Smallholding

  • Written by Andrew Davis
  • Posted on Mar 29, 2018
  • Articles

A thriving agriculture needs a broad range of businesses, large and small, generalist and specialist.  This diversity should allow a better chance of profit for the farmer and more choice for the consumer.  In the past fifty years there has been an inexorable trend towards larger farms and bigger enterprises with significant consolidation bringing economies of scale.  But there are now signs of change led, in part, by the increasing demand for high quality local produce, giving the opportunity for small-scale specialist producers to supply this market.

A century ago, before the days of refrigerated lorries and central depots, most towns had a market garden in the vicinity, supplying fruit and vegetables to the population through the market, usually held twice a week.  The same applied to others supplying eggs, sausages and other meats, dairy products and herbs.  They are long gone but farmers’ markets and farm shops offer a potential replacement.  New entrants provide the lifeblood of any industry but how can a young person get into farming, set up a specialist smallholding to supply high quality local produce?

The County Council smallholding scheme was set up in the early years of the last century, partly to provide opportunities for ex-servicemen returning from the First World War.  The idea was that new entrants could rent small farms from the County Council and set up a farming business.  After a few years, sufficient capital would have been raised for the tenant to move on to a larger farm let by an estate and make room for another new entrant.

The scheme ultimately was not as successful as hoped because the tenanted sector declined from over 90% of farmland in 1900 to around 25% in 1995, due to poor returns and the break-up of estates caused by security of tenure and high levels of taxation, particularly what is now called Inheritance Tax.  As a result, there were no farms to move on to, so the tenant was stuck on the County Council smallholding.  Although many County Councils still maintain their land holdings, for example Suffolk has let several parcels of land over the past couple of years, others have sold off their farms, a victim of central Government austerity.

Now a new organisation is setting up an alternative scheme.  The Ecological Land Cooperative has managed so far to purchase three areas of land of 18 to 22 acres.  These have been divided into smallholdings of five to nine acres to let to new entrants at affordable rates.  The aim is for the tenants to work together and be given support, including business mentoring.  A timber frame barn, on-site renewable energy generation and water from rainwater harvesting and borehole are provided for use by all.  Each tenant has been promised permission to build a new low-impact home.

This raises the issue of planning.  Paragraph 55 of the National Planning Policy Framework says that isolated new homes in the countryside should not gain planning consent unless there are special reasons such as ‘the essential need for a rural worker to live permanently at or near their place of work in the countryside’.  Further detail is found in Annex A of the now superseded PPS (Planning Policy Statement) 7 which describes two tests that have to be met.

The functional test is the need for a worker to live on site whilst the financial test requires proof that the enterprise is economically viable.  If that proof cannot be provided, if for example it is a new enterprise, the local planning authority may grant permission for temporary accommodation for a period, usually of five years, so that evidence of financial viability can be acquired.  The planning authority should only grant such consent if permission for permanent accommodation will be granted if the conditions imposed are met at the end of the trial period.

Local planning authorities are notoriously reluctant to grant permission for new homes in these circumstances.  One of the reasons for that is the history of abuse.  On numerous occasions, local planners have been convinced that an application is genuine only for the applicant, once consent has been granted, to sell and move elsewhere.  Sometimes they even buy more land in an attempt to gain consent for another new home.  This may be prevented to some extent by the imposition of an agricultural occupancy condition, but planners are extremely wary of such applications.

The situation is even more fraught when the smallholding in question is in the Green Belt.  Yet, the Green Belt is an appropriate place for suppliers of high quality local produce for sale through farmers’ markets and farm shops.  After decades of the supply of new homes failing to meet the demand, there is a chronic shortage of housing, especially in rural areas.  This, of course, has pushed up prices to the extent that many country folk cannot afford to live in their communities.

This applies particularly to those seeking to set up their own farm businesses.  Even if they can find the land, they cannot find a home at a price, capital or rental, that they can afford.  If the County Council smallholding scheme cannot provide sufficient opportunities, local authority planners should take a much more flexible and supportive approach to genuine new entrants trying to meet the demand for high quality local produce.