BPS reduction = rent reduction

[glasshouse]

Rent is a cost that comes out before profit... There are a lot of farms where the accounts often show farm generated profits as a figure that is less than the BPS payment. Recent years have been more favorable but I can find examples in our own accounts, not far back, where profit and BPS payments where very similar values, and we do not have rent to pay!

There are some nerds who believe that all rents should be higher than bps

 

[PaulNix]

I don't think it's guaranteed, given the state of public finances. Rishi Sunak has said "Not every job can be saved" and "Tough choices will have to be made." The government has accepted not every industry will survive the crisis intact and the Bank of England's position is that "Unviable businesses should not be supported by the taxpayer," instead those made redundant should be retrained so they can work in other sectors.
Surely struggling schools, hospitals, councils etc will be first in line for severely stretched government resources ahead of wild flower fields

And if we were all being totally honest how many of those schools, hospitals, councils etc etc would go to the wall as if they weren't protected by the civil service bubble.

 

[Northern territory]

And if we were all being totally honest how many of those schools, hospitals, councils etc etc would go to the wall as if they weren't protected by the civil service bubble.

We are being hung out to dry. Anyone who seriously thinks elms will amount to the same as bps is dreaming. It will be a costly business with results not guaranteed employing more pen pushers to administer it. It is a serious quandary for most businesses.

 

[chipchap]

Just look up the figures on the Farm Business Survey; it’s all there in black and white, or indeed red and white!

 

[farmerm]

ELMS will provide a replacement income stream to BPS, won’t it? Without it a lot of farms will be under serious financial pressure.

The banks appear to think that it will just get replaced and the landlords agents will be keeping their heads down with rent reviews. There will be some almighty battles lined up as agents will not want to reduce the rents as it is not a good thing to report to your client and most of their management income is based on a % of rents.

To claim £20K BPS you have only to fill in a form and adhere to a couple of minor cross compliance rules... to claim £20K ELMs expect to allocate at least £15K in expenses and income foregone.

BPS was a single tier cake... compliance costs very low. Elms is a 3 tier cake, all the options in each tier come at a cost, be it putting areas of land into birdseed and flowers, planting hedges and improving public access or establishing woodland and peatland. The total size of the cake is due to remain the same as BPS (which means it is to shrink in real terms) After expenses and income foregone are taken out of the ELMS cake there will be precious little left but cake crumbs For ELMS to provide a worthwhile income stream for a few it shall mean there would need to be many that no longer get any meaningful slice of the cake at all.

 

[ollie989898]

There will still be grants to manage the land, even if that isn't "farming" it the way you think.

With what money? I don't think the political will shall remain to hand out millions to landowners for doing chuff all. It was a political ship-storm just being paid set-aside.

 

[Courier]

We are 160 ha, but can’t afford a member of staff.
I’ll swap you the rent we pay every 6 months for a paid for owner occupied farm if you like

And probably the £250 per acre mortgage ?

 

[4course]

its simple, if like me you are mainly arable with a bit of grass all you have to is work out how you are going to replace/increase the farms income by @£90 guaranteed /acre plus any increase in foreseable costs to just stand still , then you should assess wether standing still is for you . due to the weather this year it would be fair to say most of us will have an early experience of whats to come

 

[midlandslad]

its simple, if like me you are mainly arable with a bit of grass all you have to is work out how you are going to replace/increase the farms income by @£90 guaranteed /acre plus any increase in foreseable costs to just stand still , then you should assess wether standing still is for you . due to the weather this year it would be fair to say most of us will have an early experience of whats to come

Have you worked it out yet?

You would think that there would be a flood of land and farms onto the market if this is true, or will people give the new scheme a run first?

 

[4course]

not sure that many have worked out the implications or given them much thought judging by the conversations ive had with fellow farmers

 

[Courier]

not sure that many have worked out the implications or given them much thought judging by the conversations ive had with fellow farmers

May or may not be accurate, but almost certainly no “Brexit dividend” for the majority...

 

[Rob Garrett]

There are some nerds who believe that all rents should be higher than bps

Question is; what drives the rent in your local area? Here it is rental yields for "a house in the country types". Next door farm was split up, house now rented for £2k/month, which is more than the whole farm was paying!

 

[glasshouse]

Question is; what drives the rent in your local area? Here it is rental yields for "a house in the country types". Next door farm was split up, house now rented for £2k/month, which is more than the whole farm was paying!

Thats irrelevant
Farmhouses should have section 75 applied to them to prevent non farmers occupying them

 

[glasshouse]

And probably the £250 per acre mortgage ?

He said a paid for farm, which most are.
Even a big mortgage only lasts 20 odd yrs
Rent lasts centuries

 

[Henarar]

I cant see ELMS replacing BPS and being able to do much farming on a small grassland farm like this, like the other recent evo schemes it won't pay for what's is already here in fact it penalises you for what you have,
options from what I can see are telling them to stick it which in a bad year wouldn't be a good idea, running a few head of stock as well as getting ELMS [but don't know how that will work] and doing something else with my time to make a few quid

As for rent decreases it depends on the type of rental/the contract you signed I would think, if its linked to earning potential then best you can hope for is it going down by the same amount the BPS drops, if its not secure it will come down to what the market will pay

One lesson from history is when they brought in SPS as far as grasskeep was concerned they switched the payment from those farmers that took the grasskeep to those that let it out so you would have expected grasskeep value to drop, did it hell as like

 

[Brisel]

With what money? I don't think the political will shall remain to hand out millions to landowners for doing chuff all. It was a political ship-storm just being paid set-aside.

You need to consider the wider picture. Forget narrow minded farming stereotypes and think of tourism, pollinators, wildlife, pollution mitigation, floodwater holding and carbon sequestration.

 

[Bossfarmer]

i said it before the brexit vote dont take the power out of the hands of the "unelected bureaucrats" and give it to westminster as they are just looking for votes and farmers are so few now we are meaningless to them, rents wont drop like people expect, most owner occupiers have morgages up to at least equavilent rent levels that wont drop, many tenants also forget their landlord might well have mortgages from paying family out or other business interests, theres also the fact that refuse to pay rent and walk away from your land and most likely someone else will step in any pay what the landlord wants!

 

[glasshouse]

i said it before the brexit vote dont take the power out of the hands of the "unelected bureaucrats" and give it to westminster as they are just looking for votes and farmers are so few now we are meaningless to them, rents wont drop like people expect, most owner occupiers have morgages up to at least equavilent rent levels that wont drop, many tenants also forget their landlord might well have mortgages from paying family out or other business interests, theres also the fact that refuse to pay rent and walk away from your land and most likely someone else will step in any pay what the landlord wants!

They wont walk away, they will negotiate it down as the law allows
If you knew anything , you would know that

 

[ollie989898]

You need to consider the wider picture. Forget narrow minded farming stereotypes and think of tourism, pollinators, wildlife, pollution mitigation, floodwater holding and carbon sequestration.

I don't disagree with any of that, but with what money, from where?

 

[B'o'B]

I don't disagree with any of that, but with what money, from where?

The magic money trees we are all going to have to plant of course!