Industry would benefit from tenancy changes
A call for a simpler and more flexible framework for establishing new farm tenancies was welcomed yesterday by Sarah Jane Laing, executive director of Scottish Land & Estates, who said it “captured the need to build confidence in the let sector”.
Against a long-term declineinfarmtenanciesin Scotland, Jeremy Moody, secretary and adviser to the Central Association of Agricultural Valuers, has produced, on behalf of the Land Commission of Scotland, a discussion paper aimed at opening up the farm letting sector.
In the paper, Moody maps the decline in the tenanted farming sector over the past century and the current complex rules.
He also assesses issues facing landlords and tenants including the perception among landlords that land letting is “high risk and low return”.
It is in his conclusions that some radical suggestions emerge, with one proposal including a new income tax relief as an innovative way of addressing increasing land availability.
But it may not be too radical as evidence from the Republic of Ireland suggests a significant increase in lettings there, following the adoption of a similar relief in 2015.
Moody said one of the key factors in any landlord/ tenant farmer relationship was that farming land should be mutually beneficial: “More is needed to build confidence so that a flexible let sector and wider agriculture can thrive.”
On behalf of the landowners, Laing stressed any new approach did not mean the end of existing tenancies “but looking ahead, simpler and more flexible arrangements are something that all with the interests of agriculture at heart should consider seriously.
“Ultimately, a vibrant ecology of letting arrangements requires the positive participation of landowners – there would be no tenants if no-one was willing to be a landlord.”
In assessing the report, Ian Austin, president of the Scottish Agricultural Arbiters and Valuers Association, claimed two strategic reforms by the Scottish Government could unlock a new future for farm businesses in Scotland.
He believed a new flexible framework could bring on to the market more let land, while encouragement should be given to landowners to let land.
He also called on the UK government to follow the Irish government with income tax relief for armslength private lettings of more than five years, saying: “We think the UK government should adopt it here to support positive changes in farming use and business structures.”
The Land Commission’s Tenant Farming Commissioner, Bob Mcintosh, said the report had been commissioned to encourage debate around different approaches and incentives for letting of land.
“The different approaches need to be considered alongside the work we’re doing on the current succession and retirement options for farmers and landowners.”