Won a Capital Grant? Mind the Gap Between Approval and Payment

The 2026 Capital Grants offer put £225 million on the table for environmental improvements across England: slurry stores, concrete yards, fencing, water infrastructure, tree planting and a long list besides. For farms whose applications land, the grants are genuinely transformative, funding work that would otherwise sit on the someday list indefinitely.

But anyone who has been through a grant scheme knows the part the guidance underplays. Grants, as a rule, pay in arrears. You do the work, you evidence the work, and then you are reimbursed. Between approval and payment sits a gap, and the gap is filled with your money.

Consider what that means in practice for something like a slurry store. The build might run well into six figures. Contractors invoice as they go. Suppliers want paying on delivery. The grant, meanwhile, pays out on completed, evidenced work, sometimes in stages, sometimes at the end, and always after the farm has already found the cash. A grant covering forty or fifty per cent of a project still leaves the farm financing one hundred per cent of it for months at a time.

Farms handle this gap in predictable ways. Some drain working capital and spend a season running uncomfortably close to the edge. Some lean on the overdraft, which is expensive and was never sized for capital projects. Some stagger the work to spread the outlay, which usually means the project takes longer and costs more. And some, having read the payment terms properly, quietly decide not to apply at all, which is the worst outcome of the lot: free money left on the table because the bridge to it was missing.

The better answer is to treat the gap as what it is, a short-term financing requirement with a known repayment source, and fund it deliberately.

Where the project involves equipment and machinery, asset finance does the job directly: the kit is funded over its working life, the grant income arrives and can be used to reduce the balance or simply restore working capital, and the farm never carries the full outlay. Where the project is construction, finance against machinery the farm already owns can release the cash to pay contractors, with the grant refilling the tank when it lands. Either way, the principle is the same. The farm's assets do the bridging, rather than its current account.

There is also a timing advantage that is easy to miss. Grant windows are competitive and deadlines are real. Farms that can demonstrate the project is deliverable, funding in place, contractors booked, tend to move faster from approval to completion, which matters when payment follows completion. Being financially ready is part of being ready.

None of this changes the arithmetic of whether a grant-funded project is worth doing. That case stands or falls on the project itself. But a good project abandoned for want of bridging cash is a planning failure, not a financial necessity, and it is an avoidable one.

If you have a Capital Grants application approved, or one in preparation, and the payment-in-arrears structure is the part keeping you up at night, talk to Buckingham Leasing before you talk yourself out of the project. We can look at the equipment involved, or the kit already in your yard, and put a bridge across the gap so the grant does what it was supposed to do: improve the farm, without hollowing out its cash to get there.