Mar 22 2017

STFA urges tenants to factor Brexit into rent reviews

Scottish Tenant Farmers Association

News Release

22 March 2017

STFA urges tenants to factor Brexit into rent reviews

The Scottish Tenant Farmers Association is urging landlords and tenants to take account of the Brexit factor in negotiating rent reviews. With the Spring rent review season underway STFA is reminding all those engaged in rent reviews that, although farm commodity prices have improved in the short term following the EU Referendum result, the real challenges lie ahead.  The rent review period is 3 years, so rents set in 2017 cannot be reviewed until 2020, by which time the UK may have left the EU and the Single Market if Article 50 is triggered as planned in 2017.

Writing in the STFA Spring Newsletter, STFA chairman Christopher Nicholson said: “The UK is facing huge uncertainty over the next few years as we head out of the EU. At the moment we are enjoying a short-term boost in commodity prices on the back of the drop in Sterling, but this is likely to be negated by rising input costs. Land prices appear to levelling or even falling due to Brexit uncertainties, both north and south of the border, and the devaluation of sterling could create a period of higher inflation when the profitability of agriculture, and land prices, are heading in the opposite direction.  Rents in England seem to be falling and we would expect to see the same thing happening in Scotland.

“Tenant farmers should understand where the main markets for their produce are, and the likely exposure to price changes if the UK has restricted access to the Single Market. For commodities that rely on an export market, the risks are greater if new trade agreements are not in place by 2019.  Of the main commodities produced by tenant farmers in Scotland, lamb is most reliant on export markets, and there is the further uncertainty over the future level of New Zealand lamb imports.  Already STFA are hearing from some tenant members who are cutting back their flock numbers to reduce their market exposure post 2019.

“Prior to rent reviews, tenants should look at the types of commodity produced on their farms, how reliant they are on export markets, and realise the risks involved post 2019. In short, lamb is most at risk, cereals and milk the least at risk, and beef somewhere in between.

“Brexit will also impact on Pillar 1 and Pillar 2 support payments. While the Basic Payment Scheme and Greening Payments have been guaranteed to 2020, LFASS payments are likely to see a big reduction in value from 2018, and there is no guarantee that funding will be available for new agri-environment schemes or schemes due for renewal.

“We are all in for a difficult time, and landlords should not be expecting rent increases in the next few years. Given that rent reviews are conducted with a view to the 3 years ahead, tenants need to factor in rising input costs when negotiating rents, particularly imported goods such as nitrogen and phosphate fertilisers, and animal feed proteins which will be affected by the fall in Sterling.  The bottom line is that tenants should be careful not to sign up to a rent increase which could jeopardize the viability of their business.”

By tfadmin • Uncategorized •

Mar 22 2017

STFA WELCOMES TENANTS’ HIGH COURT SUCCESS

Scottish Tenant Farmers Association

News Release

22^nd March 2017

STFA WELCOMES TENANTS’ HIGH COURT SUCCESS

Tenant farmers involved in the long running Salvesen Riddell debacle have scored a partial victory in their legal case against the Scottish government for compensation following the loss of their farms. The Court of Session ruled this week that the Government were liable to compensate the tenants “.. for loss directly arising from reasonable reliance upon defective legislation passed by it, which was then remedied by further legislation which interfered with the individuals’ rights”.

 Lord Clark rejected the tenants’ claims based on the value of the tenancy and but accepted that compensation should be paid in respect of specific losses directly sustained by the tenants who had acted in good faith on defective legislation and “for frustration and inconvenience”. Lord Clark also pointed out that both sides had agreed that the case had been brought to establish the principle of whether or not the tenants were entitled to compensation. As a consequence he was not in a position to quantify the scale of the compensation which he noted would have to take several factors into account, such as any capital investment they may have made in the holdings balanced by the fact that they had enjoyed an extended tenure beyond which they would have originally expected.

Commenting on the court ruling STFA director Angus McCall said: “This is an incredibly complex case and it will take some time for the tenants’ legal team to evaluate Lord Clark’s ruling. What has been made clear, however, is that the tenants are due some compensation for the harm caused to them by the flawed legislation instigated by the Liberal/Labour coalition and passed by the Scottish parliament 14 years ago.

The compensation due will obviously be assessed on a case by case basis and should reflect specific losses sustained by the tenants combined with a sum to compensate for the stress and heartache caused since the Remedial Order. Unfortunately Lord Clark makes no mention of the unnecessary suffering caused by the mishandling of the mediation process which never got underway until it was too late. If mediation had been available in the immediate aftermath of the remedial Order, when it should have been, it is highly that, some landlords and tenants would been able to reach agreement, with the government stepping in to assist where agreement was not going to be forthcoming.

In summing up, Lord Clark has reserved opinion on “… whether the application of those principles will or will not give rise to a sum being due to the qualifying general partners.  When that decision is reached it will also determine whether or not there has been a violation of the A1P1 rights of the qualifying general partner petitioners. I therefore reserve my judgement on that matter until the next stage in these proceedings”. The time must now be ripe for the Scottish Government and the affected tenants to engage in mediation and reach a mutually agreeable settlement which will take away the need to spend yet more time and money in litigation where the only beneficiaries will be the legal profession.

The Courts have established the extent of the government’s liability towards the tenants, there is no legal impediment to talking to the tenants so, let’s just get on and settle the matter and let the victims of this long running and tragic saga get on with their lives.

By tfadmin • Uncategorized •

Mar 2 2017

AMNESTY A TESTING GROUND FOR LANDLORD/TENANT RELATIONSHIPS

Scottish Tenant Farmers Association

News Release

28^th February 2017

AMNESTY A TESTING GROUND FOR LANDLORD/TENANT RELATIONSHIPS

The Scottish Tenant Farmers Association has commended Scottish Lands and Estates’ statement last weekend that its members are wholly committed to make the amnesty on tenant improvements work ‘well and fairly’. SL&E have also sought to clarify its position regarding tenant improvements to farmhouses.

In response to SL&E’s statement, STFA chairman Christopher Nicholson said: “We obviously welcome this signal that landlords are ready to play their part in the amnesty on tenant’s improvements. This amnesty presents tenant farmers with an opportunity to remedy deficiencies in paperwork which would otherwise have rendered many of their improvements to the farm ineligible for end of tenancy compensation.

“The amnesty process will, no doubt be complicated. Although the intention is clear, some of the legislation is confusing and open to different interpretations, such as the treatment of improvements to farmhouses and cottages and the notion of what is “fair and equitable”.

“Housing under an agricultural lease is exempt from the Housing Acts and as landlords are under no obligation to bring housing up to acceptable standards they have traditionally been reluctant to invest in farmhouses. Consequently improvements have invariably been carried out by tenants over the years and it is only right and proper that they should receive compensation at waygo.

“There are a number of grey areas around some aspects of the amnesty and STFA will be calling on the new Tenant Farming Commissioner, Bob McIntosh, to work with stakeholder organisations to find common agreement on resolving differing interpretations. STFA has already recommended the Land Commissioner and TFC approach the Land Court to explore ways of determining disagreements without embarking upon an expensive court case.

“The amnesty kicks off in earnest on 13^th June and STFA is urging tenants to make an early start in preparing for it by checking leases and looking through past paperwork so they can substantiate the notices they will be serving. In doing so, tenants should remember to detail improvements they have made to the farm which will not be eligible for compensation, but which must be taken into account in rent reviews – an important consideration with changes to the rent test imminent.

“Many tenants, especially those undergoing a rent review have already embarked on the process of registering improvements and fixtures. There is, of course no reason why landlords and tenants should not agree to recognise improvements before the legislation is activated. Andrew Thin, the government’s independent adviser has some useful guidance on the government website.

“The amnesty for tenants’ improvements will be an important testing ground for future landlord/tenant relationships. If the process is to go smoothly it will require co-operation, understanding and goodwill from all sides. STFA will play its part in making tenants aware of the amnesty, providing them with information on how to go about it and ensuring they are adequately prepared. We hope that all landlords will share the commitment shown by their leadership and make the amnesty a success.”

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Feb 23 2017

STFA URGES GOVERNMENT TO RETHINK POLICY OF TURNING VALUABLE LIVESTOCK PROTEIN FEED INTO RENEWABLE ENERGY

Scottish Tenant Farmers Association

News Release

21^st February 2017

STFA URGES GOVERNMENT TO RETHINK POLICY OF TURNING VALUABLE LIVESTOCK PROTEIN FEED INTO RENEWABLE ENERGY

The Scottish Tenant Farmers Association is repeating its warning to government that the headlong drive to produce renewable energy from by-products of the distilling industry through Anaerobic Digesters and Biomass plants will cause severe damage to the beef industry. The supply of distillery by-products, draff, pot ale syrup and dark grains, which beef and many sheep systems in marginal areas have relied on for decades as a reliable source of GM free protein, is now at risk.

The proliferation of AD and biomass plants over the last few years severely limits the supply of this feed source as distilleries divert their by-products towards renewable energy, encouraged by significant financial incentives from government. Draff has doubled in price and is in short supply and dark grains, which are a staple ingredient of most compound feeds, now have to be hauled from the central belt and there are doubts as to how long this source will be available.

North-east livestock farmer and STFA spokesperson on the environment, Alastair Nairn said: “It is not just local farmers who will miss sourcing home grown protein for their livestock on their doorstep, but this is now setting alarm bells ringing amongst the animal feed industry. The issue was discussed at yesterday’s meeting of the Agriculture and Climate Change Stakeholder Group where our concerns were shared by representatives of the feed industry.

“Unfortunately we are trying to close the stable door after the horse has bolted. It is more than 5 years since we highlighted the value of distillery by-products and warned the government of the damage that would be caused if supply became restricted. In 2012 a government commissioned report by SRUC predicted that the expansion of whisky production would ensure a plentiful supply of draff and dark grains. This has proved to be wildly inaccurate. The explosion of AD and biomass over the last few years has all but decimated the supply of draff locally and dark grains now have to be hauled from the central belt.

“The growth of AD plants has created its own problems with a vast quantity of digestate (waste from the AD process) now having to be spread on grassland. As yet, farmers have no real idea of the long-term implications of spreading this waste and how it will effect the chemical composition of soils, trace elements and available nutrients.

STFA supports the principles behind the Scottish Governments Climate Change Plan and its attempts to create a circular economy making use of anaerobic digestion and other methods to reduce emissions and turn waste products into renewable energy. However, controlling emissions should not be looked at in isolation and there must be a proper assessment of the impact that this policy may have on livestock farming and the knock-on effect on the environment and rural communities.

Far from being waste, distillery by-products are in fact a valuable source of protein in animal feed and restricting supply will harm livestock production, particularly in the beef sector. STFA is also concerned that the increasing change of use of large areas of arable land from food production to energy crops will damage the agricultural economy in some areas and will restrict opportunities for the tenanted sector and new entrants to farming.

STFA has welcomed the government’s commitment to investigate the value of renewable energy production from distillery by products in terms of its contribution to mitigation of climate change and the long-term impact it will have on livestock production and the rural economy. In the interim, STFA is calling for a planning moratorium in granting permission to build any more large scale AD or Biomass plants before more damage is caused to the livestock sector.

By tfadmin • Uncategorized •

Oct 11 2016

STFA plea to Scottish Government to halt court battle with tenant farmers

Scottish Tenant Farmers Association
News Release

11th October 2016

STFA plea to Scottish Government to halt court battle with tenant farmers

The Scottish Tenant Farmers Association has lent its support to today’s press statement issued by Hendersons Surveyors on behalf of the eight tenants affected by the Salvesen Riddell debacle and the subsequent Remedial order.

The STFA is bitterly disappointed that these tenants are being forced to take the Scottish Government to court in an attempt to gain some recompense for the loss of their tenancies as a consequence of bad law passed by the Scottish Executive in 2003. Time is now running out for the remaining eight tenants and their families who have been in limbo since the UK Supreme Court ruled in early 2013 that they must leave their tenanted farms. They now find themselves in Court on 1st November, the next two families will be losing their farms at the end of November and the rest face eviction next May and November.

Commenting on the dire situation STFA Director Angus McCall said; “The last four and a half years have been a misery for these tenant farmers since Lord Gill condemned the law that gave them security of tenure ten years previously as incompetent and contravening the property rights of landlords. The tenants now feel they have been hung out to dry by the government and its lawyers.

“None of the assurances given to them by ministers or parliament when the Remedial Order was passed in 2014 has been met. The mediation process which was supposed to take place never got off the ground, government has refused to enter into negotiation with the tenants regarding any form of compensation and now they find themselves faced with a lengthy, expensive and stressful legal battle with the government, an outcome that the RACCE committee precisely warned against.

“There is no doubt, that if the mediation process had taken place as originally planned and in the spirit intended, some of these tenants would not now be facing eviction and the others would have come to a mutually agreeable end of tenancy settlement instead of four years of uncertainty and emotional turmoil. This sorry saga has exemplified the harsh and uncaring side of government where common decency and a sense of fair play is being sacrificed on the altar of political expediency.

It is not too late for the government to enter into a dialogue with the tenants and prevent a lengthy and expensive court battle. STFA would reiterate the plea made a year ago for the rulers of this country to accept moral responsibility for the damage done though the actions of a previous government to these families and move without further delay to find a way towards an equitable settlement rather than forcing them into a long drawn out, expensive and life sapping legal battle.”

For further comment contact:

Angus McCall 07767 756840
Eddie Henderson 01577 862566

Henderson’s press release below:

TENANT FARMERS BEING FORCED TO FIGHT FOR THEIR RIGHTS!

The effects of the Salvesen / Riddell case have been far reaching and now resulting in Eight Tenant Farmers and their families finding themselves in Court against the Scottish Government despite all of the assurances to the contrary. The Remedial Order 2014 process promised that the tenant farmers adversely affected by this new legislation would be looked at on a case by case basis and due consideration would be given to the requirement for compensation payments being made for them now finding themselves losing their livelihood and in some cases, their homes.

The highly publicised Salvesen V Riddell case following the Supreme Court judgement required the Agricultural Holdings (Scotland) Act 2003 Remedial Order 2014 to correct the unlawful outcomes resulting from the defect identified and it was acknowledged by the Government’s Agricultural Minister at that time, that the Order would have a negative impact on many Tenant farmers.

The Government were advised by the Rural Affairs Committee that they should make every effort to ensure that the affected tenants did not suffer further by having to face lengthy and very costly court proceedings in seeking compensation for the impact the Remedial Order would have on their secure tenancies.

Unfortunately, having paid lip service to the advice, the Scottish Government has made no effort to lessen the stress and financial burden and these eight farmers and their families now find themselves in court as of the 1^st November 2016.

Despite the many assurances from the Scottish Government, these eight families now find themselves having to fight for what should have rightfully been addressed by the Government. One farmer has already been put out of his farm in January of this year, two more families will find themselves in the same position as of the end of November with the remainder facing eviction in May and November of next year.

One of the families due to end their tenancy at the end of next month lives on the Isle of Arran. The farm is run by two young brothers – the very type of young farmer the Government continues to stipulate is needed in Scottish agriculture. The brothers have worked all of their life on this farm on Arran, have heavily committed to environmental schemes which may now be in jeopardy and have also created a diversification business which will prove very difficult to relocate. All of the work they have carried out both on the farm and their diversification business will count for nothing when leaving their farm at the end of November. Without any form of compensation from the Government, they will be left with nothing and no means of continuing either with another farm or with their diversified business. They are young men who have worked hard believing that they would be there for the rest of their working lives, only to find that due to the failings of the original Act and subsequent Remedial Order, this is no longer the case.

The latest failing in the promises made by the Government has been their inability to procure a Mediator – something which was originally put in place, but was obviously so high on their agenda in resolving issues with the plight of these tenants, that they failed to renew the contract which ran out in June of this year.

As acting agent for the eight tenants going to court, Mr Henderson said, “it is despicable that the Tenants have been treated in this way and forced to suffer the stress of an unknown future and the financial burden of court action for mistakes made by previous Governments and legislation, with nothing but broken promises as to how they would be considered and compensated. To hide behind the legal department and use this as an excuse to refuse meeting with the affected Tenants to seek resolution out of Court is contrary to what was originally promised and will inevitably be at a further unnecessary cost to the Tax payer” he added “the fact that the Government have failed to procure the promised Mediator at such a critical time for the Tenants due to leave their farms next month, only highlights the lack of importance the Government places on this sorry mess as well as their total lack of understanding on the effect their broken promises have had and continue to have on these families” .

Contact:

Mary Mackie

Tel: 01577 862566

Email: mmackie@hendersons-surveyors.co.uk

www.hendersons-surveyors.co.uk

By tfadmin • Uncategorized •

Sep 27 2016

Small Landholding tenant farmer faces eviction

Scottish Tenant Farmers Association

News Release

 26^th September 2016

Small Landholding tenant farmer faces eviction

The Scottish Tenant Farmers Association is concerned to hear that a small landholding tenant faces losing his farm if the Scottish Government approves a planning proposal for a film studio and other developments on his small holding on the outskirts of Edinburgh.

Commenting, STFA director Angus McCall said; “Local residents are fighting to prevent the imposition of what appears to be a substantial development, including a film studio and a Gas, Chip and Pellet fired Power Station, on prime agricultural land against the will of the farmer, the local community at Damhead, and The Midlothian Council.

“This situation also highlights the vulnerability of tenant farmers who are powerless to resist a notice to quit if planning permission is granted over the whole holding. Small landholding tenants such as Mr Telfer have even less protection against development and are even more at risk. STFA has been lobbying the Scottish Government to modernise this anachronistic form of land tenure and, at last the government has agreed to conduct a survey of Small Landholding tenants to seek solutions to their plight. This however will be scant comfort to Mr Telfer who faces losing his century old tenancy although it is understood that he may be able to continue to occupy his house in the meantime..

“The Damhead Community are petitioning the Scottish Parliament to stop the eviction and are urging supporters to sign the petition by 28^th September for presenting to the Parliament the following day.

The petition can be found online at https://www.change.org/p/demand-scottish-government-reject-pentland-studio-planning-application-stop-eviction-of-our-farmers-stop-development-of-trojan-horse-power-stations-in-the-greenbelt”

The Damhead Community’s statement has been removed from this site due claims of defamatory content.

By tfadmin • Uncategorized •

Sep 14 2016

STFA backs survey of professional agents’ behaviour

Scottish Tenant Farmers Association

News Release

 13^th September 2016

STFA backs survey of professional agents’ behaviour

The Scottish Tenant Farmers Association has welcomed the joint initiative between RICS and the Government’s interim adviser, Andrew Thin, to monitor the conduct of professional agents in rent reviews. The move follows concerns expressed by MSPs during the debate over the Land Reform Bill earlier this year and has the backing of organisations representing both landowners and tenants.

The project is a joint initiative between RICS and the Scottish Government’s Independent Adviser on Tenant Farming (IATF), and follows the issuing in late March of a discussion paper about agent conduct which has been the subject of consultations with key industry bodies.

Over the next 6 – 12 months landlords and tenants involved in rent reviews will be asked a series of questions about their experience where the other party to the review employed an agent to act for them. The aim is to understand and assess how the person on the receiving end of an agent’s negotiating tactics feels about the encounter.

Responses will be analysed with a particular focus on how the conduct of agents employed by landlords is perceived by their tenants, and vice versa where an agent is employed by the tenant. The aim is to identify any aspects of the agent’s behaviour that might be potentially damaging to landlord/tenant relations.

The IATF published a guide to maintaining good relations for landlords, tenants and their agents in June 2016 which emphasised the pivotal role of agents in these relationships, and described four broad criteria which should underpin the behaviour of all three parties.

Commenting on the joint initiative, Chairman Christopher Nicholson said: “For some time now STFA has been convinced that the behaviour of some professional agents has been the root cause of the poor relationships between landlords and tenants. This view was recognised by the Agricultural Holdings Legislation Review Group and the RACCE committee of the Scottish Parliament who both heard first hand evidence from tenants who felt their relationships with their landlords had been damaged by way in which of a minority of land agents had behaved. Generally the situation was worse where an outside firm of land agents had been contracted in to conduct rent reviews.

“STFA fully supports this initiative which will, we hope, herald a new era of mutual self-respect and remove the stress, confrontation and sometimes unwarranted expense which so often accompanies what should be routine business negotiations, such as reviewing the rent. It is heartening to observe that the warnings issued by the Parliament already seem to have been taken on board by professional agents on all sides and the advent of the Interim Adviser on Tenant Farming has helped to resolve some potential disputes.

“STFA would, however, like to see this initiative rolled out to encompass other business dealings between landlords and tenants, such as the proposed amnesty for improvements which may well lead towards areas of disagreement and dispute. The amnesty will probably be one of the most important discussions tenants will ever have with their landlords, affecting not only end of tenancy compensation, but also the level of rent to be paid under the new rent review test based on the productive capacity of the farm. The amnesty will probably be available from the turn of the year and has a 3 year time limit and so it is important that negotiations over agreeing tenants’ improvements are conducted fairly and in a business-like manner.”

By tfadmin • Uncategorized •

Jul 20 2016

STFA sets out Brexit priorities for Scottish agriculture

Scottish Tenant Farmers Association

News Release

13^th July 2016

STFA sets out Brexit priorities for Scottish agriculture

 The Scottish Tenant Farmers Association has drafted an initial list of commitments and priorities to be considered by governments as the lengthy and uncertain process of the UK withdrawal from Europe and the Common Agricultural Policy begins.

Commenting on the process, STFA chairman Christopher Nicholson said: ‘Scottish agriculture is currently in a period of poor profitability and the increased uncertainty brought about by Brexit could not have come at a worse time. In contrast to England where only 15% of farm land is classed as Less Favoured, in Scotland 85% is Less Favoured and heavily reliant on support payments under the European Common Agricultural Policy. The most immediate priority for governments is to give some stability to the sector by committing to make the existing support payments to 2020 which farmers have budgeted for, and ensuring a level playing field with Europe for UK farmers with barrier free access to European markets.’

‘Going forward, a new UK wide agricultural policy will need to be developed by the devolved powers of England, Scotland, Ireland and Wales, and it is essential that the new policy is finalised before payments under the current CAP cease. A budget for each devolved power would need to be agreed with the devolved administrations implementing policy that fits their own needs.’

‘Amongst all the uncertainty and changes, there could be a silver lining in that the Scottish Government will have greater flexibility outside of the CAP to target support payments to avoid some of the excesses of the past, in particular to put an end to ‘slipper farming’ and ensure that payments only go to genuinely active farmers. There are elements of the CAP that are cumbersome and have restricted the ability of nation states to implement policy suited to their own needs, and a future policy should be able to provide the freedom to tailor that has been missing under the CAP’

‘With budgets for the CAP replacement policy coming from the UK instead of Europe, the new policy will need to stand up to greater public scrutiny in terms of how it meets the public interest. On-going long term public support is vital for Scottish agriculture, but will only be possible if the policy is seen to provide long term value for the taxpayer.’

Scottish Tenant Farmers Association, Brexit priorities

 Immediate concerns

 Commitment from Government to deliver the next 4 rounds of support payments up to the end of 2020, as planned and budgeted for by farmers. This will provide stability and reduce uncertainty in the short term.

Existing agri-environment contracts must be honoured and the process for those that are open to applications or being processed must continue.

A new agricultural and environmental policy must be in place before existing support schemes are removed. The new replacement policy must provide for UK farmers a level playing field with the rest of Europe and continued barrier free access to European markets for British farm produce.

Priorities for a new agricultural and environmental policy

 A dedicated budget for Scotland from the UK Government

At present the devolved Scottish Government administers the EU CAP budget which is granted by the UK Government. When the UK withdraws from the CAP the UK Government must provide sufficient replacement funding for the devolved Scottish Government to administer according to the needs of Scottish Agriculture.

A consequence of the budget coming from the UK instead of the EU will be greater public scrutiny of how the funds are used, and the need for all aspects of the future policy to meet the public interest. Long term public support for agriculture will only be possible if the policy provides value to the taxpayer.

Targeting of support payments to meet the public interest and give value to the tax payer

Withdrawal from the CAP should allow greater flexibility for Scottish Government to target payments in a manner which avoids the excesses of the past. In particular, support should only go to genuine active farmers, putting an end to ‘slipper farming’. Meeting the public interest may require the capping of payments to individual businesses, and targeted support payments could be used to encourage long term sustainable land tenure arrangements.

Importance of family farms

Family farms have been the resilient backbone of Scottish agriculture for centuries, and have provided not only first class farm produce but also key social and environmental benefits to Scotland’s rural areas. STFA believe that future farming policy should continue to support our current structure of family farms, and that the future policy must be well thought out to avoid the risk of family farms being replaced by extensive systems of agriculture and forestry which would be devastating for rural communities in the more marginal areas.

Access to markets

Future international negotiations on tariffs and market access for the UK’s agricultural produce must provide barrier free markets which will support a strong and competitive farming industry in the UK. Markets for UK farm produce must not be viewed as an expendable negotiating tool in future trade deals.

Delivering environmental outcomes

Agri-environment schemes should be outcome based, with farmers paid for the environmental benefits they provide. In contrast, payments under the current schemes are based on income forgone by the farmer. There are significant environmental benefits farmers can provide, especially with regard to soil management and carbon sequestration.

Farm infrastructure grants

Capped farm infrastructure grants to maintain investment and competitiveness on family farms.

Importance of support for marginal areas

A new uplands / Less Favoured Area scheme suited to Scotland. 85% of Scotland is LFA, in sharp contrast to England which is 85% non-LFA. An appropriate support scheme for marginal areas is vital for Scottish agriculture.

 Avoid the unintended distorting effects of current and past support payments

Areas based support payments both current and past have created a pattern of ever increasing land prices and land rental values which is unhealthy for agriculture, acts as a barrier to new entrants, and is often seen by the public as taxpayers supporting solely landownership rather than food production and management of the environment. Unlimited area based payments have also encouraged a pattern of land tenure driven by short term objectives to maximise payments rather than the objective of maintaining long term sustainable farming practices. Some modern letting agreements now require the tenant to pass all the area based support payments to the landlord, with the tenant having to meet all the obligations and conditions regarding the support system. Such a system of support payments clearly has elements which are not in the public interest and cannot be justified.

 Transparency of supply chain and fair returns

Farmers are typically in weak market position, sandwiched between suppliers and customers who both have monopoly powers in the marketplace. STFA see a clear role for industry ombudsmen to give annual reports on the profitability of the different stages in the food supply chain, ensuring transparency of profits at each stage, with the aim of encouraging a fair division of profits for each stage including the farmer.

Marketing

Continued marketing, promotion, recognition and branding of Scottish food and drink.

Simple and fair regulations

Rules and regulations for access to support schemes should be simple and straightforward, and penalties for breaches should be fair and proportionate.

Research and development

Continuing advisory, research, training and educational functions tailored to Scottish agriculture are vital to ensure the future viability of the sector

By tfadmin • Uncategorized •

Jul 20 2016

STFA URGES CAUTION IN END OF TENANCY PLANNING

Scottish Tenant Farmers Association

News Release

21^st June 2016

STFA URGES CAUTION IN END OF TENANCY PLANNING

The Scottish Tenant Farmers Association (STFA) is urging all tenant farmers to exercise caution and take good independent advice from experts on tenancy law when planning for retirement. When it becomes live, the new Land Reform Act of 2016 will provide a tenant wishing to retire from farming a range of options allowing him to receive realistic and fair compensation for not only the improvements he has carried out during his tenancy, but also for the value of his interest in the lease.

As at present, a tenant leaving his tenancy is only bound to receive compensation for agreed improvements he has made to the unit, on top of traditional compensation for crops in the ground, residual manurial values and so on. In many cases this represents a paltry sum and is no incentive for a tenant to retire early and make way for the next generation.

The new Act changes all this. A tenant wishing to retire can now take advantage of the amnesty on tenant’s improvements and make sure that he is compensated for improvements he has made without the proper paperwork. He can also take advantage of the new section which allows him to assign his tenancy to a limited group of new entrants and progressing farmers, if the landlord does not wish to pre-empt the assignation by buying out the tenant’s interest in the lease, to be calculated by an independent valuer appointed by the Tenant Farming Commissioner. Finally, the tenant also has the option of passing on his tenancy to a much wider class of relative than at present.

However, it is important to note that the Act is not yet active and will be implemented in stages over the next couple of years. Most of the new provisions which do not require secondary legislation should be implemented by the end of this year, but some such as the section of Relinquishing and Assignation of 1991 Tenancies are not expected to be live till next year and the new rent review section will not be available until 2018.

STFA Director Angus McCall comments: “STFA is urging tenants not to jump the gun in trying to use the new Act. There are a number of tenants who are keen to retire and pass the farm on, but they should be patient and wait a few months until various parts of the Act are active before taking action. Although the principle of compensating a tenant for transferring his interest in the lease back to his landlord has been agreed, the valuation process is still to be finalised. It is thought the tenant’s share of the value of the tenancy may be about 25% of the open market value of the farm, but this will vary according to the individual’s circumstances.

“It is also vitally important that informed expert advice is sought. Tenancy law becomes more complicated with every act of parliament and there is a lot of misunderstanding and misinformation on the go. Even some professional advisers seem to be confused. Not even the so-called experts get it right, if a recent presentation on rent reviews at law conference is anything to go by! Rather than being enlightening, the confused and inaccurate talk on the new rent system saw many of his colleagues equally at sea with the new laws.

“The Interim Adviser on Tenant Farming, Andrew Thin has just issued an “Interim Code on Determining Compensation at Way-Go”, but it must be emphasised this this code relates to the law as it stands and anyone contemplating quitting a holding should note that the Land Reform Act offers alternative ways of realising the value in a secure 1991 Act tenancy once those provisions come into effect. STFA strongly recommends that independent professional advice is sought before agreeing any way-go valuation in order to fully assess the different options that may be available. Tenant farmers should take advantage of the show season to speak to representative organisations. STFA is fully up to speed with the new Act and has the added advantage of a free legal helpline provided by Hamish Lean who was a member of the AHLRG.

“These are important decisions which can be irreversible so tenants must make sure they get them right!”

By tfadmin • Uncategorized •