An imbalance of power that works against the tenants

Published on Sunday 29 November 2009 20:41

MOST of my relations farm; some of them are tenant farmers. I was a tenant farmer myself until I found out it that was easier writing about farming than actually doing the job.

My first recollection of having a landlord was that this important person would visit my father's farm. This was part of an annual visit to the clutch of ten farms he owned in north-east Fife.

Accompanied by his land agent, he would see these properties not in their everyday wear but very much a spruced-up operation.

It was I suppose a variation of royalty visiting a location where everything receives a slap of paint and all the less desirable aspects are kept out of sight.

As a small boy, my father must have decided I was in that latter category, and for a number of years I never met this man to whom dad paid the farm rent.

When I did, I was surprised to find out he was remarkably similar to ordinary human beings and indeed asked dad about his cropping plans and did they include growing such-and-such a crop. Dad replied no, but mentioned another farm that did. The landlord looked to his agent and asked: "Is that one of my farms?"

For a short time I wanted to own so much land that I did not know whether I owned it or not, but that never happened.

Later, as the tenant of the farm, I became involved in rent negotiations and found out the pressures that are used in setting a rent. Agents would use comparable – and invariably favourable – recent settlements to make their case. They had a network of information that was beyond the ordinary tenant farmer. To combat this, my main weapons were the actual economics of the farming being carried on and the money I had spent on improving what was someone else's property.

After a meeting or two with no agreement being reached, we seemed to be heading for the Land Court, but the reality is that this option is only for the extremely determined or well-heeled financially. Thus my rent was set.

It may be thought this article is out-of-date as the main rent settlement date passed on Saturday, but it is actually very timely as a whole new raft of tenants now hold letters from their landlords indicating that their rent will be reviewed in 2010.

A quarter of a century on from my experience the same battle rages. It varies in intensity from year to year depending on the overall economic state of farming, but the main components are still there: the use of comparable settlements and the threat of the Land Court.

What is this threat of the Land Court? We live in a democracy and everyone should have access to it. Theoretically, yes, but if you take on top legal advice to support your case, do not be surprised if the exercise ends up costing big money. Many tenants do their sums and reckon they might as well pay the rent demanded.

This year the stakes have been raised with the Scottish Tenant Farmers Association (STFA) claiming some agents are using bullying tactics in raising the rents. Countering this, the Scottish Rural Property and Business Association have challenged the STFA to produce hard evidence that heavy-handed and threatening tactics are being used.

A number of years ago, the Tenants Farming Forum (TFF) was set up to try to bridge the gap between the two sides. It has sorted out a number of issues but the big issue of rent settlement remains.

Angus McCall, the driving force behind the STFA, says tenants are very aware of the dangers of airing problems within the TFF and "experience has shown that speaking out can have serious consequences for their homes and tenancies".

From the evidence I have, it appears that some tenants are facing a doubling in rent. The record reported to me is a 140 per cent rise, but most of those I have heard about are at least 50 per cent.

Two main factors are being cited. One is the arable sector did well in 2008 and the livestock sector is currently in better heart than it has been for some time. The second, alluded to by the STFA, is that some larger businesses, especially those growing potatoes have offered rents well above what is thought "normal".

A farm in Perthshire is reported to have a rental of 150 per acre which is, in normal years, a low potato rent, but which is also well above any rent based on cereals, at 80 per tonne, or livestock at pre-2009 returns.

The justification for such a rent is often given with existing large units spreading their costs across a bigger base, but that does not make life for the smaller-scale tenant farmer, living within his current boundaries, any easier.

There is no easy solution to the above divide but easier, less expensive and quicker access to the Land Court would be a help. As would an acceptance that it would be far more profitable for both sides if there was a more even-handed solution.