Draft Agricultural Holdings (Fee) Regulations 2022

Mark Spencer Excerpts

Wednesday 30th November 2022 General Committees

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

I beg to move,

That the Committee has considered the draft Agricultural Holdings (Fee) Regulations 2022.

It is a pleasure to serve under your chairmanship, Mr Twigg. I declare my farming interests, as set out in the Register of Members’ Financial Interests. As agricultural tenancy matters are devolved, I speak for England only, but I want to highlight that we worked closely with the Welsh Government on this instrument, and the same composite instrument was debated and approved by the Senedd on 22 November. I therefore trust that my Opposition colleagues will follow their Welsh colleagues and approve the regulations.

Many tenants and landlords work collaboratively and progressively to resolve issues that may arise during their tenancy agreement, but sometimes that is not possible. In that case, our agricultural tenancy legislation enables either party to the tenancy agreement to apply for a professional authority to appoint an independent arbitrator to help to resolve any disputes. The legislation also enables the professional authorities to charge a small statutory fee to cover the administration costs of delivering an arbitration appointment service. The current statutory fee was last set in 1996, at £115. Because of inflation, that sum no longer covers the costs incurred by the professional authorities in delivering that arbitration service, so the purpose of this instrument is to update the statutory fee on a cost recovery basis, to £195. That is in line with His Majesty’s Treasury guidance on managing public money. The increase was supported by 73% of the respondents to the Government’s consultation on the issue.

The instrument also updates the regulations in line with changes made in the Agriculture Act 2020 to include a wider list of professional authorities that can now offer an arbitration appointment service. The list now includes the president of the Central Association of Agricultural Valuers, the chair of the Agricultural Law Association and the president of the Royal Institution of Chartered Surveyors. Tenants and landlords have more choice between different service providers, which will help to drive continuous improvement and the provision of an efficient and quality service. In addition, the instrument includes a new duty to review the regulations every five years. Reviews will be carried out in consultation with the industry to check that the level of statutory fee is appropriate and in line with the cost-recovery principles.

I am aware that the recently published report on tenant farming—the product of a review led by Baroness Rock—includes recommendations on the operation and oversight of dispute resolution. I put on record our thanks to Baroness Rock and members of the working party for their work in producing the report. I welcome the report and the focus on supporting a vibrant tenancy sector. The Government are considering recommendations, and I will be meeting Baroness Rock to discuss the report soon. The Government will publish a formal response in due course.

I hope that I have assured you, Mr Twigg, and members of the Committee, of the need for this instrument. It will ensure that tenant farmers and landlords continue to have access to the appointment of an independent arbitrator when they need it, funded by an appropriate statutory fee set on a cost recovery basis.

--- Later in debate ---

[Mark Spencer]

I am disappointed by the Opposition spokesman’s comments. It appears fairly obvious to me that in Wales, where the Labour party is in charge and has the responsibility to sort the matter out, it is happy to go along with the increase, but here, where we are in charge, it somehow finds a political opposition to the increase. That is pretty disappointing.

There are two separate issues. One is the arrangements for the management of the arbitration service; the other is the cost. Today we are just sorting out the cost of the arbitration service, and £200 does not seem like a large sum for that service to be delivered. These occasions are quite rare, and in order to resolve challenges between tenants and landlords a fee has to be applicable. I think that £200 is an appropriate amount of money, particularly if we are talking about blocks of land where rents may be in excess of £150 an acre. We are talking about a fee equivalent to 1.5 acres on a block of land.

The hon. Member mentioned the Rock review. Of course, we will respond as soon as we can. I would gently say to him that it is more important to get it right than to do it quickly. He can have a response as quickly as he wants, but we want to get it right and consider it properly. There were 80-plus recommendations in that report. It deserves the Government to look at it properly, and consider how many they can adopt. I am keen to take onboard as many recommendations as possible. A lot of work went into the report, and it deserves due consideration. That is what it will get. I hope that the hon. Member will reconsider and support the motion, as his colleagues did in Wales.

[Daniel Zeichner]

I hear what the Minister says, but the increase in the rate has been waited on for eight, nine or 10 years.