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Government announces further support for tenant farmers

| Mark Chatterton | 8 June 2023

Following the UK Farm to Fork Summit at Downing Street last month, the government has announced further support measures for tenant farmers in response to the independent Rock Review.

This review was published in October 2022 and included significant input from all parts of the sector, including landlords, agents, and tenants, to support its long-term sustainability,

The new government’s response to this is very welcome news to the tenant farming sector, especially in the current challenging economic climate.

‘Farm Tenancy Forum’ to consider current challenges

The measures are generally in line with the Rock Review’s key recommendations, including the introduction of a new Farm Tenancy Forum, which will work to consider the challenges that the sector currently faces. It will also aid in facilitating more collaborative working relationships between tenants and landlords, helping to shape farming policy for the better.

The government is also planning to launch a ‘call for evidence’ in the near future on the proposal for a Tenant Farming Commissioner in England. This will aim to build on existing actions that have been taken to help tenant farmers benefit from Environmental Land Management schemes (ELMs).

The aim is to ultimately design a fairer system - working in the best interests of British farmers - including the tenant farming sector. The announced measures are designed to build on the progress of these ELMs, allowing tenants to benefit from more flexible options.

One of these flexible options is the Sustainable Farming Incentive Scheme - where tenants can apply, without landlord consent, and also sign up to shorter, three-year agreements which can be ended without incurring any penalties.

The recent announcement includes a commitment of more than £168 million in grants, being made available to farmers throughout 2023 to assist in supporting food production, improving animal health and welfare, protecting the environment, and driving innovation.

Accessibility is key to tenant farming success

The government also aims to accelerate the rollout of the Sustainable Farming Incentive Scheme to make this as accessible as possible with the addition of six new standards in 2023 - bringing the total up to nine.

The limit for the Farming Equipment and Technology Fund has also been lowered to £1,000, in an attempt to make it more accessible. The fund also now allows local authorities to apply to the fund themselves.

A consultation has been launched on extending Inheritance Tax (IHT) relief to also include land in ELM schemes, which should provide landlords and tenants with more flexibility to diversify their land. The consultation will also explore an option to limit IHT relief to land which has been let out for a minimum of eight years - providing tenant farmers with more certainty over tenancy agreement lengths.

The government has also opened up a call for evidence on the taxation of ecosystem service markets, in order to better understand areas of uncertainty.
This, in principle, should give landlords and tenants the confidence to invest in these new markets, as well as securely accessing payments without worry. As a result, this should open up potential new revenue streams for the sector.

NFU receptive to promising government measures

In response to the announcement, the National Farmers Union (NFU) has been generally receptive to the additional measures and has confirmed that it will work closely with the government in order to ensure that all considerations are taken forward and acted upon as swiftly as possible.

NFU Vice President, David Exwood, explained that the NFU welcomes much of what has been announced - including the new farm tenancy forum, which, he says, would provide regular, vital feedback on the tenant/landlord relationships.

David went on to emphasise that it is absolutely essential that the forum is set up as quickly as possible to revitalise the sector and aid with the challenges currently faced. He said that “these reforms must enable us to grow a more vibrant, accessible and resilient tenanted farming community” - to which I am in complete agreement.

If you’ve got any concerns or questions, you should not hesitate to contact our Agriculture team who will be more than happy to help.


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