GSC Grays Magazine - Issue 2 July 2021

GSC GRAYS Working together today to secure your tomorrow

T HE C H AL L E N G E IS O N Our model livestock farm helps assess the potential implications of future change

NATURAL ASSETS What are they worth and

TREE PLANTING TARGETS

why do they matter?

Where will all the trees actually go?

ISSUE NO. 2 JULY 2021

04 07

10

16

18

22

26

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CONT E N T S 04

N A T U RA L A SS ET S :

ISSUE NO. 2

JULY 2021

22

Peter Knox looks at how achievable they actually are.

Holly Story, Senior Environmental Management Consultant looks at what natural assets are worth and why they matter.

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THE ROA D TO NE T ZE RO Chris Thyer, Rural Associate Director gives his thoughts on how far we are along the Net Zero road.

THE G O V ERN ME N T’ S TREE PLAN TIN G TARG ETS:

25 26

TAX U PD ATE Andrew Robinson, Armstrong Watson

TH E REN TED RESID EN TIAL PRO PERTY MARK ET Has it changed forever?

18

10

TA X CONTINUES TO F UE L THE GROWTH IN DE MA ND F OR FARMS & F A RML A ND

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DA TA DRIVEN F A RMING: MA XIMISIN G P RODUCTIVITY & EF F ICIENCY

14

UP L A ND CONS E RVA TION DE L IVERED THRO U G H S TE W A RDS HIP

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DON’T GO L OS IN G YOUR W A Y

T H E CH A LLENGE IS ON :

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O NE D A Y TH I S W IL L A L L BE H O US ING: Calum Gillhespy, Director, looks at the challenges of promoting strategic land.

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RESID EN TIAL PRO PERTY MARK ET O U TLO OK

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B RAN D IN G : IT’S M ORE TH AN J U ST A LO G O

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WELCO ME TO TH E TEAM

Making our model livestock farm profitable.

G S C G R A Y S J U LY 2 0 2 1

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WE L C O M E

GUY COGGRAVE MANAGING DIRECTOR

01748 897606 gsc@gscgrays.co.uk

WHAT A FASCINATING TIME FOR AGRICULTURE AND THE RURAL SECTOR. If ever there was an occasion for strategic thinking in landowning and agricultural businesses, it would be now. To throw out the rule book for how things have always been done, to have the ‘difficult conversations’ and steer a course for the future.

Let us be clear, we are going through a time of unprecedented change. With the ongoing impact of Brexit, the rollout of the Agricultural Transition Plan and the ambitious Government targets in the soon-to-be enacted Environment Bill, land management as we know it will be forever changed.

It is not the time for despair, however. Those who act now to get a handle on their business, analyse their financial performance, understand their physical attributes, skillsets and opportunities, will be the ones best placed to assess which market opportunities, schemes, and grants fit with their vision of the future for their business.

More and more clients are taking this opportunity. We are seeing unprecedented amounts of business restructuring, new contract farming agreements, diversification projects, retirement plans, intensification and extensification strategies and indeed expansion

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THOS E WH O AC T N OW W I LL BE T H E O N E S B ES T P L AC E D TO AC T.

plans. Each of these options is a unique and a deeply personal decision. And of course, our team is here to advise should you need it.

Greg Ricketts’ model farm overview is the lead piece in this issue for good reason (page 18). Our benchmarking tool will help clients predict future returns and provide a template on which we can assess the impact of future changes that could be made to improve financial performance.

Moreover, it highlights the

vulnerability of livestock units dependant on support payments to turn a profit. The current inflated market for cattle and sheep could be creating a false sense of security for some farmers, who with strong prices feel little incentive to act.

This month we also launched our new Environment and Sustainability Department, headed up by Holly Story (you can read more in her article on Natural Capital on page 4). The new Department will lead on fast-developing areas of work that GSC Grays are already engaged in, such as ELM pilots, peatland restoration, and woodland creation, as well as offering new services, such as carbon auditing and biodiversity offsetting strategies.

This is an exciting new direction for the firm, as we deliver long-term resilience and sustainability for farming and land management businesses in a period of rapid change. We are already involved in several environmental

projects

in

the

region,

including

delivering ELM Test and Trial projects, preparing applications for the Natural Environment Investment Readiness Fund, advising on large scale Biodiversity Offsetting

Schemes,

and

providing

regenerative

farming advice.

The future may seem daunting, but with the right strategy there are exciting opportunities.

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NATURAL ASSETS: W HAT AR E THEY WO RT H A N D W HY DO ES IT M ATTER? Land owners and managers are likely to be highly experienced in the strategic management of assets. Whether residential property, forestry, grouse moors or agricultural land, having one eye on the figures and another looking to the future is crucial.

Historically, the management of natural features such as freshwater, peat bogs, ancient woodland may have been intrinsic to the success of sporting or farming enterprises, but they are not usually regarded or managed as revenue generating assets in their own right.

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Now the concept of ‘Natural Capital’ has captured the attention of politicians, land managers and private investors alike, bringing with it some challenging questions: do you know what your natural assets are worth?

Are those assets increasing or diminishing in value as a result of current management? What are the opportunities to generate revenue from those assets?

What could you do now to increase the revenue generation potential in future, or help you to tap into potential funding streams? And is it worth investing in a natural capital account?

WHAT IS NATURAL CAPITAL? The phrase ‘natural capital’ may seem to have made a sudden appearance in the vocabulary of land owners, managers and agents over the past 12 months, but it is not a new concept.

Natural capital is a term coined by environmental economists who have been working out how to quantify and value the components of our natural environment, and the services they provide us with, for decades.

‘ IF YO U C AN P UT A NUMB E R TO T HE ‘ P UB LIC G O O D S D E LIVE RE D ’, YO U ARE A ST E P C LO SE R TO MARK E T ING T HO SE GO O D S AND SE RVIC E S TO A P OT E NT IAL B UY E R ’

One of the drivers behind the development of natural capital accounting, was to increase awareness of the benefits that we derive from the natural world and

meadow or value the carbon sequestered by an acre

the costs of environmental degradation by putting

of woodland, then you are a step closer to marketing

it in front of decision makers, in cold hard figures;

those goods and services to a potential buyer, whether

if corporations and governments (or perhaps more

that be DEFRA or a multinational company seeking to

importantly their shareholders or electorate) see the

balance its own natural capital account.

impact that we have on the environment reflected on their balance sheets, they might be more likely to prioritise sustainable management of natural assets in their policy or business decisions.

The metrics and methodologies for natural capital accounting do have limitations, particularly when it comes to the assessment of farmland habitats, but the field is developing rapidly, so we may soon see

For land owners, natural capital accounting can serve a

advances that resolve these issues. The process of

similar purpose – it provides a quantitative assessment

producing accounts is also becoming more efficient,

of your natural assets, their type, extent and condition,

and increasingly automated. This, along with increasing

and the flow of ecosystem services that they provide,

competition between providers, is likely to see the

both in physical (e.g. tonnes of carbon sequestered)

costs of natural capital accounting reduce over the

and monetary terms (e.g. value of that carbon

coming months.

sequestration service). Natural Capital Accounts can also help you to understand the interdependencies or trade-offs between different ecosystem services, for instance climate regulation and food production.

THE BENEFITS OF NATURAL CAPITAL ACCOUNTING If the accounts are executed well, and carefully interpreted, they can be a useful decision-making tool

Is it therefore better to ‘wait and see’ how the field develops, rather than acting now? Perhaps, but as with any type of asset, to manage natural assets effectively, sustainably and profitably, you must have a good understanding of their value, earning potential, and how your management decisions will impact both of these. Natural capital accounting is one way to begin to understand your natural assets better, but there are alternatives.

and provide a way of tracking or modelling changes

Rather than undertaking a wide-ranging natural capital

to the natural environment over time as a result of

audit, in some cases it is more appropriate and cost

changes to management or land use. This in turn

effective to focus on particular areas that are well

opens-up opportunities to market the resulting savings

aligned with your wider business strategy, suit your

or gains to public or private beneficiaries. If you can

location and regional priorities, and complement other

put a number to the ‘public goods’ delivered by a hay

revenue streams.

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We have worked with a number of clients to review or workshop their future environmental management strategy

–

identifying

those

opportunities

and

challenges that are most relevant to their particular business, farm or estate. These are likely to include a blend of public and private sector funding.

Some projects, such as a move to regenerative farming or large-scale woodland creation, may take years to plan and develop, whereas others such as peatland restoration may build on existing successful schemes.

We have found that taking a phased approach, perhaps prioritising engagement with those markets that are currently more developed, can help to ensure that your environmental strategy develops new revenue streams while remaining well integrated with your core business.

Whichever approach is right for you, taking the time now to engage with this rapidly evolving sector will ensure that you are ready to embrace the exciting opportunities it brings.

HOLLY STORY

SENIOR ENVIRONMENTAL MANAGEMENT CONSULTANT

01748 897603 has@gscgrays.co.uk

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NEW NAT U RA L ENV IRONME NT DEPA RT MENT The questions raised by the natural capital approach do not have easy answers, but we believe they signal some exciting opportunities for rural estates, farms and businesses.

GSC Grays have launched a new department dedicated to the management of the natural environment. We will deliver specialist services such as environmental reviews, biodiversity offsetting strategies, peatland restoration and landscape recovery schemes.

All of which will be managed by consultants who combine specialist knowledge of environmental management with years of experience in estate management and farm consultancy.

If you have questions about natural capital, and its relevance to your land or business, call us today.

T H E RO A D TO N ET Z ERO In June 2019, as one of her final acts as Prime Minister, Theresa May announced her plan to achieve national net zero greenhouse gas emissions by 2050. This was quickly put into law, making the UK the first major economy to make such a legally binding commitment to combat climate change.

The road to Net Zero will be long and difficult, but has a lot of public support, thanks in part to Blue Planet raising

Everyone will have noticed changes in one form or another, be it the ban on plastic straws, the introduction of smart meters, or the move toward electric vehicles. Some significant progress has been made already, but the journey is only just beginning.

awareness of the impact our

Renewables have been fundamental in achieving this

lifestyle is having on the globe.

of 2019, renewables accounted for more energy

change. For the first time ever, in the first quarter generation than fossil fuels on the UK energy grid. So how far along the road to being Net Zero are we really and is it honestly achievable by 2050?

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SOLAR POWER

deeper waters. Once again, the UK is leading the way

Solar technology has come a long way since solar cells

the Scottish coast, is very small by modern standards

in pocket calculators, thanks in a large part to huge

at 30 Megawatts, but the ground-breaking technology

investments in China, who are the leading installer and

may herald a new era of floating wind farms.

with the world’s first floating wind farm. Hywind, off

manufacturer of solar panels globally.

As well as panels becoming increasingly efficient, advances in technology have allowed the construction

‘ T HE ROAD TO NE T ZE RO WILL B E LO NG AND D IFFIC ULT’

of tilting solar arrays, tracking the sun throughout the day, and bi-facial panels which capture the small amount of light that reflects off the ground onto the back of the arrays.

In recent years, a key landmark was achieved with subsidy-free solar power becoming a reality in the UK. Without subsidies limiting their size, modern solar farms spanning hundreds of acres are a common prospect. The industry is attracting huge investment with suitable land being snapped up at a rapid rate.

As it is such a new market, only a handful of subsidy

Meanwhile, the oldest wind farms on the UK mainland are nearing the end of their operational lives.

Discussions are starting to consider the future of these sites. We may soon see them being re-powered with newer, more efficient turbines, without significantly altering the landscape.

free solar farms have been constructed. GSC Grays have recent success with construction starting on a 50 Megawatt, 200 acre solar farm in North Yorkshire which will produce enough power each year for 13,000 houses, the first of many more.

ENERGY STORAGE

WIND TURBINES

One of the key difficulties of achieving an entirely

The UK has become a global leader in wind farm

After Clap for Carers each week during lockdown,

development. Our dense population has forced new wind farms offshore, where the wind is strong, and the turbines are out of sight to much of the general public. This has enabled turbines to become far larger and more powerful than would be permitted on land.

A prime example of this is the Dogger Bank Wind Farm, 130km off the north east coast of England. Once all phases are complete, it will be the largest wind farm in the world, generating 3.6 Gigawatts of power, enough for up to 6 million homes. At this scale wind power is remarkably cheap at £39/MWh.

For comparison

renewable energy mix is matching supply and demand. power demand spiked as everyone put the kettle on.

Historically fossil fuel power plants would simply turn up the dial, but renewables don’t have that level of control.

In order to achieve a Net Zero energy mix we need to improve access to on-demand power. Nuclear offers a low carbon solution, but it is expensive and comes with various safety, health and environmental concerns.

The ideal solution is to store any excess renewable power, releasing it back to the grid on demand.

Hinkley Point C nuclear power plant costs £92.50/

Countless energy storage solutions already exist

MWh and Drax’s biomass plant costs £100/MWh.

such as the “electric mountain” in North Wales.

The UK benefits from shallow coastal waters, ideal for constructing wind farms which sit on the seabed, but the strongest winds are far out to sea over much

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THE FUTURE OF THE ENERGY MARKET

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Opened in the 80’s, it pumps water up to a reservoir in an abandoned slate quarry, which can be released through hydro turbines when needed, generating up to 1.7 Gigawatts of power.

A more modern solution is to install giant battery

primary means of storing energy from the grid, but

banks, using technology developed for mobile phones.

plans are afoot. Teesside has received Government

Government has recently relaxed the planning rules to

backing for the UK’s first Hydrogen Transport Centre

make it easier to install big battery sites. The largest

and plans were recently unveiled for a hydrogen plant

operational battery can produce 75 Megawatts of

at Stanlow Refinery in Cheshire. This plant will use

power on demand, but the industry is growing rapidly

natural gas to generate hydrogen. Despite still relying

as planning has just been granted for a 320 Megawatt

on fossil fuels, the exhaust gasses will be stored in a

battery in Essex.

subsea reservoir to prevent them escaping into the

It is speculated that electric cars could contribute

atmosphere.

to the solution. While plugged into the mains, smart

This emerging technology still has a long way to go

chargers could use a car battery to feed power back

before it becomes a common feature of our energy

to the grid, earning a small fee to the car’s owner. An

system, but it has the potential to solve a number of

individual car will only have a small impact, but once

problems created by renewable energy, so watch this

every household owns an electric car, the potential

space!

energy would be enormous.

Whilst

battery

technology

offers

an

immediate

solution to the storage problem, its long term future is unclear. Batteries degrade with use until they need replacing. Mining the precious metals they rely on is carbon intensive and recycling technologies are still in their infancy, so to achieve a truly Net Zero energy mix, we may need another solution.

SUMMARY The energy market has been revolutionised in the last 30 years with some incredible innovations, such that renewables can out-compete fossil fuels on price. Yet wind and solar farms alone only solve part of the problem. To achieve a truly Net Zero energy grid we need more supporting technologies to ensure

HYDROGEN

power is always available when we need it. There are

The longer-term storage solution may come from

whether they can scale up in time to achieve our 2050

using excess electricity to refine hydrogen from water.

Hydrogen can easily be stored or transported to where

imaginative solutions out there, the only question is target.

it is needed, and when burnt, the only emissions are water vapour. It is a versatile fuel and with the right infrastructure it can be used to generate electricity, fuel heavy industry, run a car, or heat your house.

No projects are yet operating where hydrogen is the

CHRIS THYER RURAL DIRECTOR

07917 611531 ct@gscgrays.co.uk

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TAX CONTINUES TO FUEL THE GROWTH IN DEMAND FOR FARMS AND FARMLAND

The 2020 farms and farmland selling season was underscored by the shortage of supply in most regions of England. In 2021 this has been further highlighted by a surge in demand from those fortunate enough to have had options with housebuilders which are now coming to the fore.

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New home building is at an all time high, helped by the Government mortgage guarantee scheme, Help to Buy and the Stamp Duty holiday, leading to a surge in demand for property and new developments across the country.

The problem is that there is very little land to buy at present and if this money is not reinvested a large chunk will be lost to the industry or to the Inland Revenue. Those fortunate to be in this position would much rather pay more for land now than lose it in tax, creating a huge opportunity for sellers retiring or coming out of farming to get a premium for their properties.

Others creating competition for farmers in the farmland space are those non-farmers seeking shelter from Inheritance Tax (IHT) by utilising Agricultural

Instead of land banking developers have, in the most

Property Relief (APR), but this too is set to change.

recent past, preferred to take out options on land for

Successive governments have pledged to look at this

development in the future without locking up large

relief because it is felt that it is not being used for the

amounts of capital.

These options are being taken

purpose it was originally intended (to allow the next

up in increasing numbers as planning is granted

generation of farmers to take on the farm without the

in support of the need for new homes and taking

burden of having to raise cash to pay a tax the business

advantage of current market conditions. This in turn

could seldom afford) as is being used all too often as

is generating considerable sums to farmers who have

a tax avoidance measure for non-farmers. The impact

these development options who now wish to reinvest

of this change could well dissuade non-farmers from

in more land whilst taking advantage of current Capital

entering the market in such numbers – good news for

Gains Tax Rollover reliefs.

farmers perhaps – but without competition from this sector, prices will be likely to fall.

Despite these influences and uncertainty in UK

‘ D EMA N D CO N T I N U E S TO OU TS T RI P T H E S U PP LY O F FARM S AND LAND’

agriculture brought about by leaving the European Union, demand continues to outstrip the supply of farms and land so now really is a good time to consider selling.

GSC Grays has a dedicated farm agency team able to advise on all aspects of the marketing and sale of farms and land. With the support of their farm business advisers, specialist valuers and a reputation for

Under current fiscal rules, Capital Gains Tax relief is offered where the gain from the sale of a business asset is rolled over into the purchase of other business assets.

Technically this a deferred tax relief which

working closely with agricultural lenders, accountants and solicitors has helped deliver the best outcomes for clients, even if that turns out to be a different outcome from the one first anticipated.

would have to be paid when those assets are sold again and are not reinvested in a business, but the effect now is that the Rollover relief can save a considerable amount of tax on the gain made. This gives significant additional purchasing power to those in this fortunate position and may become even more expedient should changes being mooted to Capital Gains Tax rates bring them in line with Income Tax rates.

JOHN COLEMAN DIRECTOR

01748 897627 jarc@gscgrays.co.uk

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DATA- DRIV EN F ARM ING: MA XIMIS IN G PRODUCTIV IT Y A N D E F F ICIE NC Y In order for any industry to survive, it needs to adapt and the agriculture industry is no exception.

farmers, contractors, and foresters, will be available

As in many other sectors, innovation and technology

and environmental benefits. This scheme will be split

are going to play a huge part in future changes, which

into the ‘Farming Equipment and Technology Fund,’ a

is why many large organisations are now looking at

similar concept to the Countryside Productivity Small

the use of data and technology in agriculture. As an

Grant scheme, and the ’Farming Transformation Fund,’

industry that has been delivering at near peak capacity

for considerable investments to transform business

for many years, the challenge will be how to continue

performance. DEFRA have outlined the investment

to meet increased demand and it is recognised that

opportunities to include water storage infrastructure,

data-driven farming, coupled with the knowledge,

precision agriculture equipment, robotic and automated

experience and skill of those working within the

technology, specialist forestry equipment, items to

agricultural sector can achieve a highly productive,

improve animal health and equipment, and technology

efficient, and resilient farming industry.

for sorting, storing, and processing produce.

Productivity is reflected through improvements in

Resilience is about responding and adapting to

farming production efficiencies and technological

change, and UK farming is heading into a considerable

progression. Farming has a great aptitude to obtain

period of change. Technology and data analysis can

information to make evidence-based decisions in real

provide a more comprehensive view of farming to

time using reliable data and effective analysis. The

see what is really driving production and efficiencies.

importance of productivity, through technology, has

Therefore, UK agriculture must continue to develop a

been magnified by the introduction of the Farming

strong understanding of those drivers of production

Innovation Pathways (FIP), whereby £12 million has

and efficiency as it transitions from direct payments

been

made

available

via the Farming Investment Fund, which is due to open for applications by October 2021. DEFRA are continuing to develop the scheme design, but it is likely to offer incentivised support to fund equipment, technology and infrastructure for farm prosperity

to

to

funding

and

support

research

payments for improving the

and feasibility studies that

environment, farming more

target

industrial

aim

to

deliver

productive

and

sustainable

outcomes,

by addressing productivity, sustainability, and net zero emissions.

Further

support

through

large and small grant aid for

‘K N OWING WHAT YO U WANT TO AC HIE VE T H RO UGH DATA CO L LEC T IO N I S K EY ’

sustainably, enhancing animal health

and

welfare,

and

reducing carbon emissions.

In

livestock

could

be

the

systems

this

relationship

between feed, forage and growth rates, antibiotic usage and resistance, or grassland

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utilisation and management. In arable scenarios this

statistics, and analytics will be essential for strategic

may be the impact of pest disease pressures on yields,

management, enabling farms to forecast and plan for

planning for flooding and drought, or geomapping for

forthcoming policy change.

variable rate technologies. On a global scale, consumer behaviours can be identified therefore gaining a better

IN SHORT..

understanding of supply and demand. By harnessing

Knowing what you want to achieve through data

‘big-data’, the farming industry can maintain its ability to manage unforeseen risks, like disease pressures, extreme weather conditions, and a rapidly growing population to better maintain the flow of global supply chains.

collection is key. Implementing short, medium and long term goals can make data collection more subjective, enabling farmers to interpret the information gathered in an informative manner. Finding a suitable platform, whether that be an app or software programme, is

Utilising existing and new technologies to their maximum potential will achieve greater productivity, and with that, comes enhanced efficiency. The complexity of farming systems inspires a need for decision support mechanisms that incorporate scientific data with economic reasoning to make informed management decisions. This will most certainly be top of the agenda throughout the agricultural transition period.

a good starting point but its purpose should be to manage and inform, rather than to solely store data.

Essentially, it is all very well collecting lots of data on farm but it is how you use that data to make better informed

management

decisions.

In

turn,

those

‘informed’ management decisions will help to increase productivity, efficiency and resilience of the farming business.

DEFRA have stated that by 2028, they want to see

a

can

be

renewed

agriculture

profitable

and

sector where

economically

farms

sustainable

without subsidy, whilst significantly contributing to environmental goals. Data-driven farming will play a substantial role in this, leading to step-change in how

LAURA CURETON FARM BUSINESS CONSULTANT

0191 303 6373 lac@gscgrays.co.uk

we conceptualise whole farming systems. Innovation,

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UPLAND CONSERVATION DELIVERED THROUGH STEWARDSHIP

With farming revenues coming under perpetual strain, diversification of income has been a key theme of farming advice for years.

funded and how this will dovetail with natural capital opportunities in both the public and private sectors.

In the meantime, if existing Higher Level Stewardship (HLS) schemes are not permitted to be extended, then Countryside Stewardship continues to provide opportunities for farmers and landowners across the uplands. Both Higher-Tier and Mid-Tier Stewardship

There is much speculation as to how exactly the new

(on in-bye ground) provides a useful annual income

Environmental Land Management Scheme (ELM) will

for a holding, especially with proposed reductions

be rolled out within the uplands once the tests and

in the Basic Payment Scheme (BPS), as well as the

trials are complete; how it will integrate with existing

opportunity to access funding for capital works.

land management practices, what capital works will be

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GSC Grays were involved in one of the very first Higher-Tier Countryside Stewardship Schemes to

‘ WILL E NT E RING A SC HE ME NOW B LO C K ACC E SS TO P UB LIC O R P RIVAT E SEC TO R FUND ING ?’

be rolled out in the uplands. Not only did it provide regular annual income to the client, it enabled him to undertake extensive peat restoration works including grip blocking and reprofiling, installing sediment traps, reprofiling peat haggs and bare peat restoration & sphagnum inoculation. Some Scheme income was then used to undertake dwarf shrub over-seeding works. In addition, grants were secured for some fencing and walling as well as creating wildlife benefits such as tree & scrub planting to promote suitable habitat to support black game and scrape creation for waders,

economic and environmental. Habitat improvement, benefits to wildlife, improved water quality, flood prevention, reducing risk of wildfire and carbon storage

insects and invertebrates.

are all important considerations. The big debate is

Since then we have been involved in negotiating the

funding for capital works such as peatland restoration,

terms on, and delivering numerous schemes across

or to wait and see if a more suitable option emerges.

the region, with Natural England. These Schemes

Whether entering a Scheme now will block access to

have extended across tens of thousands of acres of

public or private sector funding for Natural Capital

moorland, and have delivered similar benefits to the

in due course is yet to be seen. There is no blanket

above-mentioned Scheme; working in conjunction

approach as yet, each case should be considered on

with owners and their staff, contractors, the Yorkshire

its own merits, although one would expect public and

Peat Partnership and the Northumberland AONB.

private sector funding for carbon related capital works

Balancing

the

whether to take advantage of a scheme now to access

requirements

of

the

various

to be readily available over the coming years.

stakeholders has been challenging at times but having

DEFRA advise that Countryside Stewardship can be

a knowledge and appreciation of the different roles

terminated early in favour of ELM, which may help

and requirements of the parties involved has helped

this decision; equally the suggestion that some stand-

ensure the delivery of successful schemes.

alone capital grants for peatland work may be made

The supporting information required to deliver a Countryside Stewardship agreement can be extensive,

available prior to ELM being rolled out will also be of interest.

especially where uplands are concerned as the sites

There are still so many variables and much to consider

are often common land and within SSSIs or European

but one thing is for certain, ELM will take over from

Designated sites.

Countryside Stewardship in due course, in delivering

Site

Restoration

Plans

are

a

significant

aspect

of this requirement. They set out the consented management activities and any data recording or monitoring requirements of management activities

upland schemes that will help shape, support and enable upland management in a sustainable way. In the meantime, Countryside Stewardship has already helped a number of our clients achieve this.

such as heather burning & cutting and livestock grazing. Bracken Management Plans, Wildfire Risk Assessments, Management Plans and Fire Response Plans are also required.

Programmes of work are often costly and ambitious, but help farmers and landowners deliver schemes for wider public benefit, as well as their own. The key

PHIL SCOTT-PRIESTLEY DIRECTOR

01748 897616 psp@gscgrays.co.uk

drivers for entering such schemes are financial, socio-

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DON’T GO LOSING YOUR WAY The Countryside & Rights of Way Act 2000 set a deadline of the 1st January 2026 for the recording of ‘lost ways’ on definitive maps.

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‘Lost ways’ are purported rights of way (ROW) which no longer appear on the definitive map and therefore could be considered as ‘lost.’

the deadline. The process will start with a Definitive Map Modification Order (DMMO) being issued by the Council or Unitary Authority covering the area in which the ROW exists.

It is vital that any DMMOs that are received are not ignored and there are a variety of steps which can be taken to contest a DMMO. The most logical starting

The definitive map will be provided by the Council

point will involve thorough research and compilation

or Unitary Authority for the area in which the ROW

of evidence as to why the ‘lost’ ROW was not ever

exists. Any ‘lost ways’ which are not recorded on the

a ROW, or why the ROW ceased to appear on the

definitive map before the 1st January 2026 will be

definitive map. It is worth pointing out that, in much

extinguished and therefore can no longer be recorded

the same way as the RA and other groups will be

on the definitive map.

ranking the ‘lost’ ROW, landowners would be well

The ability to apply for ‘lost’ ROW being recorded is based on the legal principle of ‘once a highway, always a highway’ regardless of whether that highway is recorded on the definitive map.

(RA) have announced their ‘Don’t Lose Your Way’ It is the result of a large amount of

research carried out throughout 2020 and seeks to register 49,000 miles of historic rights which they feel have been ‘lost.’ The RA are not alone in taking action on this matter; the British Horse Society, alongside other groups, are seeking the same outcome albeit without such high-profile campaigns.

‘lost’ ROW will vary in the impact that they would have on a case-by-case basis.

The RA map which indicates all ‘lost’ ROW with blue

As the deadline approaches, the Ramblers Association campaign.

advised to carry out a similar ranking process, as the

A number of

colouring, is available to view online at: Don’t Lose Your Way (ramblers.org.uk). We would strongly advise that as a starting point, this map should be inspected by all landowners in order that both the number and impact of the ‘lost’ ROW can be considered. Some of these may not seem contentious and may not have any real detriment to landowners, however some will and therefore it is strongly advised that this procedure is not overlooked.

these groups are lobbying the UK Government for an

If you consider that the ‘lost’ ROW are of sufficient

extension to the 1st January 2026 deadline, however

concern, then we would recommend consideration

this is yet to be determined.

is given to carrying out preemptive research to seek

Due to the sheer volume of ‘lost’ ROW’s which have been identified by the RA it is unlikely that all those presently identified will be pursued due to both the time and cost involved. It is understood that the RA – and other groups seeking the same outcome – will rank

out and compile evidence in advance of any DMMOs being received. We have amassed a list of researchers who we feel are both suitable and best placed to carry out research and compile evidence on behalf of landowners.

the ‘lost’ ROW based on desirability and deliverability.

The formal process for recording ‘lost’ ROW is a long and complex one, which is the principal reason for the various groups lobbying the Government to extend

‘ ONCE A H I G H WAY, A LWAYS A H I G H WAY ’

JONNY MORRIS RURAL DIRECTOR

0191 303 9543 jwm@gscgrays.co.uk

G S C G R A Y S J U LY 2 0 2 1

17

THE CHALLENGE IS ON Financially, grazing livestock farms are very reliant on support at present and are also the most challenged. It is without question a tough sector in which to make good profits.

Grazing livestock (beef & sheep) farms make up one of the largest sectors of agricultural production. This is true in terms of the numbers of farmers and farm businesses involved, the land area utilised and the number of livestock on farms.

business environment (which is almost certainly going to be the result of the implementation of the Agricultural Transition Plan and the reduction of the Basic Payment Scheme over the next few years). In addition, the model will provide a template on which we can assess the financial implications of potential changes which might be introduced on farm to improve financial performance going forward.

Our model farm comprises of approximately 160 hectares (395 acres), of which 140 hectares is owned and the other 20 hectares is rented. The principal

18

We have developed a model farm for a lowland grazing

land use is for forage production, with 130 hectares

livestock unit to track financial performance, provide a

in grass, 20 hectares in cereals, 8 hectares of roots for

benchmark comparison for other farmers and to help

winter feeding of sheep and 2 hectares of stewardship

predict future expected returns in a rapidly changing

plots/margins and non-productive areas.

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The farm carries a herd of 120 suckler cows producing

year progresses to provide ‘an actual’ result based

heifers for replacements and to be sold as stores and

on factors such as market prices, weather conditions,

steers for finishing, with 450 breeding ewes producing

lambing percentages, feed cost changes, and other

finished lambs and breeding replacements.

factors influencing the cost of production and overall

Our model farm is typical of a well-run, well-managed

financial performance.

livestock unit, with cattle reared to nine months of age

Table 1 details the financial performance of the

at around 90 per 100 cows and a lambing percentage

business for the financial year 2019/2020 (March year

of 170% for breeding ewes and 75% for ewe lambs

end) with an expected result for the financial year to

put to the tup.

31st March 2021 and two further budget projections

Labour input is provided principally by two family

for the financial years to 31st March 2022 and 2023.

members with one part-time self-employed GFW, providing input at peak times, and a lambing assistant

‘ IT IS WIT HO UT Q UE ST IO N A TO UGH SEC TO R IN WHIC H TO MAK E G O O D P RO FITS ’

in March/April each year. The business operates a modest machinery fleet, with a loader tractor, valued at £30k, and a second tractor at £15k.

Equipment

for grassland operations, both fertiliser and manure applications and forage production, form part of the machinery and equipment inventory.

The business has an overdraft facility of £150k and a loan of £100k on a repayment basis over 15 years from 2019/2020. In addition, there is an HP on the loader tractor for a 5-year term.

With regard to the financial performance, the key change between 2019/2020 and 2020/2021 is improved livestock prices. Both cattle and sheep

We believe the details above are very typical of many

prices have been strong throughout the financial year

lowland grazing farms, although clearly every farm is

to March 2021 and this has allowed an improvement in

different, and it is important to bear that in mind when

financial returns and the generation of a cash surplus,

reviewing the figures.

albeit very modest, after all costs including private

Our model farm financial information excludes any alternative/off-farm income from other enterprises

drawing requirements, tax, loan repayments and HP commitments/reinvestment requirements.

and focuses purely on the financial returns from

In addition to the changes in output prices, we have

livestock production.

taken account of reduced fertiliser cost and increased

Each year we prepare a budget projection for the business looking forward and we update this as the TABLE 1

feed cost in the year 2020/2021 and the sharp rise in straw costs. There has been some inflationary pressure

ACTUAL RESULT 2019 / 2020

PROVISIONAL RESULT 2020 / 2021

BUDGET PROJECTION 2021 / 2022

BUDGET PROJECTION 2022 / 2023

TOTAL GROSS MARGIN SUPPORT

£62,039

£77,856

£68,973

£68,973

TOTAL FIXED COSTS

£82,429

£81,053

£81,005

£80,749

(£20,390)

(£3,197)

(£12,032)

(£11,776)

TOTAL SUPPORT PAYMENTS

£40,989

£41,552

£39,320

£33,723

PROFIT / (LOSS) AFTER SUPPORT

£20,599

£38,355

£27,288

£21,947

(£14,928)

£2,885

(£9,885)

(£14,479)

PROFIT / (LOSS) BEFORE SUPPORT

CASH SURPLUS / (DEFICIT)

G S C G R A Y S J U LY 2 0 2 1

19

on the fixed costs for fuel and oil, repairs, insurance,

offset the loss of support over the next few years. We

accountancy etc.

do not underestimate the challenge in this respect.

Overall,

we

believe

the

provisional

results

for

With regard to options for the future, we feel there

2020/2021 are respectable and we are feeling pleased

is an immediate requirement to review all aspects of

with ourselves that the business generated a cash

the farm business. We need to be radical and ruthless

surplus after all costs in that year.

in the pursuit of change and improved financial

The budgets for 2021/2022 and 2022/2023 were prepared in the early part of this year, on the basis of uncertainties around longer-term livestock prices.

Although livestock prices appear to be holding up, other costs have inevitably increased and we have been cautious with regards to gross margins moving forwards.

AREAS FOR CONSIDERATION/OPTIONS FOR CHANGE INCLUDE: 1. We need to benchmark our business against the best comparable farms. The difference between

With regard to the longer-term future of this business

the top 10% and average performance on farms

an absolute fundamental is the level of support

in the North East of England is stark across all

received. In 2020/2021, we received £37,315 for

sectors. In future, only those that can achieve

the Basic Payment, and a further figure of £4,237

results in line with the top 10% as of now, will

for Countryside Stewardship. The Basic Payment

continue as livestock producers without incurring

expected for 2022/2023 will be down to £29,486,

losses.

representing a fall of £7,829 in two years. Thereafter, the Basic Payment is expected to fall further to nil by 2027/2028.

This has a massive impact for this business. To put the figures into context, the Basic Payment represents 17.5% of total income on this farm, and it is equivalent to almost 50% of the farm total gross margin. In relation to profit, it represents 100% of the profit achieved in good years.

2. We need a radical review of the cost structure of the business. The beef and sheep enterprise is operating at a loss before support payments. This will not be sustainable going forward.

3. We need to review farming practices to see if we can lower the cost of production by the

introduction

of

new/alternative

farming

techniques, for example regenerative farming techniques such as increased use of clover leys

Some might question our figures. Are we realistic and

to reduce nitrogen input, increased use of root

is the Basic Payment really that significant on grazing

crops and better forage management to reduce

livestock farms? We believe so, and we also believe

dependency on bought-in feeds etc.

substantial change is required within the sector, to

20

performance.

GSC GRAYS

4. We need to look at options to consider joint ventures where we can share resources of machinery and equipment with neighbours/other farmers.

5. Our

and focusing on other enterprises over the next few years?

9. We need to look at all resources including land, buildings, machinery & equipment, people and

another

skillsets and finance available, or access to capital/

enterprise, and this is something we intend to

grazing

livestock

farm

needs

borrowing and develop a robust strategy for our

consider/pursue over the next couple of years.

business (note, not just farming) for the future.

The options on our farm could include introducing a Bed & Breakfast pig finishing enterprise at a relatively low capital outlay utilising existing buildings, although this could have some impact on the existing operation and we might need to reduce

stocking

rates

In summary, the challenge is on for many farm businesses,

particularly

a

will be significant opportunities for many farmers to positively, but in a different

CSS/ELM

radical

‘WE NE E D TO B E RAD IC AL AND RUT HLE SS IN T HE P URSUIT O F C HANG E AND IMP ROVE D FINANC IAL PE RFO RMANC E ’

options,

where we look to invest substantial of

amounts

capital

in

a

more

intensive enterprise such as broilers for example, or investment into some form

of

diversification

enterprise

should

on

take their businesses forward

Agreement?).

More

dependency

could appear a depressing thought, we believe there

(possibly in conjunction with

where

support payments is high. Whilst at first glance this

be

way.

For example, our model farm is well capitalised overall, with

minimal

debt

levels,

well-resourced in terms of machinery

and

equipment

and well-managed. We just need

to

think

creatively

about the future enterprise structure on farm and look at new opportunities for the

considered.

future.

6. A review of Countryside Stewardship opportunities is required. Our CSS Agreement terminates this year, and we could enter a new agreement in 2022. We believe this is an opportunity to enhance the returns obtained

It is likely that most farms will need a mix of solutions in order to overcome the loss of the Basic Payment Scheme. It is unusual in our experience for one option to provide all of the answers.

from stewardship, but this will impact on the

If you would like to discuss any of the issues raised

farming operations and some changes will be

in this article and how potential changes might affect

necessary to livestock numbers.

your business over the next few months and years,

7. We need to keep a close eye on changes expected under the Agricultural Transition Plan and further

please do call one of our farm business team at your local office.

grant opportunities including Environmental Land Management and other environmental initiatives, plus

opportunities

for

improved

technical

performance.

8. We need to look at the financial returns for our livestock, is there a genuine market for our produce from which can generate a profit after

GREG RICKETTS RURAL DIRECTOR

01748 897628 gpr@gscgrays.co.uk

costs, or do we need to consider reducing output

G S C G R A Y S J U LY 2 0 2 1

21

GOVERNMENT’S PLANTING TARGETS WH AT DO T H E Y M EAN? In 2019, the Government set itself a target of planting 30,000 hectares of woodland per year across the United Kingdom before 2050, as part of the aim to achieve ‘net carbon zero’ by 2050. But what does this planting target actually mean?

22

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Currently, approximately 13% of the UK is woodland cover. When discounting the contributions of Scotland, Wales, and Northern Ireland, just 10% of England is wooded.

There is also the question of where these trees will be planted. The Government’s target totals 900,000 hectares over the 30-year period. The role of woodland planting in assisting with flood alleviation, soil structure and nutrient uptake is well known, and its importance will be harnessed in the introduction of Environmental Land Management Schemes. However, small-scale planting on less productive field corners is unlikely to be the only throw of the dice required to

The additional 30,000 hectares per year of planting will see a rise in woodland cover to 17% by 2050.

Compared

with

a

European

average

woodland

coverage of 38% the UK is significantly falling short.

A consequence of this is our need to import 70% of timber used. Evidently there is a need for planting to increase.

This therefore requires a view to larger scale planting.

But where and on what land type?

1. Productive Farmland – naturally, this would receive significant objection; the financial implications of farming businesses loosing good quality soil to woodland would be too great. Not mentioning the

When these targets are broken down, the magnitude of the proposal becomes clear. Based on planting consisting

achieve the target of a 7% increase.

of 60%

hardwood

species

and

40%

softwood species (as estimated by The Committee for Climate Change) the below levels of planting will be

TREE TYPE

HECTARAGE PER YEAR

PLANTING DENSITY

TREES PER YEAR

HARDWOOD

18,000

1 per 3m2

~20,000,000

SOFTWOOD

12,000

1 per 1.6m2

~46,900,000

TOTAL

30,000

~66,900,000

required: Tree nurseries aim to prepare for planting demand 3-years in advance, however the sudden arrival of the Government’s targets has highlighted supply chain challenges. In addition, a report by the Royal Forestry Society in 2017 highlighted a decline in enrolment in forestry courses in the UK and lack of investment in

need to feed the nation.

2. Marginal Land - much of the UK’s marginal land is priority habitat for ground nesting birds and other flora and fauna. When conducting Environmental Impact Assessments, this land is likely to be deemed unsuitable.

3. Moorland – this land is often home to deep peat, which is heavily protected from planting due to its own carbon sequestration capabilities, hence the growing prominence of the Peatland Carbon Code.

In addition, the Forestry Act 1967 states that woodland is a permanent landscape feature and is very hard to reverse. As a result of this, consideration is required to be given to the impact of woodland planting on Landscape Value. This is of particular relevance for land on or adjacent to protected areas, such as AONBs, SACs, or SSSIs.

the industry resulting in a reduced workforce with the

Nonetheless, despite the apparent lack of land on

required skillset.

which to plant trees, a report published by the Forestry Commission has identified 3.2 million hectares of ‘low sensitive’ areas for planting trees in England alone.

‘ TH E M AG N I T U D E OF THE P RO P O SAL B ECOM E S C L E AR’

These areas are highlighted on the map overleaf in green.

In addition, revenue streams are becoming more widely available to improve the financial viability of planting and increase uptake. The ever-growing variety

G S C G R A Y S J U LY 2 0 2 1

23

of grant funding opportunities for woodland planting

combined with a buoyant timber market, make these

means the forward investment required to plant trees

targets feel reachable if we are not afraid to stray

has a lesser impact on farming businesses. Whilst also

from traditional farming practices. This will require

ensuring planting can coincide with current farming

parties to critically assess the impact on the landscape

operations. Further, the sale of Carbon Tickets,

that both current land uses and proposed planting

through Woodland Carbon Code registered schemes,

schemes have, allowing parties to determine the

can provide additional income while the timber crop

feasibility of planting and ultimately their ability to

is maturing. The timber market has shown a general

assist in helping the government’s ambitious targets

increase with sawlog prices as at September 2020

to be met by 2050.

of £43.48 per m3, and financial advisers estimating a 3.1% year-on-year rise in timber demand over the next 30-years.

Prices have further increased in the

last few months.

There is no denying the ambitious nature of the government’s targets for woodland planting in the UK. However, the introduction of numerous grant schemes, a rise in social responsibility and its consequential increase in carbon offsetting

PETER KNOX SURVEYOR

0191 303 9546 pck@gscgrays.co.uk

24

GSC GRAYS

TAX CHANGES B U T N OT A S M UC H A S EX PEC T E D

By Andrew Robinson, Accounting Partner and Head of Agriculture, Armstrong Watson LLP. The Treasury’s Tax Day on March 23 is said to have

individuals and partnerships, and we presume it is to encourage companies to invest now rather than wait until 2023 when Corporation Tax rates increase.

been a “missed opportunity” to deliver on fundamental

It is available on the purchase of new machinery from

tax reforms, with many key decisions delayed until the

1 April 2021 to 31 March 2023 and will work by giving

autumn. Similarly, anyone tuning into the Chancellor’s

a deduction from taxable profits of 130% of the cost.

Budget Statement on the 3 March expecting detailed

This will increase the current tax saving on purchasing

guidance on how he planned to repair the nation’s

equipment from 19% to 24.7%.

finances from the ravages of Covid, was left both disappointed and relieved.

A trap to be aware of is that if a business had already

The predicted changes to Inheritance Tax and Capital

2021, the cost is not eligible for the super deduction.

committed to capital expenditure before 3 March

Gains Tax did not happen and gives farming businesses breathing space to undertake succession planning.

There were however three announcements that will

OFFSET OF LOSSES

impact farming businesses.

Another useful measure for some farming businesses,

CORPORATION TAX INCREASES This is the big announcement in the Budget. It affects farmers operating part or all of their businesses via a Limited Company. The rate will increase from 19% to 25% from April 2023. A company with profits of £50,000 or less will still pay 19%, and profits between £50,000 and £250,000 will be taxed at a tapered rate.

SUPER DEDUCTION FOR CORPORATION TAX

particularly those who have diversified into tourism and hospitality, who will now be able to carry back losses for up to three years rather than the current one year.

This will enable businesses impacted by Covid to get a tax refund from their losses incurred until 2022 quicker. It will also help farming businesses who have a taxable loss from investing in new equipment to carry it back against earlier tax bills rather than carry it forward to reduce future tax bills.

The announcement of a new Super Deduction was

To discuss your tax affairs please contact Andrew Robinson on

unexpected. It offers enhanced tax relief to companies

07786 527528 or email

on capital expenditure. The measure is not available to

andrew.robinson@armstrongwatson.co.uk.

G S C G R A Y S J U LY 2 0 2 1

25

HAS RENTING PROPERTY IN ENGLAND CHANGED FOREVER? Do you know what responsibilities you have as a Landlord, and are you up to speed with the current and upcoming changes in the lettings legislation?

introducing Assured and Assured Shorthold Tenancies (AST’s), in the hope to revive the private rented sector.

Today, AST’s are the most popular form of tenancy for private lettings, as they offer both parties protection.

Landlords benefit from the right to regain possession at the end of the fixed term, by serving a section 21 notice, whilst tenants are safeguarded under the Act,

Rewind back five to ten years and the private rented

from eviction, if the correct procedure is not adhered

sector was very different. During this period, there

to.

has been an influx in legislation making private renting more complex and onerous on landlords, and we fear this won’t be the end!

Whether you are a private landlord, a farmer with let farm/village cottages or an Estate owner with a wider residential portfolio, awareness of the current requirements and what is in the pipeline for this sector is key.

26

In 2015, the Deregulation Act brought protection to tenants, by imposing further rules on landlords in relation to deposit registration, retaliatory evictions and changes to the section 21 notices’.

Four years later, and the Tenant Fees Act came into force, prohibiting landlords or letting agents from charging

tenants

non-permitted

payments

and

applying a cap to deposits.

THE TENANCY SIDE OF THINGS…

The Government also dropped the ‘bombshell’ that

The Housing Act 1988 was established to give

market and protect tenants, they propose a ‘renters

landlords greater control over their properties, by

reform’ to:

GSC GRAYS

they were committed to modernising this sector and as part of their strategy to deliver a fairer rental

1. End ‘no-fault’ evictions by abolishing section 21 notices, and therefore remove Assured Shorthold Tenancies (AST’s) from the Housing Act 1988

Tenants must be supplied with a copy of the property’s EPC before the tenancy commences.

The Government recently run a consultation on

2. Strengthen and extend the section 8 ‘fault’ eviction

shifting the goalposts further, whereby the minimum

process (whereby mandatory or discretionary

EPC rating will be increased to a Band ‘C’ by 2025

grounds for possession must be met) by giving

for new lets, and by 2028 for existing lets. For many

landlords more possession rights where there is

period properties, it was a struggle to reach Band ‘E’

a legitimate need and work to simplify the court

let alone Band ‘C’. To add to this, the Government are

process.

also proposing to increase the cost cap from £3,500

3. Introduce a lifetime deposit to ease the burden for tenants when they relocate.

to £10,000 per property.

GAS SAFETY

This reform was also covered in the Queens Speech in

Landlords must ensure that annual Gas Safety checks

December 2019.

are carried out on gas appliances by a certified Gas

The ‘Renters Reform Bill’ is thought to be introduced

Safe engineer.

later in the year. The Coronavirus pandemic has clearly

Again, tenants must be provided with a copy of the

caused some setbacks.

valid gas safety certificate before the start of the tenancy and within 28 days after the test, during the

THEN THERE IS CORONAVIRUS…

tenancy.

The Coronavirus Act 2020 saw the landlords’ two

2020 brought with it another mandatory legislation

month section 21 notice period extended to six months, until 31st May 2021. The Government then announced that from the 1st June 2021 this notice period would be reduced to four months, and there is talk that from the 1st October 2021 notice periods may revert back to pre-pandemic levels.

ELECTRICAL SAFETY in respect of electrical safety and landlords ensuring properties electrics meet the current 18th edition wiring standards.

• From 1st July 2020, all new tenancies must have a satisfactory Electrical Installation Condition Report (EICR) and tenants must have been

AND LEGISLATIVE MATTERS… The obligation for landlords to meet increased compliance and improve property standards often seems never ending. The following is a summary of mandatory requirements landlords are currently to meet:

THE MINIMUM ENERGY EFFICIENCY STANDARDS New and existing let properties must have an Energy

provided with copies prior to the commencement of the tenancy.

• From 1st April 2021, the legislation was imposed on existing tenancies and tenants must be provided with a satisfactory EICR within 28 days of the test being undertaken.

The landlord is then obligated to ensure that the electrics are tested every five years.

SMOKE AND CARBON MONOXIDE ALARMS

Performance Certificate (EPC) of a Band ‘E’ rating or

Landlords must ensure private rented properties with

above. If the minimum EPC rating is not met, energy

solid fuel appliances (such as open fires or log burning

improvement works will need to be carried out, or a

stoves) have carbon monoxide alarms installed in

valid exemption applied for and lodged on the PRS

these rooms, and rooms housing the boiler.

exemption register.

G S C G R A Y S J U LY 2 0 2 1

27

Smoke alarms must also be installed on each floor of the property.

Again, evidence is key!

Chimneys should also be swept annually. This may be a requirement within your insurance policy.

HOMES FIT FOR HUMAN HABITATION ( HFFHH) The HFFHH Act 2018 brought greater emphasis for landlords to be aware of factors that affect safety and fitness for human habitation. Hazards include; damp and mould growth, excess cold, unsafe stairs etc. If the landlord has not complied with the Act, the tenant now has the right to take them directly to court.

SEPTIC TANKS

then a Form 9 notice must be served on the tenant

The General Binding 2015 regulations imposed a

before the tenancy is entered into.

deadline of 1st January 2020 for making changes to ensure that no septic tanks discharged directly into surface water. Failure to do so, could result in a fine of up to £100,000.

RIGHT TO RENT Landlords are required to carry out Right to Rent checks on all people over 18 years old who will be residing in the property as their main home.

HOW TO RENT GUIDE As part of the prescribed information, tenants must be provided with a copy of the current Government How to Rent Guide at the outset of the tenancy.

DEPOSIT Deposits are now capped at 5 weeks rent, and must be registered in a Government approved Tenancy Deposit Scheme within 30 days of receipt and the tenants must receive the prescribed information.

FORM 9 NOTICE

With these changes, landlords are likely to experience:

1. Less flexibility 2. Delays in gaining possession – going through the Courts

3. Increased expense with the Section 8 – court route

4. Lack of confidence with the Section 8 route, if the court process is not streamlined

5. Higher costs in maintaining and meeting increasing compliance.

6. Continuing pressure to meet standards.

Will the fear of not being able to ‘easily’ regain possession and the added pressure of ensuring a higher standard from a legislative and specification

If an agricultural worker is going to occupy the

perspective see landlords no longer operate in this

property, and the landlord wishes for the tenancy to be

sector, and look to invest elsewhere?

an AST, rather than it becoming an assured agricultural occupancy (where the tenant can benefit from a degree of security of tenure and greater protection),

28

WHAT DOES ALL THIS MEAN FOR LANDLORDS AND THE SECTOR?

GSC GRAYS

If so, will stock fall drastically and the private rented sector shrink? What will happen to the households who cannot afford to buy and cannot access social

IT’S NOT ALL DOOM AND GLOOM! A sensible starting point would be to undertake a review of your property(s), with consideration to:

1. Location - Is it in a sensitive area?

2. Condition - Are works required to improve the properties specification?

3. Compliance aspects - Does it meet current standards, if not what expenditure would likely be required?

4. Future plans - Is it likely to be required for a relative or an employee? If so, would it be prudent to leave the property vacant to mitigate issues with rented housing? Have the Government given this consideration?

Or will some landlords not see this as a cause for concern.

AND WHAT COULD THIS MEAN FOR TENANTS?

regaining possession, or is disposal a preference.

There may be suitable alternative uses, such as the property being a Holiday Cottage, if it is up to standards and has suitable characteristics. It may be that it could be run as a separate business opportunity or in conjunction with your existing business.

For those wishing to stay in the sector, and have a working landlord/tenant relationship, there could

‘Supply and Demand’…. If private rented property

be opportunities to offer tenants a fully serviced

numbers decline, the tenant’s choice will be reduced,

package, to include; chimney sweeping and boiler

increasing competition and inevitability driving rents

servicing which can no longer be charged for under

up.

the Tenant Fee Act and charge a reflective rent. Some

May the tenancy application process become more rigorous?

Will landlords scrutinise tenants’ obligations under tenancies and police these?

landlords may wish to go beyond this and supply logs, a gardening service or routine decorating?

Landlords are inevitably going to want tenants who will take good care of their properties, and therefore are likely to be more risk averse when choosing tenants.

Whilst there is still a slight element of the unknown, it is advisable to be proactive in considering your individual position and future objectives.

‘ B E PROAC T I VE IN CON S I D E RI N G YOUR I N D I V I D UA L POS I TI O N AN D F U TU RE O BJ EC T I VE S ’

HELEN SIMPSON SENIOR SURVEYOR

01347 820506 hes@gscgrays.co.uk

G S C G R A Y S J U LY 2 0 2 1

29

“DAD ALWAYS SAID TH AT ONE DAY, THAT WILL ALL BE HOUSING” This is a phrase which is regularly recounted to me and generally dates back at least 20 years. So why is it that housing doesn’t get to these seemingly ideal sites?

In this article, we look beyond the physical attributes and explore what is needed behind the scenes. Assuming that the site is physically and legally capable of development, you need a supportive planning framework, coupled with a lack of political opposition or ideally political support.

30

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Where strategic land is being promoted, the returns involved are significant and the process is frequently competitive.

Landowners, therefore, need to be

proactive and should not simply expect the council to come knocking on their door.

To ensure a supportive planning framework requires engagement at all stages of the plan making process.

As Local Plans last for around twenty years, the opportunities to shape them need to be taken whenever they present themselves.

The planning policies which affect a site have three broad layers to them; National planning policies, Local Plans and Neighbourhood Plans.

Westminster establishes the national direction which it wants local authorities to take, including the broad criteria used for the application of national strategies, such as Green Belt policies or the regional distribution of national housing numbers. This is done through the National Planning Policy Framework (NPPF).

County and District Councils are then required to maintain a Local Plan. These are written through a

hall) can mean that you are missing a trick.

If you can achieve a range of outputs from the site, you will garner wider support and make it more likely to happen.

Working with facts will always put you in a stronger position

to win

a

debate

over the

merits

of

development.

consultative process which generally takes at least

Undertaking high level assessments needn’t cost the

two years to complete. A plan must be Adopted in

earth but will provide a steer on predictable and often

order for it to have a full effect. Prior to Adoption,

emotive issues, such as visual impact, ecological harm

a government appointed Planning Inspector has to

or pressure on local services. Rather than hiding from

find the plan sound at the end of a series of public

these issues, you should address them and clearly

hearings.

establish the link between the development and delivery.

‘ WOR K I N G W I T H FAC TS A LWAYS P U TS YO U I N A S TRON G E R P O S T I O N ’

Crucially, where a report identifies risks, you should take active steps to address them. This needn’t be expensive. Take visual impact, for instance. A change to the cutting of a roadside hedge to allow it to grow up and encourage hedgerow trees might quite quickly screen the site. Where there are more distant views, you can filter these by planting up some intervening field corners. This is not expensive to implement,

Neighbourhood Plans can be produced by Parish or

only represents subtle landscape changes, but starts

Town Councils. Their process follows a lighter touch

to create the environment that you need in order to

version of that for a Local Plan and can build upon but

achieve development.

not overrule an Adopted Local Plan.

GSC Grays has produced a guide to the promotion of

The policies set out in these plans directly influence the

strategic land, which is available to download from our

likelihood of planning being achieved. It is therefore

website. It expands on some of the ideas touched on

essential that these are reviewed and commented

here and should provide you with the tools to inform

upon in order to give a site the best chance of coming

yourself over the merits of a site, before needing to

forward.

pay professional fees.

Policy support is more likely to be achieved with

At the time of writing, the company is involved in the

political backing.

When making representations

promotion of 2,100 acres of development land, which

to Local and Neighbourhood Plans, it is therefore

can accommodate approximately 25,000 new homes

sensible to engage with members and consider public

and is worth an estimated £261m of additional value

consultation events to either canvas local opinion or

to our clients.

to promote your site.

Identifying local needs and addressing these as part of the development proposal is sensible. Viewing a development as solely delivering housing and failing to consider the other beneficial outcomes (such as traffic calming, ecological gain, flood mitigation and

CALUM GILLHESPY DIRECTOR

01833 694931 crg@gscgrays.co.uk

investment in local facilities, such as a school or village

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RESIDENTIAL PROPERTY OUTLOOK FOR 2021

Given all the turbulence of the last year, where will the housing market be heading in 2021?

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GSC GRAYS

The unprecedented activity in the property market experienced by GSC Grays in 2020, along with similar increased performance levels across many parts of the UK, was probably not what was expected when Covid-19 took hold in early Spring.

volatility whilst the higher end of the market above

For the first time, in a very long while, the housing

‘ O UR E XP EC TAT IO NS ARE T HAT T HE RE SID E NT IAL P RO P E RT Y MARK E T WILL RE MAIN RE SILIE NT’

market appeared to do the opposite of the rest of the economy, as people up and down the country reassessed their life choices following the end of the first lockdown.

The year ended extremely positively with Nationwide

£500,000 is more resilient against these factors and is less likely to be impacted.

For the latter part of 2021, the economy is expected to begin the recovery process as businesses get back on their feet and the ratio of vaccinated people overtakes those unvaccinated. This is likely to cause the housing market to push on again due to improved consumer confidence.

reporting the highest growth rate for six years, with house prices climbing by 7.5% in 2020; something that housing market professionals probably thought seemed highly unlikely at the start of the pandemic,

Market activity and property prices will likely fluctuate

myself included.

slightly throughout the year as we move through the process, but our expectations are that the residential

WHAT DOES THIS ALL MEAN FOR THE HOUSING MARKET IN 2021?

With the agreement of an EU trade deal, additional perceived risk to the housing market has receded.

Combined with the rapid roll out of the Covid-19 vaccination programme and extension of the Stamp Duty holiday to the end of June 21 at the full rate and

property market will remain resilient.

Since the budget, we have seen no reduction in interest from purchasers in our region, with new properties attracting interest from across the UK. Special attention is being paid to those with extra space inside and out and our only real concern is the lack of supply to match this growing demand.

We are looking forward to another memorable year.

a further 3 months at half the holiday rate; we have had considerable reason for optimism.

The biggest fear for the housing market was the threat of unemployment, but the furlough scheme, which saw the government pay up to 80% of wages up to £2,500 a month, has also been extended until September 2021.

This has added additional short

term confidence to the market, but when the furlough scheme does come to an end, a rise in unemployment across the UK is likely to be expected.

The effect of this may make the lower to mid-range housing market slow and potentially lead to price

CATHERINE GREAVES AGENCY ASSOCIATE DIRECTOR

01833 637000 clg@gscgrays.co.uk

G S C G R A Y S J U LY 2 0 2 1

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BRANDING: IT’S MORE THAN JUST A LOGO There is no doubt that the Agricultural Transition Plan will not only change the rural landscape but will also provide many rural businesses with the catalyst to look to generate additional income streams from existing or new enterprises.

Combine this with changing consumer behaviours accelerated by the pandemic; as people become more aware of the environment, the origin of their food and look for staycation experiences to rival their usual European getaway. These factors provide an ideal opportunity for rural businesses to elevate their brand and capitalise on these trends.

A strong brand is far more than a logo and some pretty colours, it should underpin every single aspect, from the way you communicate with your customers, how you advertise and the core values that you instil in your staff.

HERE ARE SOME TIPS TO HELP YOU REVIEW WHERE YOU ARE CURRENTLY: IDENTIFY YOUR BRAND VALUES You may know what they are but do others? People are the very heartbeat of your business, so it is important to understand their perception in the establishment of your core values. What do those you employ really think about what you do and how you operate? What do your customers think?

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GSC GRAYS

ASK YOURSELF WHY You have a business that sells a product or service, but why do you do what you do? Naturally, the end goal is always to increase profitability, but selling something to make money will not motivate the consumer to buy into your brand. Start by building a foundation of who and why you are selling what you do. Ask yourself: What difference will it make to those who buy it?

KEEP IT SIMPLE While catchy names and striking graphics can be

memories, capture moments and make up for lost time. Starved of face-to-face contact, people will be desperate to ensure they have the best time possible, making brand and customer experience more relevant than ever. Take time to revisit all aspects of your brand, make sure everything is consistent, aligns with your values, your why, and fulfils the needs of your target audience.

With people still glued to their screens and starting to draw up plans, there is plenty of opportunity to use social media to create a sense of anticipation and

alluring, they do not provide the best way of telling

drive demand, for example:

your story.

• Take your followers on a journey: If you’ve got

Your business name, logo and slogan

should provide insights into what you do and the products or service you offer.

BE YOURSELF

a project taking place, take your audience on that journey with you.

Show them how it is

developing either through photographs or video updates including the highs and the lows, be as

The best branding is a combination of creativity and

authentic as you can. Make sure you have a call to

approachability. When considering a name, logo, and

action, and keep your followers updated on when

brand aesthetic, consider your audience. The most

bookings are being taken.

successful brands adopt a creative spin without deviating too much from what their target market needs and expects.

STAND THE TEST OF TIME Communicating that a brand is cutting-edge may make you trendy now but think about how it will look and sound in five or ten years’ time, will it still be relevant?

DOUBLE CHECK We all take inspiration from other brands and their activity but be sure to check that aspects of your brand, including logo and slogan are not plagiarised.

• Engage with the community: Little acts of kindness can go along way and are a great way of increasing engagement and cementing loyalty from followers.

Could you offer a visitor pass to front line workers to enjoy a day out? Or run a competition to find your local unsung hero? What is the little big that you can do to make the difference?

The coming months will provide you with a real opportunity to raise the profile of your business. By being part of people’s memories on and offline during these initial months of freedom and by capitalising on this, you can ensure brand loyalty and a healthier

A starting point to avoid this pitfall is to use the

bottom line.

Government’s trademark search tool.

As Amazon’s founder and CEO Jeff Bezos said

Given the recent and much anticipated lifting of

“branding is what people say about you when you’re

restrictions, there is no doubt that rural communities will start to experience a surge in visitor numbers,

not in the room” – be sure to give them something good to talk about.

with day trippers to holiday makers wanting to create

CHARLIE ROBERTS

‘A COM BI N AT I O N OF CR E AT I VI T Y AN D A P PROAC H A BI L I T Y ’

MARKETING MANAGER

01748 829212 car@gscgrays.co.uk

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WELCOME TO THE TEAM Here at GSC Grays, we recognise our people are our greatest asset; connected by a passion for the countryside and supporting the rural communities in which we live and work.

Our teams are well placed to deliver regional coverage across the North of England, with the benefit of indepth local knowledge and having expert boots on the ground enables us to deliver a first class service for our clients across all sectors of the industry.

Over the last 6 months, we have made several new appointments, including a number of graduates who have joined us at the start of their careers. You can find out more about some of the new members of our team here:

JONNY MORRIS As a newly appointed Rural Director, Jonny has extensive experience of commercial, residential, agricultural, and sporting properties and agreements.

Within these areas, he has experience of strategic planning, diversification, development, tax planning, and strategic whole estate reviews.

Jonny brings with him a wealth of experience, energy and determination to all aspects of his role, always mindful of and working towards achieving the best results with and for his clients. Currently based in our Lambton Estate office, Jonny will soon be relocated to head up the Estate Management team at Alnwick.

HANNAH PROCTOR

JAMIE JAY Jamie joined the GSC Grays team in February 2021 after graduating from Harper Adams University.

Jamie studied Rural Enterprise and Land Management and as part of his degree spent a placement year working for an Estate Management firm in Oxfordshire.

Jamie, who was based at our Lambton Estate office, has recently relocated to bolster the rural team at Alnwick, where he will be undertaking Estate Management and Rural Professional work.

JAMIE CHARLTON Jamie joined GSC Grays in 2021 to become part of the farm business team. Prior to starting at GSC Grays Jamie had been working in Anaerobic Digestion in the South West.

Jamie graduated from Harper Adams University in 2019 with a First-Class Honours degree in Agri-Business.

FIN PURCHASE Fin joined GSC Grays in March 2021 after graduating from The Royal Agricultural University where he studied Rural Land Management.

Fin is based at the Lambton Estate office, where he undertakes Estate Management and Rural Professional work.

Hannah joined the Farm Business team in October 2020, having graduated from Harper Adams University with a First-Class Honours degree in Agriculture with Farm Business Management.

During her placement year from University Hannah worked at a local livestock auction mart.

Hannah was relocated to our Alnwick office earlier this year, to help bolster the Farm Management team.

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GSC GRAYS

* Please note that the information contained within this briefing is based on the current understanding of Government Legislation and is subject to ongoing change. Before making any decisions that will affect your business you should seek further advice.

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