Farmers will need to be supported and practical action is needed to target the issue of rural housing, a new report has stated.
The Retirement Housing for Farmers in The United Kingdom document considers access to housing for retiring farmers and the impact on the industry.
It was released on Thursday (24 October) by University College of Estate Management, the Central Association of Agricultural Valuers (CAAV), the Prince’s Countryside Fund, the Royal Agricultural University and the Northumbrian Water Group.
Agricultural and rural housing has been the subject of official reports and action by housing organisations, but less attention has been paid directly to the specific issues of housing and farming retirement.
The report identifies that current measures and policies, such as the Prince of Wales’ Rural Housing Initiative and rural planning initiatives, have not worked sufficiently and potential post-Brexit challenges could stimulate retirement.
The nature of the issues means there is no single answer but rather a need for a range of flexible options and support, says the report.
Jeremy Moody, secretary and adviser to the CAAV, said: “Housing is one key obstacle to farmers when scaling down or retiring – whether through lack of availability or limitations in affording it.
“We need to promote the opportunities now in policies to provide housing for the next farming generation, so that the retiring farmer can stay in the house he has always lived in.”
Farmers Weekly has identified the key struggles, solutions and recommendations from the report.
- An important goal is bringing new economic vitality to the farming economy through retirement, flexibility in land occupation, and new entrants. To achieve this, benefits must be unlocked for both new entrant and retiring farmer levels.
- Policy must ease the supply of relevant housing to facilitate retirement, including housing for the next farmer. The newly-revised National Planning Policy Framework in England has followed Welsh Technical Advice Note 6 in supporting new houses on holdings for people taking over majority control of farming businesses.
- Planning authorities must accept and follow through on such policies as they handle cases and develop revised local plans. Farmers, landowners and advisers also need to be aware of these opportunities.
- An extension of conditional relief from inheritance tax for landowners providing affordable housing would both help with supply and give landowners insulation from social housing institutions and wider rights to buy or similar issues.
- The creation of a specific farming housing association and/or opportunities for farming charities to develop housing for retired tenant farmers.
- Financial support for those providing affordable housing, whether as single units or in larger developments.
- A private or public landowner could use loan finance secured on their property to fund new housing on their own land on a commercial basis.
- Income tax relief on farmland rents – as has been successful in Ireland.
- Inheritance tax – residential nil rate band amount gives tax relief on houses passed down the family and could be a better alternative than agricultural property relief.
- Re-direct remaining BPS payments to fund retirement.
- Tenancy measures – the Tenancy Reform Industry Group has proposed simplifying tenancy succession in order to promote land changing hands and thus aid retirement plans.
Pressures for change
Significant farming change is often driven by necessity.
The two key drivers foreseen to be relevant here, beyond individual issues such as ill health, are:
- Economic pressures from markets and the business changes required as they become more open.
- The reduction and, in England and Wales, removal of BPS payments over the coming decade.
Mechanisms for handling change
A critical, if intangible, element in this is enabling and sustaining an openness of conversation and discussion within farming families about these issues, so they are seen as acceptable and even positive.
Much here will turn on the farmer’s trusted advisers and, where possible, the examples of other farmers who have already acted and been seen to succeed.
Opportunities to make change
Support: The implementation of the proposal for England to delink the remaining Basic Payments from a requirement to farm should be designed so that included within it is a specific and positively structured path to retirement and so the release of land for others.
Taxation policies: The creation of an income tax relief, akin to the present Rent a Room Relief, on rent from the arms-length letting of farmland for five years or more, as has been successful in Ireland.
Development control policies: The positive and flexible use of planning policies that support rural development.
Rural affordable housing: The mechanisms for rural affordable housing should be developed so that they can offer options that are seen to be for retiring farmers.
Tenancy law: Revising tenancy law to enable retirement and change in land occupation.
Seeing this as knowledge exchange: The whole process can be substantially assisted by active support under post-Brexit policies with information, the illustration of successful examples and the promotion of discussion.