4:24pm Friday 3rd January 2014
A FARMERS’ leader has called for longer tenancy agreements and a realistic approach by landlords on rent reviews.
Jeremy Walker, national chairman of the Tenant Farmers Association (TFA), believes the average length of tenancy agreements should be at least ten years.
He also said that two years of extreme weather had left the finances of many farm businesses “fragile” at best and landlords and their agents had to be realistic in their approach to rent reviews, investment and maintenance.
Mr Walker said: “Landlords have been used to seeing uplifts in farm rents over recent years.
However, notices served for rent reviews in 2014 will apply to holdings last reviewed in 2011 when margins were appreciably better than are being forecast.
“Landlord’s agents therefore need to take a realistic approach to reviews and ensure that the expectations of their clients are managed appropriately.
The TFA does not see that there is scope for further increases to rents which were properly reviewed in 2011.”
Mr Walker said the TFA would like 2014 to be the year that longer tenancies are granted. Since the introduction of farm business tenancies in 1995 the average length had rarely been more than four years.
He said: “The TFA believes that at least tenyear agreements should be more the norm. With the major planks of the CAP policy now in place and with a very benign taxation environment, we think there is no excuse for landlords not granting longer terms at this time.
“If we do not see the demonstration of this in the marketplace, we will be looking for the Government’s assistance in making this a reality.”
Mr Walker described 2014 as a year of both promises and potential pitfalls. He said that as “the Is are dotted and the Ts are crossed” on the European Regulations for the new CAP, the UK’s devolved administrations would be working to ensure that both pillar one and pillar two schemes are ready for launch at the beginning of 2015.
He said: “Despite the good performance of Mark Grimshaw’s Rural Payments Agency team in more recent times, the dark days of 2005 will loom large over the staff of the RPA, particularly as we are seeing the development of new computer systems to operate the new policies.
“Given the past, poor performance of Government departments in being able to deliver major IT projects on time and on budget it is inevitable that there will be major risks of problems occurring. This will be exacerbated by a number of outstanding policy issues yet to be determined which will impact on implementation.”
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