The Rural Update: New flood taskforce and Defra challenges
Your weekly dose of news, views and insight from Knight Frank on the world of farming, food and landownership
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Viewpoint
It probably pays to be a little sceptical when a new government initiative, especially one involving numerous ministries and external stakeholders, claims it is going to “turbocharge” something.
But by convening the Floods Resilience Taskforce, discussed below, Defra Minister Steve Reed is at least bringing a bit of belated joined-up thinking to an issue that is costing the agricultural sector and UK society as a whole billions of pounds each year.
Rural estates have the potential to significantly mitigate the impact of downstream flooding on local communities. However, a lack of investment in basic drainage infrastructure has exacerbated the impact of increasingly erratic rainfall patterns on farms across the country.
Nevertheless, following the news that it failed to spend hundreds of millions of pounds on its vaunted new environmental schemes over the past few years, Defra has a bit of work to do to convince rural landowners that it can deliver on its targets and aspirations, let alone turbocharge them.
In this week's update:
• Wheat support
• Defra underspends big
• Flood task force launched
• Welsh farming minister confirmed
• Rock removed
• Crown e-tenancies launched
• Planning consultation deadline looms
• Vaccine bee boost
• Regen defined
• Cumbrian coalmine quashed
• Criminal court considers ecocide
• Bluetongue update
• Country houses - Dipping but outlook brighter
• Farmland - Values hold firm
• Development land - Market stays flat
• New Forest find
Commodity markets
Wheat support
Several factors, including a potential reduction in the size of Russia’s 2024 wheat harvest and dry planting conditions for next year’s crop in key grain-producing areas like Russia, eastern Ukraine and the US, have helped to nudge up grain prices over the past week. However, trader Frontier points out that the support is not enough to move prices “on to another level yet”.
Rental reform
The Renters’ Rights Bill was published by the government last week. The bill largely mirrors the Renters’ Reform Bill, which was due to be introduced by Rishi Sunak’s administration but fell by the wayside once the General Election was announced. It includes the abolition of Section-21 no-fault evictions and will also end blanket bans for those on benefits or with children.
There are however some interesting new elements to the bill, points out estate management specialist Jess Waddington. “While the intentions of the Renters’ Rights Bill are in essence the same as the previous Renters’ Reform Bill, there are a few key changes. Most notably, banning the ability for an agent or landlord to accept a rent payment which would be considered ‘over’ the market level and therefore removing competitive bidding. This might result in increased rents as agents and landlords could market properties at higher rents to see if they were possible, as they can only negotiate downwards.”
The new bill focuses on strengthening both the grounds for possession, and the court processes for regaining possession, points out Jess. “In addition, the new bill promises an ombudsman service to assist in resolving issues without the need to go to court. While in principle, this is positive news, it will only be in practice where we will see the ultimate success or failure of this bill,” she adds.
News in brief
Defra underspends big
Last week we revealed that the Treasury could be clawing back £100 million that Defra failed to spend on its environmental schemes. Now we learn that the total underspend since 2021 comes to almost £360 million. The figures were revealed in the 2023-2024 edition of Defra’s Farming and Countryside Programme Annual Report, which was published last week. The report provides a fascinating snapshot of how much Defra spends on its various support programmes. Last year a total of £806 million was spent on environmental and land management schemes. For advice on making the most of grant funding please contact Henry Clemons.
Net-zero target tricky
A lack of government support for climate-friendly farming methods, such as the aforementioned underspend, means the NFU’s aspiration for the agricultural sector in England and Wales to hit net zero by 2040 is under threat, claims the lobby group. To mark Back British Farming Day last Wednesday (11th September), NFU President Tom Bradshaw optimistically called for the UK’s total agriculture budget to be increased from £3.5 billion to £5.6 billion.
Flood task force launched
Rain-battered farms and estates will be hoping that the government’s new Floods Resilience Taskforce, which met for the first time last week and brings together various government departments and external stakeholders, will deliver on its promise to “turbocharge the development of flood defences and bolster the nation’s resilience to extreme weather”. The group’s remit will include championing the delivery of drainage systems, flood defences and natural flood management schemes in communities.
Welsh farming minister confirmed
Wales’ new First Minister Eluned Morgan has confirmed that Huw Irranca-Davies will retain his farming brief as well as becoming Deputy First Minister. Irranca-Davies, whose official job title is Cabinet Secretary for Climate Change and Rural Affairs, is widely considered a safe pair of hands when it comes to farming. He will need all his political nous and farming experience to pilot the country’s Sustainable Farming Scheme, which proved so unpopular with farmers that its introduction has been delayed until 2026. Farmers, meanwhile, have until 27 September to apply to join the new separate Integrated Natural Resources Scheme.
But Rock removed
Defra has perplexed representatives of the tenanted farming sector by dropping Baroness Kate Rock as one of its non-executive directors. In 2022 Rock was appointed as Chair of The Tenancy Working Group, commissioned by the Environment Secretary to look at the future of agricultural tenancies. The subsequent Rock Review made several recommendations to strengthen the tenanted sector, boost access to environmental schemes and improve landlord-tenant relationships.
Crown e-tenancies launched
One of the big issues highlighted by the Rock Review is the difficulty tenant farmers sometimes face accessing environmental support schemes under the terms of their tenancy agreements. However, The Crown Estate has just announced that it is set to start offering environmental Farm Business Tenancies that will provide the “guardrails” for farmers to continue producing food while delivering enhanced nature recovery across its 287,000-acre rural estate.
Planning consultation deadline looms
Anybody interested in sharing their opinion on the government’s proposed changes to the National Planning Policy Framework (NPPF) have until 24th September to respond to the consultation. The changes, which include allowing more houses to be built in the green belt, are part of the government’s bid to deliver 1.5 million new homes over the next five years.
Vaccine bee boost
Bumblebee populations have plummeted with the use of agrochemicals such as neonicotinoids receiving much of the blame. But new research findings show it could be possible to “vaccinate” bees. Scientists have discovered that hydrogel microparticles fed to bumblebees in sugar water cause a 30% higher survival rate in individuals exposed to lethal doses of neonicotinoids and significantly milder symptoms in those exposed to lower doses that would not usually be lethal but can cause harm.
Regen defined
An academic paper has called for different sustainable farming practices to be more clearly defined to help support farmers. Dr Tom Staton of Reading University, who led the research, said: "There's a lot of buzz around regenerative farming, but it's crucial to understand that 'organic' is a legally protected term. This means consumers can trust that organic produce meets specific standards, particularly regarding pesticide and manufactured fertiliser use.
We're not knocking regenerative farming, which helps improve the health of British soil and boosts biodiversity. Regenerative farming is not regulated, however, and if we want to see real change in our food system, we need to support approaches with clear, enforceable standards."
Cumbia coalmine quashed
Planning consent for a controversial Cumbrian coalmine has been withdrawn following a legal challenge by Friends of the Earth and regional campaign group South Lakes Action on Climate Change. Consent was originally granted by Michael Gove in 2022 based on the mine using carbon credits to offset its emissions. However, the court ruled this reliance on carbon offsets was unlawful as UK policy prohibits using international credits to meet emissions targets under the Climate Change Act 2008. The court also ruled that Gove had failed to properly consider the climate impact of burning the coal produced by the mine, which accounts for 99% of the emissions from the project.
Criminal court considers ecocide
Environmental lawyers could be gearing up to take on even more cases if the International Criminal Court (ICC) decides to add ecocide to the list of crimes such as genocide that it prosecutes. The ICC revealed last week that it is formally considering such a move after lobbying by climate change-affected island states such as Vanuatu, Fiji and Samoa. Ecocide is defined as “unlawful or wanton acts committed with knowledge that there is a substantial likelihood of severe and either widespread or long-term damage to the environment being caused by those acts”. It could include large oil or chemical spills, the clearance of primary forests or ancient woodland at scale, or the spilling of microplastics in large quantities.
Bluetongue update
As of Sunday, the number of farms affected by the latest outbreak of bluetongue virus had risen to 56 cases including in East Yorkshire and Lincolnshire. The restricted livestock movement zone now covers part of Kent as well as areas of Greater London and all of Norfolk, Suffolk and Essex. You can find the latest updates on the spread of the disease and what measures stock farmers are being advised to take here.
Research
Country houses - Dipping but outlook brighter
The average value of country houses nudged down by a further 0.6% in the second quarter of the year taking the 12-month fall to 3%, according to the latest results from the Knight Frank Prime Country House Index. Homes priced between £1 million and £2 million recorded the biggest annual fall of almost 4%, while those worth between £4 million and £5 million dipped by just 0.4% - potential buyers at this level are less dependent on mortgage funding, points out Head of UK Residential Research Tom Bill. He predicts a total average price slide of 2% this year, with values bouncing back by 3% in 2025 as interest rate cuts boost market confidence.
Farmland - Values hold firm
The farmland market in England and Wales shrugged off the potential impact of the recent general election to register another quarterly price increase, according to the latest results from the Knight Frank Farmland Index. Average values nudged up by almost 1% in the second quarter of the year to hit £9,335/acre. For more insight and data please download the full report.
Development land - Market stays flat
The value of greenfield development sites remained static in the second quarter of the year, according to the latest results of the Knight Frank Residential Development Land Index. Over the past 12 months the index is down 2%. According to Anna Ward, who compiles the index, developers have welcomed Labour’s commitment to reinstate local housing targets and recruit more planning officers. But with interest rates failing to shift and build costs increasing, homebuilders still face significant headwinds, she adds. Download the full report for more insight and data.
Property of the week
New Forest find
Anybody looking for a compact private farming and lifestyle estate in the south of England will want to check out 286-acre Landford Lodge near Salisbury, Wiltshire. Located within the New Forest National Park, a picturesque mix of pasture, arable land, woodland, lakes and streams surround a Grade II listed house with 12 bedrooms. The guide price for the main lot, which includes 259 acres of land is £12 million. Further land, a tree nursery and a secondary house are lotted separately. Please contact Georgie Veale for more information.