Access To Land
The UK has a troublesome history of land ownership. Much of its land was held in common ownership prior to the Enclosures Acts of the 1750s, when parliamentary acts enclosed previously open field systems and put land into the private ownership of a rich few, sweeping away the customary and legal access to land of millions of people. The enclosures are responsible for much of the shape of our current landscape. The result of our early involvement in the Industrial Revolution also meant a mass exodus from rural areas to the new centres of industry and can be blamed for the UK population’s overwhelming disconnection from the land, farming and food production.
The reasons for loss of farmland in the UK are obvious when we consider that 705,000 hectares of rural land was lost to urban use between 1945-1990. Similarly, rural developments are also causing a loss of agricultural land, with about 11,000 hectares being developed between 2001 – 2009.xv
At the same time as the total quantity of land available for farming is decreasing, the land that is used for agriculture is becoming concentrated into fewer, larger holdings. Between 2005 and 2012 we saw the number of agricultural holdings drop from 248,000 to 222,000, a loss of 10.5%. The number of smaller holdings, those under 20ha, is dropping faster at 13%, while the average farm size increases year on year. What we are left with is a situation where out of the total of UK farms, 18% are large farms (over 100ha) and they control 73.6% of farmland.xvi
In the UK 90% of agricultural land is privately owned. The remaining 10% is owned by public bodies, semi-public bodies and institutions.xvii Of the private land, 56% of this is owner occupied and 34% tenanted.
Over the course of most of the 20th century, the law gave increasing rights to tenants, including rent control, security of tenure and succession rights allowing the transfer of agricultural tenancies to family members. This was a reaction to the historical power of land-owners and culminated in the 1986 Agricultural Holdings Act. The result of this trend though was seen as disadvantageous to landlords, discouraging them from renting land due to the burdens placed upon them and by 1994 the proportion of tenanted holdings had dropped to 24%, from 60% in 1960 and a reduction in the area of land being rented.xviii This led to a swing in the opposite direction with the Agricultural Tenancies Act (1995), which introduced short-term and flexible contracts, deregulating tenancies with the aim of freeing up more agricultural land to be rented in the UK. While leases signed before 1995 still fall under the old legislation, enjoying lifetime security of tenure and succession for up to three generations, this type of tenancy is inevitably dying out with the farmers who signed them.
Leases signed after 1 September 1995 fall under the Farm Business Tenancies (FBT). These tenancies state that the farmer must comply with the business condition, which means that there must be some farming for the purpose of trade at some point during the lease.xixLandlords and tenants have to come to an agreement on the upper limit of compensation allowed. Landlords have protection in that the tenant has to give at least 12 months notice before quitting. However, the tenant cannot give notice of over 24 months. Measures to ensure clarity of rent to both the tenant and the landlord include discussions on whether both parties would like rent reviews. In addition, both parties can ask for a review after three years.xx
FBTs are widely seen to lack the security of previous tenancies. Indeed the majority of tenancies last less than five years.xxi As well as giving less security to tenants, the loss of rent controls since 1995, coupled with the prospect of increased incomes on arable farms in England is leading to higher rent prices and an increase in the cost of Farm Business Tenancies.
Land values in the UK are unregulated and at the mercy of the open market and in recent years various pressures. The global search for productive land, in the face of the threat of climate change and the perceived imperative to increase food production, has led to a dramatic increase in UK land prices over the last decade. As these prices rise, and due to the liberal British land ownership laws, UK and foreign investors are increasingly buying agricultural land as an investment vehicle, causing prices to rise till further. The UK is one of very few countries that has an entirely free land market with no restrictions on foreign buyers.xxii
In 2014, land prices rose by 8.3% over the year to just over £10,000 per acre, which had a knock-on effect on rents in many farming sectors.xxiii
