Cashflows in disarray
Farmers' cashflows will be thrown into disarray for the second consecutive year as the Rural Payment Agency puts the brakes on payments.
The first week of February saw the RPA computers reset to pay just 50 per cent of payments due, with a target to pay the balance at the end of June. This followed a two-week run when full payments were distributed to a few luckier farmers.
Balfours' partner Peter Wright, pictured, says: "For the second year running farming businesses will face problems in their cashflows. The single payment system will essentially produce these problems each year - and so it is easier to plan for the worst - then things can only get better."
He says as we enter year two, facing virtually identical problems, there is a need to review how farm businesses are to overcome these difficulties.
"Last year, because the problems were viewed as teething troubles rather than the norm, businesses scraped by on relatively informal and temporary finance arrangements.
"However with news that 50 per cent of SFP won't be paid until the end of June, we would urge businesses to revisit overdrafts and loans."
