BY: PHIL EDMONDS
The challenges associated with farm ownership transition have not gone unnoticed by the Government.
MPI research shows over half of New Zealand’s farmers have identified succession planning is an issue for them, their family, and their farm businesses. It’s a pressing concern and one it has been proactively trying to address – albeit indirectly.
Poorly planned or even non-existent farm succession might not sound like a significant inhibitor to the growth aspirations the Government has for the primary sector, but failure to deliver straight-forward ownership transition will at the very least stifle the ability to optimise land use.
MPI’s acting Director of Rural Communities and Farming Support Peter Ettema says the Government’s food and fibre sector roadmap, Fit for a Better World – Accelerating our Economic Potential, includes a target of employing 10,000 more in the food and fibre sector workforce over the next four years. But Ettema says the target will be difficult to achieve without clearly marked and enticing career pathways that progress to farm ownership.
A key part of the succession process is ensuring young people or career changers see farm ownership as achievable. If not, then there’s the potential to see those who are best placed to take leadership roles (those who have grown up in the sector) look for alternative careers.
So, what is the Government’s role in making sure the obstacle of farm succession is overcome? It can’t directly fund and facilitate decision making that safeguards family relationships through farm asset transfers. It has however been active through enabling industry bodies and rural professionals – those organisations already providing services to farmers – to become stronger advocates for the importance of succession planning.
Ettema points to the Red Meat Profit Partnership programme (RMPP) co-funded by MPI from 2013 as an example of its interventions.
“The RMPP worked closely with farmers and an industry advisory group to develop resources for pathways to farm business ownership. Lawyers (who pulled together examples of agreements) and consultants with experience of working with entry into, and transitioning of, farm businesses were involved, and that generated case studies, videos, fact sheets, guides to necessary legal documents, and a resource book.”
The wide range of material is easily accessible on the Beef + Lamb NZ Knowledge Hub website.
Resources targeted at dairy farmers have also been developed from projects connected to the Transforming the Dairy Value Chain PGP and are available on the DairyNZ website. More recently, MPI’s Sustainable Food and Fibre Futures (SFFF) programme has funded the New Zealand Deer Farmers’ Association to lead workshops helping deer farming families across the country talk about succession planning.
MPI acknowledges that while the red meat industry is often the focus of succession challenges with the owner profile markedly skewed toward older age groups, other primary sectors are as much at risk of not enabling easy exits and entries.
MPI targeted the horticulture industry last year by funding a report on business succession, that investigated financial and business mechanisms in horticulture and agriculture that can facilitate the incoming generation succeeding to horticultural businesses or building equity in horticultural careers.
To make sure its reach goes beyond (and across) individual sectors, succession planning also has the potential to be supported by start-up funding through Rural Community Hubs. Ettema says the Hubs, established by MPI to help rural communities respond to the challenges they face, could deliver workshops by suitable rural professionals if it was deemed to address a local aspiration.
To some extent creating the resources and making them available is the easy part. Getting farmers to engage with it, and act on the advice is the most important challenge.
FIND OUT MORE
Beef + Lamb NZ Knowledge Hub – www.beeflambnz.com
DairyNZ – www.dairynz.co.nz/business/planning/succession-planning/
www.dairynz.co.nz/publications/dairynz-podcast
MyMilk – www.farmsuccession.co.nz/
Passing it Forward – CMK accounting – cmk.co.nz/publications-resources/
A legacy or a liability – how to master farm succession – search ‘succession’
under Podcasts at www.sarahscountry.com
