Rock Review of Agricultural Tenancies: Government Response

Thursday 25th May 2023 Written Statements

[The Minister for Food, Farming and Fisheries (Mark Spencer)]

I am repeating the statement made yesterday by my noble friend the Minister, Lord Benyon.

Following the UK Farm to Fork summit last week, the Government have today set out its next steps to support tenant farmers who are at the heart of our rural economy. The Government supports tenant farmers because there is no better way to bring new people into the sector.

We are today publishing the Government response to the Rock Review of tenant farming in England. From day one of the agricultural transition, we have worked with tenant farmers as we co-designed our farming schemes, utilising their knowledge and experience. This is the next step, alongside significant work to date, to support farmers in all corners of the country to produce world class food, while protecting the environment. The Government supports tenant farming, because it is one of the best routes to bring new people into the sector.

I would like to thank Baroness Rock and the tenancy working group for their time and dedication in producing the review. Recognising how critical the tenanted sector is to a successful agricultural transition, we commissioned the group, chaired by Baroness Rock, to carry out a comprehensive review of tenant farming in England.

Today’s response builds on the considerable progress that we have made since the review was commissioned to implement their ongoing feedback. For example, we have designed the sustainable farming incentive (SFI) to be as accessible as possible to tenants, with the addition of six new standards in 2023 and shorter agreements. Further, half of the 22 landscape recovery projects selected in the first round involve tenants and we are delivering the aims of the local nature recovery (LNR) scheme by evolving countryside stewardship (CS) instead of building an entirely new scheme.

As announced at Budget 2023, we launched a consultation on extending inheritance tax relief.

We have opened a call for evidence on the taxation of ecosystem service markets to understand the commercial operations and the areas of uncertainty in respect of taxation.

We have also published the “Nature Markets Framework”, which provides greater clarity on the principles that will guide the development of UK market mechanisms for carbon and other ecosystem services and set out next steps including arrangements to develop a suite of investment standards for nature markets. These consultations, combined with the Nature Markets Framework, should give tenants and landlords more confidence to invest in and securely access payments from these new markets, opening up new revenue streams for the sector.

We strongly agree with the review that tenant farmers should be able to access farm offers; make their essential contribution to restoring the natural environment; and produce food for the nation. We are therefore taking forward the majority of Baroness Rock’s recommendations and setting out the next steps to implement them today.

Today we are announcing a new farm tenancy forum to put in place more formal engagement and feedback structures between Defra and the tenanted sector. This will allow the tenanted sector to work with us, to provide regular feedback on trends in tenant/landlord agreements and report any emerging issues that may need addressing, effectively monitor trends in landlord-tenant relationships. We are inviting industry organisations who represent tenant farmers, agricultural landlords and professional advisors who work in the sector to be members of this group. The forum will support the implementation of the Government response to the Rock Review, feeding back real-world experience and insight on progress. Terms of reference for the group has been published alongside this Government response.

We will be launching a call for evidence this summer to explore the proposal for a tenant farming commissioner in England in more detail. This will examine the benefits and impacts of how a tenant farming commissioner might work in practice and how the role would fit within existing procedures and regulations.

We agree with the review that the tenanted sector has an essential role as a route into farming for new entrants. We will work to embed the views of the tenanted sector in the development of our new entrant support scheme, working closely with the new tenant farming forum.

Our response sets out the significant progress we have made to ensure our new farming schemes work for every type of farmer. We are supporting those with shorter tenancies or where there is a change of land manager/owner by removing penalties and increasing flexibility in agreement lengths, where it still provides value for taxpayer money. We are also introducing a requirement in countryside stewardship for landlords to engage with their tenant prior to applying in order to obtain their support.

The legacy of the review will mean that tenant concerns are heard and addressed through our policies and schemes, and we will continue to engage with the forum and the wider sector as we implement its recommendations and move through the agricultural transition.

[HCWS806]