Covid-19 – Rural business update February 2021

Farms & Estates

While some see the lockdown restrictions as a great opportunity to get outside and explore the British countryside; farmers are being left to foot the bill with widening footpaths and damaged crops. The wet winter paired with lockdown restrictions has meant that walkers are avoiding the muddy paths and trying to socially distance themselves, resulting in crops being trampled on and footpaths widening.

Some farmers are reporting footpaths being widened by up to 16 metres in places. The CLA has urged walkers to use wellies whilst the NFU Deputy President Stuart Robers warned people that this is next year’s food they are trampling on.

In December, the government announced an extension to the Seasonal Workers Pilot for 2021 with an expanded quota of 30,000 visas. In preparation for this year’s harvest, the government is working alongside the industry to expand the Pick for Britain campaign. This comes as a result of the need to support British farmers since leaving the EU and reducing the food miles of food in our shops as part of the government’s wider commitment to the environment.

Rural businesses are looking to adapt, with more and more farms considering diversifying into hospitality and tourism. The staycation trend was on the rise in 2019 and has been ever more so increased with camping and glamping being a popular attraction for UK residents.

Going forward, the travel trends for 2021 see staycations expected to boom after the third national lockdown ends as people look to explore more on their doorstep and avoid the hassle of international travel restrictions and quarantine regulations. The challenge for 2021 is for businesses to capitalise on this trend and to tap into the market of those cautious to travel abroad this summer.

Rural property owners with hospitality and tourism businesses will benefit from an extension of the cut in VAT from 20% to 5% until 31 March 2021. This extension was part of Chancellor Rishi Sunak’s economic package to mitigate the impact of the virus on businesses and will give the tourism and hospitality sectors confidence to continue trading and adapt to an ever-changing working environment. The government is under pressure from the hospitality industry to extend this cut for the year to allow businesses to not only survive but recover from the effects of the pandemic.

With another lockdown in play and hesitance over the return to office environments, the prospect of country living appeals to those stuck in London with minimal outdoor space. This fundamental shift in buyers’ requirements is seeing rural hotspots around the Home Counties as the pandemic acted as a catalyst for buyers and sellers to act now.

As long as rural connectivity can support the needs of remote workers, remote working could see an increase in the conversion of redundant farm buildings for development to commercial and residential use to meet the growing demand.

The future of tax for property buyers is very much of topic at the moment, with the Stamp Duty Land Tax (SDLT) holiday being called for a further extension beyond 31 March 2021. Chancellor Rishi Sunak is under increasing pressure from buyers and sellers to extend it and is reportedly reviewing its extension to allow buyers to complete through to mid-May.

The Financial Conduct Authority is extending the ban on mortgage lenders repossessing homes while coronavirus restrictions remain tough by two months until 1 April 2021. This was due to expire at the end of January 2021 but with the worsening coronavirus situation, “consumers could experience significant harm if forced to move home at this time as a result of repossession proceedings”, the regulator said.

Let Properties

Under the government’s new Model Tenancy Agreement, landlords can no longer issue a blanket ban on pets in rental properties. If they wish to argue this, they will have to object in writing within 28 days of a written pet request and provide a proper reason. Although consent for pets will be the default position, landlords will still be protected with tenants having a legal duty to repair or cover the cost of any damage to the property by the pet.

With regards to mortgages, the mortgage holiday has been extended yet again, with applications open till 31 March 2021. Lenders have agreed to offer payment holidays where needed due to the coronavirus-related hardship, of up to six months. This also includes buy-to-let mortgages. Those who have not yet had a mortgage payment holiday will be entitled to a six-month holiday, and those that have already started a mortgage payment holiday will be able to top up to six months without this being recorded on their credit file.

The Coronavirus Act 2020 provides protection to social and private tenants through the ban on evictions and the delay in time for landlords to start proceedings to evict tenants. A week before the lapse of the current period, a further extension on evictions for private renters has been granted until 31 March 2021. Landlords are unable to start possession proceedings unless they have served six months’ notice on the tenants of the property. As before, the exception is for serious circumstances such as illegal occupation, domestic abuse, anti-social behaviour, and where a tenant has accrued extreme rent arrears to the value of over six months’ rent.

Business

Businesses are anxiously awaiting Chancellor Rishi Sunak’s 2021 Budget which will be unveiled on 3 March 2021. After last years ‘coronavirus Budget’, Mr Sunak will be under pressure to protect jobs and businesses once again as restrictions continue. It is set to be the toughest Budget in years given the pressure to stabilise the public finances with additional spending cuts or tax increases.

A bad week for commercial landlords, with the government drawing up plans to extend the controversial moratorium on commercial property owners’ ability to evict tenants over unpaid rent. The eviction ban was due to expire at the end of March 2021 and the government said in December that it would not be extended beyond March having extended the ban twice already.

Back in November, we looked at how Mr Sunak had announced that the Coronavirus Job Retention Scheme, which covers 80% of salaries up to £2,500 a month, had been extended until 31 March 2021. This has been further extended until the end of April 2021.

The Self-Employment Income Support Scheme (SEISS) has been extended until April 2021, offering support to those who are actively trading but face reduced demand over the winter months. The fourth grant instalment will be paid February through to April covering a three-month period worth of profit and will be worth 80% of average monthly trading profits, capped at £7,500 in total.

The Bounce Back Loan Scheme, Coronavirus Business Interruption Loan Scheme, and the Coronavirus Large Business Interruption Loan Scheme have extended deadlines, giving businesses across the UK until the 31 March 2021 to access the support.

The Bounce Back Loan Scheme offers greater flexibility and more time, with loan repayments being extended from six to 10 years, nearly halving the average monthly repayments. The scheme has had significant take-up with loans being offered between £2,000 and £50,000, capped at 25% of turnover. Repayments aren’t due for the first 12 months and the government cover interest payments for that period.

Businesses across England that were forced to close as a result of local and national lockdowns have been able to claim grants of up to £3,000 per month. Since 5 January 2021 as a result of a third national lockdown; the government is offering businesses in England the opportunity to claim a one-off grant of up to £9,000 in addition to the grants mentioned above.

Covid-19 Secure Workplaces

With England in the midst of a third national lockdown, the pressure is on businesses more than ever to ensure that they are following the government's guidelines when it comes to providing a Covid-19 secure workplace for employees who are still able to go to work. Part of this includes a thorough risk assessment addressing the risks of Covid-19 and implementing social distancing and control measures; meaning that landowners need to update their Health & Safety policies accordingly.

According to government guidelines, rural business risk assessments should include the following;

1. Assessing the risk – Employers have a legal responsibility to protect workers and ensure their health and safety is not compromised, especially from Covid-19
2. Who can work – Particular attention should be paid to the vulnerable and guidelines surrounding their employment
3. Implementing social distancing – Guidelines on 2m distancing, frequent hand washing, screens, side-to-side working if 2m distancing can’t be achieved
4. Managing common areas – Reconfiguring seating in break out areas and where possible, using outdoor areas
5. Managing external visitors – Maintaining a record of visitors on-site and limiting the number of visitors at any one time
6. Provide signage – Guidelines to employees on social distancing, the use of PPE, and other measures implemented to limit the transmission
7. Implementing frequent cleaning – Clearing of workspaces at the end of shifts, sanitisation stations, and frequent cleaning of work areas and shared equipment and vehicles
8. Use of PPE and mask coverings – Continue to do so where PPE is already used in the workplace
9. Managing goods arriving and leaving the farm – Encouraging drivers to stay in vehicles, limiting the number of workers loading/unloading vehicles, and revising pick up/drop off times to limit the number of visitors on site

Photo by jens holm on Unsplash