Frequently Asked Questions about Council-owned smallholdings estate (County Farms) in Herefordshire
Updated - February 2017
Decisions that were taken in regards to smallholdings disposal are available on the council's website with their associated reports:
What is the rationale behind selling smallholdings estate?
As resources reduce the council's strategy has been to focus on those areas which are the council's responsibility and which cannot be done by anyone else - it is not a requirement for the council to manage a farm estate and there are many other agricultural landlords who may be better placed to do so.
The gross revenue from the smallholdings estate is around £400k per annum. However, when including the maintenance costs and the support cost of providing this service, the net income value is negligible. The cost to clear backlog maintenance could not be met by simply increasing rental. Following the reduction in funding from the government, the council is looking at other funding opportunities which include realising the value of its asset holdings. Some areas of the estate might have the potential for development which can be used to provide vital infrastructure and housing growth opportunities thus contributing to the overall economy by creating jobs and enriching services.
How many tenants will be affected by this sale and how will this sale affect the tenants?
Of the 2,664 agricultural holdings in Herefordshire, the council owns 50. In April 2016, the council made a further decision to retain 7 farms for future development value. As of 31 October 2016 there are 36 tenant farmers on these smallholdings which are affected by the sale. These consist of 10 lifetime tenants, 10 retirement tenants, 15 farm business tenants and 1 residential tenant. Tenants with 'lifetime' and 'retirement' tenancies are unaffected by this decision.
The council will give due regard to the welfare and needs of current tenants who are affected by the sale, ensuring that their respective rights are protected to the end of their contractual term.
How much is the backlog of maintenance?
There is a significant backlog maintenance liability of approximately £2.8m.
How much income were smallholdings generating for the council?
For the financial year 2014/15, the gross return on capital was less than 1%.
Does this mean that these farms will cease to exist?
It is anticipated that the majority of the farms will continue in their current form until the contractual tenancies terminate with the land remaining as being used for agriculture for the foreseeable future.
Who made the decision to sell smallholdings estate?
A task and finish group was formed on 10 June 2015 by the general overview and scrutiny committee to identify options for the long term future of the council's smallholding estate. The committee reviewed the report and findings of this group on 27 October 2015. Recommendations were put forward to the cabinet after this meeting. The cabinet met on 03 December 2015, and after thorough discussion within the cabinet, the decision was taken to approve a new policy which included selling the entire smallholding estate and possible development on appropriate sites.
Does this mean the entire estate will be sold?
A further decision taken by the cabinet on the 14 April 2016 sought to retain approximately 500 acres and 7 farms for future development value. Therefore these will be excluded from the sale.
This page has been migrated from our old newsroom due to the launch of our new website. View the news archive.