British fruit and veg growers may see their levy payments rise after the reform of the levy board system.

Running costs at the Horticulture Development Council were likely to increase, not fall, once the system was centralised under Levy Board UK, according to HDC tree fruit panel chairman Clive Baxter. The hikes could drive growers out of business, he claimed.

"Given there's no business plan for the reform, it's hard to see how adding another layer of bureaucracy won't add cost," he said.

It would defeat the object of reform, which was to improve the value each sector board provided to its levy payers, he claimed.

"The only reason the Apple and Pear Research Council joined the HDC was because we had identified cost savings."

The first step towards raising the levy rate was taken last week, when the ceiling for payment was raised from 0.5% of growers' sales to 0.75%. The decision was taken at the inaugural meeting of the horticulture sector company, which will take over from the HDC in April 2008.

"At the HDC, we actually considered reducing the percentage because the funds we have available are adequate for our R&D," added Baxter.

It was poor timing for the decision, said NFU horticulture board chairman Richard Hirst. "The levy board review was supposed to be about efficiency so this may send out the wrong message.

"I wouldn't be happy to pay the increase at this stage, and in the future I would want it to go on research and development or promotion, not on extra administration costs."

But Hirst said growers may not see rises straight away. "I suspect it's just a precaution so the board doesn't have to go back to the government and ask for an increase further down the line."

Topics