Food processing grants: Growth Programme
- Rural Payments Agency, Rural Development Programme for England Network, and Department for Environment, Food & Rural Affairs
- Part of:
- Growth Programme: grants for the rural economy, Common Agricultural Policy reform, and Access to the countryside
- First published:
- 23 March 2015
- Applies to:
Some food processing businesses can apply for grants from the Growth Programme – this explains who can apply and what the grants will cover.
These Growth Programme grants are for businesses that process agricultural and horticultural products.
They are to help these businesses gain access to new national and international markets, with new or existing products, by creating new processing facilities.
Applications will need to show how the farmers and growers that supply the raw materials will benefit from the project. This could include:
- shared risk and reward, and/or
- paying price premiums to suppliers
Some food processing projects can also apply for a business development grant. The call for applications will say which types of grant applicants can apply for.
Who can apply
Businesses can apply for this grant if they process Annex 1 agricultural and horticultural products (for example, meat, milk, grain and root vegetables).
The exception is fisheries products, which are not eligible for these grants. These projects may be eligible for grants under the European MMF
The applicant business can be a micro, small or medium-sized business. Check how to calculate the size of a business.
Micro and small businesses that have a business development grant can also apply for these food processing grants, as long as the grants are for different projects.
Who can’t apply
The following are not eligible for these grants:
- non-departmental public bodies or Crown bodies
- members of Producer Organisations under the Fresh Fruit and Vegetables Aid Scheme who have had (or can get) a grant for the same project under that scheme
Businesses wholly or partly supported by government funding
Businesses that are wholly or partly supported by government funding are only eligible if they can show that the funding used to match the grant is from private sources (for example, savings or a bank loan).
Applicants that have some public funding
If an applicant has already had public funding, they must declare this when they apply. They may not qualify for some grants if they have received more than €200,000 (approximately £145,000) of funding in the past 3 years.
Applicants can contact the RPA to check whether they are eligible.
Food Enterprise Zones
Food Enterprise Zones (FEZ) are being set up in some LEP areas. The call will say if there is a FEZ in the LEP area and if applications for projects in a FEZ will have priority over other applications.
How much funding is available
Growth Programme grants will normally be above £35,000. Each ‘call for applications’ will specify if there are minimum and maximum grant limits.
In general, the amount of the grant depends on whether or not the end product of the processing is still an Annex 1 product.
|Raw materials in||Product out||Business size||Grant rate|
|Annex 1 product||Annex 1 product||Micro, small and medium businesses||Cornwall and the Isles of Scilly up to 50%. All other areas up to 40%|
|Annex 1 product||Not an Annex 1 product||Micro and small businesses||Cornwall and the Isles of Scilly up to 45%. All other areas up to up to 20% OR Up to 40% to de minimis limits in all areas|
|Annex 1 product||Not an Annex 1 product||Medium||Cornwall and the Isles of Scilly up to 35%. All other areas up to 10% OR Up to 40% to de minimis limits in all areas|
Businesses whose end product is Annex 1
Micro, small and medium-sized businesses can all apply for up to 40% of the project’s total eligible costs. Businesses in Cornwall or the Isles of Scilly can apply for up to 50%.
Businesses whose end product is not Annex 1
If a business is using Annex 1 raw materials but producing an end product that is not Annex 1, the amount of grant money available will depend on the state aid cover used.
A maximum of €200,000 (approximately £145,000) is available to any one applicant in any 3-year period under de minimis state aid regulations. If an applicant has had other public funding, this may count towards the de minimis aid amount, and reduce the amount of money they can apply for.
If a grant is awarded under de minimis regulations, the grant rate will be 40% in all areas of England. This will cover grants of up to a maximum of €200,000 (approximately £155,000), depending on whether the applicant is already in receipt of other state aid using de minimis limits.
Where an applicant has had the maximum funding under the de minimis rules there may be other state aids rules which will provide for grants of up to 20% of eligible costs. RPA will check and discuss this with applicants where necessary.
If a grant is not awarded under de minimis regulations, the grant rate for small and micro businesses will be 20% (or 45% in Cornwall and the Isles of Scilly). The grant rate for medium-sized businesses will be 10% (or 35% in Cornwall and the Isles of Scilly).
Applicants can get funding for these costs:
- building or improving fixed property
- buying new equipment and machinery, and
- architects, engineer or consultant fees for the project (as long as these don’t add up to more than 15% of the project’s total eligible costs)
The following costs are also eligible, as long as they only form part of the project being funded:
- buying or developing a dedicated piece of computer software (but not an off-the shelf piece of business software like Microsoft Office)
- patents, licences, copyrights or trademarks, and
- energy-saving and resource efficiency equipment
There are some costs which are not eligible for all grants
Food processing grants will also not cover marketing and promotion costs.
How to apply
Read about how to apply for Growth Programme grants.
Rural Payments helpline: 03000 200 301