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    Tenant Farmers Association AGM - Chairman's Report
08/03/07

In 2006 the Tenant Farmers Association passed a significant milestone having achieved 25 years of service to tenant farmers in England and Wales. 

farmland

It gave us all a good chance to look back over the 25 year history of the TFA and to pay tribute to all those, particularly the founding fathers, who have made the Association what it is today.  Sadly Dick Whittle, the main driving force for creating the Association, and Stephen Hart who set the ground work for developing the ethos of the Association did not live to see its 25th Anniversary.  However, I am pleased to say that Henry Fell, Poul Christensen and Stuart Kirkwood who were also instrumental in establishing the TFA were able to join many of our celebratory events throughout 2006.

Those celebrations started with our Silver Jubilee Reception held here at the Farmers Club following last years Annual General Meeting.  It was good to see so many old friends of the Association gather to kick off our Jubilee year.  I was also delighted that Baroness Hazel Byford made an impromptu speech at the Reception praising the Association for its hard work on behalf of tenant farmers.

Our celebrations moved on to July at the Royal Show where we held a Silver Jubilee Reception with Barclays Bank at their Pavilion.  It was a real coup for the Association to have David Cameron, the Leader of the Opposition, to address the Reception.  The room was packed with people from all walks of the industry and did much to raise the profile of the Association and to put our 25th Anniversary firmly on the map.

In the autumn of 2006, to coincide with the actual anniversary of the Association, we published a 25th Anniversary TFA News which was circulated widely, not just to TFA members but to others within the industry.  It continues to be an incredibly useful resource for promoting the Association more widely.  I am grateful to all those who took advertising space in the magazine to help to defray some of the costs.

The icing on the cake was however our Conference at Lords Cricket Ground in October.  This was truly a magnificent event and I pay tribute to the TFA’s Communications and Events Co-ordinator, Rowan Hill, who was responsible for organising it. 

We had a tremendous array of speakers including a specially recorded video message from His Royal Highness the Prince of Wales.  I was particularly struck by the sensible comments made by Professor Philip Stott in the area of climate change and I am delighted that he accepted our invitation to speak again here today to follow up those comments following the publication of the Stern report.  I will be very interested to hear what he has to say to us today.

The Conference is still very much referred to by those who attended and I am pleased to say that all the conference proceedings, including the DVD of His Royal Highness’s key note speech, are available on the TFA’s website.

There is no doubt that we marked our 25th Anniversary extremely well.  Our profile throughout the year was high and we were able to use that for the benefit of our members.

2006 was of course marred significantly by the major delays that occurred with payments under the 2005 Single Payment Scheme.  The trauma experienced by a large number of our members as a result of the delayed payments was unforgivable.  The Association was inundated with calls and correspondence from members who were struggling to pay their bills as the delays lengthened.  It is interesting to note that at our AGM last year the then Chief Executive of the RPA, Johnston McNeill, was confidently predicting that payments were on track.   It was only a few days after our meeting here that the fundamental problems with the RPA’s computer system became evident and Johnston McNeill lost his job.  From then on we entered a frenetic period of meetings, consultations, postmortem examinations and reviews.  The Minister then responsible for the RPA, Lord Bach, immediately instigated weekly meetings with ourselves, the NFU and the CLA to discuss how matters were being resolved.  There is little point at this stage to catalogue all the problems that were encountered through that period but what became very clear was a fundamental failure at the heart of Defra and a lack of engagement by the Secretary of State, Margaret Beckett, who, it was revealed, had only met the Chief Executive of the RPA twice and the second time was to sack him. 

What I am pleased to report is that throughout the whole of the crisis and continuing now, the three principle farming organisations, NFU, CLA and ourselves worked closely together in order to ensure that there was a common approach in lobbying the government and in the advice that was being provided to the industry.  We issued joint press statements and met regularly to ensure that we would be singing from the same hymn sheet when we met Ministers and senior civil servants.  It truly was a united approach from the whole of the industry.  I am also pleased to see that whilst there are still considerable problems to be dealt with by the RPA, the payment of 2006 claims is much improved in comparison to the situation for 2005 payments.

As I have said, what became clear was a fundamental breakdown in the operation of the policy within the heart of Defra.  As an Association, we have always taken the line that the blame should not have been shouldered by Johnston McNeill but by Mrs Beckett.  It was therefore galling in the extreme to see Mrs Beckett promoted to Foreign Secretary having made such a shambles of such a key policy within her last department.

A much brighter aspect of 2006 was the eventual enactment of the changes to tenancy legislation proposed by the Tenancy Reform Industry Group.  However, I have to say that it was not before time given that we had to wait over three years since the production of the TRIG report before the government was able to introduce the changes by a Regulatory Reform Order which we had been told back in 2003 would be a fast-track approach for enacting legislation.  As I have said from time to time, if that was the fast-track I am glad we weren’t on the slow track. 

It was a major disappointment that the changes were introduced after Michaelmas which is a traditional time for new lettings and tenancy reviews.  Given that the new rules have only been in place since October, evidence of their use is still emerging.  We will continue to monitor how the changes are used throughout the year.

We are keeping one particular aspect of the changes under careful review.  That relates to the changes in the livelihood test associated with succession to 1986 Agricultural Holdings Act tenancies.  Previously a potential successor had to show that they had gained the principle source of their livelihood from agricultural work on the holding they wish to succeed to or a bigger unit of which the holding formed part for five out of the last seven years.  The changes introduced in October will allow a potential successor to include income earned from non-agricultural activities carried out on or from the holding so long as the landlord has consented to those activities on or after the 19 October. 

Of course many tenanted holdings will have diversified activities where consent has been granted before the 19 October and that will mean that those tenants will have to go back to landlords in order to reconfirm that consent.  In anticipation of concerns about landlords willingness to re-grant consent on that basis, we convinced the government to agree to consider new legislation in the area which would compel landlords to provide consent if there was widespread evidence that they were not providing consent voluntarily.  We have therefore produced a template letter for members to use with their landlords to ask for consent to be reconfirmed and a questionnaire so that information about landlord’s responses can be sent back to the Association which we can then collate and use in evidence for discussions with Ministers.  I would encourage you all to promote that questionnaire amongst your tenant farming neighbours. 

It is also particularly galling that the taxation proposals agreed by the Tenancy Reform Industry Group have got nowhere.  The Treasury appears to be ambivalent to the consensus reached by industry organisations on what was agreed a very important part of the package of reforms being proposed.  We are in discussions with the NFU and CLA about how these aspects of the reforms can be promoted.

Elsewhere in the tenanted sector the disruption caused by the Single Payment Scheme in terms of new lettings evidenced in 2005 continued to 2006.  Also, we experienced a fairly quiet period on rent reviews.  This follows a period since 1996 where we have, in some cases, seen rents on individual farms fall three times.  It is perhaps therefore not surprising that there should now be a certain stagnation in rental levels.  Landlords are also focusing more heavily on the residential components of farms and are therefore more reluctant to agree to rent reductions than in the past.  The Single Payment Scheme itself is also having a distorting effect on rents with high rents being quoted in Wales for new lettings where people are having to find land for their historic entitlement whereas grassland and some arable land in parts of England are changing hands for very low levels of rent where there is either no SPS payment available or where it is being claimed by the landowner. 

The Association also continues to be concerned about retirement issues within the tenanted sector.  We are aware of a significant number of tenant farmers who, with low net worth and lack of available accommodation, cannot consider retirement as a viable option.  We were, of course, disappointed that Defra did nothing about pursuing a retirement scheme in 2001 even though it formed part of the Labour Party’s General Election Manifesto.  We are seeking to find a way of encouraging Defra to reconsider a retirement scheme but we are also looking at other ways, focusing on housing provision, to assist with retirement.  We are looking at the possibility of tax incentives to landlords who allow retiring tenants to stay in Estate accommodation at below market levels.  We are also seeking to see how we could strengthen agricultural ties on dwellings in order that more accommodation was available for retiring tenants.  At the moment it is too easy for owners of these dwellings to have the ties removed.  In the context of the need for housing stock for key rural workers we are also thinking about how the agricultural ties might be extended to make them key rural worker tags.  Finally we are trying to see whether it is possible to extend the policy of use of exception sites and we are pleased to be working with the ARC Addington Fund which is doing a lot of good work in this area already.  The retirement issues are not going to go away and we must find solutions quickly.

Turning now to wider issues with which the Association was involved throughout 2006, I must start with the ongoing problems of bovine TB.  To place my comments in context, we need to refer back to the beginning of the Krebs Trials in the late 1990’s.  The government said to the industry that whilst it accepted there was a link between bovine TB and badgers, there was no firm scientific basis to affect a control strategy.  The government then suggested a series of trials which when completed would inform a new policy to control badgers.  That work is now almost completed and it has concluded that in order to control badgers and bovine TB effectively there needs to be widespread culling over areas of at least 300 square kilometres on an intensive basis over a long period of time.  In view of this conclusion the government is now prevaricating on a badger cull because they are worried about public opinion, cost and practicality.  A consultation on control strategies has long since concluded and we await the government’s decision.  The TFA, along with other farming organisations, is pressing the government to come forward quickly with a cull of infected wildlife in keeping with the conclusions of the Krebs Trials.  While we wait, the industry has been saddled with pre-movement testing, the standard table of compensation rates and a threat that the government will look to the industry to take an increasing part of the burden of cost for animal disease control.  The TFA has made it clear that there can be no increase in the share of costs borne by the industry in the current circumstances.

Although there are some encouraging signs of recovery in prices in some sectors, the profitability in all sectors of our industry remains on a knife-edge.  Increasing costs, increasing regulation and volatile commodity prices are all factors.  A significant concern is the increasing power of the retail sector to command prices and contractual terms in their best interests but not in the best interests of society as a whole into the long term.  As an Association, we have for some time been arguing for a food industry regulator to ensure fair treatment of producers, processors and retailers in the food chain.  It would act in the same way as regulators for the water companies, power companies and telecommunications companies.  Having been a voice in the wilderness for a while, I am now pleased to say that the idea has become much more mainstream.  I was particularly pleased to see the report of the All-Parliamentary Group on dairy farming who have specifically recommended that there should be an industry regulator at least for the dairy sector.  It is also pleasing to see the public coming increasingly onto the side of the farming industry.  We need to capitalise on this and there are various initiatives around which will enable us to do so. 

We were pleased to support, for the first time, British Food Fortnight in 2006.  This has become a very high profile initiative and its work has shown lasting benefits for our industry.  We are pleased to be supporting it again in 2007. 

The Year of Food and Farming in the education sector, announced at the end of 2006, will take place through the academic year 2007/2008.  This will be a great opportunity to put farming at the centre of the National Curriculum and expose our children and young people to farming, in some cases, for the very first time.  The TFA is involved in the work leading up to the start of the year and we will be giving it our full support.

I must also pay tribute to the NFU for their “Why Farming Matters” Campaign.  In my view, the campaign is an excellent example of clear communication in a refreshing way to key stakeholders and the wider public.  We have in the past been somewhat critical of the NFU’s activities in this area and I am very pleased to see that many of the points of concern we have raised in the past have been taken on board in this new campaign.

Throughout 2006, the TFA was involved in a host of policy areas in an attempt to ensure that the needs and requirements of tenant farmers were taken into consideration.  No doubt throughout 2007 that list will grow.  Issues such as Hill Farm Allowance, Nitrate Vulnerable Zones, implementation of the Water Framework Directive, implementation of the Waste Regulations, review of levy bodies, avian flu, policy on climate change, the European Commission’s proposals for changes to CAP, the new England Rural Development Programme including Environmental Stewardship and new policy on animal health and welfare to name but a few, will all require an input from the TFA on an ongoing basis.

Given the growing complexity of the policy framework within which our members have to operate, it is vital that we have a good strategy of ensuring that members are informed of new developments and what they mean for them at grassroots level.  One of the key functions of the Association is to provide advice, information and support to members.  Head Office now deals with an average of 40 to 50 advisory calls a week from members on top of correspondence by post, fax and e-mail.  The internet is clearly an important place for individuals to glean information on demand.  At the TFA we have had a useful member’s website for a number of years, but we have recently invested time, money and effort into upgrading the website to make it more accessible and appealing.  I am pleased to announce today that we are launching our new look website with easier access for members and with more information than ever.  The website can be used to access Briefing Notes, Guidance Notes, Newsletters, forms and precedents and our extremely valuable rent databank.  I would encourage all members with internet access to visit the website and register for regular e-mail updates.

We have maintained our high quality series of evening members meetings and in 2006 we were very pleased to be working with the British Institute of Agricultural Consultants (BIAC) in presenting a series of meetings throughout the country on diversification, succession and retirement issues.  These have been followed up in 2007 with a series of meeting sponsored by NatWest looking at how members can take advantage of collaboration and the new suite of rural development schemes (when they arrive).  We have also continued our presence at agricultural shows and technical events although we have attempted to focus on those which still have a large farming component.  In this respect, I have some concerns about the future of the Royal Show but we will see what happens now that the RASE have taken the show back in-house from Haymarket Events.

As I enter my thirteenth and last year as National Chairman of the Tenant Farmers Association, I am pleased to report that the Association is in good heart.  It has a stable membership, sound finances, a growing influence and a desire to do its best for its membership.  We have also sought hard to add value to the membership through affiliation schemes such as farm insurance with our long term partners, Towergate Lloyd and Whyte, a new farm finance scheme with BHF Finance and of course our successful and comprehensive legal expenses and arbitration insurance with DAS.  The TFA now truly has a package of benefits for TFA members across a range of aspects for their businesses.

In twelve months time I will be standing down as National Chairman and I am very pleased that the TFA’s current Vice-Chairman, Greg Bliss will be succeeding me in the role of National Chairman.  Greg will bring much to the role and I am sure that he is the right person to take the TFA into its next stage of development.  I would like to thank Greg for agreeing to give up the time to take on the role of National Chairman.

I would also like to thank the Executive Committee and in particular the Chairman and Vice-Chairman of the Regional Committees who do so much to ensure that the TFA operates at the grassroots of its membership.

Our sponsors are incredibly important to us as they help us to deliver a high quality service to our members.  As I have said, it was through the generosity of all those who took advertising in the TFA’s 25th Anniversary magazine that we were able to cover production costs for that.  I am also pleased to say that we are continuing our long association with Barclays who sponsor our TFA News.

I would also like to thank our panel of Recommended Professionals who ensure that the Association and our members receive high quality advice and professional services.  I hope that the relationship with the TFA continues to provide mutual benefit for all concerned.

The Head Office team works incredibly hard on behalf of the membership.  I was particularly impressed with their dedication to task through the difficulties of 2006.  The workload on Head Office is increasing which does put the staff under ever more pressure.  It is truly a team effort and I pay tribute to each one for all they do.

As usual I reserve my final thank you for the wider membership whom I have been very pleased, once again, to serve throughout 2006 as National Chairman.

I look forward to serving you again in 2007 and hope to meet many of you at the shows, events and other meetings that we run and attend.

Reg Haydon OBE, National Chairman

link Tenant Farmers Association AGM 2007 - Chairman's Report
link Planning for Succession to a Tenanted Farm
link Tenant Farmers Association Speaks Up For County Farms

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