Tenancy consultations to be held for England and Wales

Two concurrent consultation processes will be launched tomorrow in England and Wales on the issue of agricultural tenancy, on foot of a report from an advocacy group for tenants in both countries.

The Tenancy Reform Industry Group (TRIG) delivered a report to the Department of Environment, Food and Rural Affairs, as well as Welsh Government ministers, in the autumn of 2017.

The launch of the consultations has been welcomed by the Tenant Farmers’ Association, despite the fact that not all of the recommendations from the TRIG will make it into the consultations.

It is great to see some of the ideas discussed by TRIG gaining wider exposure as it was disappointing that the Agriculture Bill, published last year, failed to feature any references to agricultural tenancies.

“Important changes do need to be made to the bill to ensure that farm tenants are not left out of new policy initiatives. We hope that there will be time to feed in some of the ideas raised in these consultations in the debate on the amendments tabled, and as we head towards the latter stages of the bill,” said George Dunn, chief executive of the TFA.

The consultations will contain some “radical proposals” according to the TFA, including a plan to allow tenants to sell their interest through tenancy assignments to assist in retirement and restructuring.

There are also plans to provide tenants with greater leverage over “restrictive” clauses, which the TFA claims prevents these tenants from diversifying or entering certain schemes.

While we are really pleased to see these suggested changes to legislation, it continues to be a source of frustration that we are not able to look at the possible changes to the taxation framework within which agricultural tenancies operate.

“The consultation will look at some of the legislative barriers to longer tenancies, but the biggest drivers are the ways in which taxation operates,” argued Dunn.

He highlighted: “The TFA has argued that landlords should only be able to obtain Agricultural Property Relief from inheritance tax if they are letting land for 10 years or more, rather than for tenancies of any length as is currently the case.”

He concluded by saying: “As farm business tenancies now account for almost half of all tenancies, and with over 80% of all new tenancies being let for five years or less, we risk moving into a very short-term environment which is not good commercially or in producing public goods.”