Proposals to enable tenant farmers to improve professionalism and prosperity by overhauling agricultural tenancy laws are part of a consultation launched today (9 April).

First published:
9 April 2019
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Currently around 30% of total land farmed in Wales is rented either through the Agricultural Holdings Act, Agricultural Tenancies Act or informal agreements or grazing licences.

The consultation looks for ways to enable this key sector of the agricultural industry to modernise by considering elements of tenancy law which are perceived outdated or restrictive to modern farming practices.

The 12-week consultation, running concurrently with another from Defra, builds on the recommendations of the Tenancy Reform Industry Group, who provided advice on the key policy priorities for the tenanted sector as the United Kingdom prepares to leave the EU.

The aim is to enable tenant farmers and agricultural landlords to thrive by ensuring agricultural tenancies are fit for the future as we move away from the Common Agricultural Policy and bring in a new agricultural policy.

The consultation will seek views on proposals which could remove perceived barriers to productivity levels and make it easier for structural changes in the tenant farming sector.

These changes aim to remove barriers preventing tenants from erecting or alter buildings, invest in new fixed equipment, take on other land or diversify into non-agricultural activities, such as environmental land management.

The consultation, where responses will be made from where the holder is registered when land straddles the border, will focus on four distinct areas;

  1. Proposals to facilitate structural change - the proposals have been designed to enable the incumbent tenant to give up or pass on their rights to others in advance of the retirement age, creating opportunities for the younger generation.
  2. Proposals to facilitate productivity, investment and environmental improvements - the proposals would include loosening standard landlord restrictive clauses in leases preventing tenants from making longer-term investments in sustainable land management practices and productivity improvements.
  3. Non-legislative options - this may be through brokering better and more robust relationships between tenant and landlord and promoting the benefits of longer tenancy agreements.
  4. Call for evidence - this section includes an open call for evidence covering mortgage restrictions and repossession of farm businesses to aid consideration of the issues and potential action in the future.

The consultation will also seek evidence and views into whether current restrictions on agricultural mortgages are a barrier to landowners wishing to let land, as well as whether there is a need to introduce additional measures into repossession proceedings to provide protection for farm business borrowers who are unable to meet finance repayments.

It is hoped the new proposals will assist tenants and landlords to adapt to change, access new schemes, improve productivity and enable structural change by modernising elements of tenancy law.
The consultation is open until 2 July.

Minister for Environment, Energy and Rural Affairs, Lesley Griffiths, said:

“We are determined to put the agricultural industry in the best possible position to thrive in the future and allow both landowners and tenants to adapt to challenges and overcome whatever issues they face.

“As we prepare to leave the European Union and Common Agricultural Policy it is more important than ever that we support proposals like these, so tenant farmers can be safe in the knowledge that their futures are strong and sustainable.

“We’re urging everyone in the sector to share their views so we can gain an insight into the issues they’re facing and ensure the new regulations are fit for purpose. With this reform we’re determined to help farm businesses become more professional, resilient and prosperous in the future.”

Chairman of The Tenancy Reform Industry Group Julian Sayers said:

"TRIG as the cross industry Group has worked closely with the Welsh Government representatives to identify how to invigorate the tenanted sector through further legislative and other measures.

“We face a period of significant change across the whole farming industry, to which both landlords and tenants must be in a position to adapt over the course of the next few years and beyond."