NEWS LETTER

New Options for Environmental Stewardship

Farmers looking to enter the Environmental Stewardship Scheme will now be offered a greater range of options following the announcement of additional options available from May 1st.

In addition to the introduction of 3 new options, which are aimed at tackling potential soil erosion, points allocations and payments have been increased for the existing in-field tree and mixed stocking options, reflecting alterations to the requirements for these options. The new options are:

1. 12m riparian buffer strip on cultivated land. Points allocation 400/ha (ELS) and 500/ha (OELS). Similar option to current buffer strip options on cultivated land.
2. Maintenance of watercourse fencing. Points allocation 4 per 100m. Equivalent option to maintenance of woodland fencing.
3. Enhanced management of maize crops to reduce soil erosion and run-off. Points allocation 94/ha. Combines early harvest with establishment of cover crop. (ELS only)
4. Uncropped, cultivated strips for rare plants on arable land. Points allocation 460/ha. Extending availability of current ELS option into OELS. (OELS only)

Changes have also been made to the Higher Level Scheme (HLS):

New HLS capital items:

1. Hard base for livestock drinker. £85/drinker.
2. Hard base for livestock feeder. £120/feeder.

Amended HLS options:

1. Protection zone extended from edge of canopy to 2m beyond edge of canopy. Points allocation raised to 16 points per tree (from 12 per tree)
2. Protection zone extended from edge of canopy to 2m beyond edge of canopy. Points allocation raised to 11 per tree (from 8 per tree)
3. Proportion of cattle raised to 30% (from 15%). Points allocation raised to 9/ha (from 8/ha).

If you would like to discuss any of the new options or would like assistance with your ELS/HLS application, contact Paul Oughton or Stuart Milsom on 01285 648 113.

VAT & Farm Rents – Clarification

Much uncertainty has been caused by the Mason v Boscawen case for those reviewing rents under the Agricultural Holdings Act where the landlord had opted to tax for VAT. The judge in that case held that VAT comprised part of the rent and therefore a change in the VAT rate had the effect of changing the rent, thus re-triggering the minimum three year period for unilaterally seeking arbitration on a rent review.

The recently published Finance Bill includes a clause that would amend the Agricultural Holdings Act 1986 to tackle this issue. The Clause states that a demand for arbitration will not be effective if the next termination date falls within three years of the date when the last rent review took effect.  The effect of s.78 of the Finance Bill should be to reverse the position which resulted from the Mason v Boscawen ruling and leave parties back where they thought they were, so that changes to VAT rate, do not have any effect on the rent review cycle. The Finance Bill is unlikely to be law until July.

We are aware of some landlords & tenants who have delayed serving rent review notices because of the uncertainty surrounding this issue. If you are currently amidst discussing a rent review, or looking at options in relation to the forthcoming Michaelmas rent review date, contact either Robert Young or Chris Graham for advice.

Increased Grant Rates to be available under RDPE

DEFRA is seeking European Commission consent to increase the funding limit on a range of Rural Development Programme grants from 50 % to 100 %. The changes will benefit farmers who want to diversify into non-agricultural businesses and small rural enterprises which want to start up or expand, although the proposed changes do not mean that all projects falling into the relevant categories will be 100 % publicly funded.

DEFRA Consultation on CAP Health Check Issues

DEFRA has commenced a consultation period looking at aspects of the CAP Health Check reforms in relation to the Single Payment Scheme and other direct payments. The consultation includes issues such as increasing the minimum claim size to possibly 3 or 5 ha. (16% of SPS claims are for less than 5 ha.), the imposition of a 'genuine' farmer test, and the decoupling of support for protein crops and nuts. If enacted, these measures would probably take effect in 2010.

On the one hand, whilst a reduction in the number of small claimants will hopefully speed up the processing period, the additional work involved in the RPA policing a genuine farmer test, could mean further delays. The consultation is available on the DEFRA website, with a closing date for responses of July 22nd.

Concern Over Spring OSR Variety Ritz

Although the problem only appears to relate to certain batches of seed, we are aware of issues concerning the poor germination of some Spring OSR crops, (and Ritz in particular). If you believe that you are one of those affected, you are advised to take early advice as to whether compensation may be available. We can assist you in collating and submitting the necessary evidence required to make a claim, and for further information contact Paul Oughton or Brian Smith on 01285 648 113.

Further Changes to Employment Legislation

The Employment Act 2008, which came into force on April 6th 2009, changes the way that arrears of pay are calculated when enforcing the National Minimum Wage.  These provisions also apply to the enforcement of the Agricultural Minimum Wage as set out in the Agricultural Wages Order.

The new provisions mean that if a worker makes a complaint about the level of agricultural wages they have received and it is established after investigation that arrears of pay are owed, the worker is now entitled to have the full amount (limited to a maximum of 6 years) of those arrears paid at the rates of pay set out in the current Agricultural Wages Order.

Therefore, a worker who originally made a complaint in May 2009 would be entitled to have any arrears of pay relating to work carried out between 2007 and 2008, for example, paid at the rate applicable in the 2009 Agricultural Wages Order. In addition, the Government can also impose a penalty of up to half of the total underpayment, up to a maximum penalty of £ 5,000.

In a separate announcement, the Government has confirmed that the National Minimum Wage rate will increase by 7p per hour (1.2%) with effect from October 1st 2009. The new rate for workers over 22 years of age will be £ 5.80/hour.

Did you know that Moore Allen & Innocent can undertake all your monthly and year end payroll administration for as little as £ 350 per annum. For further information regarding how our employment, farm accounts and payroll services can assist you, contact Paul Oughton on 01285 648 113.

For clear, objective and professional advice on these or any other agricultural and rural estate issues please contact one of our Agricultural Team:

Robert Young ~ Mark Hill ~ Christopher Graham ~ Paul Oughton ~ Brian Smith
Peter Kirby ~ Katherine Foot ~ Stuart Milsom ~ Margaret Bush ~ Bethany Morris

Tel. 01285 648 113                                                             Fax. 01285 640 494    

This newsletter is produced for guidance only and should not be used as a substitute for professional advice. Accordingly no liability or responsibility for any loss or damage can be accepted by Moore Allen & Innocent or other contributors as a result of any person, company or other organisation acting or refraining from acting upon comment on this newsletter.

• Farm & Estate Management • Sales & Purchases of Rural Properties • Valuations • Estate Planning •
• Landlord & Tenant • Farming Agreements • Auctions • Compensation & Compulsory Purchase •
• Farm Buildings • Expert Witness • Planning & Development • Grants & Quotas • Agri-Environment •
• Woodland • Digital Mapping • Diversification • Employment • Payroll & Accounts •

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