Step in to correct this market failure
Tenant Farmers’ Association (TFA) chief executive George Dunn called on the Government to ‘step in to correct this market failure’.
Brexit uncertainty is having a knock-on effect on professional advisers and their landlords who are avoiding long-term tenancy agreements.
Tenant Farmers Association (TFA) chief executive George Dunn blamed the ‘ongoing uncertainty’ for unsettling landlords into shortening Farm Business Tenancy (FBT) agreements which, on average, have lasted about four years.
It would be more appropriate for those advising landlords to be helping them find good tenants with whom to do long-term deals at sensible levels of rent, he said.
Mr Dunn said: “However, since the market is not delivering this rational outcome, it is time for the Government to step in to correct this market failure.
“For a long time, the TFA has been urging the Government to use the taxation framework within which landlords make decisions about land occupation to encourage longer farm tenancies and to remove taxation benefits to those who wish to continue to let on a short-term basis.
“If we get to a budget on November 6, we will be pressing the Chancellor of the Exchequer, once again, to take this approach.”
Mr Dunn added part of the problem was adviser anticipation about the development of new Government policy for agriculture and the possibility their clients would be able to capitalise on it.
“The Government should be making it clear that new policies will be targeted at active farmers only,” he said.
A Defra spokesperson said the department understood the issues and pointed to its recent consultation on ways to improve the competitiveness and sustainability of the tenant farming sector.
“We recognise the importance of providing tenant farmers with the security they need to invest in their business and deliver environmental improvements, while also ensuring landowners can agree tenancy agreements that suit their individual needs,” the spokesperson added.
Source: Farmers Guardian
Author: Lauren Dean
Date: 28th of October 2019