How Cornwall Council plans to support its county farms estate

Cornwall Council has pledged to spend £16.4m on a new strategy for its 112-year-old farms estate.

Following a public consultation in 2019, its cabinet voted to restructure the estate, sell off a number of high capital value residential buildings and decrease the number of holdings available to let, though almost all of the 4,400ha estate’s total size will be retained.

The council also wants to improve environmental standards across its farms by focusing on soil health and methane capture, as well as planting 300ha of woodland.

See also: How to become a county council farm tenant

Estate facts

  • 4,400ha
  • 89 fully-equipped opportunities
  • 47ha average holding size
  • 49.5% are dairy farms
  • Remainder are stock farms (mainly beef and sheep)
  • No arable only holdings
  • FBTs offered with a minimum of 11 years to a maximum of 20 years

Councillor Adam Paynter, deputy leader, said the estate is worth investing in because it has grown in value and it generates good income.

Cllr Paynter said: “Selling off the estate is a bit like selling the family silver and you can only do it once.

“The estate washes its own face and in the long term it’s better to have that income to support other council services, rather than taking the short-term decision to cash it in.”

The NFU has welcomed this response amid a backdrop of many other local authorities looking to sell off some or all of their county holdings, but said the main test lies in ensuring these aims are delivered.  

What will change?

The farms estate generates gross income of £1.4m, according to the council’s strategy report. Of this, £1.3m is rental income, leaving a net income of £777k.

This budget is under severe pressure and cannot be sustained without intervention, it says.

The cost of the retained residential and farm buildings has been identified as the main source of the pressure, with backlog maintenance costing £16m across all existing holdings required over the next 10 years.

To raise capital, the council has chosen to adopt Model 1, which will see a reduction of 15% of the number of fully equipped holdings, but just a 1% reduction in the total area of the estate.

Changes to estate structure

Estate structure

Current

Model 1

Change

Fully equipped holdings

89

74

-15 (17% reduction)

Bare land new entrants

1

13

+12

Bare land progression units

32

20

-12

Other

4

15

+11

Dairy

44

32

-12

Hectares

4,400

4,353

-47

The report said it had not been possible to construct a model that retained all 89 holdings, delivered the investment in the buildings to ensure compliance, and provided a positive revenue position.

Implementing Model 1 will have a negative impact on the council’s income by reducing the current operating surplus from £777k a year to £430k.

This was deemed the most preferable option because it will have the least impact on the number of letting opportunities.

In comparison, the other options suggested a 25% reduction of the number of fully equipped holdings and a 1% reduction in area (Model 2) or a 17% reduction in the number of fully equipped holdings and an 8% reduction in area (Model 3).

Model 1 requires £16.4m investment. The disposal of assets (likely to be older and listed buildings) with an estimated sales value of £5.2m would leave a net capital funding requirement of £11.3m.

Cllr Paynter, who is a dairy farmer, said: “We’ve got listed buildings on the estate which are very expensive to run or improve and which have not had much investment over the past few years but have a high capital value.

“A lot of the estate was pulled together in the 1920s-1940s so for modern farming there might be areas where we want to sell land and re-buy in another area to consolidate the land and make it easier for our tenants.”

Selling residential buildings will result in an increase in the number of bare land plots available for new entrants, to include growing plots, community-supported agriculture opportunities, and livestock grazing lets.

However, overall the number of new letting opportunities will decrease, meaning tougher competition for applicants.  

New entrants

The strategy emphasises opportunities for new entrants and young people and Cllr Paynter said supporting these farmers is important to the council.

“It’s very difficult to come into farming starting at zero, but particularly when private landlords are increasing the size of their let farms, with some of their smallest units larger than our largest ones,” he said.

“We need to balance looking for younger tenants with ensuring they have enough experience so we are not setting them up to fail. They need to have the qualifications, experience, and financial backing, and be able to do the job.”

Individual tenants’ businesses need to be profitable, as does the council’s overarching management of the estate, he said, and the land management activity also needs to be sustainable.

Environmental focus

Cornwall Council declared a climate change emergency in 2019 and its new strategy incorporates funding a number of actions specifically to reduce the estate’s net carbon position.

This includes planting trees on about 300ha of farmland over the next 10 years and the introduction of methane capture over slurry lagoons, reducing the release of greenhouse gases.

It also wants to work with tenants on land management techniques and cropping rotations that protect and build soil nutrients, thus reducing the release of carbon dioxide.

The report states the number of livestock on the estate is not anticipated to reduce, and the focus is on supporting and unlocking access to the Environmental Land Management scheme funding.

It has not yet been determined exactly what this will be or how it will work.

NFU welcomes long-term plan

Chris Cardell, chairman of the NFU’s national tenants forum and tenant of a Cornwall Council farm near Truro, said he hopes more certainty on farm support and environment schemes will arise as the Agriculture Bill makes progress.

Chris Cardell

Chris Cardell © NFU

He appreciates the authority still has to run the estate and make decisions in the meantime.

“We welcome a long-term plan being put in place because it allows the tenants to plan as well,” Mr Cardell said.

“The council needs to keep the balance of supporting new entrants and current tenants because it is a big jump to move off, and some people are able to do it and some aren’t.”

Though it is disappointing to see any part of the estate sold, if it is done in a structured way (with outlying blocks of land and high capital properties released) and the original size is maintained, that should be considered good management, he said.

“The challenge the council faces is the delivery and matching that aspiration,” Mr Cardell said. “It’s easy to sell a farm, but it’s not always easy to buy one, especially in the specific place you want it, so that’s something we will be keeping a close eye on.”

DECEMBER
2

Support for farmers facing 2021 challenges

Register now