Government’s Plan for Water: The Water Management Grant (Round 2)

Tash McDonagh, one of our Harper Adams Placement Students has taken time to summarise the latest round of the Government’s Plan for Water as follows –
Arrow Graphic

The Government released their Plan for Water document on the 4th April 2023, this document sets out how they plan to achieve their water security goals in the UK. The document splits the Government’s plan into three sections;

  1. Transform the management of the whole water system
  2. Deliver a clean water environment for nature and people
  3. Secure a plentiful supply of water

The final section of the document is the most crucial for those involved in the agricultural sector because this includes the Government’s plan to secure a supply of water for farmers. The main aims of this plan are:

  • To increase the amount of water stored on-farms to 66% by 2050
  • To allow farmers to obtain abstraction licences quicker and easier
  • To remove planning barriers to smaller reservoirs
  • To encourage more agricultural collaborations such as the Felixstowe Hydrocycle Ltd

There are also two grants within the plan:

  • The Slurry Infrastructure Grant

    • £34 million grant funding slurry stores and slurry equipment
    • Currently closed for applications however DEFRA have announced that another two rounds will be released in late 2023 and 2024

  • The Water Management Grant

    • £10 million grant funding on-farm reservoirs and irrigation equipment
    • Currently open for applications

The Water Management Grant (Round 2)

The Water Management Grant provides funding for on-farm reservoirs, irrigation technologies and irrigation infrastructure as part of the Farm Transformation Fund – this is the second round of funding for this grant. The grant is aimed towards businesses that grow irrigated crops, which can either be a landowner or a business renting land to grow the crops. If the business applying is renting the land, then they will need to have a sufficient period of time left on the rent agreement.  The grant will cover 40% of the projects cost, with up to £10 million of funding available:

  • Minimum grant fund per project is £35,000 (£87,500 total project cost)
  • Maximum grant fund per project is £500,000 (£1,250,000 total project cost)

It is possible for an applicant to make up to 3 applications for different projects, as long as the total grant funding applied for does not exceed £500,000.

The Water Management Grant has been set up to promote sustainable water sources therefore it will not support projects that source water from:

  • Summer water abstraction
  • Mains

The grant will support projects that source water from:

  • Winter peak-flow abstraction
  • Rainwater harvesting
  • Bore hole/aquifer

The grant can be used to apply for reservoir construction and infrastructure items, irrigation equipment and irrigation technologies, to find a full list of the eligible items that you can apply for under the grant then please follow this link.

Application – Two Stage Process

Stage One

Stage one of the application process is a short online application, this opened on the 19th  April and will close at midnight on the 12th July 2023. The application has an eligibility section at the beginning which will be scored; strong, average or weak – this part can be completed as many times as you would like to improve your score but once you go past this part and submit, you cannot resubmit. The details required for the stage one application are listed below:

  • Farm/business details
  • Items required
  • Estimated cost
  • Planning permission (you need to indicate if planning permission will be required but no details need to be given in stage one)
  • Abstraction licence (you need to indicate if an abstraction licence will be required but no details need to be given in stage one)
  • Current/future water and irrigation use
  • Cropping

Once all stage one applications have been submitted the RPA will assess the applications and if the grant is oversubscribed, they will shortlist the applicants according to the best fit to policy objectives.

Stage Two

Successful stage one applicants will be invited to stage two/full application a month after stage one is close – approximately mid-August. You will then be required to provide further information at this stage, as listed below:

  • Abstraction licences
  • Current and future irrigation water sources
  • Current and future irrigation techniques
  • Areas of current and future irrigated land
  • Cropping that will be irrigated
  • Quotes

    • For items over £5,000 you will need to provide 3 different quotes from different companies

  • For items under £5,000 you will only need to provide 1 quote

The Water Management Grant requires you to fund the other 60% of the project privately – hence why they require evidence of project funding. Private funding can come in the form of a loan, mortgage or funding from a private company such as a water company, as long it is not considered public funding. You are allowed to purchase items using lease purchase or hire purchase as long as when you claim the grant funding you own the items outright and have paid off all installments.

The stage two applications should take approximately 6 weeks to complete and can be submitted as soon as you are ready too. The deadline to submit is 31st October 2024.

Project Construction

Once the full application is submitted, the RPA will try to turn it around in approximately 60 days when a Grant Funding Agreement will be offered to the applicant. According to these timescales we believe the earliest the Grant Funding Agreement could be offered is January or February 2024. It is crucial that the Grant Funding Agreement is accepted and signed before any of the following is started on the project:

  • Work or commitments to costs (deposits)
  • Legal contracts
  • Any orders

If work is started before the agreement is accepted, then your application will become ineligible.

The RPA have estimated that project construction should take around 18 months to complete from the date the Grant Funding Agreement is accepted but if you believe your project will take longer, the RPA will reassess the timeline. Grant funding will be paid in Arrears which means that you will only be able to claim your funding after the money has been spent – you can claim your total funding in up to 3 separate payments.

Final Notes

Once constructed, the reservoir water can be sold or traded with neighboring farms as long as evidence can be provided that some of the water is still being used in the applicant’s business.

If you have any questions regarding the Government’s Plan for Water or the Water Management Grant, then please get in touch with us –