Rural Landlords and Land Letting: Reform

Lord Cameron of Dillington Excerpts

Thursday 21st January 2021 Grand Committee

[Lord Cameron of Dillington (CB) [V]]

My Lords, I declare an interest as a farmer, landlord and past tenant farmer.

In haste—if we want our agricultural productivity to compete with other nations’, we need fresh blood and, for agricultural tenancies to proliferate, to bring that fresh blood in we need to have a system that encourages both sides to get involved. Tenants need the incentive to invest in their soil and infrastructure. In my view, no tenancy should be for less than seven years and, if possible, it should be renewed for a further seven years unless there are good reasons not to, which could include, for instance, the landlord having a family who want to farm, or even wanting to sell the holding. However, a second term should be the norm.

Extending succession provisions of older tenancies to wider members of the family would not help. Interfering in existing contracts sends all the wrong messages to landlords and it would not open up our farms to all our best students, who do not happen to have a sitting tenant as a relative. Succession tenants are not necessarily the most able and, for our agriculture to catch up with others’, we must ensure that all of our very best can have their chance.

Equally, to encourage more lettings, HMRC needs to recognise the concept of the rural business unit, whereby you can have different enterprises operating on a holding but treated as one business for the purposes of tax. One of those permitted enterprises should be long-term agricultural tenancies. If that were to happen, long-term tenancies would flourish. Incidentally, agricultural tenancies themselves should be able to include a variety of enterprises, especially and including ELMS.

I stress again that, for agricultural tenancies to proliferate, the motivations of both landlords and tenants must be accommodated.