DEFRA plans further review of tenancy rules

DEFRA is planning a review of agricultural tenancy legislation, to see if changes made in 2006, designed to improve landlord/tenant relations, are working properly.

Addressing Thursday’s (19 November) NFU tenant farmers’ conference at Chatsworth House, Derbyshire, junior DEFRA minister Lord Davies said he would convene a meeting with TRIG (the Tenancy Reform Industry Group) early next year to take stock of the situation.

“If evidence comes forward that landlords are preventing succession, or putting up barriers to diversification, then government will look again at the fiscal and legislative measures needed to address this,” he said.

The 2006 reforms were intended, among other things, to encourage diversification by tenant farmers, allow the restructuring of holdings without jeopardising tenants’ rights and provide more flexibility for rent reviews and notices to quit.

TRIG chairman Julian Sayers said it was possible some landlords were stopping tenants from diversifying because of concerns over loss of agricultural property relief (APR). If this was the case, then it was important tenants came forward with the evidence.

He also highlighted challenges around planning permission acting as an impediment to investment. “Planning permission is also increasingly expensive, and sometimes unnecessarily complex,” he said.

“I would also highlight the proposed community infrastructure levy, which would be an added and inappropriate burden to a farmer looking to invest in a new slurry store or anaerobic digester.”

Mr Sayers called for the letting of farms by landlords to be treated as a business from a taxation point of view, which “would act as encouragement to investment”.

NFU president Peter Kendall also addressed the conference, calling on tenants, landlords, government and the food chain to create conditions in which farming is valued and viable.

“Farming in the UK, of which tenants are a vital part, has a central role in feeding the global population, tackling climate change and maintaining some of our most cherished landscapes, particularly the uplands,” he said. “Investment is critical if farmers are to meet those challenges.”

He called on government to facilitate a business environment which encouraged this investment. The phasing out of the Agricultural Buildings Allowance by 2011 was a retrograde step.