One in four living below poverty line (From The Northern Echo)

One in four living below poverty line

4:19pm Tuesday 7th December 2010 in North-East Business Features By Mike Bridgen

A QUARTER of farming households live below the official poverty line on less than £20,000 a year, according to a study.

Most are upland farms with grazing livestock and, according to the Commission for Rural Communities (CRC), receive relatively little support from agricultural policies or the welfare state.

Dr Stuart Burgess, CRC chairman, said there was a tremendous variety of financial stability within farming in England.

While many had increased production, resilience and farm incomes, one in four lives in poverty.

He said: “A quarter of farming households have an income of less than £20,000 and, in the majority of cases, this derives from capitalising on the business assets rather than actual farm business profits. These struggling farms are likely to have grazing livestock and be located in upland areas. Many are left trapped in poverty without the resources or support to earn a living wage.”

Dr Burgess said that, for the majority of farming households, the ability to diversify production and earn income off-farm was essential.

He said: “Overall, nearly two out of three farms have some form of off-farm income, and in 2008-9 the total income from diversified activities was £300m.”

However, Dr Burgess said: “Tenant farmers can experience specific barriers to business development due to the fact that they do not own the land that they farm.

“They often find it difficult to access investment capital, and tenancy agreements can prohibit certain business activities to avoid tax and inheritance implications for the landowner.

“Planning regulations can also be a barrier.”

Dr Burgess said the coalition Government’s Homes on the Farm scheme, which encourages farmers to convert buildings into affordable housing, was a helpful intervention.

But he added: “Inadequate pension provision and a lack of alternative affordable housing can make this difficult.

Furthermore, the sale of assets to fund retirement can undermine the viability of a family farm for a successor.”

In times of difficulty, Dr Burgess said farmers could claim benefits, but it could be hard for them to provide the evidence to access the benefits to which they are entitled.

“For example, it can be difficult for tenant farmers to access housing benefits because tenancy agreements may not separate rental costs for the farmhouse and land,” he said.

“Tackling poverty among farming households is long overdue. The Government should actively promote farm business support and the take-up of income-related benefits to eligible farming households.”

The CRC report, Poverty amongst farming households: achieving sustainable livelihoods, is at ruralcommunities.gov.uk/wpcontent/
uploads/2010/11/farming_poverty.pdf