Survey of the Views of Owner Occupier Farmers on Current Issues for Tenant Farming

This survey of owner occupier farmers is part of a series of evidence to support the Agricultural Holdings Legislation Review Group.


EXECUTIVE SUMMARY

Introduction and methodology

A Ministerial led review of the Agricultural Holdings legislation is being carried out by the Agricultural Holdings Legislation Review Group (AHLRG). As part of this review, the Scottish Government commissioned Ipsos MORI to carry out a survey of farmers who own their land, in order to better understand their future intentions and views on renting-out land.

The survey is part of a series of studies being conducted on behalf of the Scottish Government to support the development of agricultural policy and regulation and covers the following topics:

  • the current level and types of agricultural land owned in Scotland
  • changes in land tenure since 2000
  • agricultural owner occupiers' views on renting-out agricultural land
  • the likelihood of agricultural owner occupiers renting-out land in the future
  • agricultural owner occupiers' views on the future of the farming sector in Scotland
  • agricultural owner occupiers' views on the Absolute Right to Buy

A total of 337 surveys were completed by post. This represents an overall response rate of 12%. Results were weighted by regional location and size of farm.

Agricultural owner occupiers and the land they own

The average hectarage of land owned by respondents was 142 hectares. Respondents were more likely to farm one holding in hand (70%), while 8% farmed two holdings or more. Twenty one per cent of respondents said that they did not farm any holdings in-hand. This may be because owner occupiers did not understand the question or they are owner occupiers of unmanaged hill ground etc.

Most respondents (84%) were actively involved in the management of their business, including farming activities, land based industries and other diversified enterprises. Ten per cent said that they were kept informed of the financial outputs of the business, while 6% oversaw the management of the business.

The majority of families or businesses (87%) had taken over ownership of their estate or holding since 1945, with 38% having taken over ownership since 1998 or after.

More than a half of respondents (56%) were aged over 60, with a quarter aged over 70 (27%). Fifty four per cent had a successor in mind for their business, with 52% planning to pass on their business to a family member, while 18% did not have a successor in mind and were planning to sell their business when they retired.

Changes in land tenure over time

The majority of respondents (77%) owned the same amount of land now as in 2000. Of those whose land had changed in size since 2000, it was more likely that their hectarage had decreased than increased, with 17% saying that their land was smaller than in 2000 compared to 6% who said that their land had increased during this time. The hectarage of land owned was more likely to have decreased in size by selling the land to another party (not a farmer) or by selling land to a neighbouring farm within a 10 mile radius (13% and 4% respectively).

Most respondents said that they did not contract out or in any agricultural land (88% and 86% respectively). Of those who did contract out agricultural land, 9% contracted out the same amount of land compared to 2000, 2% contracted out more land and 1% contracted out less land. Of those who contracted in agricultural land, 10% contracted in the same amount of agricultural land compared to 2000, 1% contracted in more land and 3% contracted in less land.

Absolute Right to Buy (ARtB)

Around a quarter of respondents (24%) said that all tenant farmers should be offered the ARtB with a further 22% saying that certain tenant farmers should be offered the ARtB. Less than half (44%) of respondents said that no tenant farmers should be offered the ARtB.

Similar proportions thought that if ARtB were to be introduced that the land should be valued at either vacant possession value or sitting tenant value (30% and 29% respectively). Five per cent thought that the land should be valued at investment value while 38% said that they did not know how the land should be valued.

When presented with a series of statements on the possible implications of the ARtB, the majority of respondents thought that its introduction would discourage landowners from renting-out land, make it more difficult for new entrants to rent land and increase farmers' financial risk of negative equity (63%, 56% and 56% respectively).

Respondents who thought that no farmers should be offered the ARtB had more negative opinions over its potential introduction. Seventy nine per cent of this group thought that the introduction of ARtB would discourage landowners from renting-out land (compared to 63% overall) and 68% thought that it would make it more difficult for new entrants to rent land (compared to 56% overall).

Future of Owner Occupiers' Land and the Farming Sector

In terms of attitudes towards renting out land, four out of five respondents (80%) said that it was unlikely that they would rent out land in the future, with 46% saying that it was not at all likely. However, one in ten (10%) said that it was likely that they'd rent out land in the future, with 2% saying that it was very likely. The types of arrangements that respondents were more likely to use to rent out land in the future were seasonal lets and informal agreements with neighbours (35% and 29% respectively). Five per cent of respondents said it was likely that they would use secure tenancies.

Some of the main reasons respondents did not rent-out land at present were: they needed all the land for their own business; they wanted to pass the land onto a family member; and uncertainty around future legislative change (76%, 66% and 61% respectively).

Financial incentives, less bureaucracy and more rights for landowners would make respondents more likely to rent-out land (43%, 42% and 42% respectively). Thirty four per cent of respondents said that being certain ARtB would not be introduced would make them more likely to rent-out land.

Respondents were presented with a series of statements concerning the challenges facing the farming sector in Scotland at the moment. Sixty six per cent of respondents agreed that 'Uncertainty around the future of agricultural legislation is detrimental to farming' and 58% agreed that 'Landlords and tenants should have more freedom to develop business contracts to progress new business interests'. Only 11% agreed that 'Current rent levels encourage new entrants'.

Contact

Email: Liz Hawkins

Back to top