Sustainable Production Grant evaluation (summary)

The Sustainable Production Grant (SPG) was an important element of Welsh Government Rural Communities – Rural Development Programme (WGRC-RDP) 2014 to 2020. It was an investment package aimed at helping Welsh farmers to invest in equipment to reduce harmful environmental impacts from agriculture and to support sustainable farming and land use. It offered investment support for facilities and equipment related to animal health and welfare, crop storage, livestock housing and handling, renewable energy production and soil and crop management.

There were seven rounds (referred to as ‘windows’) of the SPG. In the early rounds (windows 1 to 3), the scheme was designed to help farmers in Wales to improve the economic and environmental performance of their agricultural holdings. For later rounds (windows 4 to 7), scheme objectives included enhancing nutrient management, as well as safeguarding and improving water, soil and air quality, by reducing pollution. 

This evaluation provides an independent assessment of the SPG in terms of its implementation and impacts within Wales.

The specific objectives of this evaluation project are to assess:

• effectiveness of the SPG scheme management – including the claims process, monitoring systems, communications and the availability of support post-award 
• progress of SPG in meeting the targets
• illustrative impact of the SPG 
• effectiveness of the project application, decision and appraisal processes
• extent to which supported businesses have been able to achieve the objectives set out in their business plans (for SPG windows 1 to 3) 
• extent to which the Business Plan model is utilised for SPG windows 1 to 3 (i.e. is the business plan requirement being used as a means to an end or is it a useful tool for farmers to help them achieve their objectives)
• SPG responsiveness to the perceived needs of the agricultural industry
• alignment of the SPG with support available to the sector and more broadly with the Welsh Government and EU strategic policy objectives.

A range of methods were used to form the evidence base for this evaluation.

• Scoping interviews with stakeholders (staff involved in the design and delivery of the SPG within Welsh Government and Rural Payment for Wales).
• A desk-based review of scheme documentation and a sample (10) of business plans of windows 1 to 3 beneficiaries.
• An online survey of scheme beneficiaries (population=481, responses=99) and non-beneficiaries (population=917, responses=54).
• Ten in-depth interviews with grant recipients from windows 1 to 3.
• Three focus groups and two interviews with grant recipients from windows 4 to 7.

Communications

The majority of both beneficiaries (58%) and non-beneficiaries (65%) reported Welsh Government services such as Farming Connect, Gwlad and the official website as being the primary source of awareness for the SPG grant. A higher percentage of beneficiaries cited interpersonal channels, such as consultants/agents (22 vs.13%) and friends/neighbours (15 vs. 9%) than non-beneficiaries; whereas a higher percentage of non-beneficiaries stated they used press articles (26 vs. 9%) as other sources of awareness of the SPG grant.

Application and claim process

Online survey results suggest that majority of beneficiaries were either satisfied or very satisfied (59%) with the application process, whereas a smaller proportion (24%) of non-beneficiaries felt the same.

The survey results also indicate that successful applicants tended to seek more assistance across various aspects of the application process than unsuccessful applicants. Most successful applicants sought external help in preparing the business plan (66%), completing the application form (55%) and providing supporting information (53%).

The interviews and focus groups revealed a need for more support for farmers. Many wanted more flexibility and guidance in both the application stage and during the project’s development. They noted issues around updating their project, providing invoices/bills and extensions or timeline changes. 

More in-depth insights from the focus groups and interviews with scheme beneficiaries suggest that some farmers found guidance at the application stage unclear and often complex. Many farmers perceived that a consultant was necessary and without one it would be too challenging or could potentially hinder their success in obtaining the grant. 

Interviews and focus group discussions also revealed that the requirement of securing three quotes for proposed capital investments during the grants process, often posed a challenge and proved difficult for farmers. Due to external factors such as COVID-19 and rising costs, farmers found that they were either unable to obtain three quotes for their capital items or the quote was no longer valid. Some farmers explained that prices had increased drastically since the initial quote provided by suppliers, thereby affecting the overall cost of the intended investment.

In terms of the claim process, online survey results suggest that only around 40% of the beneficiary businesses were satisfied or very satisfied with the support provided by RPW in the claim process and just under 50% of the respondents were happy with the time needed to process their claims. 

Feedback from the interviews and focus groups revealed that an area of concern for farmers was the time needed for claiming the grant, which added stress to farmers due to the large amount of money committed into the capital investments from their own finances or bank loans.

Use of a Business Plan 

Although 60% of the survey respondents reported that preparing a business plan was useful in terms of creating a focus for the farm, helping farmers reflect on costs and using it to plan for the future, in-depth interviews suggest that very few farmers made use of their business plan during or after the implementation of the SPG supported project.   

The interviews and focus groups show that the five-year business plan developed for the application stage was perceived by many as something that was not very useful. Most no longer used a business plan or had moved on from the business plan used at the application stage and were now using their own updated or changed one. The farmers found it challenging to justify the use of the business plan as it was a five-year plan and many had changed their farm practices since applying with it or encountered unexpected challenges which shifted their focus and business outcomes. 

Impact of the SPG

The online survey results suggest that the scheme made a positive impact on the environment (reducing pollution, increasing compliance with water quality regulation, etc.) and the economic performance of the farm businesses (increases in turnover, profit and sales, and decreases in cost and improvement in job efficiency, safeguarding jobs and benefits to local economy).

Interviews and focus groups highlighted farmers' perceptions of environmental benefits from their investments, more pronounced in windows 1 to 3 but still present in windows 4 to 7, where better slurry management and clean water solutions contributed to positive outcomes.

The grant provided flexibility and welfare benefits, allowing farmers to manage tasks more efficiently and improve long-term resilience in farm management.

Grant support not only benefited farmers but also local businesses and suppliers, particularly in windows 1 to 3 where larger investments led to increased employment and supply chain development. Many of the case studies show that profitability, efficiency and resilience had been achieved through the grant support as it allowed investment on a scale that was future proofing their business. 

Windows 4 to 7 showed a larger focus on improving nutrient, energy and water efficiency as well as meeting NVZ regulations. Despite a smaller grant size compared to windows 1 to 3, many farmers felt that they could still achieve efficiency and resilience in their businesses, aligning with upcoming regulations. However, external factors such as COVID-19 and increasing costs prompted many beneficiaries in later windows, as highlighted in focus groups and interviews, to note that the actual grant rate was lower than 40% of project expenditure due to cost increase.

Additionality 

The online survey results showed a relatively high level of additionality/low level of deadweight of the SPG scheme, with full deadweight of less than 5% and partial deadweight of approximately 30% indicated by scheme beneficiaries. Comparisons with the non-beneficiary group from the survey also confirmed high additionality of the SPG scheme in terms of achieving a range of impacts, with an overall 15% full deadweight and 9% partial deadweight indicated by non-beneficiaries.

Evidence gathered from the in-depth interviews and focus groups, however, indicates a division among farmers regarding whether they would have proceeded with the investment on their farm without the grant support. Many mentioned that the improvements and capital items they applied for under the grant were investments that the farmer was already considering or deemed necessary (particularly concerning regulatory obligations). The grant, however, supported the farmer in expediting the process of upgrading/expanding their farm or enabled them to pursue options that would have been otherwise inaccessible, such as robotics. Therefore, the additional support from the grant contributed mostly to creating a scenario that made the investment a decisive action for the farmer. It either allowed them to comfortably invest to align with future regulations or improved resilience through upgrading farm equipment and future-proofing the farm.

Findings from the evaluation suggest that recipients of SPG funding generally perceive positive impacts on their business but also for the environment and local economy. Moreover, the majority indicated that investments would not have been made without SPG funding or at least not as rapidly or at the same scale. Estimated additionality/deadweight is comparable to that reported by previous evaluations of similar grant schemes. 

However, successful and unsuccessful applicants encountered a number of issues with the process of applying for and/or claiming SPG funding. In particular, complexity forced recourse to (expensive) consultants, obtaining quotations from suppliers was awkward, inflation eroded the real value of funding, and time-lags between incurring costs and receiving funding caused cashflow/debt problems.

These issues are familiar from previous evaluations of similar schemes. To a certain degree, these issues merely reflect the ongoing challenge of balancing the need for public accountability and a desire for administrative simplicity. Nonetheless, some recommendations for potential improvements are offered below.

Effectiveness of the SPG Scheme Management

The effectiveness of the SPG was evaluated based on process effectiveness, measured by the effectiveness of communication, and efficiency of the application and the claim process as well as the use of the business plans developed at the application stage. 

In terms of communication, a significant proportion of beneficiaries and non-beneficiaries identified Welsh Government services, Farming Connect, Gwlad, and the official website as their main sources of awareness for the SPG grant. However, compared to non-beneficiaries, successful applicants tended to also use interpersonal channels (such as advisors and friends/neighbours) as information sources and seek more assistance across various aspects of the application process. 

Recommendation 1: Encourage farmers to use more advisory support when making applications to fully understand the guidance provided and assess potential implications for their businesses.

The application process saw a higher satisfaction rate among beneficiaries than non-beneficiaries. Challenges included unclear guidance during application, complexities in the quoting system, and difficulties in obtaining quotes due to external factors (such as COVID-19). 

The majority of beneficiaries were satisfied with the claim process. Improvement is needed for the processing time of claims, which caused some cashflow/debt problems.

Recommendation 2: Monitor the processing time for claims and identify main reasons for delays as well as appropriate measures to shorten the time for making funds available. 

The use of support varied, with successful applicants seeking external help for business plan preparation, application form completion, and providing supporting information. However, interviews highlighted concerns about the minimal support provided for many farmers, indicating a need for more flexibility and guidance during the application and project development stages.

Recommendation 3: Improve information and guidance provision during project development stage to facilitate high quality applications.   Consider offering explicit funding for advisory support (within same overall level of funding) for business planning and application processes.

In terms of the use of the business plan, while the majority of survey respondents found preparing a business plan useful, in-depth interviews revealed that very few farmers utilised it during or after the SPG-supported project. The five-year business plan developed for the application stage was perceived as less useful, with many farmers creating and using their updated plans.

Recommendation 4: Consider portraying business plan merely as evidence of engagement in process of business planning. 

Requirements to obtain three quotes from suppliers proved awkward for many farmers, leading to problems in accessing full funding and/or exposure to inflationary pressures.

Recommendation 5: Consider use of standard cost model, allowing for payment rates to be adjusted during periods of high inflation.

Impact of the SPG scheme

Farmers generally achieved or were on track to achieve their outlined objectives, but external factors sometimes cause deviations to outcomes. Windows 1 to 3 focused on large-scale changes, achieving profitability and expansion of farm businesses, while windows 4 to 7 emphasised regulation compliance with smaller grant sizes. The SPG scheme made a positive impact on the environment and economic performance, as indicated by online survey results.

Farmers perceived environmental benefits, flexibility, and welfare improvements due to the grant. The investment benefited local businesses through sourcing suppliers locally, contributing to short-term and long-term economic gains. 

Recommendation 6: Better monitoring data is needed to measure changes over time due to grant support both for economic and environmental outcomes.  Consider using a more standardised template (for example, the business plan) to collect both baseline and end of project data and making this a condition of receiving grant support for beneficiaries.

Additionality

The online survey suggested a relatively high level of additionality. In-depth interviews revealed differing opinions on whether farmers would have proceeded without the grant, but many acknowledged the grant's role in expediting upgrades and enabling access to otherwise unattainable options.

Recommendation 7: Adopt additional metrics to measure additionality collected routinely as part of application and claims process to allow additionality to be estimated more easily without recourse to ad hoc surveys. 

The findings indicate both positive impacts and challenges, emphasising the need for continuous improvement in communication, support availability, and clarity in the application and quoting processes for future iterations of the SPG scheme.

Report author: Yiying Cao, Michael Burd, Joshua Chapman and Andrew Moxey

ADAS and Pareto Consulting

Views expressed in this report are those of the researchers and not necessarily those of the Welsh Government.

For further information please contact:

Research, Monitoring and Evaluation team
Welsh Government
Cathays Park
Cardiff
CF10 3NQ

Email: research.evaluation@gov.wales

Social research number: 41/2026
Digital ISBN: 978-1-83745-113-5