can also benefit from a range of other government-funded skills programmes, including skills bootcamps and higher technical qualifications.

The government wants to support small and medium-sized enterprises (SMEs) to offer more apprenticeship opportunities. On 18 March we announced a further £60 million for the year 2024 to 2025 to boost apprenticeships opportunities for young people in smaller businesses, and to meet overall increased employer demand for apprenticeships. The DfE will fund 100% of training and assessment costs for new apprentices aged 16-21 in SMEs, and double the transfer allowance so levy-paying employers can now transfer up to 50% of their funds to support apprenticeships in other businesses.

The DfE is focused on simplifying the apprenticeship system and reducing complexity so employers can focus on delivering high-quality apprenticeships. The DfE has already removed the limit on the number of apprentices that SMEs can recruit and cut by a third the number of steps needed by them to take on an apprentice, making it easier for them to grow their businesses with the skilled apprentices they need. The DfE has also launched an ‘expert provider’ pilot to find new and innovative ways for training providers to engage and support SMEs though the apprenticeship journey. 

In the 2021 to 2022 and 2022 to 2023 financial years, on average 98% of the English apprenticeships’ budget was spent. It is therefore important that this remains ring-fenced for apprenticeships to ensure continued affordability of the programme and to ensure that employers of all sizes, including those that do not pay the levy, can continue to access high-quality apprenticeships training. The Government therefore currently has no plans to reform the apprenticeship levy but remains committed to ensuring the apprenticeships system continues to help employers fill their vacancies and address industry skills gaps. 

Skills supply and food career curriculum delivery

Defra has provided seed funding to the industry to establish a professional body; The Institute for Agriculture and Horticulture (TIAH). TIAH is based around an on-line platform and will support professional career development, providing direct access to a range of personalised learning opportunities to facilitate entrepreneurship, including digital skills, business management and leadership. TIAH launched their full offer in early 2024 and is now available for membership.

However, securing a domestic supply of skilled workers to meet the future needs of the economy remains of utmost importance to government.

We therefore accept the recommendations to ‘Build on skills supply collaboration’ and ‘Support food career curriculum delivery’ and will look to build a better understanding of the skills required by the food supply chain, while fostering greater collaboration between government, industry and education providers.

To achieve this, the Food and Drink Sector Council’s (FDSC’s) Future Skills Project Group will build a better understanding of the future skills required by the food chain. The dedicated group will bring together trade associations, academia, skills providers and companies to ensure that government has a stronger understanding of the industry’s future skills requirements across the total supply chain helping to facilitate more effective policy development and skills development programmes in every region across England.

Alongside this, government will work to improve its understanding of the current food supply chain skills offer. Defra will also work with other government departments to ensure that the cross-government skills agenda pays appropriate regard to the skills needs of Defra-sponsored sectors, including exploring the supply of courses, availability, take up, and quality of apprenticeships, further education, higher education and T Level offers.

More broadly, Defra is intensifying its commitment to cultivating a skilled and thriving workforce in its sectors, aiming to put nature and sustainable growth at the heart of the UK’s future. To realise this vision, we are deepening our understanding of skills gaps and barriers to filling those gaps, whilst also assessing the respective roles of government and employers in tackling skills shortages in each sector.  We will collaborate cross government to ensure that the government-wide skills agenda meets the needs of Defra sectors and policies, which are crucial to the growth of the green economy of the future.

Meeting the skills needs of employers

The DfE continues to reshape post-16 technical education and training to better meet the needs of employers and the wider economy. This is reflected in the 38 Local Skills Improvement Plans (LSIPs).

The LSIPs are employer-led and provide employers, education providers and other stakeholders in a local area with an agreed set of actionable priorities, to help learners gain the skills they need to foster career prospects and enter the workforce. All 38 areas of the country had an LSIP approved and were published by the Secretary of State for Education in August 2023. Progress for each LSIP will be reviewed annually for a 3-year period.

The Local Skills Improvement Fund (LSIF) has additionally been established for two financial years, to support Further Education providers across a geographic area to respond collectively to the priorities established in the LSIPs. These include the provision of new courses to meet the skills needs of local businesses and investment in new facilities and equipment. The LSIF has provided £80 million in funding from 2023 to 2024 (£40 million revenue and £40 million capital), with £85 million capital arranged for 2024 to 2025.

The DfE is routinely monitoring the progress of all LSIP and LSIF projects. Defra will monitor the progress of LSIP and LSIF projects which have identified sectors within the food supply chain as a local priority, seeking to gather insights for how this work is impacting the skills needs of employers within the food supply chain.

Recognising the size and importance of the food manufacturing sector in particular, in support of the Advanced Manufacturing Plan, the Department for Energy Security and Net Zero has partnered with other government departments to publish an action plan on green skills in 2024. Alongside the Department for Business and Trade, they will work closely with the DfE and Defra to develop a forum with the National Manufacturing Skills Task Force, focusing on issues that businesses have highlighted. These include attracting more new entrants, promoting manufacturing as a life-long career, supporting retraining for the digital and net zero transitions, and considering how best to attract global talent for the overall benefit of UK industry.

Workforce data

The Shropshire review repeatedly highlights the importance of better and more accessible data to address skills gaps and labour shortages. Better labour market and skills information will provide the food supply chain with greater confidence to plan ahead and invest for the future, with benefits for competitiveness, productivity and growth.

The Shropshire review recommends that the government produces a workforce data strategy to address these issues.

The government already publishes an extensive array of labour market and skills information, with new publications and improvements in the pipeline. However, we acknowledge that, in providing this for the whole food supply chain, there have been challenges in data collection, disaggregation and accessibility.

We also accept that there is a real need to develop consensus about future recruitment and skills needs and trends across domestic and migrant labour, and their interaction with automation, to better evidence and inform policy decisions.

In response, the government will produce a public facing workforce data product for the food supply chain, led by Defra, working with the DWP, the DfE, the Office for National Statistics (ONS), His Majesty’s Revenue and Customs, other government departments and industry.

This product will consolidate existing labour market and skills data, and future research and statistics from Defra, the ONS and the DfE’s Unit for Future Skills (UFS) and other government departments, as well as industry, ensuring greater awareness of available skills and labour market data and improved accessibility to it.

Defra will also work with the FDSC Workforce sub-committee to drive awareness of this product, and how it could be improved, to help businesses with workforce planning and ensure a robust skills pipeline.

Summary – Skills

1. government is investing £2.7 billion investment in apprenticeships, with a further £60 million for the year 2024 to 2025
2. government is funding 100% of training and assessment costs for new apprentices aged 16 to 21 in SMEs
3. government is doubling the transfer allowance to enable levy-paying employers to transfer up to 50% of their funds to support apprenticeships in other businesses
4. government has launched an ‘expert provider’ pilot to find new ways for training providers to engage and support SMEs though the apprenticeship journey
5. there will be a dedicated FDSC Future Skills Project Group to build a better understanding of the future skills required by the food supply chain
6. Defra will work with other government departments to ensure that the cross-government skills agenda pays regard to the skills needs of Defra sponsored sectors
7. Defra will monitor the progress of LSIP and LSIF projects which have identified sectors within the food supply chain as a local priority
8. government is publishing an action plan on green skills in 2024, led by the Department for Energy Security and Net Zero
9. government will produce a workforce data product for the food supply chain

Automation

In response to the Shropshire review’s recommendations 8 to 10:

8. Incentivise automation

9. Advance automation knowledge

10. Moonshot approach to innovation

Industry-led promotion and knowledge exchange

The government acknowledges that there are barriers to automation adoption and innovation, including a lack of awareness of available support, the perceived complexity of this support, significant fragmentation between technology providers and end users, and the cost and financial risk of shifting to a more capital-intensive business model. These barriers are holding back the adoption and development of commercially available technology both pre and post farm gate.

We also accept that a renewed impetus for government and industry collaboration is needed to help overcome these barriers, incentivise automation uptake, and foster development of innovative technologies.

The government, working with the Food and Drink Sector Council’s Automation Project Group, will therefore establish a forum that brings together government, industry, academia, technology companies and integrators to promote the adoption of available and proven technologies in the food supply chain.

Taking a total supply chain approach, this automation forum will act as a knowledge sharing platform that improves the awareness and uptake of pre-existing financial and fiscal support, promotes shared learning from early adopters of technology, and provides insight to support SMEs to adopt new technologies. Ultimately, this workstream will work to accelerate the adoption of automation technology.

Automating the horticulture sector

It is this government’s ambition to turbo-charge automation in the horticulture sector, helping boost productivity and help it transition away from low-skilled migrant labour as fast as possible.

The government recognises that this will require a step change in the uptake of commercially available technology, such as packhouse automation, and the acceleration of robotic crop harvesting.

Immediately after the publication of this response, we will launch a packhouse automation challenge with the horticulture sector, equipment manufacturers and integrators to accelerate the automation of packhouses in edible horticulture. This is where the quickest progress can be made to reduce the demand for migrant workers, with several packhouses in the country already fully automated.

We will begin by conducting a ‘sprint’ with a select group of growers with major packhouse operations and industry experts to make initial assessments of the challenges, barriers, and returns on investments, to better understand the support from government that is needed to make fully automated packhouses universally viable for major growers. This will look to pave the way to fully automate these packhouses in 12 to 18 months.

Significant bespoke packhouse automation funding will be made available covering 2024 to 2025 and 2025 to 2026, to support growers. This will be based on a robust assessment of need informed by the initial sprint, increasing by up to £50 million the existing support for agri-innovation available from within the farming innovation budget. This will build upon existing support for agri-innovation from within the Farming Investment Fund (FIF).  

The government knows that the harvesting of crops is where demand for seasonal workers is highest and so, alongside the packhouse automation challenge, we will collaborate with technology companies and industry to accelerate the development of robotic crop harvesters. This will aim to bring prototypes to human picking parity in three to five years.

Robotic crop harvesting has the greatest potential to modernise horticultural practices, whilst securing global leadership in horticultural production and automation technologies. It will not only significantly reduce sectoral dependency on seasonal migrant labour, but drive a more productive, innovative, resilient and competitive food supply-chain, reduce crop wastage, create more sustainable farming practices, and improve food security and worker conditions and welfare. In autumn 2024, we will also set out details of how we will drive and fund this work.

Government recognises that automation advancements cannot happen immediately. However, this response sets out our commitment to incentivise and support the sector to automate as quickly as possible, to deliver the huge economic and technological benefits it offers.

Continued investment for the food supply chain

In addition to turbo-charging automation in horticulture, the government will continue to incentivise the research, development and uptake of automation technology across the whole food supply chain using pre-existing mechanisms.

The government permits full expensing for expenditure incurred on qualifying main rate plant and machinery investments from 1 April 2023, with a 100% first year allowance. This will last until 31 March 2026 and will continue to support investment in automation technology pre and post farm gate. We have also set the annual investment allowance to its highest ever level of £1 million since 1 April 2023.

The FIF, through two main strands, will continue to provide grants to farmers, foresters, and growers, including contractors, to invest in the equipment, technology and infrastructure that will help their businesses grow, whilst increasing farm productivity and environmental sustainability.

The first strand, the Farming Equipment and Technology Fund (FETF), provides smaller value grants towards a specified list of items proven to be effective in raising farm productivity, alongside environmental sustainability and animal health and welfare outcomes. In round one of the FETF, we paid out over £34 million with a further £21.6 million paid out to farmers who were successful in the most recent competition. Further rounds of the FETF are planned on an annual basis, with FETF 2024 having opened for applications on 6 March.

The second strand provides a more flexible model to improve productivity and sustainability, where applicants can seek higher-value investments for more significant infrastructure and equipment that is transformative to the farm business. On 25 January a second round of Improving Farm Productivity opened for applications. This offered an initial £30 million, providing capital grants of £25,000 to £500,000 towards robotic and automatic equipment, with up to an additional £20 million available depending on levels of interest.    

Furthermore, the government’s £270 million Farming Innovation Programme (FIP) continues to provide grants to farmers developing pioneering technologies and farming methods. This aims to connect groups of researchers, farmers, growers and agri-food businesses to work in partnership on projects that are responsive to industry-identified productivity challenges, alongside Defra-defined competitions.

Through the FIP, we recently committed £12.5 million funding to help accelerate the deployment and uptake of automation and robotics products and services, within horticulture and other agricultural sub-sectors, that required further research and development funding to enable them to come to market.

The retained EU Fruit and Vegetable Aid scheme will continue operating until 31 December 2025, funding actions that contribute to improved competitiveness and market orientation, with a particular focus on collaboration and productivity. The government has confirmed it will replace the scheme thereafter, expanding it to ensure that more growers, including those involved in Controlled Environment Horticulture such as glasshouses, can access investment.

We currently have no plans for a similar scheme post farm gate, where proven and commercially available automation technology is more accessible in many sub-sectors.

For food and drink SME manufacturers, however, the Made Smarter initiative will continue to support the adoption of industrial digital technologies.

In the recently published Advanced Manufacturing Plan, the government announced that it will be extending the Made Smarter Adoption Programme, committing up to £16 million in 2025 to 2026 to offer the scheme to all regions in England, before working with the devolved administrations to explore expanding the programme further from 2026 to 2027. The programme of support includes digital road-mapping, leadership and management training and 50% match-funded grants, to enable greater uptake of automation technology across the food supply chain.

The Smaller Abattoir Fund also opened on 13 December 2023, which will provide £4 million of grant funding for both capital items and investment in smaller abattoirs across England to help improve productivity, enhance animal health and welfare, add value to primary products, and encourage innovation and investment in new technologies.

Finally, the government welcomes the Regulatory Horizons Council’s report, which recently published the findings of a three-month policy sprint to explore and address the regulatory challenges and opportunities surrounding the use of Robotics and Autonomous Systems (RAS) in agriculture and horticulture.

The report made seven suggested regulatory policy interventions, which aim to foster a regulatory environment that stimulates growth in RAS in the agriculture and horticulture sectors, including establishing regulatory sandboxes for RAS; improving industry-led data collection; and enhancing collaboration between regulators, users and technology developers.

Defra and other government departments will continue to explore opportunities aimed at promoting the adoption of RAS in agriculture and horticulture. 

Summary - Automation

1. there will be a dedicated FDSC Automation Project Group to increase knowledge sharing and accelerate adoption of automation technology
2. government will be challenging the horticulture sector, equipment manufacturers and integrators to accelerate automation of packhouses
3. government will be working with industry to accelerate development of robotic crop harvesters, aiming to bring prototypes to human picking parity in three to five years
4. government is continuing existing grant funding to incentivise the research, development and uptake of automation technology