Support useless without land

Recent announcements in the media by the Royal Bank of Scotland that new entrants to farming need additional support is to be commended. However in reality will this do any good and will it alter the situation of an aging farming population and a chronic shortage of farms to let?

The current business road shows and seminars carried out by the bank with the Young Farmers Clubs are an important first step. These provide practical experience on budgeting, business planning and understanding accounts, which are key elements for new entrants and young farmers entering the world of bidding for farms.

However, where are the farms for them to apply for? Unlike in the days of our national bard, Robert Burns, who changed farm regularly which was the norm, there are few or no farms available for young entrants.

The Forestry Commission is to be applauded for the creation of starter farms offering new entrants a first step on the farming ladder. But the word “starter” implies a progression and that after the initial 10-year term of the lease they will be expected to move on to a larger unit. All very well in an ideal world but there are no farms to progress to. What will happen at the end of the tenancy? The tenant could rightly say the farm is their home and business and refuse to move. We have already seen evidence of this and will the cabinet secretary and the government officials again ride into battle to raise the issue of tenants’ rights as we saw last year in East Lothian? Surely a 10-year lease means a 10-year lease.

Cambridge Council is to be lauded for making four farms available to new entrants. The forward-thinking council has turned its back on a quick capital boost to funds by selling land, and supporting tenanted farms. The application criteria for the farms are strict. Applicants must be between the age of 23 and 40, have had five years’ practical experience or a three-year formal agriculture qualification; have sufficient financial support and must not be from established farms.

Those who can demonstrate direct employment generation will have enhanced potential. The final element is that the farms will be let on farm business tenancies (FBT) for a period of more than two years.

So why are we in Scotland struggling to make more land available for new entrants? The answer is simple. We need the government to abandon all ideas of rights to buy for tenancies (1991 Act Tenancies accepted) and to provide security and some incentives for landlords however large or small to let land. The government wants a vibrant tenanted farming sector but seem unwilling to facilitate it. The flexibility of the FBT or something similar is vital to making new tenancies work.

Financial institutions find themselves in a difficult position as well. There is a willingness to kickstart the new entrant market but under current structures, they cannot support those with no track record in farming.

There cannot be one set of credit rules for existing customers and borrowers and another for new entrants – or can there?

Somebody needs to take the lead. We all know what needs to happen but there are perceived risks involved. Banks risk bad debts and land owners risk potential tenancy issues and rights to buy. The answer in my humble opinion, is in the government’s hands. Trying to influence the Brexit debate seems more important to some than the future of our young farmers and our rural economy.

Picture: PA. RBS has joined the debate over new entrants to farming.