NORTH NORFOLK RURAL ECONOMY STUDY Prepared By Acorus Rural Property Services Ltd Old Market Office 10 Risbygate Street Bury St Edmunds Suffolk IP33 3AA Authors Miss Jemma Stennett (BSc) Hons MRICS Mr Brian Barrow BSc (Hons) MRICS Mr M How BSc (Hons) Mr G Streeter BSc (MRICS) Contributions from ADAS SEPTEMBER 2005 JS/GC/N Norfolk/rpt Page 1 of 174 FORWARD This study was produced in response to a specification provided by North Norfolk District Council. The aim of this project is to assist North Norfolk District Council in the formulation of core strategy and site specific policies for the North Norfolk Local Development Framework (LDF). The project outputs will ensure these policies are based on a sound understanding of both current and likely future requirements of agriculture and the wider rural economy. The authors would like to specifically thank Steve Blatch from North Norfolk District Council but especially all farmers, landowners and other rural based businesses that contributed to surveys and discussion groups which were an essential part of the background investigations to this project. JS/GC/N Norfolk/rpt Page 2 of 174 CONTENTS FORWARD SECTION 1. Executive Summary 2 The Current Agricultural Climate - National and North Norfolk 3 The Planning Issues – Methodology 4 Historic Guidance 5 - The North Norfolk Local Plan 1998 - National Planning Policies and Other Influences What has been Achieved and What Lessons have been Learnt - The Positives and Negatives 6 Other Local Authority approaches to Rural Policy – Beacon Status 7 Current Guidance and Advice 8 - National Planning Policies – PPS7 - Other Guidance/Influences to Future Policy The potential implications of land use planning policies on agricultural trends JS/GC/N Norfolk/rpt Page 3 of 174 9 Recommendation for North Norfolk’s Future Policy Direction 10 Appendices 11 Bibliography JS/GC/N Norfolk/rpt Page 4 of 174 SECTION 1 Executive Summary JS/GC/N Norfolk/rpt Page 5 of 174 1. EXECUTIVE SUMMARY 1.1 North Norfolk Farming Systems North Norfolk is a region dominated by cereal, general cropping, pig and poultry production. The countryside character represents a region that is remote, sparsely populated and dependent upon agriculture and tourism for its main sources of income. The region has a wide diversity of habitats, with several areas designated as Areas of Outstanding Natural Beauty (AONB) and Sites of Special Scientific Interest (SSSI). There is a conflict between tourism and countryside conservation. The region has good soils which are suited to cereal and general cropping, although the more peaty soils are prone to erosion. The amount of land within agricultural production has decreased over the past decade, with land taken out of production for diversification, development and conservation. The largest group of holdings are under five hectares (12 acres) in size, with the second largest group being represented by holdings over 100 hectares (247 acres) in size. The greatest changes have been seen in the numbers of farms classed as ‘pigs and poultry’ (increase) and ‘general cropping’ (decrease). The amount of land rented has decreased and there has been a corresponding increase in the amount of land classed as “owned”. With the introduction of the Arable Area Payments (AAPS) the area of cereals grown has fallen with a corresponding increase in land down to set aside. Sugar beet production has decreased in the North Norfolk region, with potato production showing an increase. Only 0.9% of agricultural land within the East of England Region is within organic production. The East of England Regions is below average in terms of number of organic growers, and the region represents 15% of the total number of organic processors in England. There is potential to increase the number of organic producers and growers within the East of England Region, although the exact number of organic producers and growers within North Norfolk are not known. The ADAS Farmer’s Voice survey undertaken in 2004 found that organic growers are more content with their farming system than non organic growers, and are more likely to have diversified than non organic growers. Total income from farming in the UK fell in 2004 by 5.4%, with income from farming now on a level to that of the late 1980’s and early 1990’s. Cereal and general cropping farms are predicted to have a lower income in 2005 than in 2003/04. Pig farming is predicted to show a decline in income, and poultry farms are expected to show an increase, due to higher egg prices. JS/GC/N Norfolk/rpt Page 6 of 174 In the region of North Norfolk, agriculture represents 20% of the total Gross Domestic Product (GDP). It is predicted that smaller farms in the region will see a greater period of change over the next two years compared to larger farms in the region. 1.2 Trends in agricultural employment since 1990 Agricultural employment numbers in North Norfolk has dropped 53% since 1990, this is a reflection of the overall trend for the United Kingdom. This decline is seen in full and part time, male and female employees. In North Norfolk, agriculture represents 8.3% of total employment, this is similar to figures shown in other remote rural areas. There is a disproportionate number of male and female employees within agriculture, with male employees dominating the industry. North Norfolk has a high incidence of seasonal employment. 49 percent of people employed within agriculture are 45 years old or above. This is probably due to the out-migration of younger people and could lead to a worsening of the problem of recruiting into farming. North Norfolk shows a great concentration of low earners within the agriculture sector. It is forecasted that due to changing policies and income within agriculture, farm managers will have to adapt to change. 1.3 Drivers of change within Agriculture The most significant legislation to affect agriculture within England, The East of England and North Norfolk are viewed as: CAP reform Sugar Beet Reform IPPC regulations AONB and SSSI designations (North Norfolk) Water Framework Directive New Agricultural waste regulations Countryside and Rights of Way Act 2000. Of these the recently introduce Single Payment Scheme (CAP Reform) and the imminent Sugar Beet Reforms will have the biggest influence on shaping the future farm businesses within North Norfolk. The Single Payment Scheme will give the farmers the ability to adapt to market forces without influencing subsidy payments. The absolute level of subsidies will fall over the coming years regardless of farmer fortunes. The new sugar beet regime will force the sugar industry to rationalise with a resultant contraction in the amount of beet grown in the area. This will affect the farms in North Norfolk more than other areas of the country where sugar beet has not historically been grown. JS/GC/N Norfolk/rpt Page 7 of 174 1.4 Diversification and business opportunities Farm diversification has been undertaken since the 1980’s as a response to the CAP reform. The assessment of diversification and business opportunities within the whole rural economy shows that there is a varied choice of diversification options, all of which depend upon many variables. The main opportunities available include tourism, recreation, animal and crop products, organic production, woodland products, use of redundant buildings, wetland and wildlife. The choice of diversification ultimately depends upon the farmer/landowner’s preferences and the following variables: Land Location Capital available / underlying business security Current and proposed income stream Human resources Buildings/Cottages/farmhouses Competition Current markets The diversification options available to farmers in North Norfolk are likely to be aimed towards tourism, on-farm, accommodation and exploiting the equine industry. Alternative crops may also be a future possibility. Successful diversification will also depend upon the availability of government grants, under schemes such as the Rural Enterprise Scheme, which is administered by the Rural Development Services of DEFRA. Compared to other regions in England, farms in the East of England region are above average in terms of having a diversified activity and off farm employment. As a result of this they are below average in terms of the farm being the main source of income for the holding. Farms in the East of England have the average number of let buildings compared to other regions. They are above average in terms of diversifying into processing and retailing and are considerably above average in terms of diversifying into tourism. The main farm business accounted for some 65% of farm income over the last year among non-organic producers compared to 55% among organic producers. For the latter, diversification activities accounted for almost 15% of farm family income and off-farm income for almost 30%. The farm diversification options available to different farms in North Norfolk will be influenced by variables such as location, costs, return on capital invested, employment costs and labour requirements. JS/GC/N Norfolk/rpt Page 8 of 174 Opportunities for farm diversification in the region of North Norfolk exist in the following areas: Tourist accommodation Activity holidays Package holidays Outdoor pursuits Equine Industry The tourism season needs to be extended in order to create more permanent employment, higher levels of pay and improved employment conditions. The quality of the landscape in North Norfolk draws tourists to the area but also brings with it responsibilities in terms of managing the visitors and preserving the area’s special qualities for future generations. There are opportunities within North Norfolk to improve upon bridleways and tourism/accommodation based upon the equine industry. 1.5 Organic, alternative crops and Grower Groups Organic production, alternative crops and bio fuels are likely to increase within the United Kingdom although growth within the organic sector has slowed down within recent years. 51% of organic producers taking part in the ADAS Farmer’s Voice survey said they are likely to develop alliances with other farmers, compared to 40% of non-organic producers. 47% of organic producers indicated some likelihood to market directly to consumers, compared to 19% among non-organic producers. This indicates that organic producers are ahead of the game with regards to ‘direct retailing’ and a difference in attitudes to marketing between organic and non-organic producers. Bio fuels offer a number of benefits towards the environment and opportunities for farm businesses. Hundreds of new jobs could be created through producing bio fuels on England’s farms. With the need for agriculture to become more competitive and to survive with world commodity prices the businesses must become more cost efficient and also improve their marketing. Farmer Controlled Businesses of many different types and guises will enable the industry to restructure and face the future with confidence. From the analysis of the rural economy a number of key trends and their implications have been identified: As with many other sectors the trends suggest that there will be continued rationalisation resulting in fewer but larger holdings. JS/GC/N Norfolk/rpt Page 9 of 174 The area of grassland is increasing yet the number of grazing livestock is falling. The rise in grassland area is predominantly due to marginal land being taken out of conventional cropping as the economics of growing crops has come under pressure. Whilst there has been a dramatic fall in breeding pig numbers in North Norfolk, the total number of pigs within the region has dropped by 7% in the last 15 years highlighting the change within the region from breeding pig herds to finishing pigs. With little improvement in the economics of milk production it is likely that the already small number of dairy producers within North Norfolk will continue to dwindle. The increasing age of the average farmer coupled with the continued outmigration of the younger workforce has significant long term implications for the agricultural industry. The imminent changes within the sugar beet regime are likely to have a momentous effect on future cropping options within North Norfolk, again having a nock on affect on employment in the area. The new Single Payment Scheme will also have a huge effect on future farming enterprises. The main implications for production are reductions in cereals, beef and sheep. There will be increased pressure to cut variable and fixed costs with a resultant cut in employed on-farm labour as well as more farmers becoming part-time. Cereals will only be grown where it is efficient to do so. There will also be an increase in the use of alternative farming arrangements. Switch from break crops to cereals and removal of more land from arable cropping to permanent or temporary fallow. Further uptake of environmental schemes and woodland, also some additional land will be taken out of agricultural production and managed to the minimum requirements of Cross Compliance. More farmers are expected to introduce or expand existing diversification enterprises to ‘supplement’ their farm incomes and make up profit shortfalls. The primary choice of diversification is the alternative use for redundant farm buildings or replacement of unsuitable buildings with purpose built units. Horse tourism may be an avenue that could be expanded further, this could have the added bonus of utilising some of the additional grassland. The rise in potential for crops to be used for biofuels will also generate alternative uses for the land and give the agricultural businesses additional markets that are not reliant on commodity market prices. JS/GC/N Norfolk/rpt Page 10 of 174 For a few businesses there will be opportunities to develop niche markets for their produce. The emphasis will be to add value with some form of on farm processing and orientate the business nearer to the customer. This may be achieved by direct retailing for example Farm Shops or Farmers Markets. To help drive the challenge of reducing input and fixed costs more collaboration and joint ventures will be considered. The rise in Farmer Controlled Businesses may lead to further reduction in production orientated labour but may have a positive effect on those employed in adding value to primary agricultural produce. However the increase in business rationalisation will undoubtedly result in an increase in redundant farm buildings as farming operations become more centralised and fewer in number. 2 The project brief identified a number of key rural issues to be addressed; these have been divided into 8 key areas as follows. 1. Agricultural Buildings 2. Agricultural dwellings and occupancy conditions 3. Conversion of rural buildings 4. Low cost housing 5. Land Use including the AONB and Agricultural Land Quality 6. Farm Diversification (Including Farm Shops and Other On-Farm Non Agricultural Development) 7. Replacement buildings 8. Recreation and Tourism These areas are not mutually exclusive and there are clearly relationships between them but they encompass the key issues in terms of rural policy formulation. 3 An understanding the historical policy framework and existing Local Plan is essential to any study of its effects. The current North Norfolk Local Plan has a number of policies specifically related to the Rural Economy. The following are considered relevant: Policy 22 Agricultural Land Policy 23 Prior Approval of Agricultural and Forestry Buildings Policy 29 The Reuse and Adaptation of Buildings in the Countryside Policy 66 Agricultural and Forestry Workers’ Dwellings in the Countryside JS/GC/N Norfolk/rpt Page 11 of 174 Policy 67 Removal of Agricultural Occupancy Conditions Policy 76 Farm Diversification Policy 88 Farm Shops Policy 117 Horses The other key influences on how current development has occurred are government policies and other guidance. PPG7 is considered the most relevant for the rural sector. PPG7 – The Countryside – Environmental Quality and Economic and Social Development replaced the former 1992 version. In March 2001 Paragraph 2.8 and 2.9 of PPG7 were amended to include more guidance on how local planning authorities should take account of any statutory designations In 1992 “The Good Practice Guide on Rural Diversification” was produced and has been a key influence on development plan policies from that time. Part of North Norfolk was designated as an objective 5b area and this also had a key influence in terms of positive advice and grant aid. The advice within the existing North Norfolk Local Plan and National Policies clearly has had an impact on the type of development that has been both encouraged and discouraged and ultimately permitted through the application process. Understanding what has worked and what has not is important before deciding on changes that can be made in the light of new guidance, this is outlined in Section 7. 4 The existing policy framework was assessed to analyse practical implementation, consider relevant issues such as infrastructure, market demand and the effect on the rural economy. Research was undertaken through the following methods:i) Farmer Focus Groups ii) ADAS North Norfolk Farmer surveys. iii) Agricultural Business Survey iv) Analysis of rural planning applications submitted to North Norfolk District Council during the life of the existing local plan. The first three of these methods are based on ‘grass roots’ perceptions and opinions and should be considered as such. JS/GC/N Norfolk/rpt Page 12 of 174 4.1 Focus Groups A series of four farmer focus groups were held with attendance of between 10 and 20 farmers at each. The eight key issues listed in Section 2 were considered in terms of existing local plan policy, national planning polices, problems with policy relating to actual proposals and potential solutions. The results of the focus groups are included at Appendix 2 of this report. The following are some of the perceptions and opinions identified (note not all attendees necessarily shared all these views). They have been reported in the form expressed by farmers during this consultation process. • Agricultural Occupancy Conditions – no local workers available. • Seasonal workers were a key resource but the provision of permanent accommodation was considered to be a problem. • Relocation of intensive agricultural sites currently in/or adjacent to villages, should be considered. • Holiday accommodation too expensive in terms of capital investment with low returns. The fact that grants were ending was also an issue. • Retail in rural areas had potential, in terms of re-use of buildings. • Highways conditions on access were often too onerous and too expensive. • Diversification is essential and should be based on a sound financial plan. • Diversification of the wider rural economy was needed not just on working farms. • There are likely to be more redundant buildings due to CAP reforms and sugar beet regime. • There is a shortage of rural housing. • There is an over supply of holiday lets. • Restrictive policies on farm shops are preventing development. • The policies on diversification are seen as too restrictive. • Business growth is seen to be more restricted in AONB and other landscape areas. JS/GC/N Norfolk/rpt Page 13 of 174 4.2 • Policies on agricultural buildings and development only consider permitted development and give no guidance on planning applications. • Agricultural development in AONB/ Areas of High Landscape Value/County Wildlife sites is restricted to the detriment of businesses due to these large designations rather than each site considered on landscape issues. • North Norfolk District Council is not positive towards agriculture and seems to be contrary to other government and DEFRA guidance. • Replacement farmsteads/new farmsteads not considered. • Highways always a problem. Farmer Survey In order to gather as much first hand information and to give the farmers an opportunity to participate in the process a postal survey of agricultural holdings was carried out. The questionnaire gathered details about the farm business and cropping, diversification enterprises, attitude to farming and the CAP reform as well as various issues regarding housing, redundant buildings and planning. The questionnaire and a covering letter were sent out in early June 2005 to 500 of the 1,000 holdings in North Norfolk. A total of 81 completed questionnaires were returned and analysed. Below is a summary of the main findings: Farm Details 86% of the land is owned and farmed by the owner and 51% of farmers also had additional land that was farmed under an agricultural tenancy. Within the last 5 years 25% had increased their acreage (mainly those growing field vegetables) and 6% had decreased their acreage (mainly within the dairy, pigs and poultry sectors). 70% of respondents said that their areas farmed would not change within the next 5 years. JS/GC/N Norfolk/rpt Page 14 of 174 Percentage of holdings with livestock/arable or horticultural enterprises 12 Other cash crops 25 Field vegetables Combinable crops 90 88 Root crops Intensive poultry 5 Intensive pigs 4 Outdoor pigs & poultry 9 Dairy 4 Beef & sheep 33 Forage maize 5 Grassland 57 0 10 20 30 40 50 60 70 80 90 100 Diversification - Percentage of the different enterprises among those respondents who have diversified Off-farm non-agricultural business Leasing of land Leasing of buildings Farm-based craft business Other farm-based leisure business (eg sports, open farms) Equine (eg livery, grazing, riding trail) Future Current Discontinued Farm-based accommodation (eg B&B, self catering) Farm-based food retailing Farm-based food processing Agricultural services Non-food crops Novel livestock (eg ostriches, rabbits) Novel food crops 0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50% The most common reason stated as the barrier to diversification was difficulty obtaining planning permission. This is not an uncommon result for this type of survey. 28% of respondents indicated that “farming has a limited future – I need to diversify”, and 33% indicated that “I see my future in farming but I expect that JS/GC/N Norfolk/rpt Page 15 of 174 I will have to change my farming practice”. Only 1% indicated that they would give up farming altogether. The most likely way in which businesses would change in the future was to develop alliances with other farmers (65%) and also to forward sell their produce (65%). The most unlikely changes in the future would be to develop alliances with service providers or market directly to customers. 40% of respondents indicated that they foresee no significant changes to their main farm enterprises due to CAP reform. Of those that do foresee changes the most likely changes would be: • • • • • Cease and decrease combinable crop acreage Cease and decrease sugar beet acreage Increase field vegetable area Claim SP without cropping Due to the low number of livestock respondents it is difficult to draw out any conclusive trends with statistical significance except an increase in free range poultry. The trend towards decreasing numbers employed in agriculture would continue. 43% of respondents had one or more dwellings with an agricultural occupancy condition and 60% would consider letting these dwellings for local housing as a form of diversification. Redundant Buildings – 73% of respondents indicated that they had redundant buildings; there was no correlation with farm type. 33% indicated that there would be further redundant buildings in the future. In descending order the most likely uses to which buildings would be concerted was; Residential, Holiday, Industrial, Offices, Leisure, Retail and On Farm Processing. 54% of respondents would let out their buildings once converted. 4.3 Agricultural Business Surveys To gather information to inform an analysis of trends within the agriculturally related sectors, perceived demand for services and future requirements, a cross section of businesses that are directly involved with offering services to farmers were interviewed. 30 interviews were conducted following a predetermined format that gathered information about their core business, areas of operations, and perceived changes in the agricultural sector and how this would impact on their businesses and how they would react. Also views on planning issues to do with their business and those of their customers were obtained. The main points to be drawn from the interviews are: JS/GC/N Norfolk/rpt Page 16 of 174 • There is great inertia within agriculture, farmers will take the next 3 years to adapt to the SPS. • The changes will focus the grower into cost of production and marginal land will come out of production. • Farmers will look to co-operate more with one another. • Biofuels could be a saviour to the sugar beet industry; if not there may not be any sugar beet within the UK within 15 years. • Whilst the banks recognise the need for more ‘financing’ within the sector and are happy to provide it, they are making it their duty to inform their clients about the long term sustainability of their businesses, and the urgent need to resolve problems. • Professional marketing of produce will become more important. • Farmers markets are expanding and there is scope for more within the area if satisfactory sites are forthcoming. • The supply industry will have to fight for a share of a smaller market. • The contraction of farming activities will seriously impact on the supply industries and there is great concern. • Slow down in erection of new buildings within medium sized businesses. • Highways are perceived as a thorn in the side of many failed planning applications. • The road structure is limiting future prospects. • Current planning policies are too rigid and not flexible enough. • There is a “stone wall, no can do” attitude from planners. • Current planning policy is too narrow. • Should not impose ‘city policies’ in rural areas. • There is a need for more local housing. • More site meetings would be useful. • As farming ‘rationalises’ more redundant farm buildings will be created, both traditional and the more modern steel frame type. What can be done with them? JS/GC/N Norfolk/rpt Page 17 of 174 4.4 Analysis of Planning Application A total of 30 case studies were selected at random by N.N.D.C. The sample analysed provided a background to the type of application and the development proposed. The major issues and the relevant planning policies were extracted to enable trends to be observed and the following became apparent. 4.4.1 Conversion of rural buildings was the most popular type of application with a diverse range of uses. The survey showed that diversification including re-use of rural buildings, to tourism was extremely popular and the majority included some form of self-catering holiday accommodation. The main issues relevant to these applications were, Highways, Landscape and AONB impact and the effect on wildlife. 4.4.2 Agricultural and other occupational dwellings were also popular, with all cases analysed being approved but at Committee level. Objections and concerns centred on size, location and landscape impact. The applications analysed had the model agricultural occupancy condition attached in most cases, but some were specific to the other rural business operated which was not agricultural. The majority of the applications required some form of landscaping or tree survey as standard, particularly in AONB. 4.4.3 Agricultural Buildings were also a popular form of development. In these cases the majority of decisions were delegated Landscaping requirements and the presence of AONB status were some of the key issues. In particular siting was deemed to be more important in the AONB and use of natural features to reduce impact of the proposed building was noted. 4.4.4 The survey showed that approximately 90% of applications gained planning approval with a high proportion having implemented or intending to implement their development in due course. The two most quoted reasons for influencing the decision to submit a planning application were to maximise capital value of the asset and a change in enterprise. The survey responses clearly show that economic reasons have major influences on farmers decisions to submit applications. The rural enterprises and customer requirements are all influences which are driven by market and economy conditions. 4.5 Analysis of Local Plan Policies Based on the evidence gathered and views of those surveyed and/or attending the focus groups, the following conclusions were reached on the current policies. JS/GC/N Norfolk/rpt Page 18 of 174 4.5.1 Agricultural Buildings and Development North Norfolk District Policy 23 does cover prior approval, offers practical guidance and aims to protect the AONB. Areas for modification/improvement 4.5.2 • No specific policy on full planning applications for agricultural buildings. • No specific policy on important and varied roles of agriculture in managing the countryside and valued landscapes. • Does not take account of the requirement for farmers to become more competitive, sustainable and environmentally friendly. • Allowing farmers to adapt to new and changing markets (e.g. free range egg/table bird production). • Comply with changing legislation (IPPC). • Diversifying into new agricultural opportunities (e.g. renewable crops). • Broaden their operations to ‘add value’ to their primary produce (e.g. diversification/development of successful farm shops). • Farms within the AONB, county wildlife sites and areas of high landscape value perceive that their businesses are constrained by Policy 23. They also believe the beauty of these areas is dependent on their continued farming and management of the countryside. • In terms of highways there is no positive policy in rural areas, this constrains the rural economy. Agricultural Dwellings and Occupancy Conditions North Norfolk District Council Policy 66. This policy has a number of positive aspects, including the requirement for a functional test, there are specific criteria regarding siting design and landscaping, and there is a requirement for alternative accommodation or redundant buildings to be considered. Areas for modification/improvement • JS/GC/N Norfolk/rpt The policy is specific to agricultural or forestry workers – other occupational dwellings e.g. equestrian are not detailed as now covered in PPS 7. Page 19 of 174 • Consideration of financial sustainability is only required if the functional test proves inconclusive. Financial sustainability should always be considered for a permanent dwelling. • Imposing conditions on other houses on the farm can prove to be impractical e.g. large listed houses. North Norfolk District Council Policy 67 (Removal of Agricultural Occupancy Conditions). This policy does include guidance for potential applicants. Areas for modification/improvement 4.5.3 • Criteria ambiguous – the words ‘reasonable’ and ‘genuine ability’ are open to interpretation. There are no additional guidance notes. • There is no information on alteration of conditions to include diversification or alternative occupations. • The policy is not clear in its requirements. Conversion of Rural Buildings North Norfolk District Council Policy 29 (The Re-Use and Adaptation of Buildings in the Countryside). This policy supports the re-use of appropriately located and suitably constructed rural buildings. It also considers the importance of design in conversion, The Wildlife and Countryside Act 1981, and the impact on the overall landscape. Areas for modification/improvement 4.5.4 • The policy which considers residential conversion appropriate in or adjacent to towns or villages does not necessarily encourage the most appropriate scheme. • The policy includes detail on highways and may not allow for small traffic increases and should be brought in line with PPG 13. • Commencement of development within two years can be restrictive if the applicant needs to gain building regulations, grant approval and funding. A two year timescale may be too short. • Current policies are preventing full utilisation of the existing rural built environment. AONB and Other Landscape Issues North Norfolk District Council Policy 20, 21 & 24 protect the AONB Areas for modification/improvement JS/GC/N Norfolk/rpt Page 20 of 174 • 4.5.5 Policies 21 and 24 are unnecessarily restrictive. The AONB and the Broads and its setting cover a large area of agricultural land and can be negative towards agricultural development proposals, unnecessarily. Farm Diversification North Norfolk District Council Policy 76 (Farm Diversification) and Policy 88(Farm Shops) – There is recognition of the importance of diversification. Areas for modification/improvement 4.5.6 • The policy does not set out specific criteria relating to agricultural diversification. • It is not supportive of well conceived farm diversification schemes. • It does not give detailed criteria on the wider benefit of diversification. • It does not give detail on acceptable highways implications. • The policy on farm shops is restrictive on sale of non local produce. This is constraining businesses and resulting in local foods being harder to market. Replacement Buildings No policy exists in the North Norfolk District Council Local Plan 1998 due to changes in Government Policy since its publication. PPS7 states that the Government is supportive of the replacement of suitably located, existing buildings of permanent design and construction in the countryside for economic development purposes. The replacement of buildings should be favoured where this would result in a more acceptable and sustainable development than might be achieved through conversion, for example, where the replacement building would bring about an environmental improvement in terms of the impact of the development on its surroundings and the landscape. Local planning authorities should set out in their LDDs the criteria they will apply to the replacement of countryside buildings. These should take account of the considerations set out in paragraph 17 that apply to the conversion and reuse for economic purposes of existing buildings in the countryside. Authorities should also set out the circumstances where replacement would not be acceptable and clarify the permissible scale of replacement buildings. JS/GC/N Norfolk/rpt Page 21 of 174 4.5.7 Recreation and Tourism North Norfolk District Council Policy 108. This policy includes the reuse of existing rural buildings and protects the AONB. Areas for modification/improvement • All proposed developments should be outside the AONB and the special landscape area which may restrict occupational schemes within the areas. • Restrictive policy and provision of indoor sports facilities in rural locations due to accessibility and highways. North Norfolk District Council Policy 117 (Horses). The positive aspects of the policy are that a specific policy exists and that guidance is given in a policy. Areas for modification/improvement • Restrictive policy in relation to highways and bridleways when onfarm riding could be provided. • Policies open to interpretation. • No inclusion of set criteria for supporting equine enterprises that maintain environmental quality and countryside character. North Norfolk District Council Policy 123 (Static Caravan Sites). This policy protects the AONB and enhancement and improvement of existing sites is encouraged. Areas for modification/improvement • There is no specific policy on small scale log cabin siting as farm diversification e.g. log cabins with fisheries or horse riding facilities. Policy 125 (Touring Caravan Sites). There are specific policies and the AONB and undeveloped coast is protected. North Norfolk District Council Policy 128(Loss of Un-serviced Holiday Accommodation). This retains important holiday accommodation and is site specific. Areas for modification/improvement • JS/GC/N Norfolk/rpt Does not consider circumstances when holiday occupancy conditions should be lifted. Page 22 of 174 5 Whilst all Local Authorities take Government advice as the basis of their forward planning process significant variations in approach do arise. As part of this study councils who have Beacon status in terms of supporting the rural economy were looked at in more detail. These councils are :Lancashire County Council East Riding of Yorkshire Council Waverley Borough Council Caradon District Council Richmondshire District Council Tynedale Council Lincolnshire and South Holland District Council The beacon scheme exists to facilitate the sharing of excellent practice so that best value authorities can learn from one another. Analysis has taken the format of the 8 areas identified as being the cornerstone of rural policy. The following details summarise some of the key features of the beacon status Local Authority plans. Agricultural Buildings and Land • Development on agricultural land and Greenfield sites only allowed after all other sites considered. Recognises that PPS7 encourages farmers to diversify. Local plan seeks to minimise loss of agricultural land. Seeks to concentrate new development in towns and selected villages. Recognises that the countryside plays an important role within recreation. Whilst supporting diversification and conversion of farm buildings, the countryside must be protected. • Development for the purposes of agriculture or forestry within the countryside will be permitted provided it does not have an adverse impact on the landscape, conservation sites, monuments or listed buildings. The use of sympathetic materials will be required in sensitive locations • The use of best and most versatile agricultural land for any development associated with agriculture or forestry will not be permitted unless there is a strong case for development. Proposals for intensive agricultural development will be permitted if they do not harm views, the colour of the buildings is minimised, proper vehicular access is provided and there is no impact in terms of smell, noise and discharge. • The use of land for development in upland or on best and most versatile land will not be permitted unless there is an overriding need. New farm buildings sited on sites of an open nature will require considerably higher design and landscaping standards. • Permission will be granted for agricultural development provided that the proposal is reasonably necessary, does not detract from the character of the rural landscape and the materials etc are appropriate to the surrounding JS/GC/N Norfolk/rpt Page 23 of 174 area, the proposal would not give rise to significant noise and disturbance, the amount of traffic generated would not prejudice safety and vehicular access can be achieved. Agricultural Dwellings and Occupancy Conditions • Proposals for new dwellings in the open countryside, including other rural settlements, will only be permitted where such development is specifically provided for under other policies of the plan. • The only exception to policies which resist new housing development in the open countryside is where accommodation is required to enable a farm worker or other essential workers to live in the immediate vicinity of their workplace. • Applicants must demonstrate that there is a genuine need for the proposed accommodation, and that an enterprise to which the functional need relates is profitable. Size, siting and design are also considered. • The process is the same as that in PPS7. • Planning applications for the removal of a rural workers occupancy condition will only be approved where it can be convincingly demonstrated that the longer term need for dwellings for rural workers in the locality no longer warrants reserving the dwelling for that purpose. • The removal of an occupancy condition will only be granted where it is demonstrated that there is no longer a functional need and it is demonstrated that there is no need in the area for agricultural worker’s dwellings and a sustained attempt has been made to market the property. Conversion of rural buildings • Proposals for the re-use or adoption of existing buildings outside defined settlement limits to residential use will only be permitted where the council is satisfied the building is unsuitable for employment uses, the building is of permanent and substantial condition, conversion can be achieved without affecting the merit of the building, the design is sympathetic to the building and the building is capable of conversion without significant alteration. • The change of use or conversion of existing buildings in the open countryside will be permitted for the following uses: Small scale employment, holiday accommodation, recreational uses (including camping barns and bunk houses), tourist facilities and new rural enterprises, including farm diversification. • All proposals for the change of use or conversion of existing buildings in the open countryside will be required to fulfil criteria such as construction criteria, affects on other rural amenities, the effect on the surrounding landscape and nature conservation issues. JS/GC/N Norfolk/rpt Page 24 of 174 • The change of use or conversion to residential use will only be permitted where it can be demonstrated that employment generating uses are not suitable. • Conditions withdrawing agricultural permitted development rights may be attached to permissions for the conversion of existing buildings to non agricultural uses. Conversion of low cost housing • In the countryside development proposals for affordable housing schemes promoted by the council, housing associations, civil parish councils, village trusts and other similar organisations may be permitted on sites not appropriate for general housing development, provided that the applicant demonstrates that there is a genuine local need, the scheme will meet the need, the number of houses proposed does not exceed the need, existing housing cannot meet the need, the site adjoins the boundary of a village, there would be no adverse effect on the character of the village and the scheme does not include any element of market housing. • In selected small villages development proposals for more than four dwellings may be permitted provided that all the excess dwellings are for affordable housing. • The District council considers the provision of affordable housing to meet the needs of local people to be one of the most important issues facing it. The council therefore defines “Affordable Housing” as being homes provided to meet the needs of people who cannot afford to buy or rent suitable property on the open market. The council is following the following three routes to ensure maximum delivery: Direct Provision by the District Council; Provision by Registered Social Landlords or Charities; or Provision by Private Developers. • The council will, where a relevant local need has been established, seek to negotiate with developers to secure an appropriate element of affordable housing on allocated and windfall sites. The housing provided under this policy should, where appropriate, be amiable for the life of the property to provide affordable housing for local people Local Plan Policies relating to AONBs and landscape designations • For designated sites, the Council will seek to conserve the critical nature conservation value for which they were designated, Proposals for development which may affect such sites will be assessed. Such sites will be assessed against a number of criteria. • Development will not normally be permitted which may directly or indirectly destroy or adversely impair the integrity of wildlife corridors and other areas which are of major importance for wild flora and fauna. The JS/GC/N Norfolk/rpt Page 25 of 174 District Council will, in co-operation with others, seek opportunities to consolidate and strengthen wildlife corridors. • Priority will be given to the protection and enhancement of the landscape qualities of the North Pennines Area of Outstanding Natural Beauty. Development within or adjacent to the AONB which adversely affects the special scenic quality of the AONB will not be permitted. • Any large scale development within or adjacent to the AONB will only be permitted, when it is proven to be in the national interest and there are no alternative sites in less sensitive areas. • Development in the AONBs and Heritage Coast will not be permitted unless the development is sited as to minimise its visual impact on the landscape, is designed so as to reflect locally distinctive character, traditional building styles and local materials and conforms to the locally characteristic patterns of settlement. Farm Diversification 6 • Proposals for farm diversification projects will be permitted provided that the following criteria are met: It is considered as a legitimate form of farm diversification; The economic activity proposed relates to a specific use or range of uses rather than to a use class; Existing or redundant rural buildings are utilised wherever it is practical to do so; It does not result in excessive expansion and encroachment of building development into the countryside; It does no result in an unacceptable traffic impact on roads servicing the site; The development would not result in an adverse impact on neighbouring residential properties or the local landscape and environment. • Outside settlements, proposals for farm shops and other small scale retail outlets will be permitted where criteria such as the scale, design and landscaping of new or converted facilities does not detract from the visual amenity of the surroundings and no detriment would be caused to highway safety. • Proposals for the diversification of a farm enterprise will be permitted, where the criteria including the following are met; Where relevant, the proposal retains existing, or provides additional or alternative employment; and where possible, existing buildings are utilised. The new North Norfolk Local Development Framework needs to take account of current Government advice but should also draw on other studies and reports of which a number have been identified as detailed below. These are not intended to be an exhaustive list but are those documents/studies which provided relevant useful guidance. JS/GC/N Norfolk/rpt Page 26 of 174 6.1 National Planning Policy 6.1.1 PPS 7 - Sustainable Development in Rural Areas These policies will need to be taken into account by local planning authorities in the preparation of local development documents. Government objectives for rural areas in PPS 7 include the following:(i) To raise the quality of life and the environment in rural areas through the promotion of: - thriving, inclusive and sustainable rural communities; - sustainable economic growth and diversification; - good quality, sustainable development; and - continued protection of the open countryside. (ii) To promote more sustainable patterns of development: - focusing most development in, or next to, existing towns and villages; - preventing urban sprawl; - discouraging the development of 'greenfield' land; - promoting a range of uses; and - providing appropriate leisure opportunities. (iii) Promoting the development of the English regions by improving their economic performance by developing competitive, diverse and thriving rural enterprise that provides a range of jobs and underpins strong economies. (iv) To promote sustainable, diverse and adaptable agriculture sectors where farming achieves high environmental standards, minimising impact on natural resources, and manages valued landscapes and biodiversity; contributes both directly and indirectly to rural economic diversity; is itself competitive and profitable; and provides high quality products that the public wants. Paragraph 27 of PPS7 covers agricultural development. Paragraph 10 of PPS7 covers policy on new agricultural dwellings. JS/GC/N Norfolk/rpt Page 27 of 174 Paragraph 17 of PPS 7 details re-use of buildings in the countryside. In planning for housing in their rural areas, local planning authorities should apply the policies in PPG3 Paragraph 24 and 25 of PPS7 gives advice on local landscape designations. Local landscape designations should only be maintained or, exceptionally, extended where it can be clearly shown that criteriabased planning policies cannot provide the necessary protection. When reviewing their local area-wide development plans and LDDs, planning authorities should rigorously consider the justification for retaining existing local landscape designations. Paragraph 30 of PPS7 advises on farm diversification. Recognising that diversification into non-agricultural activities is vital to the continuing viability of many farm enterprises. Local planning authorities should be supportive of well-conceived farm diversification schemes for business purposes that contribute to sustainable development objectives and help to sustain the agricultural enterprise, and are consistent in their scale with their rural location. Paragraph 19 of PPS7 gives specific guidance on replacement of buildings in the countryside. Paragraph 34 of PPS7 outlines detail on tourism and leisure. Equine related activities are also covered in paragraph 32. The policies should provide for a range of suitably located recreational and leisure facilities and, where appropriate, for the needs of training and breeding businesses. They should also facilitate the re-use of farm buildings for small-scale horse enterprises that provide a useful form of farm diversification. 6.1.2 PPG 13 - Transport This guidance gives detailed policy on transport, the objectives of this guidance are to integrate planning and transport at the national, regional, strategic and local level. In order to reduce the need for long-distance out-commuting to jobs in urban areas, it is important to promote adequate employment opportunities in rural areas. Diversification of agricultural businesses is increasingly likely to lead to proposals for conversion or re-use of existing farm buildings for other business purposes, possibly in remote locations. PPS7 indicates that for development related to agriculture and for farm diversification, appropriate new buildings may also be JS/GC/N Norfolk/rpt Page 28 of 174 acceptable. In plan policies and development control decisions, local authorities should encourage farm diversification proposals particularly, but not exclusively, where this enables access by public transport, walking and cycling. They should be realistic about the availability, or likely availability, of alternatives to access by car. Similarly, they should not reject proposals where small-scale business development or its expansion would give rise to only modest additional daily vehicle movements, in comparison to other uses that are permitted on the site, and the impact on minor roads would not be significant. 6.1.3 PPG3 - Housing In terms of overall housing provision, only a limited amount of housing can be expected to be accommodated in expanded villages. Whilst occasionally a village could be the basis for a new settlement most proposals for additional housing will involve infill development or peripheral expansion. Villages will only be suitable locations for accommodating significant additional housing where: 6.1.4 • It can be demonstrated that additional housing will support local services, especially where the village has been identified as a local service centre in the development plan; • Additional houses are needed to meet local needs, such as affordable housing; and • The development can be designed sympathetically and laid out in keeping with the character of the village. PPS 6 This statement whilst not applicable to rural development was produced to protect and develop town centres which can on occasions conflict with positive rural policies. 6.2 Other Guidance/Influences to Future Policy There are a number of other reports and studies which can provide assistance when looking at formulating local policy. The following is by no means an exhaustive list but does encompass many of the issues previously identified. 6.2.1 Rural Delivery Pathfinders - DEFRA The aim of pathfinders is to ‘pilot’ processes which will potentially be useful nationwide. The aims of pathfinders are to experiment with and test: JS/GC/N Norfolk/rpt Page 29 of 174 6.2.2 • ways of achieving more joined-up delivery of services in rural areas, addressing economic, social and environmental issues through a partnership approach; • where practicable, innovation in rural development and delivery of services in rural areas, building as appropriate on existing best practice; and • better prioritisation of existing resources, in line with local priorities, towards areas, communities and people with the greatest needs. Regional Rural Delivery Framework for the East of England The document outlines the challenges facing rural areas in the East of England. These are: 6.2.3 • support entrepreneurship and sustainable rural business growth; • ensure that the least well performing rural areas in the region are addressed in terms of increasing productivity; • create and regenerate thriving communities in which there are local employment opportunities for good quality jobs, a supply of affordable housing for local people and access to services including health, education, skills, transport, business support and ICT; • enable a productive and sustainable food and farming industry to flourish, mitigating the impacts and optimising the opportunities of CAP reform whilst conserving and enhancing the potential of the natural environment and heritage. East of England Delivery Plans for Sustaining Farming and Food The government sustainable farming and food strategy (SFFS) was published in December 2002. The government office for the East of England have developed their own plan with action areas and projects. These include the efficient use of water, marketing of local food and development of food trails. 6.2.4 PPG 7 Implemented in Relation to the Diversification of Farm Businesses – ODPM The Study looked at some of the key issues from PPG 7 and how they were being implemented by various local authorities. The documents contain what can be described as a best practice, approaches to policy formulation. JS/GC/N Norfolk/rpt Page 30 of 174 In a survey of planning officers a number saw their plans as being more restrictive than PPG 7 6.2.5 The Federation of Small Businesses East of England Area Policy Unit The section on Rural Issues calls for the following: It is perceived that planning policy is designed to meet the needs of urban communities and then applied to rural ones, irrespective of whether or not it is appropriate. Often applicants find the process difficult and advice hard to obtain. Advice should be available in an easily understood format on council websites, or else in booklet form. In addition planning officers should have surgeries where people can discuss planning issues affecting them. The lack of consistency in policies is a major issue and often influenced by national guidelines or regulations rather than the need for local considerations. Despite encouragements from central government members have reported difficulties in obtaining planning consent for the conversion of redundant farm buildings with highways issues often overriding economic ones. Business rate relief should be offered to all eligible businesses in all rural districts. 6.2.6 The Characteristics of Businesses Using Rural Buildings - RICS Research February 2005 The document provides useful background to government policy on the change of use of buildings. The report uses primary research of businesses using rural buildings some of the main findings were: ƒ Over one third said they intended to expand on their current site. ƒ The majority of the businesses were involved in some sort of service provision. ƒ A high proportion were new start ups (41%). ƒ 68.5% were local businesses with no other site. ƒ HGV use was rare with 68% stating no HGV deliveries. ƒ The main travel distances were 8 miles for employers and 11 miles for employees. JS/GC/N Norfolk/rpt Page 31 of 174 ƒ A significant proportion of workers commute from urban areas to converted buildings. In conclusion the study found that the re-use of rural buildings was a very dynamic force in the rural economy although it was dependant upon the private car. The study recognises that its findings were too late to have an influence on government policy in PPS7. 6.2.7 Consultation Draft – Strategy for the Horse Industry in England and Wales, British Horse Industry Federation February 2005 The government has recognised the importance horses now play in the rural economy hence their inclusion in PPS7. The strategic aims and objectives of this strategy are all about raising skills and provision of facilities which will have planning implications. 6.2.8 Norfolk County Council Local Policies and Standards for Highways Development Control in Norfolk. Norfolk County Council December 2004 The role of highways in rural developments are significant, especially when many proposals are not served by ideal roads in policy terms. Ensuring highway safety in line with Highways Policies whilst ensuring rural businesses can thrive is a key challenge in any local policy formulation. 6.2.9 The Price and Affordability of Dwellings with Occupancy Conditions. Acorus May 2004. Acorus have produced two of the above reports, the last in Mid 2004. By analysing a number of sales of agriculturally tied property the aim was to identify what the market was for agricultural dwellings with agricultural occupancy conditions. This is important where a Local Authority is seeking to establish whether there is a need for an agricultural dwelling based on marketing evidence. The study showed that agricultural dwellings sold for between 5% and 28% of the value if a tie wasn’t present. This would back up a view that when a house is marketed above their levels and doesn’t sell, it is the local market not the price which prevented a sale. 6.2.10 National Farmers Retail and Market Association This organisation supports and promoted farm shops and markets nationwide. They currently have a campaign titled “21 reasons to be excited about local food” JS/GC/N Norfolk/rpt Page 32 of 174 6.2.11 Research by N.C.C – Through re-use of redundant farm buildings. North Norfolk Country Council currently operates an advice and grant scheme on the re-use of rural buildings. The results of their initial research were looked at related to this project. 6.2.12 North Norfolk Community Partnership (NNCP) North Norfolk Community Partnership (NNCP) brings together the Parish and Town Councils, the District and County Council, the police, the health service, businesses, community and voluntary groups to work together to produce a concerted and co-ordinated approach to the delivery of services in the communities of North Norfolk (www.northnorfolk.org/nncp/default.htm ). Future Community Aspirations Research carried out in 2002/03 identified eight key areas as themes for action. They were: ƒ Housing ƒ Transport ƒ Community safety ƒ Economy ƒ Heath and Social care ƒ Environment and Outdoor Recreation ƒ Leisure and culture ƒ Learning and skills 6.2.13 Farmer’s voice survey and Farmer’s attitudes survey (ADAS) The findings from the latest ADAS Farmer’s Voice Survey show that nearly a quarter of all farmers in England and Wales are expecting their farming practices to change. A similar number (20%) either have no idea what that change will need to be, or think that they will have to give up farming completely as uncertainty and pessimism about CAP reform pervades many sections of the farming industry. 46% of the farmers questioned believed that the impact of CAP reforms in their regions will be negative. The survey findings pointed to the fact that farmers do not fully understand the implications of CAP reform. Also that farmers planned to reduce the intensity of how they farm. Those responding predicted an average decline in winter cereal area of 4% while a decrease of 12% in suckler cow numbers was envisaged (ADAS News Release: Farmers Concerned over CAP Reform). JS/GC/N Norfolk/rpt Page 33 of 174 7 The potential implications of land use planning policies on agricultural trends. The key trends for the rural economy and their implications have been identified and summarised within Section 1. They are based on two main shifts in agriculture, namely rationalisation and broadening operations to add value to primary produce. Land use planning policies are likely to have an impact on these trends:a) b) The rationalisation of the agricultural industry in North Norfolk is likely to create the following land use issues:• A requirement for larger more centralised purpose built agricultural buildings. • A surplus of outdated buildings both traditional and modern. • A further reduction in full time labour employed in agriculture, and an increase in seasonal workers. This will result in an increase in houses with agricultural occupancy conditions no longer required for agricultural labourers. • An increase in grassland but reduction in agriculture livestock. • IPPC Regulations will lead to loss of pig and poultry units but others will need to improve facilities, expand or relocate. Businesses are being encouraged through government initiatives to add value to their produce which will create the following land use issues. There is likely to be an increased requirement for smaller high labour specialist enterprises producing high quality products for niche markets. Products could be processed and packaged on farm. Therefore these enterprises may require on site supervision and specialist buildings which would require planning permission. The products could be marketed through farm shops and farmers markets on farms. c) Diversification of the whole rural economy is already taking place. These diversified enterprises utilise redundant land, buildings and rural labour force in addition to stimulating the rural economy as a whole. Due to economics, market demand and government initiatives, land use planning polices will have an impact on the direction of these trends and should consider the maintenance and management of the countryside, in addition to the rural economy as a whole. Production will be increasingly driven by economic viability so economies of scale and efficiency of capital investment will be crucial to land remaining in production. JS/GC/N Norfolk/rpt Page 34 of 174 Positive policies on agricultural buildings should enable the continued rationalisation of agricultural businesses enabling land to remain in production. If there is no positive policy on the development of agricultural buildings, more land and buildings could come out of production which could have negative landscape impacts in addition to further rural unemployment. Continued rationalisation will inevitably lower demand for agricultural dwellings. Planning policies could enable these conditions to be altered to provide local or low costs housing. Any policy on removal of occupancy conditions should be specific in terms of exact requirements for removal. It should consider changes in markets and requirements for agricultural dwellings on the holding and in the locality. This should prevent abuse of the planning system and retain agricultural housing where it is required. If policies allowed amendments to other relevant occupations e.g. equine it could help to facilitate an efficient diversification of the rural economy reducing the need to build more new houses in the countryside. Policies should enable dwellings to be built in countryside locations where essential. Therefore enabling rural businesses to be profitable and well managed which can have a positive impact on the rural landscape and economy in terms of employment. Policies should however ensure the dwellings are essential and that the associated business is likely to be financially sustainable in the future. This should prevent abuse of the concession that the planning system makes for such dwellings. Rationalisation together with on farm processing and packaging has led to the use of seasonal workers in some areas that is currently being provided under permitted development rights through mobile homes. This can create landscape problems and a poor standard of housing. A planning policy allowing conversion of existing buildings to seasonal workers’ hostels could mitigate the impact of housing seasonal workers in rural areas. This study shows that the trends in agriculture are likely to continue to create redundant buildings in rural areas. The re-use of these buildings could help to stimulate the rural economy and avoid dereliction and adverse impacts on the landscape. However, the re-use of these buildings will be dependant on the economic viability of potential uses. If no economically viable use can be found, the buildings will fall into disrepair and dereliction before being lost as an asset to the rural built environment. Farm diversification is likely to become more important to the viability of the rural economy. Positive policies on diversification will encourage this. Diversification policies should consider landscape implications, traffic generation, and impact on neighbours and should be planned on a sound financial basis. This will prevent damage to the character of the landscape, JS/GC/N Norfolk/rpt Page 35 of 174 road network problems and nuisance. A business plan should show the level of employment and economic value to the area associated with the development. Keeping horses is a growing trend in the UK and in North Norfolk, it can encourage tourism, provide employment, utilise existing buildings and land that could otherwise go out of production. With the reduction in livestock, horses can be used as an alternative when keeping grassland in well managed production. Planning policies should support equestrian development that maintains environmental quality and landscape character. Floodlights, outside storage of hay and straw bedding and show jumps could have adverse impacts on the landscape. Diversification can often utilise existing buildings but occasionally new build is more appropriate e.g. environmental requirements of food processing plants. Replacement of redundant buildings could be an alternative to new build in this situation. Policies could provide for this type of development but would need to consider the size and scale of replacement buildings, the importance of the existing buildings and the effect on the existing surroundings. These recommendations have been based on a detailed rural economy study. Policy decisions in these areas must be linked with the overall strategy of the district. 8 Recommendation for North Norfolk’s Future Policy Direction Based on the primary research and desk research of published data including National Polity it is considered North Norfolk District Council should formulate policies that strike the correct balance between protecting the countryside, in particular the AONB, but also recognise the significant changes in agriculture both historically and in the future. The recommendations have been based on a detailed rural economy study. Policy decisions in these areas must be linked with the overall strategy of the district, for example; housing strategy, tourism, transport, industrial development/employment. 8.1 Agricultural Buildings Specific policy on planning applications for agricultural buildings is required with particular reference to intensive livestock and relevance of new regulations is required, e.g. IPPC. The current policy on prior approval should remain but a new policy is required for agricultural development to cover crop and general stores, livestock buildings and horticultural development. In this respect a policy similar to East Yorkshire 1997 adopted policy would be suitable i.e. JS/GC/N Norfolk/rpt Page 36 of 174 “Permission will be granted for agricultural, horticultural or forestry related development provided that:(a) the proposal is related to and located on an existing unit, and is reasonably necessary for the purposes of agriculture, horticulture or forestry within that unit; (b) it would not significantly detract from the character of the rural landscape; (c) the location, scale, design, colour and materials are appropriate to the character and appearance of the surrounding area; (d) the proposal would not give rise to significant noise and disturbance to the occupiers of nearby residential properties or otherwise adversely affect residential amenities, for example by reason of dust, odour or effluent; (e) the amount of traffic likely to be generated would not prejudice highway safety or cause significant harm to the environmental character of country roads, and (f) satisfactory vehicular access can be achieved”. A footnote to the effect that proposals required to meet the requirement of new legislation, i.e. IPPC would be viewed favourably. In assessing an application account will be taken of the improvement on the existing unit. A key issue is the more restrictive treatment of agricultural buildings in the AONB, which is generally accepted to be the right approach. Greater difficulties arise with the area of High Landscape value which is seen to be too restrictive given it covers a large area of the district. 8.2 Agricultural Dwellings and Occupancy Conditions It is recommended that 2 policies for new dwellings are appropriate. One for permanent agricultural dwellings and one for temporary, reflecting the differing approaches in annex A of PPS 7. The policies also need to reflect other occupational dwellings. 8.2.1 Permanent Dwellings A policy similar to the following could be appropriate. New permanent dwellings in the countryside for agriculture, forestry or other occupational requirements will only be permitted where: i) JS/GC/N Norfolk/rpt There is a clear functional requirement for a person to be resident on site; Page 37 of 174 ii) The need is full-time; iii) The unit is established, profitable and economically viable; iv) There are no other dwellings on the holding or locally which would fulfil the need. A footnote to the effect that when a need has been identified an agricultural dwelling should be of a size the unit can sustain A guide of 180m² - 200m² maybe appropriate. 8.2.2 Temporary Dwellings A policy along the following is required A temporary dwelling for agriculture, forestry or other occupational purposes will only be permitted where: 8.2.3 i) Significant evidence is provided to show the business has been planned on a sound financial basis; ii) There will be a functional requirement to live on site; iii) There are no other dwellings on the holding or locally which would fulfil the need; iv) There is a realistic prospect that the business will meet the requirement of policy X (permanent dwellings) Hostels for Seasonal Workers In some areas of the country large grouping of mobile homes, which can be exempt from planning permission, have created landscape and other concerns. North Norfolk should consider introducing a policy which may support conversion of buildings for the provision of hostels when they are relevant to the units they wish to serve. 8.2.4 Occupancy Condition Removal The first paragraph of the existing policy is entirely suitable but criteria a) and b) are not clear and references to parishes are too prescriptive and gives rise to differing geographical interpretation. An alternative maybe; a) JS/GC/N Norfolk/rpt the applicant has shown that the property has been marketed with sufficient publicity to the agricultural community, over a minimum of 6 months; Page 38 of 174 b) 8.2.5 The property has been available at a price reflecting the condition which would normally be a 30% reduction on its open market value. Amendments/Alterations of Conditions A further consideration is amendment of the conditions to include other occupational businesses (e.g. equine), local need housing and holiday use. In these cases it should not be necessary to undertake any marketing. Such applications should be judged favourably. The study looked at whether agricultural dwellings could be used for low cost housing and investigating this could be made a requirement of any removal. However it is considered the range of housing types and issues make this inappropriate. 8.3 Conversion of Rural Buildings The existing policy, number 29, needs little change other than related to residential use and to reflect the latest advice in PPS 7 to encourage buildings to be converted to the most appropriate use. The recommendation is to remove the first section and introduce a policy on residential along the following lines:Conversion to residential use will only be permitted where: i) The residential element is part of a mixed scheme including business reuse or ii) The building is worthy of preservation and residential use is the only way this can be achieved iii) The conversion scheme can be incorporated without alteration to the fabric and retains the barns appearance. This will encourage the development of mixed schemes including in or on the edge and within villages to meet sustainability objectives and will ensure important buildings wherever they are located have a chance of preservation. 8.4 Low Cost Housing This was not specifically part of the remit although it did arise in relation to removal of agricultural occupancy conditions. It is not considered that a restrictive policy requiring such a use is achievable or appropriate in North Norfolk although it should be an option. JS/GC/N Norfolk/rpt Page 39 of 174 8.5 Land Use in AONB and Agricultural Land Quality Protecting high quality agricultural land is no longer the cornerstone of Government advice and should be viewed alongside other sustainability considerations, however given the importance of agriculture in the North Norfolk district, retention of a policy maybe appropriate. An alternative wording to policy 22 should reflect that other sustainable issues maybe more important and developers should not make decisions based too heavily on land quality considerations. 8.6 Farm Diversification Generally A clear policy is essential to recognise the Government policy in PPS 7. Whilst other policies in the LDF will be important, diversification should have its own policy and criteria. Suggested wording would be as follows:“Farm diversification proposals will be allowed where:a) the proposal does not unacceptably impact upon the amenities of residents; b) the proposed access and level of traffic generated by the proposal is within the capacity of existing approach roads, when compared with the permitted agricultural use and would not be detrimental to the amenity of the locality or prejudice highway safety; c) the proposal does not result in demonstrable harm to the landscape and nature conservation; and d) building requirements are met through the conversion of suitable existing buildings or replacement buildings. New buildings will only be approved where the activity proposed cannot be met through the conversion of an existing building and where the new structure does not result in excessive expansion of built development into the countryside. e) The proposal should be planned on a sound financial basis. Farm Shops A policy on farm shops should be retained but needs flexibility in terms of ‘imported’ goods to ensure farm shops can operate all year round especially when local produce might not be available and labour needs to be retained. Horses North Norfolk Policy is written in a restrictive manner. JS/GC/N Norfolk/rpt Page 40 of 174 A policy similar in nature to the existing policy is appropriate, although given the importance of horses to the rural economy the policy should be more positive and state: “development proposals involving horses will be permitted subject that it: (a) would have no detrimental effect upon the appearance and character of the surrounding landscape; (b) would have no detrimental effect upon areas of nature conservation interest; (c) would have no significant detrimental effect on the residential amenities of nearby occupiers; (d) would not impair highways safety; and (e) are well sited in relation to bridle-ways, roads used as public paths and unclassified metalled roads if required or unless on farm riding is provided.” The current local plan in its definition reference paragraph 12.63 outlines the unsightly nature of many equine facilities. Any new LDF should explain that these facilities require planning permission as only grazing is exempt from specific permission. A supplementary document maybe appropriate. 8.7 Replacement Building Given previous diversification of the rural economy and the fact that some rural buildings may not necessarily be of the best design or layout, Government policy recognises that replacement maybe appropriate. North Norfolk Should have a policy to cover such development along the following lines: The replacement of buildings in the countryside outside the development boundary will be allowed subject to the following:1) The building is not of historical or architectural importance; 2) The building to be replaced is of permanent construction and structurally sound; 3) The replacement building is of a similar size and scale as the building to be replaced. 4) The new building will provide environmental improvement compared to the old building; 5) There will be no detrimental effect on surrounding buildings especially those of historic or architectural importance. JS/GC/N Norfolk/rpt Page 41 of 174 8.8 Recreation and Tourism Again this was not a specific area subject to the study on which specific recommendations are required but does have significant Rural Economy implications, particularly related to change of use of buildings and farm diversification. The various surveys and workshops identified a possible over supply of holiday accommodation although that is an economic matter and should not necessarily be restricted within planning policy. 8.9 Highways Highways is a common theme which has an effect on all levels of development. There is a perception that in some cases highways advice is over negative and does not recognise the level of traffic that would arise from the permitted agricultural use. Advice also needs to be tempered against the general standard of roads in North Norfolk. Whilst highways policy is a county matter and cannot be specifically addressed in the new LDF, it is an area North Norfolk need to be aware of, and, if necessary encourage a more flexible approach. JS/GC/N Norfolk/rpt Page 42 of 174 SECTION 2 The Current Agricultural Climate – National and North Norfolk Project Aim Agriculture within the region Sector profitability Employment in agriculture Drivers of change within agriculture Agricultural diversification Farmer controlled business (pcbs) JS/GC/N Norfolk/rpt Page 43 of 174 1 PROJECT AIM The aim of this project is to assist North Norfolk District Council in the formulation of core strategy and site specific policies for the North Norfolk Local Development Framework (LDF). The project outputs will ensure these policies are based on a sound understanding of both current and likely future requirements of agriculture and the wider rural economy. JS/GC/N Norfolk/rpt Page 44 of 174 2. AGRICULTURE WITHIN THE EAST OF ENGLAND REGION North Norfolk is situated within the East of England Region. Water is a key factor in the environment and economy of the region. It is low-lying, coastal and vulnerable to flooding. The wetland habitats include lowland and chalk rivers, fens and wet grasslands. Rural areas cover 79% of the East of England Region, with a relatively high proportion of land under arable and horticulture. All of the county of Norfolk is relatively remote, sparsely populated and heavily dependant on a vulnerable agricultural industry. Many of the regions coastal areas, wetlands, and pastoral areas are subject to national and international protection measures. The area also attracts large numbers of tourists to areas such as ‘Areas of Outstanding Natural Beauty’ (AONB). The soil in the eastern part of the region, the low lying fens, is mainly of excellent quality for agriculture (Grade 1). Soils are developed in marine silt or deep peat. However, the peat tends to suffer wind erosion and oxidisation which threatens the long term land quality. Land of good to moderate quality, grades 2 and 3, is widespread throughout the region and corresponds to a wide range of soil types. The East of England region contains some 2,000km of river and drain fisheries. Many rivers are slow flowing and intensive agriculture poses a threat in terms of nutrient leaching. There is a diverse range of coastal and semi-natural habitats in the Region. In addition, arable fields and farmland features such as hedgerows support a variety of wildlife. The importance of the Region’s biodiversity is reflected in the many designations for habitats and species however, many of these are threatened by intensive farming practices and development. About 40% of the woodland in the region is ancient or semi natural woodland, with 38% of coniferous woodland. The arable habitat is extensive but due to intensive agricultural practices there has been a decline in biodiversity. Areas of grassland have been improved. The internationally scarce resource of lowland heath land is to be found in North Norfolk. Soft rock cliffs, sand dunes and shingle occur at numerous locations along the Norfolk coastlines. There are large areas of salt marsh on the region’s coast, mostly lying within the estuaries. Some 7.5% of the land area is designated as National Park, AONB or Heritage Coast. There is a dominance of cereal and general cropping farm types across the East of England region. The farm type profile for the region is very different from that of England in two major respects. There are very few dairy holdings. Cereal farming and general cropping dominate the region, and account for over half of the holdings. JS/GC/N Norfolk/rpt Page 45 of 174 Percentage of farm type in East of England compared to England (2004): 35% 33% 33% 30% Percentage of holdings 25% 25% 21% 20% East of England England 14% 15% 12% 11% 10% 10% 9% 9% 7% 6% 5% 5% 5% 2% 1% 0% Cereals General Cropping Horticulture Pigs & Poultry Dairy Grazing Livestock Mixed Other (Source: Taken from DEFRA – 2004 Census data) Due to the favourable climate and soils, the East of England region is intensively cropped. The region accounts for 26% of the cereal area, 50% of the sugar beet crop and 30% of all horticultural crops in England. Within the East of England region there is a higher proportion of farm holdings over 100 hectares (247 acres) compared to the national average, with 18% of the total farm holdings in England that are over 100 ha in size. JS/GC/N Norfolk/rpt Page 46 of 174 East of England Land Use, 2004 (‘000 ha): All other land, 39, 3% Set aside, 116, 8% Woodland, 46, 3% Rough grazing, 28, 2% Grass (permanent), 158, 11% Grass (temporary), 31, 2% Crops and Fallow, 1,040, 71% (Source: DEFRA – 2004 Census data) Agricultural land use comprises 1.46 million hectares. The dominant land uses are for cropping and fallow (71%). There has been a decrease in the area categorised as agriculture since 1990 of around 17,500 hectares (1.2%). This decrease is broken down into a decrease in crops and fallow of 132,000 hectares offset by a 99,000 hectare increase in set-aside, a 5,000 hectare increase in grassland and a 10,000 hectare increase in woodland. The remaining land has gone into non-agricultural land use which may include uses such as private amenity, conservation and development. Note that over 13,500 hectares of land has been lost from agriculture since 2002 (77% of the decline since 1990) JS/GC/N Norfolk/rpt Page 47 of 174 East of England distribution of holdings by size, 1990 & 2004: 12,000 10,000 Number of Holdings 8,000 1990 2004 6,000 4,000 2,000 0 < 5 ha 5 to <20 ha 20 to < 50 ha 50 to <100 ha >100 ha Holding Size (Source: DEFRA – 2004 Census data) • By number of holdings, those under 5 hectares dominate with the next main categories being those over 100 hectares and in the 5-20 hectare category. Since 1990, there has been a big increase in the number of holdings under 5 hectares (from 4,685 to 9,647) and a large decrease in the 20-50 hectare and 50-100 hectare categories. The greatest decline is shown in those holdings between 20 and 50 hectares (49 to 124 acres) in size. Holdings of this size find it difficult to fund improvements, such as the replacement of buildings and equipment, and so become less competitive and eventually no longer viable. It is likely that these farms have changed ownership and become amalgamated with others. The larger holdings benefit from economies of scale and are able to spread their fixed costs. The statistics suggest that the trend for fewer, larger holdings in this region is set to continue. • By area, farms over 100 hectares dominate with 80% of the total agricultural land. All farms over 20 hectares comprise 96% of the agricultural land area. • In 2004 there were a total of 19,851 holdings in the East of England region with an average size of 73 hectares (180 acres). • Since 1990, there has been a 6% increase in the number of holdings (from 18,651) and a corresponding drop in average size (from 79 hectares) • Since 1990 there has been a significant decrease in the number of general cropping farms (33% to 3,213) and all other types of farm apart from grazing livestock (from 1,345 to 2,509), “other” farms (from 2,351 to 7,638) and “pigs and poultry” ( from 1,028 to 1,256). The number of specialist cereal holdings has remained unchanged. JS/GC/N Norfolk/rpt Page 48 of 174 • 2.1 By area, the main types comprise cereals and general cropping farms. Note that the “other” category comprises only 3% by area. Changes within North Norfolk from 1990 to 2004 Farm Types, Number of Holdings within North Norfolk: 500 463 450 400 356 339 Number of Holdings 350 300 1990 2004 250 200 138 150 98 100 90 85 60 54 55 56 69 33 39 50 10 8 0 Cereals General Cropping Horticulture Pigs & Poultry Dairy Cattle and Sheep Mixed Other Farm Type (Source: DEFRA – 1990 and 2004 Census data) • The number of farms classed as general cropping has decreased by 23%, whereas the number of farms classed as pigs and poultry has increased by 42%. These changes point towards increasing specialization, amalgamation and expansion of the main pig producing areas. The number classed as grazing livestock has increased by 156%. There has been relatively little change in the number of holdings classed as cereals and horticulture. There has been a substantial increase in the farms classed as “other” from 69 holdings to 339. It is assumed that these types of farm have diversified, into areas such as alternative crops and non-farming activities. • There has been a 12% decrease in the amount of land rented in North Norfolk, and now 70% of the land is owner occupied and farmed ‘in hand’. This is confirmed by the North Norfolk Farmer Survey that found that 86% of respondents were owner occupiers. JS/GC/N Norfolk/rpt Page 49 of 174 Distribution of Holding Size in North Norfolk 1990 v 2004: 600 515 Number of Holdings 500 400 1990 2004 300 224 200 224 187 158 160 137 134 119 97 100 0 <5 ha 5 to 20 ha 20 to 50 ha 50 to 100 ha >100 ha Holding Size (Source: DEFRA – 1990 and 2004 Census data) • The changes in holding size distribution mirrors that of the rest of the East of England region and the UK, with a large increase in the number of holdings under 5 hectares and the next dominant size being those over 100 hectares. • The Farmer Survey within North Norfolk indicated that in the last 5 years 25% of respondents had increased the area of land farmed, mainly for field vegetables. Whilst 12% now farm a smaller area than 5 years ago, mainly within the dairy, pigs and poultry sectors. • Whilst there has been a 25% decrease in the number of hectares growing temporary grass, there has been a 30% increase in permanent grass and a 34% increase in rough grazing. The total amount of grass has increased 21% to 12,000 hectares. The catalyst for these changes in grassland area has been the drive towards more extensive grazing systems to take advantage of the livestock premiums and the environmental schemes that have encouraged long term grassland. The falling arable margins have also led to the least productive land being taken out of production and being put down to set aside or grassland. Woodland has also increased by 21%, however it still only accounts for 4% of land use. JS/GC/N Norfolk/rpt Page 50 of 174 Agricultural land use in North Norfolk 2004: 1621, 2% 4372, 6% 2816, 4% 2229, 3% Crops and fallow Temporary grass Permanent grass Rough grazing Woodland Setaside All other land 8619, 11% 1240, 2% 54865, 72% (Source: DEFRA – 2004 Census data) • The areas of both wheat and winter barley have decreased, this is due to the requirements for set aside, however cropping and fallow still account for 72% of land use. The North Norfolk Farmer Survey indicated that approximately 90% of farmers had both combinable crops and sugar beet, and almost 50% grew potatoes. • The area of Sugar beet has decreased by 18%. This is because of the unprofitability of ‘C quota’ beet, the increase in yields due to modern varieties and improved husbandry, and the cuts in quota. The number of holdings growing potatoes has fallen by 31% however the area grown has increased by 17%, indicative of the trend towards specialisation within this sector. Potatoes grow well in the East of England, due to the correct soil and climate type. There is also accessibility to irrigation, making this a relatively easy high value crop to grow, however due to the increasing capitalisation required to grow them profitably it is now a specialist crop. • A 66% decrease has been shown in the area of peas and beans grown, due to the contraction in the fresh processing capacity within the region. • There has been a 224% increase in the number of hectares of maize grown as the popularity of the crop has increased as a valuable alternative forage to conserved grass. • Other vegetables and salad have decreased by 11% and total fruit by 71%, again highlighting the inconsistent margins and degree of specialisation required within these sectors. There has been a decrease in fruit due to the smaller growers being unable to meet the market requirements. • All livestock numbers have decreased, with total cattle numbers falling by 35% and total pig numbers by 7%. The largest fall (46%) has been in the JS/GC/N Norfolk/rpt Page 51 of 174 number of breeding pigs, however these only represent 7% of the total pig numbers in North Norfolk. Therefore the onus has changed more towards pig finishing than breeding. 2.2 • The number of dairy cows has fallen by 59% and the number of producers has fallen by 52% to just 23. This reflects the general downward trend in dairy numbers in the East of England region, with the migration of milk production to the west of the country. • Whilst the total number of holdings stocking sheep has increased by 27 to 140 the total number of sheep has dropped by 20%. Sheep fit in well with lowland management systems and holdings under ESA agreements. Organic Farming Organic farming requires farmers to operate to a system based on ecological principles and imposes strict limitations on the inputs that can be used, in order to minimise damage to the environment and wildlife. Only 0.9% of agricultural land in the East of England Region is in organic production, compared to 5.3% in the South West and 3.0% in the West Midlands (2.8% in England as a whole). Only the region of Yorkshire and Humberside has the same percentage as the East of England Region. Compared to other regions within England, the Eastern Region is below average in terms of the number of organic growers and producers, representing approximately 10% of the total number of organic producers in England. The East of England has 14% of the total organic processors within England. The majority of organic livestock producers (46%) are situated in the South West, with just 5% situated within the East of England. Most of the basic organic vegetable crops that are currently imported could be grown within the East of England region. These crops could then be marketed to the wholesale trade, as well as directly to supermarkets for attractive premiums. This would benefit the environment in the region as organic farming with less artificial inputs is a more sustainable way of conserving the region’s soil resource and lessening pollution of watercourses. The diversity of soil types in the region offers the opportunity for farmers to consider organic methods of production. The recently revised organic aid package has stimulated fresh interest from conventional farmers turning to organic methods. In the East Anglian Objective 5b region the strategic organic project “East Anglia Food link” has provided initial organic assessments to 29 farm businesses in its first year. The project has referred an additional 25 to the Organic Conversion Information Services (OCIS). There has been a rapid increase in organic and organic conversion land in the UK from 35,000ha in 1992 to over 690,269 ha in January 2005. Within the JS/GC/N Norfolk/rpt Page 52 of 174 East of England region there is a total of 12,761 hectares of land under organic management. Organic farming is perceived to offer some solutions to the problems currently facing most agricultural sectors. The organic sector in Europe is rapidly expanding. As the number of producers applying for certification of land continues to rise, so does the uptake of support schemes for organic farming. Organic farming schemes for converting producers have operated as part of the Rural Development programmes in all regions of the UK since 2000. The Farmer’s Voice survey, undertaken by ADAS Consulting in 2004 found that organic farmers are more content with their lot than their non-organic counterparts – 39% are happy to stay in farming as compared to 26% nonorganic. At 16%, a greater proportion of Organic growers claimed to have increased the area of land owned and/or farmed by them over the last 1-2 years compared to 11% for non-organic growers. Some 70% of the organic respondents to the Farmers Voice Survey (2004) indicated some diversified activity compared to around 50% of non-organic producers. Key among diversified activities cited by organic farmers was: • Off farm non-agricultural businesses (27% c.f 16% among non-organic) • Farm based accommodation (22% c.f 8%) • Leasing of land (17% c.f 11%) • Equine (15% c.f 10%) • Leasing of buildings (13% c.f 15%) • Farm based food processing and/or retailing (15% c.f 8%) JS/GC/N Norfolk/rpt Page 53 of 174 3. SECTOR PROFITABILITY In 2004, Total Income from Farming in the UK is estimated to have fallen by over 8% in real terms and by 5.4% at current prices. This is approximately 70% above the low point in 2000 and 50% below the peak in 1995. The dramatic rise in farming’s profitability in the early nineties followed the decline in the euro/sterling exchange rate after the United Kingdom left the Exchange Rate Mechanism. The equally rapid reverse in the second half of the decade was caused by increases in the exchange rate, lower world commodity prices and the impact of BSE. In 2004 the effect of stronger prices in the cereal and livestock sector in the first half of the year was more than offset by weaker prices and a lower quality harvest in the second half of the year, resulting in a fall in real terms of Total Income from Farming. Incomes are expected to have fallen for all farm types except dairy and specialist poultry. Since 1995 food prices have risen by 11% while prices of all items have risen by 25%. The Farmers’ share of a basket of food staples is estimated to have fallen by 25% between 1988 and 2004. After a period of relative stability the value of net worth, in real terms, and total assets has begun to fall. At current prices, the value of total assets fell in 2004 by 0.9% (3.6% in real terms) to £113 billion while total liabilities increased by 5.5% (2.6% in real terms) to £10 billion. Net worth consequently fell by 1.5% (4.2% in real terms) to £102 billion. The value of fixed assets fell by 2.2% to £102 billion; of this, the value of land and buildings, which form the greatest proportion of the total value of assets, fell by 2.4%. The value of current assets rose by 14% to £10 billion. Long and medium-term liabilities rose by 4.5% to £4.9 billion and short-term liabilities rose by 6.4% to £5.4 billion. Bank overdrafts (short-term loans) fell by 1.1% while trade credit increased by 17%. JS/GC/N Norfolk/rpt Page 54 of 174 8 000 25 000 6 000 20 000 15 000 4 000 10 000 2 000 5 000 0 1970 Total Income from farming per full-time person equivalent (£ per head) Total income from farming (£ million) UK income trends in real terms at 2004 prices: 0 1975 1980 1985 1990 1995 2000 Total Income from Farming (£ million) Total Income from Farming per full-time person equivalent (£ per head) Source: Defra Statistics Profitability for different types of farm in 2004/05 Average net farm income for all types of farm in the UK is expected to fall by 29% to £17,000 in 2004/05. Cash income is expected to decrease by 5%. Incomes on cereal and general cropping farms are forecast to be considerably lower for 2004/05 compared to 2003/04. This is due to lower commodity prices from the 2004 harvest, particularly cereals and potatoes, as well as increases in key inputs such as fuel, fertiliser and agrochemicals. Revenue from arable area payments is also expected to have fallen in 2004/05. Incomes on pig farms are forecast to decrease due to a slightly lower pig meat price over the twelve months and higher costs. Specialist poultry incomes however are expected to rise, largely due to the increased value of eggs. Incomes for dairy farms are expected to remain broadly similar or increase slightly compared to last year. Output on dairy farms will be bolstered by the introduction of the dairy premium in 2004, although this is partially offset by higher costs. The decreases in net farm income and cash income for cattle and sheep farms between 2003/04 and 2004/05 are mainly due to a small fall in livestock output combined with a similar increase in costs. Output has fallen due to lower prices for some classes of cattle and sheep whilst inputs such as fuel, fertiliser and depreciation have increased. 3.1 East of England Agricultural Financial Performance Primary agriculture in the East of England provides an output in excess of £2 billion. The rural tourism sector accounts for a further £3.4 billion. If the JS/GC/N Norfolk/rpt Page 55 of 174 ancillary industries are included, agriculture provides employment for 12% of the region’s working population. Gross output from agriculture within the East of England region represents 14% of the total UK output, and 18% of the total England output. Primary agriculture contributes 2.1% to the regional Gross Domestic Product (GDP). This percentage is higher than the English average of 1.8%. Its importance is further realised as, after agriculture and its ancillary industries are taken into account, it represents 4.2% of the regional GDP. In rural areas agriculture makes a far more significant contribution to the GDP. It is estimated that agriculture contributes up to 20% of the GDP in rural areas in the more remote parts of the region, particularly the northern areas of Norfolk. Norfolk and Suffolk have the highest reliance on agricultural income with figures of 5.7% and 3.7% respectively. In 2003, a series of unusual and concurrent market and weather conditions prevailed across the world. In North Europe, the weather limited the production of most crop and livestock commodities and prices increased. At the farm level, the price increases exceeded the reduction in the tonnage of crop and livestock sales and a single year recovery in net farm income resulted. Market prices in 2004 slipped back and the long-term cost-price squeeze on commodity prices continued. Greater annual variations in farm performance are likely in future years due to the greater price volatility that is likely to occur following the move towards free market conditions. 3.2 Future Prospects for farming The future business prospects for farming will reflect the interaction of the key drivers (both long-term and short term) which have shaped the present position. The chart below shows some stylised projections of underlying trends. These types of projection have very broad margins of uncertainty and also agriculture is an industry where specific events, such as disease outbreak or poor weather, can shift incomes from the underlying trend in individual years. The recovery projected for 2005 and 2006 is based on the expectation that energy prices, though still relatively high, will fall below their peak in 2004. The projections also assume a recovery from the poor quality of the harvest in 2004. A slight downward trend in the baseline projection thereafter is influenced by an expectation of lower prices. The projections take account of de-coupling, modulation and Rural Development Programmes, environmental regulations, the single payment scheme and cross-compliance. The baseline projection in the chart assumes an exchange rate of 67 pence per euro. Projections are also provided to illustrate the effects of further movements in the exchange rate. The exchange rate scenarios shown illustrate the effects of a 5% weakening of the pound against the euro, which approximates to the favourable 2003 rate, and a 10% strengthening, which approximates to the high exchange rate of 2000. JS/GC/N Norfolk/rpt Page 56 of 174 Another key driver of farming incomes is productivity. The high productivity scenario within this analysis has been chosen to broadly match the growth rate seen for the leading group of Member States of the European Union (France, Denmark, the Netherlands and Belgium). This will be a challenging path for agriculture in the United Kingdom to follow, but if achieved would give a further rise in income per head of around 20% relative to the baseline position. UK Total Income from Farming in real terms at 2004 prices per full-time person equivalent, up to 2009: £ thousand 30.0 25.0 20.0 15.0 Actuals to 2004 (prov) 10.0 Baseline projection £ weakens by 5% against euro 5.0 £ strengthens by 10% against euro Assuming high productivity gains 0.0 1973 1976 1979 1982 1985 1988 1991 1994 1997 2000 2003 2006 2009 Source: Defra Statistics JS/GC/N Norfolk/rpt Page 57 of 174 4. EMPLOYMENT IN AGRICULTURE Agriculture’s share of the workforce in the United Kingdom is 1.8%, however the agri-food sector as a whole provides over 3.8 million jobs that equates to just under 15% of the total workforce. Since the 1980s the proportion of part-time workers has risen from about 25% to 50% of the total. Average Employee Numbers in Agriculture in the UK 1990-2004: 350 300 Numbers (thousands) 250 200 All Male Female 150 100 50 0 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 Source – Office for National Statistics This data illustrates the general decline in employment within agriculture, a 26% drop and 83,000 people less than in 1990. Seasonal employment is highest in rural areas which have a high demand for a workforce at peak times of the year such as agricultural harvest. Relatively high concentrations of self employed are within the agricultural sector. Many full time farmers are turning towards part time employment as they look for other sources of income off the farm. 29% of holders in the United Kingdom were aged 65 years or older in 2003, up from 25% in 2000, while the number of holders younger than 35 years old fell from 5.2% in 2000 to 3.4% in 2003. JS/GC/N Norfolk/rpt Page 58 of 174 Age of holders in the UK: Source: http://statistics.defra.gov.uk/esg/ Statistics indicate that those employed within agriculture are generally older than those within other occupational sectors. 49% of the population employed in the agriculture, fishing and forestry sector are 45 years of age or above compared with 32% for all other occupations in the region. Fewer job opportunities have existed for young people in recent years and the industry is seen as less attractive in terms of sociable working hours, this suggests that the existing workforce is not being replaced. The statistics point to an increase in the ageing population in the rural parts of the region and a further out-migration of the younger workforce. Farm Employment within North Norfolk 1990 & 2004: Farmers ( & Directors, Partners, Spouses) full time Farmers ( & Directors, Partners, Spouses) part time Farmers ( & Directors, Partners, Spouses) full & part time Managers - full time Managers - part time Managers - full & part time Employees (male) - full time Employees (male) - part time Employees (female) - full time Employees (female) - part time Casual labour Total labour (Source: DEFRA Census data) 1990 2004 No. of Holdings No. of Holdings 1990 2004 Number Number 343 455 576 815 711 919 54 309 97 29 85 113 757 67 36 103 154 63 18 47 79 832 1,166 1,270 68 1,086 138 60 253 1,873 4,644 110 67 177 384 99 33 90 215 2,267 From the data in the above table it is apparent that in North Norfolk the total labour employed on farms between 1990 and 2003 has fallen from 4,644 to 2183, a drop of 53%. This is well above the national levels and is largely due to the predominance of arable farms in the area which have rationalised their workforce to a greater extent than livestock orientated farms. JS/GC/N Norfolk/rpt Page 59 of 174 There has also been a decrease in the number of full time and part time employees (both male and female) and an 89% drop in casual labour numbers. “The Norfolk economy still lags behind that of the rest of England. The aim of the Shaping the Future Strategy is to narrow the gap and improve Norfolk’s relative competitiveness. It is the businesses of Norfolk that generates jobs and creates wealth. The number of people in Norfolk aged 16-74 employed in Agriculture, hunting and forestry is 13,664. The agricultural sector is recognised as an important traditional sector for North Norfolk in terms of the number of businesses and employees (5.66% of all people aged 16-74 in North Norfolk work in the agricultural industry). This compares with an England and Wales average of 1.52%” (Economic Development Strategy to 2007 - North Norfolk District Council) The agriculture, forestry and fishing sectors represent 2.5% of the working population in the East of England Region. In England this figure is 1.8%. In the remote rural areas of the region, such as the district of North Norfolk, agriculture, forestry and fishing account for 8.3% of the total employment. This figure is representative of other remote rural areas. Within the agriculture, fishing and forestry sectors, men predominate as employees. There are fewer full time employees in the more rural counties of Norfolk and Suffolk; however, these counties have a higher level of self employment. Norfolk and Suffolk have the greatest concentration of low earners, and in these two counties, 36% of full time employees earn less than £250 per week. This equates to just over 60% of the national average wage. This pattern of wages reflects the low economic activities taking place in the northern parts of the region. 4.1 Skills Levels In 2000, 22% of holder managers in the UK possessed either basic training or full agricultural training; the majority had practical experience only. The proportion of holder managers with some agricultural training increases with farm size; a greater proportion of small holdings were run by holder managers with only practical experience JS/GC/N Norfolk/rpt Page 60 of 174 Agricultural training of holder managers in the UK, 2000: Source: http://statistics.defra.gov.uk/esg/ Agriculture as a sector is becoming more market orientated. Managers and administrators will need to acquire the skills to take advantage of new opportunities as they arise. Agriculture is no longer a production led sector. Managers will need to be able to make the necessary changes to meet new market demands. People and Training Overall, the skill level required among the workforce is increasing, particularly in relation to machine-intensive agriculture, which is increasingly requiring technician-level skills and flexibility to deal with more complex equipment. The Farmer’s Voice Survey (2004) found the following with regards to the farming family taking on the business Question: Do you expect a member of your family to take on the business after you? Family to take on the farm business Unlikely/Definitley not 47% 36% Non Organic 32% Possibly 43% Definitely/Very likely Any Organic 18% 21% 0% 10% 20% 30% 40% 50% Percentage of respondents JS/GC/N Norfolk/rpt Page 61 of 174 Approximately only a fifth (18%) of respondents farming non-organically indicated that they expected a member of their family to take on their farm business after them. Therefore more than 80% are unsure or definitely think that their business will not be taken on by the next generation. Within the Farmer Survey the respondents were asked about their future attitude to farming and over half of them were worried about their business’s future and recognised a need to change their farming practices. JS/GC/N Norfolk/rpt Page 62 of 174 5. DRIVERS OF CHANGE WITHIN AGRICULTURE 5.1 Major Drivers of Change Legislation/Driver of Agricultural Change CAP Reform – Single Payment Scheme (SPS) Sugar Beet Regime JS/GC/N Norfolk/rpt Details Likely Impact? Payments are now decoupled from production, so the amount of subsidy received is no longer conditional on the area of crops produced or the number of stock held on the farm. The value of the farmer’s entitlement will reflect the value of claims made by the farmer in 2000- 02 (the historical element) and the regional flat rate. To qualify for the SPS payment the relevant proportion of the “arable land” (8%) must be set aside and the rules of Cross compliance must be adhered. More farmers will now have a set aside requirement, although the total amount of set aside with the UK will not increase. Non-agricultural uses – activities with greater restriction permitted for up to 28 days. Cross compliance – three sets of requirements – cross compliance applies on a whole farm basis As special entitlements are required to receive SPS for Horticultural crops, this sector seems to be pseudo-decoupled. We estimate that the agreement will have the effect of reducing the labour requirement for UK agricultural production on farms by some 3-7 %. This will be in addition to a continuing declining trend in employment in farming. In addition there may be some saving in labour from the simplification of the subsidy schemes. There is also likely to be some reduction in employment in the industries supplying agriculture and those which are dependent on its output. It is difficult to estimate the impact on these sectors but it is likely to be relatively small (about 1-2% of employment in these sectors). On the other hand, because the industry is brought closer to the needs of the market there may be increased opportunities for employment in higher value added or other land based enterprises. The European’s Commission’s White Negative impact on UK agriculture Paper of July 2004 sets out plans to and the environment. UK sugar Page 63 of 174 reform the European sugar regime. The Commission is proposing a substantial two-step price cut coupled with a generous restructuring fund lasting four years. Production of the English sugar beet crops remains concentrated in Eastern England. Norfolk has the largest area of sugar beet accounting for 30% of the national crop area. The current sugar regime ends on 30 June 2006. There is pressure for the new regime to encourage and enable change in the sugar sector. quota cuts and/or price cuts will cut back sugar beet production and lead to significant reductions in the farm income and a reduction in biodiversity. Most farms will have to cut back on production and a price cut will force the least profitable growers to exit the industry. The profitability of alternative land uses will determine the extent of a cut back in sugar beet production. In the loner run, when farms can adjust more fully, production is likely to cease if the enterprise does not generate a positive net margin. Impacts of replacement by winter cereals or break crops. At some future date sugar beet may be used for bio-ethanol production, however the uptake of this will depend on the contract prices being offered. IPPC only applies to the larger installations that have more than 40,000 broiler bird places, 2,000 fattening pigs or 750 sows. It already applies to all new intensive livestock enterprises. All other producers with existing installations that exceed the threshold will be affected after the end of 2006. Installations which fall within the scope of IPPC will have to apply for a permit to operate. Planning authorities have an obligation to include policies within their structure and local plans which aim to conserve and enhance the special scenic qualities of AONB’s. IPPC Integrated Pollution Prevention Control (IPPC) is a major new piece of environmental legislation that will have an important impact on the UK intensive livestock industry (Poultry & pigs). It aims to control environmental effects so that emissions to air, water and land are prevented or reduced as is appropriate. AONB In 1968 an area of approximately 450 square kilometres of the Norfolk Coast was designated as an Area of Outstanding Natural Beauty. AONB’s are designated under the National Parks and Access to the Countryside Act (1949) and they represent the finest examples of countryside in England and Wales. Designation seeks to protect and enhance natural beauty whilst recognising the needs of the local community. SSSIs are the country’s very best Must give English nature wildlife and geological sites. SSSIs notification of any listed operations support plants and animals which find it taking place. SSSIs must be SSSI JS/GC/N Norfolk/rpt Page 64 of 174 difficult to survive in the wider countryside. Notification for a SSSI gives legal protection to the best sites for geology in England. Covers 68% of the North Norfolk Coast. Rural White Paper Town and Country Planning (General Permitted Development) Order 1995 Town and Planning (Environmental Impact Assessment) Regulations 1999 Animal Health Act 1981 Animal Health Act 2002. Welfare of Farmed Animals Regulations 2000 Horse Passport Regulations 2003 JS/GC/N Norfolk/rpt managed appropriately to conserve the special wildlife and geological features of SSSIs. Those convicted of carrying out work without permission, or damaging a SSSI, may be fined up to £20,000 by a magistrate’s court or an unlimited amount by a Crown Court. The thinking and conclusions from the review will feed into a refreshed rural strategy that Defra is currently preparing. This will set out the key priorities for the Government’s rural affairs agenda over the next few years, and an action plan for achieving them. The Government’s Rural White Paper Our Countryside: The Future, A Fair Deal for Rural England was published in November 2000. It set out all the different aspects that the Government was tackling in rural areas. However, due to Foot and Mouth Disease hitting the nation in 2001, resources were redirected from implanting the rural white paper to tackling the aftermath of foot and mouth. The rural white paper is now under review. This order details the types of Would increase expense of planning development that can be undertaken on applications and lengthen time agricultural land without planning scales if this policy ceased permission. These regulations include explanations of the type of installations for which an environmental impact assessment is required. Animal Health Act and the Orders made under it, aim to control the spread of diseases and to eventually eradicate them. This is done by controlling the movements of animals and isolating areas where disease is confirmed. The Act has strict controls on the import of animals, which include import licenses and strict quarantine controls. These regulations include details of the welfare requirements for farming poultry. The government announced on 14th February 2002, all horses and ponies will need to have a passport identifying the animal. Additional expense and time delays Additional paperwork and administration and some movement restrictions Increased costs of production 1st March 2005 – Horse Passport Regulations in England and Wales. It is now an offence for an owner to: • Export a horse • Use a horse for the purposes of competitions • Move a horse to the premises of a new keeper Page 65 of 174 • • • Present for slaughter for human consumption Sell a horse Use a horse for breeding purposes If the horse is not accompanied by a valid passport. The Pigs (Records, Identification and Movement) Order 2003 Water Framework Directive Agricultural Waste The Countryside and Rights of Way Act 2000 (CRoW Act) JS/GC/N Norfolk/rpt This order was introduced to improve The new rules that the order the identification of older pigs and pigs introduced require pig farmers to moving to slaughter. put a slap mark on the shoulder area of each pig under one year old that is moving direct to slaughter and each pig over one year old that is moving to any destination. This is a vital piece of European There will be many significant Legislation which is designed to scientific, technical, planning, integrate the way water is managed administrative and economic across Europe. Using the directive, implications. Implementation of the every member state should make the Directive will take place in a series same plans to protect and improve of planning cycles. rivers, lakes and coastal waters. The main aims are to improve water quality, prevent flooding and stop the deterioration of wetlands and improve aquatic habitats for wildlife. The UK, along with all other EU member states, must implement the Water Frameworks Directive. The government has recently published a The new controls, expected to take consultation paper, outlining new place in June 2005, will involve big proposals on how it intends to bring changes in waste management controls for agricultural waste into line practices on farms, with the with the European waste Framework proposals including a ban on Directive, Landfill Directive and the burying waste without a landfill hazardous Waste Directive requirements. permit. Anyone who deposits, recovers or disposes of controlled waste must do so either: Within the conditions of a waste management licence, or Within the conditions of an exemption from licensing. The CRoW Act comprises Five Parts The right-to-roam will be in and Sixteen Schedules. It aims to operation across all of England’s • Make new provision for public open country and registered common land from Oct 31 2005. access to the countryside • Amend the new law relating to The CRoW Act has reaffirmed the importance of the AONB public rights of way Page 66 of 174 • • Enable traffic regulation orders to be made for the purpose of conserving an area’s natural beauty Amend the law relating to nature conservation and the protection of wildlife designation as a method of protecting the landscapes of national importance, and places a duty on local authorities to act jointly to prepare and publish an AONB management plan. Farmers and landowners may be affected by open access to the countryside, in terms of increased visitor numbers. The two major drivers of change that will shape the future face of agriculture in the North Norfolk area are the recently introduced Single Payment Scheme and the far reaching changes to the future sugar beet regime. It is therefore felt that these aspects need to be further examined. 5.2 CAP Reforms and the Single Payment Scheme Farm Ministers of the EU Member States made an agreement on Common Agricultural Policy (CAP) reform in June 2003. The majority of the changes came into effect on the 1st January 2005. The most significant change is the decoupling of support. This means that farm support in the future will not be linked to what is being produced on the farm during the year. i.e. to the crops being grown or the numbers of livestock kept. The aim of the reform was to remove the incentive to maximise production and so reduce environmental damage. The agreement also makes receipt of subsidy dependent on meeting certain EU environmental, food safety, plant and animal health and animal welfare standards as well as maintaining the land in good agricultural and environmental condition (Cross Compliance). In addition, subsidy will be diverted to wider rural development and environmental initiatives, which farmers can undertake. The CAP reform agreement allowed Member States to implement these changes differently in separate regions. The UK has taken up this option to enable all four agriculture departments (in England, Scotland, Wales and Northern Ireland) to take the approach that best suits their needs and meets their priorities. On 12th February 2004, the Secretary of State announced that the payments in England would be regional and flat rate based and that this would be phased in from 2005 to 2012, with the flat rate element of the entitlement starting at 10% and increasing to 100% by 2012. To ease the transition to flat rate payments, farmers would receive an element of the entitlement based on their individual average historic receipts in the reference period 2000 to 2002. On 22nd April 2004, further clarification was announced. Three distinct regions will be created within England – land within the moorland line and within the upland Severely Disadvantaged Areas (SDAs), other upland SDAs and land outside the SDAs. Payments for the non-moorland SDA will be approximately 55% of that in lowland and those in moorland about 14%. The North Norfolk area falls JS/GC/N Norfolk/rpt Page 67 of 174 within land outside the SDA and will therefore receive the full amounts of their entitlements. The Single Payment Scheme (SPS) replaces 10 main schemes. An application form will still need to be completed each year (usually by 15th May) in order to receive the payment. The single payment (SP) has a number of conditions attached that must be met in order to receive the full payment, known as cross compliance conditions. The SP will also be subject to deductions to fund the national reserve, EU and national modulation (to fund rural development measures) and, eventually, financial discipline (to ensure that the overall EU budget is not breached). Other important points of the SPS include: • The payments are calculated in euros, therefore the £:euro exchange rate remains important. • From 2006 the entitlements to the SP will be tradable. • Most farmland is “eligible”, comprising of arable land and permanent pasture but excluding “permanent crops” (e.g. orchards, and vineyards), woodland and land in non-agricultural use. The land has to be at the farmer’s disposal for at least 10 months of the year. • The set-aside rate in English lowland will be 8%, and 1.3% in nonmoorland SDA. • A dairy premium will be paid to milk producers as compensation for price cuts. This will be paid based on the amount of milk quota held on 31st March 2005, and converted into per hectare SP entitlements. • A number of deductions will be made to the payments, most of which increase over time. Up to 3% will be deducted for the National Reserve, to provide payments for special cases. There will be modulation to fund EUwide Rural Development projects, this starts at 3% in 2005, increasing to 5% from 2007. There will also be member state modulation, in England this will be 2% in 2005 and 6% in 2006. In 2007 there will also be a deduction for “EU Financial discipline” to keep spending within the budget thresholds. By 2010 the total of these deductions could be 25% or even more. The gradual change to a flat-rate payment will create winners and losers. By 2012 a farm in 100% combinable crops will lose around £90/ha (from approximately £240/ha to £150/ha). Growers of previously unsupported crops such as potatoes and soft fruit will gain the whole of the payment, though at the cost of having to incur set-aside and cross-compliance rules. Dairy farmers with high milk yields and the higher their stocking rates the more they will lose, especially if they have a flying herd, i.e. no followers. A low-yielding, extensively stocked dairy farm with many followers may be payment neutral. JS/GC/N Norfolk/rpt Page 68 of 174 Intensive beef producers could lose considerably. A beef suckler herd with a low stocking rate should also be payment neutral. However lowland sheep would have to be stocked at a very high rate to lose from the new system and most should gain. 5.3 Implications for Production The following is taken from a report for DEFRA by GFA-RACE Partners Limited, in association with IEEP and is based upon previous research commissioned by DEFRA on likely decoupling impacts. It relates specifically to England, not to the UK as a whole. Likely impacts include:Reduction in production in cereals, beef and sheep with associated price increases. Improvement in incomes in most sectors but not dairy. Pressure to cut variable and fixed costs. Cut in employed on-farm labour. Arable sector – expansion of efficient farms, wider use of alternative farming arrangements. Switch from break crops to cereals and removal of more land from arable cropping to permanent or temporary fallow. Livestock sector – greater reduction in beef production. Move away from suckler cows to breeding ewes (hill/upland areas) and arable cropping where possible/profitable (lowland areas). Extensification of production through reduction in stock numbers (less so for small farms). Dairy sector – decoupling likely to contribute to restructuring – increase in herd size and yield in more productive areas and least competitive farms leaving the sector. More flexibility of land use between arable crops and grass. Some land to fall out of agricultural production and be managed to minimum standards. More land to be put into agri-environment and other schemes. Reduced flexibility to move into or expand unsupported crops (fruit, vegetables, potatoes). Slow increase in non-food crops at the expense of permanent or rotational set aside managed for environmental benefit. JS/GC/N Norfolk/rpt Page 69 of 174 Cross compliance might suggest a slightly higher standard of environmental care although “we do not expect additional compliance costs for businesses”. 5.4 Rural development measures More farms seem likely to benefit from enhanced funding for the new agrienvironment schemes and existing rural development schemes but it seems unlikely that other new measures will be introduced. The additional funding will lead to increased agri-environment scheme take-up and support further diversification. 5.5 General It is estimated that the Reform will result in an overall increase in UK farm incomes of up to £280million per year. 5.6 • Farm incomes higher on average, except for the dairy sector. • Significant variations at individual farm level. • Reduction in labour requirement for UK production by 3-7%. • Farmers will be slow to adapt systems of production due to uncertainty. • Business planning difficult due to a number of elements left for subsequent EU-level decisions. How will farm businesses respond to the changes Despite the enormity of the changes made in the gross margins, net margins or profits of the major enterprises affected, the impact on production (areas planted and number of livestock reared) is likely to be small in 2005. They will almost certainly be greater in subsequent years. There are a number of reasons for this: • The changes will take time to register for many producers, the instinct will be to wait and see. • Many businesses will continue to sow and rear as in the past because “it is what they do”. • There will be continuing uncertainty about many of the details of the new regime, therefore do not want to change as this may risk losing some of the Single Farm Payment. • There are penalties/restrictions on making some changes that might otherwise be contemplated, e.g. growing more potatoes. Additionally new enterprises often mean more capital investment, more know-how, risk of JS/GC/N Norfolk/rpt Page 70 of 174 overproduction and hence reduced prices. diversifications, as well as farm enterprises. This holds true for many However an increasing number of farmers, particularly those who are older, with no obvious successors, or others simply tired of the work involved, the uncertainties and the increasing paperwork and red-tape, will no doubt opt for a simple system of farming, with very low inputs and making sure that they abide by the cross-compliance rules. The future market prices will also dictate the pace of change as lower prices will accelerate the ‘evolution’. More farmers are expected to introduce or expand existing diversification enterprises to ‘supplement’ farm incomes and make up shortfalls. In some cases the diversification may entirely replace farm enterprises. However for many this is easier said than done. Large changes in the beef sector are predicted as the profitability in the past has been dependant on the subsidies which from now on will be decoupled from production. For most beef enterprise, even the most efficient, they will find it difficult to make a positive net margin without the subsidies. Of course the SP can still be used to subsidise production. However the significant difference is that the payments will continue even if production ceases (as long as crosscompliance rules are met). Production looks bound to fall substantially as time goes on. The implementation of CAP reform is a challenge and an opportunity for everyone involved with farming. In responding to CAP reform, some farmers may expand their businesses, others will decide to move into other activities on the farm, taking advantage of the new flexibility provided by the SPS, and some may see this as an opportunity to take a step back from farming, perhaps passing their farm on to the next generation. 2005/06 is going to be a watershed year for the farming industry. Following CAP reform, farmers will have the opportunity to respond to market demands without being tied to commodity-linked support. These changes will provide opportunities for all farmers. This may be through development of existing production systems, new market opportunities or participation in the new agrienvironment schemes, or perhaps a combination of these. The changes, however, will present a challenge for many farmers. The impact of CAP reform will be so significant that it is highly unlikely that ‘doing nothing’ will be a sensible or prudent decision. The current policy framework, including the recently published Government Strategy for Sustainable Farming and Food, places considerable emphasis on diversification as an element in rural and agricultural recovery. The number of diversified businesses is steadily rising. In the light of CAP reform proposals to de-couple support payments from production, it is logical to assume that the JS/GC/N Norfolk/rpt Page 71 of 174 level of diversification will continue to rise. Farm diversification is no longer merely a modest supplementary add-on to the core farm business. 5.7 Effects of CAP Reform in North Norfolk Over the next few years the changes will be slow due to ‘management inertia’. However some of the current trends identified in the previous Sections will continue and some will be accelerated. The likely effect of the CAP reform in North Norfolk will be: The overall reduction in production of cereals, beef and sheep may result in price increases in the market place. This should result in the improvement in incomes in most sectors but not dairy. Continued pressure to cut variable and fixed costs and improve economic efficiency. Cereals will only be grown where it is efficient to do so. There will also be an increase in the use of alternative farming arrangements. Switch from break crops to cereals and removal of more land from arable cropping to permanent or temporary fallow. There will be more flexibility of land use between arable crops and grass. Further uptake of environmental schemes and woodland, also some additional land will be taken out of agricultural production and managed to the minimum requirements of Cross Compliance. Therefore more land will be taken ‘out’ of agriculture. With the decoupling of subsidies from specific crops (mainly cereals) the area of vegetable and salad crops may increase slightly. However this will only apply to a very small number of holdings. Large changes in the beef sector are predicted as the profitability in the past has been dependant on the subsidies. Production looks bound to fall substantially as time goes on. Livestock producers will move towards more extensive production through reduction in stock numbers (less so for small farms), and the least efficient will leave the industry. There will be further rationalisation of the dairy sector with the continued trend of falling herd numbers, increase in herd size and yield for the more efficient producers and the least competitive farms leaving the sector. Continue the trend of reduction in full and part time employees (shrinking labour force). Increase in part time farmers. More farmers are expected to introduce or expand existing diversification enterprises to ‘supplement’ their farm incomes and make up profit shortfalls. In some cases the diversification may entirely replace farm enterprises. JS/GC/N Norfolk/rpt Page 72 of 174 5.8 Future Sugar Beet Regime Sugar beet growing was introduced as a UK crop in order to break dependence on sugar cane from the colonies, the sole source of sugar at the time, which made it a rare and precious commodity. The crop has gradually spread throughout Europe. From the 1920s on, with the development of maritime transport, sugar beet production faced competition from cane sugar and has survived since then largely as the result of tariff protection. 5.9 How the current sugar regime works The essential features of the current sugar regime are support prices (a minimum price to growers of sugar beet, and a guaranteed price to support the market), production quotas to limit over-production, tariffs and quotas on imports from third countries, and subsidies to export surplus production out of the EU. Sugar quotas There are two types of quota: A-quota (initially determined in accordance with domestic consumption) and B-quota (additional amount to fulfil export potential). Production quotas were set to distribute production of sugar amongst the Member States and to keep overall production within certain limits. They represent the maximum quantity of sugar eligible for price support. The total quota for the EU-25 is 17.4 million tonnes (A-quota: 82 %; B-quota: 18 %); Member States may produce more but that over-quota production (‘C sugar’) has to be sold outside the EU without subsidy. Support prices The minimum price for sugar beet is the minimum price at which sugar manufacturers are required to buy beet from growers for the production of quota sugar. It is currently €46.72 per tonne for beet used to produce A-quota sugar and €32.42 per tonne for beet used to produce B-quota sugar. ‘Intervention’ (market support) prices are €631.9 per tonne for white and €523.7 per tonne for raw sugar. Current prices are unchanged since 1993/94. Sugar imports The EU has several international trade agreements with third countries and groups of third countries, allowing preferential access (i.e. at low or zero tariffs for quantities subject to quotas) to the high-priced EU sugar market. These are longstanding and enshrined in multi-lateral trade agreements. 5.10 Reasons to reform the sugar regime The sugar sector maintains artificially high prices JS/GC/N Norfolk/rpt Page 73 of 174 Current EU price levels are three times higher than world market prices – this has been a constant point of criticism inside and outside the EU. The restructuring of the sugar industry is unavoidable: sugar must be brought in line with today’s economic realities. The EU lost a World Trade Organisation (WTO) sugar ‘panel’ The recent ruling of the WTO Appellate Body (‘panel’) in a case brought by Australia, Brazil and Thailand against aspects of the EU sugar regime obliges the EU to alter the regime. The ruling found that ‘C sugar’ exports benefit from export subsidies by being cross-subsidised with revenues from production under A and B quotas. Secondly, the WTO ruled that the EU exceeds its export subsidy commitments due to its subsidised export of sugar equivalent to imports from the Africa Caribbean and Pacific (ACP) countries and India. Measures must be taken to comply with the ruling. The current sugar regime expires on the 30th June 2006 Without a new regime all price provisions, all quota arrangements and the public storage (‘intervention’) system would cease to apply; this could lead to serious market disturbances and threaten the organised restructuring of the European sugar sector. Prolongation of the current system is not an option The EU has to adapt to its international obligations. The status quo is unsustainable - it would lead to a scenario dominated by attrition: Countries benefiting from the EU’s Everything But Arms (EBA) agreement with Least Developed Countries (LDCs), allowing free access to the EU sugar market, could send all their production (around 3.5 million tonnes) to the EU. EU production quotas would then have to be reduced automatically by the imported quantities in order to achieve market balance. The sugar industry, even in the most competitive EU regions, would be damaged. Non-competitive regions will suffer gradual decline without the incentive to seek economic alternatives. At least 60 factories would close and 5,000 agricultural jobs, 25,000 jobs in industry and 50,000 indirect jobs would be lost within the EU. 5.11 Objectives of the reform The main objectives are to: • guarantee a regular supply of sugar while protecting the European market from extreme price fluctuations; JS/GC/N Norfolk/rpt Page 74 of 174 • make the sugar sector more competitive, able to withstand international competition; • move towards more market orientation while restructuring the sector; • provide a fair standard of living for farmers and maintain rural communities; • maintain preferential access for ACP and LDC producers to the high value EU market; • simplify the regime and make it more transparent; • limit budget costs. Reaching these objectives would provide the sector with a long-term policy framework. 5.12 Key elements of the reform The EU Commission has studied the sugar market in detail and the proposal has been made after discussion with stakeholders in the sector. Its impact assessments have shown clearly that the maintenance of the Status quo is unsustainable. Without reform quotas would have to be drastically reduced across the board, hitting the most competitive producers hardest and leading to an attrition scenario. The reform proposal fixes the economic and legal framework for the European sugar sector until 2014/2015 without foreseeing a review clause. The Commission is proposing a substantial two-step price cut coupled with a generous restructuring fund lasting four years. The restructuring fund has three main objectives: firstly to provide incentives to encourage less competitive producers to leave the industry, secondly to provide money to cope with the social and environmental impacts of factory closure (financing of social plans or redeployment programs and of measures to put the site back into good environmental condition) and thirdly to provide funds for the most affected regions to develop new business in coherence with EU structural and rural development funds. The European Commission on 22nd June 2005 proposed the following farreaching reforms to the Common Market Organisation for sugar. The proposals will be ratified in November 2005 for implementation 2006 onwards. The main elements are: 1. Significant price reduction A 39% cut in sugar support prices over two years beginning in 2006/07. JS/GC/N Norfolk/rpt Page 75 of 174 To be more competitive and market-oriented the reform introduces price cuts. Those who cannot compete within the new framework will be given incentives to give up their quotas. Thus: prices should revert to their true role as the determining factor in the allocation of resources and investment decisions; EU-funded buying into stores (‘intervention’) will be abolished and the intervention price replaced by a ‘reference’ price; the support price for white sugar will be cut in stages; minimum prices for beet will be cut by a corresponding amount; the new price system will remain for a period so as to provide stability. 2. Partial compensation for farmers Direct payments for sugar beet growers will be paid (covering 60% of the revenue loss from the price cuts). Payments are calculated in the same way for all 25 Member States. Direct payments will be decoupled and become part of the Single Payment Scheme; payment is therefore conditional on the fulfilment of ‘Cross Compliance’. 3. Quota reduction There will be no compulsory quota cuts in an initial phase to ensure competitive producers will not be weakened. A voluntary restructuring scheme lasting 4 years for EU sugar factories, and isoglucose and inulin syrup producers will be introduced. It will consist of a high digressive payment to encourage factory closure and the renunciation of quota as well as to cope with the social and environmental impact of the restructuring process. The restructuring fund will offer a clear incentive to leave sugar production for those whose production is not viable. Restructuring funds could be used in three ways: • Industry: contributing to costs of factory closing/reconversion of sites • Farmers: compensating for full price cuts in year one • Most affected regions: financing of diversification measures The payment will be €730 per tonne in year one, falling to €625 in year two, €520 in year three and €420 in the final year. The fund would be financed via a digressive levy on holders of quota, lasting the first three years. Current quota arrangements will be simplified by merging A and B quotas into one quota; the quota system will be extended. To maintain production levels in Member States currently producing C sugar additional quota will be made available against a one-off payment. Furthermore, isoglucose quotas will be increased. JS/GC/N Norfolk/rpt Page 76 of 174 There will also be a top-up payment for beet producers affected by the closure of factories in the first year for which they have delivery rights. To maintain a certain production in the current “C” sugar producing countries (UK is one of them), an additional amount of 1million tonnes will be made available against a one-off payment corresponding to the amount of restructuring aid per tonne in the first year. The sugar quota system will remain in place until 2014/15 with no review clause. 4. Market Balance The intervention system will be abolished and the intervention price will be replaced by a reference price. Tools to ensure market balance in each marketing year will be retained, e.g.: • Carry forward mechanism: sugar factories may carry forward an overshoot of quota to the following year. • Withdrawal mechanism: the Commission may deal with a market imbalance by compulsory storage of sugar. • Introduction of a private storage system as a safety net, triggered once the market price falls below the reference price. 5. Enlarging alternative outlets for out of quota sugar There will be improved incentives for the industrial uses of sugar: • Biofuel, chemical and pharmaceutical industries will have access to out of quota sugar which should guarantee them reasonable raw material prices • Processing of biofuel from sugar beet will be promoted - sugar beet will become eligible for energy crop aid to the sum of €45/hectare (provided under the 2003 CAP reform) and will qualify for set-aside payments. • Increase of Isoglucose quota of 300,000 tonnes for the existing producer companies phased in over three years with an increase of 100,000 tonnes each year. JS/GC/N Norfolk/rpt Page 77 of 174 6. Budget neutrality The reform will be budget neutral as the costs of new measures, notably the compensation of the sugar beet farmers, will be off-set mainly by savings resulting from a substantial reduction in export subsidies. 5.13 Impact of the reform on EU Member States The impact of sugar reform varies according to Member States’ possibilities for sustainable production. Areas with specific advantages, such as Austria, Belgium, France, Germany, the Netherlands, Poland, Sweden and the UK should be least affected. Negative impacts can be offset by: • • • • • new outlets for out of quota production (ethanol and industrial use); refining of cane sugar in sugar beet factories to achieve economies of scale; increases in isoglucose quotas; moving to alternative crops (notably to wheat or maize) the restructuring fund. JS/GC/N Norfolk/rpt Page 78 of 174 6. AGRICULTURAL DIVERSIFICATION 6.1 Reasons for Diversification Rural diversification is not a new concept. Virtually all farm businesses have been affected by an ongoing decline in agricultural returns. Any business facing economic change needs to review its position and look for new solutions. Alongside seasonal fluctuations within the agricultural sector there has been an economic trend in recent years that has made it harder for many small farms to remain viable. Financial performance may only be improved through making structural changes to these businesses. Where the existing farm enterprise is no longer able to generate sufficient income, the only answer sometimes appears to be to diversify and introduce a new venture. Or a situation may arise where the farmer has identified a new venture where he feels he could succeed and for which the property and its location are well suited. It may be that the existing farm is viable within its present context but that there is a need to increase its income in order to meet some changing circumstance. There is also another area of change within the countryside in that there is ever increasing development in rural districts. Circumstances may change in the vicinity of the property, due perhaps to a change in either local or national government policies. 6.2 Opportunities for Diversification There are numerous opportunities for diversification which depend upon the farmer’s preference, location, capital available, grant availability etc. Buildings Farm buildings represent a valuable asset. Some may be out of use, or unsuitable for the current farming system. The North Norfolk Farmer Survey highlighted that 73% of respondents currently have redundant buildings and 94% of these were of traditional construction. Agricultural Dwellings Many farms have cottages that were originally erected for the purpose of housing farm workers. 43% of the farmers within the North Norfolk Farmers Survey had one or more dwellings on their holdings with agricultural occupancy conditions. Due to the decline in numbers employed in agriculture, some of these cottages are no longer utilised by farm workers. There may be potential for increasing income from renting farm cottages. JS/GC/N Norfolk/rpt Page 79 of 174 The farmhouse Farm houses are frequently larger than other country homes, as they were built to accommodate several generations working together. However, there may well now be spare space that could be used for bed and breakfast accommodation. The situation and condition of farm buildings will have a great bearing upon the options available for farm diversification. Land and location There may be areas of land on the holding that are not that well suited to agriculture or could be given up without significant loss. Some of this land could be used as a caravan site for example, or some other non-agricultural venture. Conservation is becoming an increasing common factor in the considerations of alternative uses for land. Location is a fundamental consideration in almost every diversification scheme. A rural business that succeeds well in one part of the country may well fail to establish in another. Land owners need to ask themselves questions such as what sort of area is it? Is it mainly agricultural or are there other interests there as well? If so, do the non-farming communities live there and work locally or commute to work further a field? Is it frequented by visitors and do they come on a daily basis or for weekends or on holidays? What sort of image does the neighbourhood have; is it pretty and therefore probably protected countryside, or more workaday? Has there been much new development? Does this imply a proactive local planning policy? There are regional designations that may also have a positive or negative bearing upon the potential for diversification. For example, where the farm is in a National Park, an Area of Outstanding Natural Beauty (AONB), or an Area of High Landscape Value, there could be greater difficulties in gaining planning permission or possible DEFRA grant funding. Human Resources and Finance Developing and then managing a new venture will demand time and energy, especially at the beginning. It is important to assess if there is enough labour readily available to continue with the established farm business at the same time. There will also be seasonal demands on the business for example providing holiday accommodation when the cereal harvest is under way. Offering the same accommodation on an autumn calving dairy farm would probably be more easily managed. The demand for extra income on the farm will determine the extent to which the diversification takes place. The owner has to establish how soon he may be able to raise capital to fund the diversification. There are a number of grants JS/GC/N Norfolk/rpt Page 80 of 174 offered to encourage and facilitate diversification and conservation. However, there can sometimes be a lengthy process to obtain the grant and this may delay the diversification further. Most diversification schemes involve a significant amount of time and money. There are no definite answers either to the future of various sectors or to the outlook for new enterprises. The farmer needs to be realistic about the current farming business performance. Not only must the circumstances be well suited to the proposed venture, but the individual’s attitude and ability will be a major factor. 6.3 Types of Diversification The Main groups of alternative enterprises on farmland: Tourism and recreation Tourism Recreation Enterprises Adding Value to conventional products Animal products Crop products Unconventional agricultural enterprises Animal products Organic production Use of ancillary buildings Woodland products and resources Redundant buildings Wetland Public Goods Wildlife Landscape Historic sites Access Bed and Breakfast Cottages/chalets Caravans/camping Activity holidays Farm museums Visitor Centres Riding Game Shooting Other Shooting Fishing Farmhouse Catering Meat (direct sales etc.) Skins/hides/wool Dairy products (direct sales/processing) Milled cereals PYO and direct sales of vegetables Sheep milk Rare breeds Fish Deer and goats Fuel wood Craft timber products Industrial premises Accommodation Fish Game Environmental Stewardship Payments Management agreements Heritage relief Access agreements (Source: Slee, 1989) JS/GC/N Norfolk/rpt Page 81 of 174 Equestrian tourism has two different meanings – for some it means inbound visitors attending race meetings, watching major equestrian events or going on packaged riding holidays. For others it means the activity regularly undertaken by many riders, travelling to areas away from home to ride their own horses on bridleways or long distance routes. All of these activities are important aspects of horse tourism. Much work is already being done in relation to farm based tourism. A similar structure needs to be developed for equestrian tourism. This should be carried out in partnership with other rural based tourism. This emphasis is on activities that bring tourists into the area. The following is taken from the DEFRA Consultation document - Strategy for the Horse Industry in England and Wales: Action - Encourage a cohesive approach to promoting equestrian tourism through local authorities, regional tourism councils and national bodies; publish a national register of riding holidays and equestrian tourism opportunities on the internet; and establish tourism. Responsibility - Association representative of professionals in the industry, including British Horseracing Board, British Horse Society and the Association of British Riding Schools, working with holiday providers and regional and national tourism bodies. Priority - Medium-term Resources - Industry resources and Rural Enterprise Scheme 6.4 Current levels of diversification Diversification is widely held to offer considerable scope for improving the economic viability of many farm businesses and in turn reducing their dependence on the production of primary subsidised agricultural commodities. Defra’s Farm Business Survey (FBS) (January 2005) estimates that 48% of “full-time” farms in England in 2003/04 have a diversified business, the average output from these farms is £19,500. The research also found that although letting out buildings for non-agricultural use is the dominant enterprise, 19% of farms have other kinds of diversified activity. There are also wide variations in the incidence of diversification. The study also states that “61% of cereal farms have let out buildings for non-agricultural use (compared with an average of all farm types of 39%) and 22% of horticulture farms engage in food processing or retailing (compared with an average of all farm types of 7%)”. The FBS also states that “the average output from renting out buildings is £11,400 compared with £31,600 for processing and retailing of farm produce and £56,700 for other diversified activity”. The North Norfolk Farmer Survey found that 64% of the farms had some form of diversification with Farm-based accommodation, leasing of buildings, JS/GC/N Norfolk/rpt Page 82 of 174 supply of Agricultural services and farm-based food processing being the major activities. Sources of income other than from farming – England Regions 2003/04 No of farm businesses (full and part time) Percentage of which: Have diversified activity Farmer or spouse have off farm employment or self employment Where farmer is sole source of income for farmer/spouse NE & YH NW EM WM EE SE SW 10,000 6,500 7,000 6,800 8,900 8,700 11,500 37% 37% 58% 42% 54% 68% 42% 19% 26% 17% 20% 29% 24% 29% 32% 27% 19% 25% 18% 16% 24% (Source: Defra Farm Business Study January 2005) Compared to other regions in England, farms in the East of England region are above average in terms of having a diversified activity and off farm employment, and as a result of this, below average in terms of the farmer being the main source of income for the holding. Farms with diversified activity – England Regions 2003/04 NE & NW EM WM EE SE YH Number of farm businesses (full and part time) with 3,700 2,400 4,000 2,900 4,800 5,900 diversified enterprises Percentage of which have: Let buildings for 83% 62% 94% 89% 80% 86% non-farming use Processing/retailing 9% 14% 8% 11% 16% 23% of farm produce Tourism 16% 14% 4% 4% 22% 20% Sport and recreation 10% 7% 5% 5% 6% Other diversified 10% 4% 7% enterprises SW 4,800 68% 16% 22% 9% 11% (Source: Defra Farm Business Study January 2005) JS/GC/N Norfolk/rpt Page 83 of 174 Farms in the East of England have the average number of let buildings compared to other regions. They are above average in terms of diversifying into processing and retailing and well above average in terms of diversifying into tourism. The North Norfolk Farm Survey has confirmed these findings with farm-based accommodation, supply of farm services, and leasing of buildings being the most common enterprises. Types of diversified enterprises, current, future and discontinued within North Norfolk: Off-farm non-agricultural business Leasing of land Leasing of buildings Farm-based craft business Other farm-based leisure business (eg sports, open farms) Equine (eg livery, grazing, riding trail) Future Current Discontinued Farm-based accommodation (eg B&B, self catering) Farm-based food retailing Farm-based food processing Agricultural services Non-food crops Novel livestock (eg ostriches, rabbits) Novel food crops 0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50% (Source: Acorus North Norfolk Postal Farmer Survey 2005) Diversified enterprises in the East have one of the highest average output, of £20,400, second only to the South East. This is largely due to the higher value of let buildings. There is a wide regional variation in the scale of food processing/retailing enterprises, possibly reflecting the grouping together of two potentially different operations. JS/GC/N Norfolk/rpt Page 84 of 174 Average output of diversified enterprises on farms - England regions 2003/04 NE & NW EM WM EE SE SW YH Average output of diversified enterprises (£/farm) Let buildings for 7,400 2,800 8,500 5,700 14,400 20,000 9,900 non-farming use Processing/retailing 16,100 43,400 43,000 17,600 38,000 42,200 10,000 of farm produce Tourism 4,100 5,800 4,400 9,900 4,500 9,900 6,000 Sport and recreation 5,300 5,500 19,500 10,000 6,600 16,100 Other diversified 17,100 4,700 21,100 11,400 enterprises ALL 9,300 10,700 13,800 11,900 20,400 41,900 12,400 DIVERSIFIED ENTERPRISES (Source: Defra Farm Business Study January 2005) The Farmer’s Voice Survey (2004) questioned respondents over “approximately what proportion of your “farm family” income over the last 12 months has come from each of the following sources? Non Organic Producers Main farm business Diversification Off-farm income Any Organic Producers Main farm business Diversification Off-farm income Mean Score 65.7% 9.7% 22.8% Mean Score 55.4% 14.8% 29.5% The main farm business accounted for some 65% of farm income over the last year among non-organic producers compared to 55% among organic producers. For the latter, diversification activities accounted for almost 15% of farm family income and off-farm income for almost 30%. When the respondents were asked which diversification enterprises they had operated in the past but discontinued, currently operated or would consider operating in the future. One in ten respondents reported a diversified activity that had been discontinued. Around one quarter, 28%, of all respondents were considering some diversified activity in the future – this increased to 36% among organic producers where the key options being considered included Leasing of Land (13%), leasing of JS/GC/N Norfolk/rpt Page 85 of 174 Buildings (11%), Equine Related (10%) and Farm-based Accommodation (9%). A study undertaken by the University of Exeter in 2002 for DEFRA found that larger farms are more likely to have the resources, flexibility, and entrepreneurship to pursue diversification. Compared to the “all holdings” averages, diversification is significantly more common on “cereals”, “general cropping” and “mixed” farms, and notably less common on “dairy” and “cattle and sheep (LFA)” farms, and “on other types”. These findings are consistent with the earlier study of farm diversification. The report also identified a number of important features about farm diversification. The report summarised the costs and profit structures of farm diversification which are important in understanding the nature of this form of farm business activity: On average, direct costs represent about 43% of total operating costs, and overhead costs 57%; However, cost structures vary widely by type of enterprise, with overhead costs accounting for between 36% and 78% (“trading” and “recreation and leisure” respectively) of total operating costs; The average diversified enterprise brings in a net profit per farm of £9,474, with a range by type of enterprise of between £5,617 (“trading enterprises”) and £12,456 (“miscellaneous services”); For all diversified enterprises, the average net profit margin is 27.8%; Profit margins also vary widely by type of enterprise; they are lowest for “trading enterprises” (at 18.4%) and highest for “equine enterprises” (at 64%). Variability from the overall mean by enterprise type is greatest for total operating costs, particularly direct costs and least for net profits, with variability in output levels somewhere in between. A noticeable trend for farm businesses in North Norfolk is to look to diversify into barn conversions for tourism purposes and, usually self-catering. This is because NNDC planning regulations make it easier to get planning permission for tourist accommodation than it is for local resident housing. The number of self catering accommodation properties appears to have grown in North Norfolk during the past years. Some say that the market is now saturated, and this is reflected in the fact that DEFRA is now diverting grant funding for farm diversification projects into tourist accommodation away from the ‘honey pot’ area of North Norfolk. There is still room for eco-tourism projects as well as other diversification projects such as water resource, workplace conversions etc. The average farm in Norfolk generates a non-farming income of around £24,500 per year, with much of this coming directly or indirectly from tourism JS/GC/N Norfolk/rpt Page 86 of 174 The North Norfolk area has a very strong and stable tourism industry. The attractive open countryside and busy seaside towns attract tourists. However, accommodation providers in North Norfolk experience a lower than average occupancy rate. This is due to the diverse range of accommodation they offer. The Curry Report 2002 states that: “Alternative crops - those grown for some other purpose than food - have been highlighted as a very important potential new market for farmers. Alternative cropping plays to farmer’s core skills, and is one of the best diversification options for farmers in arable areas who may lack opportunities in value-added or tourist markets”. Industrial and chemical uses of crops are constantly being developed. Producer collaboration is vital in the non-food crops market. The Curry report recommends that planning guidance must strongly support “development of local combined heat and Power and gasification plants, in the context of developing new energy markets” Some “alternative crops” include the following Asparagus – production in the UK has declined although this is an excellent product with an export market. Daffodils – These are relatively easy to fit into an existing crop rotation and can compliment many farming systems and are a good product to market on a worldwide basis, although European competition is depressing prices. Dried Grass and Lucerne – these products are mainly aimed at the animal market, especially equine. They may also be eligible for government subsidies. Flax – this annual crop has many uses arising from the resulting fibre. Industrial Crops & Essential Oil – interest in Industrial crops has been growing steadily due to the decrease in prices for many of the more traditional crops and there may be opportunities for a formidable amount of growth in this area. Aromatic plants and their essential oils are a source of natural medicines or plant protection chemicals. Lupins – These plants have a low input, requiring minimal management. Lupins may compliment existing crops rotations and improve the ground for following crops. Mushrooms – growers can expect to produce high yields and good quality mushrooms. It may be a successful add-on to equine enterprises, where a cheap supply of manure is available. However competition within the marketplace is fierce. JS/GC/N Norfolk/rpt Page 87 of 174 Sunflowers – sunflowers compare well with Oilseed rape in terms of input and equipment requirement. Turf – this may be an alternative to grass and can be fitted into existing agricultural systems. 6.5 Options for diversification in North Norfolk The farm diversification options available to different farms in North Norfolk will be influenced by variables such as location, costs, return on capital invested, availability of finance, employment costs and labour requirements. Visitors to Norfolk look to farm based accommodation to provide a specific experience in an attractive rural setting. The East of England Region “boasts six marketing co-operative groups comprising farmer members who have diversified into the provision of accommodation, either serviced and/or non serviced”. (Source: www.defra.gov.uk/erdp/docs/eastchapter/east14/tourism.htm) North Norfolk has a diverse landscape and contains many areas of high environmental value. North Norfolk has the lowest population density of the East of England Region. The region’s economic heritage is as a framing and food production region. Its countryside is vital in terms of biodiversity, with the region containing SSSIs and an AONB. Looking to the future, the relationship between farming practices and landscape management will change again in the context of the CAP reform package. The overall implications in terms of the biodiversity of rural areas are yet to be seen, and they may vary significantly on a sub-regional scale. Remote farms in North Norfolk may struggle to derive an income from tourism due to poor accessibility and high costs. However, the continuing demand for outdoor pursuits and package holidays may well become an option for on-farm diversification. Those farms situated nearer to the coast and urban areas may well be better suited to diversification relating to tourism. Honey Pot Coastal resorts and villages in the west of the District suffer overcrowding, while the relatively under-developed coastal area to the east, in terms of the number of tourism visits, is in decline. The quality of the landscape in North Norfolk draws tourists to the area but also brings with it responsibilities in terms of managing the visitors and preserving the area’s special qualities for future generations. There are many ICT opportunities for collective marketing of events and activities. While the tourism industry creates employment for many people in North Norfolk, these jobs are often low-paid, under-skilled and seasonal. North Norfolk’s high dependence on tourism means that tourism businesses must look to maintain or expand their competitiveness if they are to survive and prosper in the future. JS/GC/N Norfolk/rpt Page 88 of 174 Issues: The tourism industry needs to consider the local community and the environment in future partnership developments. Over the past decade there have been significant changes in the domestic tourism market away from main holidays to short breaks. North Norfolk has adapted well to these changing market trends, exploiting its relative proximity to main centres of population, its natural environment and attraction as a place to escape to, and the predominance of its smaller, quality accommodation. The North Norfolk Farmer Survey highlighted that obtaining planning permission, lack of capital, and poor access and road network to the farm were major problems holding back their diversification efforts. Factors that have prevented farmers in North Norfolk from developing an existing diversified business, or caused them to cease: Agricultural tenancy agreement restrictions Difficulty obtaining planning permission Unable to supply enough produce Poor access and road network to farm Difficulty getting people with the right skills for the job Future Current Discontinued Lack of land Lack of capital or cashflow problems Difficulty obtaining the right advice or information Lack of buildings Lack of expertise or training 0 10 20 30 40 50 60 (Source: Acorus North Norfolk Postal Survey 2005) Opportunities: Tourism opportunities for farm diversification in the region of North Norfolk exist in the following areas: • • • • Tourist accommodation Activity holidays Package holidays Outdoor pursuits The tourism season needs to be extended in order to create more permanent employment, higher levels of pay and improved employment conditions. JS/GC/N Norfolk/rpt Page 89 of 174 Grants and funding available: The Rural Enterprise Scheme (RES) is part of the England Rural Development Programme (ERDP). It provides assistance for projects that help to develop more sustainable, diversified and enterprising rural economies and communities. For commercially based projects funding of between 10% and 50% of eligible expenditure could be possible. However this is a competitive scheme and so funding is not guaranteed. 6.6 Organic and traceable foods The organic market continues to be one of the fastest growing areas of the UK food and drink sector, with a 15% expansion in sales between April 1991 and April 2002. The organic food market grew in retail sales value by 10.3% in the year ending April 2003. This has continued the fall in annual growth rate since the year ending April 2000, although growth in the organics market is still much more substantial than that of the total grocery market. The slow down of growth in the organic sector is mainly due to a maturing sector and a level of saturation. However, some of the highest growth recently has been achieved in fresh meat, baby foods and milk. Since 1992 there has been government support for organic farmers and growers, in the shape of grants for the organic conversion of agricultural land. However, a sudden increase in the amount of organic milk being produced has led to a vast quantity of organic milk being marketed as non-organic. This has resulted in the ‘organic premium’ for milk being reduced and hence the economics of organic milk production are now being questioned. Approximately 50% of the organic food market is represented by imports, but this percentage is in decline and is being met by home production. Imports of meat have also recently fallen. The Farmer’s Voice Survey (2004) asked respondents to indicate their likelihood of undertaking each of six different strategic actions in the near future. Responses are summarised, in table in the appendix, on the basis of any organic compared to non-organic producers. Over half, 51%, of organic producers indicated some likelihood of developing alliances with other farmers and this was ahead of the 40% of non-organic producers likely to follow this option. Just below half, 47% of organic producers indicated some likelihood to market directly to consumers, compared to 19% among non-organic producers. Over a third, 38% of organic growers would consider ceasing agricultural production but maintain the land in good agricultural environmental condition compared to 30% among non-organic growers. JS/GC/N Norfolk/rpt Page 90 of 174 In March 2005 the Organic Entry Level Stewardship (OELS) replaces the organic farming scheme and Organic Aid. Land to be entered into OELS must be either fully organic or in conversion. Entry into the OELS will net the business an additional £60 per hectare over all of the organic land. 6.7 Bio-fuels Climate change has become a top priority for governments worldwide, with the UK leading the debate as both president of the G8 summit and the European Union. However latest figures from the EU15 show greenhouse gas emissions rose by 1.3% in 2003 and, more alarmingly, by 2.2% in the UK. With the net rise of 3% since 1997, there is now a real risk that the UK will miss its Kyoto target. The case, therefore, for using agriculture to provide a unique, proven and relatively cheap opportunity to make a real contribution to combat climate change in Britain has never been more convincing. Adoption of biofuels to deal with CO2 emissions from transport (the fastest growing energy demand sector), offers rapid, easy and targeted greenhouse gas savings. The EU target is for 5.75% renewable road transport fuel in the UK by 2010. Currently the government incentive to kick-start the UK biofuel industry is a 20% cut in fuel duty for biofuels. Those with an interest in this fledgling business calculate that 28 ppl is needed to kick-start production. The UK’s obligations under the Kyoto Protocol include the target of reducing greenhouse gas emissions by 12.5% below 1990 levels by 2012. The domestic target is to generate 10% of the nation’s electricity from renewable sources by 2010. The UK is sitting at the bottom of the EU biofuels’ league table. Of the 19 member states with declared targets for the biofuel share of transport fuels for 2005, the UK’s 0.3% puts it way behind the EU 2% target. It lags behind the Czech Republic and Sweden, at 3% and is beaten by Germany, France, Spain, Slovakia, Lithuania, Latvia and Belgium with 2% targets. One of the main reasons for the UK’s lethargic approach to biofuels, compared with its EU neighbours, has been the ‘cushion’ afforded by North Sea oil. Other member states, particularly in central Europe, have been forced to develop new sources of fuel in the face of hikes in oil prices following the OPEC and Middle Eastern crises. However North Sea oil reserves are drying up and in 2004, for the first time, the UK imported more petrol and diesel than it exported. Oil prices are at a record high and are expected to go higher, so the case for biofuels is both economic, strategic and environmental. Rapeseed oil and other vegetable oils can be processed to make biodiesel, while bioethanol can be made from processing wheat, sugar beet, potatoes and a variety of other starch and sugar crops. JS/GC/N Norfolk/rpt Page 91 of 174 Based on European Commission estimates, if biofuel production accounted for 5.75% of road fuel, 20-30,000 jobs would be created in the UK, mainly in rural areas. Research from Reading University shows that this would generate around £175m in income for the UK. The production of biofuels would also support mixed cropping in the UK and provide a valuable outlet for producers hit by sugar reforms. By supporting a domestically fed biofuel industry a base will be put in the cereal and oilseed market and new markets found for the restructured sugar-beet industry; without which marginal land is predicted to become a monoculture of grass. Research to date into the environmental impacts has shown that increased biofuel production from a broad mix of arable crop and feedstocks would have a broadly neutral effect on the farmed environment. Direct replacement of cereal crops with oilseed rape would have no significant effect. However, replacement of spring grown break crops by an expanding winter oil seed rape or cereal area could have a negative effect on crop diversity and farmland birds as over-wintered stubble provides a valuable habitat for a number of important bird species. The USA now has a flourishing green fuels industry, which is expected to produce 4 billion gallons of bioethanol in 2005. America’s production is on target to make it the world’s largest bioethanol producer by 2006, outstripping Brazil. There is a US government target to double production to 8 billion gallons by 2010. Blended bioethanol sales now account for 3% of the huge US transport fuel market, a shift primarily driven by the desire for US fuel security. The observed benefits in the US are dramatic, with a positive and reinvigorated agricultural economy. The development of medium-scale agricultural cooperative bioethanol plants appears also to have been responsible for the industry’s expansion, allowing growers to become stakeholders and benefit from impressive returns on investment. Local corn prices have also improved dramatically because of increasing demand. Biofuels are becoming more mainstream in the UK, but much of it is still being imported. Tesco is one company that imports over 5,000 litres of bioethanol a month from Brazil to blend, at 5%, with its unleaded petrol for its South East stores. Tesco plans to roll his out to its stores in the North West and a new 1% biodiesel blend later this summer. By this autumn, it is hoped that the £21m biodiesel plant in Teeside, owned by The Biofuels Corporation, will be on stream. It will use around 150,000t of UK produced oilseed rape and 250,000 tonnes of imported palm oil each year. Meanwhile, Greenergy Fuels has received planning permission for a 100,000t biodiesel plant in Immingham, potentially requiring 125,000t f rape per annum. British Sugar has just announced its second stage of planning for a 55,000t bioethanol plant at Wissington. Palm and soya bean oil are already being imported to the UK to produce biodiesel. Research has suggested that about 2-5 farming jobs could be created JS/GC/N Norfolk/rpt Page 92 of 174 (or sustained where crops substitute for other cultivation) for each 1,000 tonnes of biofuel produced. A 100,000 tonne processing plant could therefore create/sustain around 60-80 jobs directly and as many as 550 jobs in agriculture. 7. FARMER CONTROLLED BUSINESSES (FCBS) It is widely believed that the recent MTR reform of the CAP, particularly the decoupling of support from production, will increase the scope for individual farms and groups of farms to become more flexible in what they produce and thereby more responsive to value adding market opportunities. The development of a more entrepreneurial mindset will become increasingly important for farmers as in the medium term levels of farm support will reduce. The new freedom to alter cropping and stocking in response to market forces implies that in future food retailers and processors, as well as food service companies, will have to work more closely with their farm suppliers to ensure an adequate and timely supply from UK farms. Operating in an increasingly concentrated supply chain and with less and less government involvement in the market, individual farmers find themselves in a weak strategic position within the industry. The often difficult relations between farmers and food processors and retailers are a symptom of this unbalanced situation. Farmers must understand the importance of scale, reputation and competitiveness in an increasingly global food market and that by collaborating farmers and their food chain partners can establish a competitive advantage for the UK food industry. As the competitive pressures mount, the creation and capture of value by businesses increasingly demands a thorough understanding of consumer needs and the ability to work collaboratively with others to supply those needs most cost effectively. The growth of vertical collaboration in the food chain is happening in response to demand for greater supply chain efficiencies and market effectiveness. It is seen as the best way of delivering more consistent quality, predictability of supply and consistent prices. For those producers who are not part of an aligned supply chain the future will be increasingly difficult to predict and plan for, unless they can satisfy a clear niche market. The rapidly growing food service sector represents a clear opportunity for UK farmers to work on both a large scale supplying contract caterers and on a local scale emphasising the traceability and source of their product. However, like retailers, large food service buyers require sufficient volume of consistent quality and this could be achieved by producers collaborating to meet this demand. The risk for producers is that as consolidation continues further cost reduction is sought as processors compete and that, once established, the processor and producers are highly dependent on perhaps one major retailer. It is important to recognise this and mitigate the risk. If a partnership works well and both sides share in the efficiency and longer term gains, then mutual dependence provides a higher level of security. JS/GC/N Norfolk/rpt Page 93 of 174 Collaborating farmers cite more efficient investment, reduced costs and shared skills as benefits of production collaboration; and a strengthened position in the food chain coupled with reduced marketing costs as key benefits of marketing collaboration. However there is a lack of conviction amongst some farmers that the perceived benefits flow through to their bottom line. Concerns also exist about the management ability within FCBs. Some farmers collaborate to deliver environmental benefits. A few have turned this into a marketing advantage. Research shows that in the future many farmers would support collaboration to meet the anticipated increase in environmental regulation. Non-collaborating farmers cite lack of opportunity, loss of independence and not being convinced of the benefits as the factors that hold them back from greater collaboration. For farmers to relax their desire for independence and accept loss of control they must be attracted to good opportunities for collaboration and see clear benefits. FCBs see farmer independence as the barrier to their growth. They do not see lack of opportunity as an issue suggesting they are not always communicating their message to non-members. FCBs see the effect of MTR and changing markets as the big unknown and are concerned that farmers lack loyalty to them. In terms of future help FCBs have identified market advice and strategic business advice and information as key. With a thorough understanding of consumer needs and the ability to work with others to supply those needs most cost effectively, farmers could both create and also capture more value from the food chain than they do at present. But many farmers are still not positioning themselves to do this and risk having their market returns pushed down to levels determined primarily by world agricultural commodity prices as openness allows EU food markets to be increasingly dictated by external suppliers. It is believed that farmers do not collaborate more because they want to remain independent. Farmers on the other hand indicate that the key reasons are that they have not had the opportunity, they are unconvinced of the benefits and they lack trust in the FCBs they know about. The key issue for farming, and its suppliers and customers in the food chain is to recognise that the attitudes and business practices that served in an era of protection and price support are unlikely to be appropriate in the future. The future will be characterised by intense competition but also new opportunities. New technologies will deliver not only more efficient production techniques but also a much wider range of food and non-food products. As a global business, food and farming like other global businesses, must adapt to its changing environment. It seems sensible that in the process it should learn from the experience of other industries and be prepared to embrace the practices and collaborative relationships that have served to keep them competitive. As governments step-back from the support of farm gate prices so farmers must seize the initiative and try to capture the value they create. JS/GC/N Norfolk/rpt Page 94 of 174 An efficient and effective food chain necessitates a new collaborative mind set by all participants. The changing dynamics in the food chain represent a huge opportunity for those farmers who position themselves to meet the needs of retailers and food service companies. In particular, farmers need to collaborate both horizontally and vertically; first, with fellow farmers, to gain economies of scale in purchasing, operating and marketing as well as to share knowledge and best practice. Secondly, they need to collaborate with their suppliers and customers, to ensure a consistent supply of high quality product, in the quantity required and at the right time and place, to reduce logistical costs, improve relationships within the food chain and speed up the flow of information between partners. Collaboration provides a way in which farmers, as relatively small businesses, can participate and compete in the food chain in a way that would not be possible on their own. For example, bringing producers together could make the distribution of local and regional food sold at farmers’ markets more efficient as well as minimising food miles thereby helping to satisfy the growing desire for a more sustainable food and farming industry. Yet the farming industry in England is behind the game in collaboration. For a range of historical reasons, including our previous trading relationships, differing support structures and land laws and a political focus on the consumer, co-operation among farmers has not developed in the UK to the extent that it has in Europe and North America. The value being added by FCBs in these regions is huge and in many cases is still growing. In its simplest form farmer collaboration may consist of two or more farmers getting together and sharing their resources to reduce cost. The next stage may involve the formation of a separate business entity, sometimes extending or evolving into a larger scale business such as a machinery ring with many members. This is production collaboration with the purpose of creating and capturing value that would otherwise be lost in higher costs of production. Contract farming has undoubtedly helped farmers to reduce costs of production but in its purest form is no more than a farmer buying in a service that he cannot provide due to lack of resources whether it is capital, labour or indeed managerial skill. True collaboration only starts when all parties share a common goal, are prepared to invest in the relationship and to shoulder a fair share of the risk inherent in any value seeking activity. A major difficulty for farmer collaboration is that unless the individual farms are very large it takes large groupings of farm businesses to achieve the scale of output that is commercially viable for dealing with processors, retailers and food service companies. Whereas small groups of farmers could join together in collaborations based on trust to supply niche markets, a grouping of farmers capable of operating at a regional, national or even multinational level calls for a more formal collaboration involving an organisational architecture capable of managing a larger scale business. Such a formal collaboration is an FCB. An FCB is a separate legal entity often established as an Industrial and Provident Society or a limited company with farmer members or shareholders. They can be small, for instance a group of farmers operating a pea viner or JS/GC/N Norfolk/rpt Page 95 of 174 grain store, or large such as a major dairy or grain co-operative. The key principle is that it is set up to benefit the farmers that it is servicing. FCBs may be focused on delivering one or more of the following: • • • Purchasing economies: allowing members to buy inputs at lower prices. Marketing economies: enabling members to achieve jointly the benefits of large scale operations. Processing economies: providing members with the means of capturing value from downstream processes. The traditional picture of England’s farmers is one of a desire to maintain independence and control of their decision making with minimum collaboration with others. At the present time around two thirds of farmers claim they run their businesses independently and do not work with other farmers or other businesses either in production or marketing collaboration. 38% have collaborated to buy inputs. A common trend is that larger farms and those involved in more specialised and unsupported crops demonstrate a much greater willingness to collaborate with 16% of larger farms having done so in production, 41% in marketing and up to 60% in buying inputs. Most significantly three quarters of all farmers believe collaboration will be more important in the future. This trend is particularly identified amongst farmers within the supported sectors faced with major CAP reform. Collaboration in production between farmers in a formal arrangement is currently a mere 5% although for larger farms, which on the face of it might be more self sufficient, the figure is significantly higher at 11%. This suggests that smaller farmers either find it more difficult to find collaborative partners, or they believe there is less benefit for them. Vegetable growers and root cropping farms have a much higher level of production collaboration. Approximately 25% of farmers have been or are currently involved in market collaboration. Again larger farms and specialist cropping farms demonstrate greater collaborative activity. Unfortunately, this follows the trend identified in production collaboration, with the smaller farmer choosing to opt out or coming across more barriers to collaboration. One possible cause maybe that marketing co-ops are less attracted to smaller farmers, due to the cost of transport, and administrative, assurance and traceability issues, and therefore do less to encourage them to join. From its study of global FCBs, the English Farming and Foods Partnership (EFFP) has identified the following 6 important factors in developing successful farmer controlled businesses (FCBs): • The driving motivation must be profit, not co-operation for its own sake. JS/GC/N Norfolk/rpt Page 96 of 174 • • • • • Planning must be strategic and long term to deliver maximum benefit to farmer members. Total member commitment and loyalty to the organisation is needed. The hiring of professional management and allowing space to manage is essential. Strict corporate governance must be adhered to. This will ensure the integrity and proficiency of management. Risks must be taken through investing in order to capture greater rewards from the supply chain. Despite the development of some very innovative collaborative initiatives in England, and a handful of very good FCBs, on aggregate collaboratively we are still a long way behind North America and Europe. JS/GC/N Norfolk/rpt Page 97 of 174 8. KEY TRENDS FOR THE RURAL ECONOMY AND THEIR IMPLICATIONS As with many other sectors the trends suggest that there will be continued rationalisation resulting in fewer but larger holdings. Already, by area, farms over 100 hectares dominate with 80% of the total agricultural land within North Norfolk. The area of grassland is increasing yet the number of grazing livestock is falling. The rise in grassland area is predominantly due to marginal land being taken out of conventional cropping as the economics of growing crops has come under pressure. With the decoupling of subsidy from production this trend is bound to continue. The increase in uptake of Environmental schemes will accelerate this trend. Whilst there has been a dramatic fall in breeding pig numbers in North Norfolk, the total number of pigs within the region has dropped by 7% in the last 15 years. This highlights the change within the region from breeding pig herds to finishing pigs. With the increasing specialization within the pig sector and the capital requirements for pig breeding buildings it is unlikely that this position will reverse. With little improvement in the economics of milk production it is likely that the already small number of dairy producers within North Norfolk will continue to dwindle as milk production migrates to the west where grass production is more sustainable. Due to the low pay structure, unsociable working hours and lack of affordable housing within the rural sector the average age of those employed in agriculture is the highest of any industry in the UK, and is continuing to rise. Overall, the skill level required among the workforce is increasing, particularly in relation to machine-intensive agriculture, which is increasingly requiring technicianlevel skills and flexibility to deal with more complex equipment. This coupled with the continued out-migration of the younger workforce has significant long term implications for the agricultural industry. The imminent changes within the sugar beet regime are likely to have a momentous effect on future cropping options within North Norfolk, again having a nock on affect on employment in the area. Most farms will have to cut back on production and a sugar beet price cut will force the least profitable growers to exit the industry. The profitability of alternative land uses will determine the extent of a cut back in sugar beet production. The new Single Payment Scheme will also have a huge effect on future farming enterprises. The main implications for production are reductions in cereals, beef and sheep. There will be increased pressure to cut variable and fixed costs with a resultant cut in employed on-farm labour as well as more farmers becoming part-time. JS/GC/N Norfolk/rpt Page 98 of 174 Cereals will only be grown where it is efficient to do so. There will also be an increase in the use of alternative farming arrangements. Switch from break crops to cereals and removal of more land from arable cropping to permanent or temporary fallow. There will be more flexibility of land use between arable crops and grass. Further uptake of environmental schemes and woodland, also some additional land will be taken out of agricultural production and managed to the minimum requirements of Cross Compliance. Therefore more land will be taken ‘out’ of agriculture. More farmers are expected to introduce or expand existing diversification enterprises to ‘supplement’ their farm incomes and make up profit shortfalls. The primary choice of diversification is the alternative use for redundant farm buildings or replacement of unsuitable buildings with purpose built units. Historically, within North Norfolk, many of the redundant traditional buildings have been converted into holiday accommodation, however it could be that this sector is now approaching saturation and now other alternatives need to be investigated. Due to the relatively isolated position of North Norfolk and the present road infrastructure non-residential uses for these traditional buildings will be limited. Horse tourism may be an avenue that could be expanded further, this could have the added bonus of utilising some of the additional grassland. The rise in potential for crops to be used for biofuels will also generate alternative uses for the land and give the agricultural businesses additional markets that are not reliant on commodity market prices. By supporting a domestically fed biofuel industry a base will be put in the cereal and oilseed market and new markets found for the restructured sugar-beet industry; without which marginal land is predicted to become a monoculture of grass. For a few businesses there will be opportunities to develop niche markets for their produce. The emphasis will be to add value with some form of on farm processing and orientate the business nearer to the customer. This may be achieved by direct retailing for example Farm Shops or Farmers Markets. The number of Farmers Markets continues to rise and there is a willingness to pay for fresh, locally produced, quality produce. To help drive the challenge of reducing input and fixed costs more collaboration and joint ventures will be considered. The rise in Farmer Controlled Businesses may lead to further reduction in production orientated labour but may have a positive effect on those employed in adding value to primary agricultural produce. However the increase in business rationalisation will undoubtedly result in an increase in redundant farm buildings as farming operations become more centralised and fewer in number. JS/GC/N Norfolk/rpt Page 99 of 174 SECTION 3 The Planning Issues – Methodology Introduction JS/GC/N Norfolk/rpt Page 100 of 174 INTRODUCTION The brief issued by North Norfolk District Council identified a number of key rural issues to be addressed. In undertaking the study Acorus divided these into 8 key areas as follows. - Agricultural Buildings - Agricultural dwellings and occupancy conditions - Conversion of rural buildings - Low cost housing - Land Use including AONB and Agricultural Land Quality - Farm Diversification (Including Farm Shops and Other On-Farm Non Agricultural Development) - Replacement buildings - Recreation and Tourism These areas are not mutually exclusive and there are clearly relationships between them but they encompass the key issues in terms of rural policy formulation. JS/GC/N Norfolk/rpt Page 101 of 174 SECTION 4 Historic Guidance The North Norfolk Local Plan 1998 National Planning Policies and other Influences Introduction North Norfolk Local Plan Other Historic Policy Document Results of Current Advice JS/GC/N Norfolk/rpt Page 102 of 174 INTRODUCTION North Norfolk Local Plan Understanding the historical policy framework and existing Local Plan is essential to any study of its effects. In terms of rural policy the specific local plan policies and Government advice in PPG 7 (now superseded) are the key guidance. These policies have had an effect on trends and forecasts as well as farmer perceptions. They give an insight into how planning policies have and could impact on land use trends and show the likely consequences of adopting policy options, when considered in relation to the North Norfolk Farmer Survey and the agricultural study contained in this report. This information has allowed us to consider practical implementation of these policies and puts into context the review of previous rural planning applications submitted to North Norfolk. 4.1 The current North Norfolk Local Plan has a number of policies specifically related to the Rural Economy. The brief for this study identified a number of these as follows Policy 22 Agricultural Land Policy 23 Prior Approval of Agricultural and Forestry Buildings Policy 29 The Reuse and Adaptation of Buildings in the Countryside Policy 66 Agricultural and Forestry Workers’ Dwellings in the Countryside Policy 67 Removal of Agricultural Occupancy Conditions Policy 76 Farm Diversification Policy 88 Farm Shops Policy 117 Horses Some consideration has also been given to Policy 57 although not strictly within the remit of this research. 4.2 Other Historic Policy Documents The other key influences on how current development has occurred are government policies and other guidance. These have both influenced how development control decisions have been taken in the past, but also the mentality of applicants. These applicants are driven not only by their own economic situation but also government policies, strategies and grant provision. JS/GC/N Norfolk/rpt Page 103 of 174 PPG7 – The Countryside – Environmental Quality and Economic and Social Development replaced the former 1992 version with the following aims:o to take account of the White Paper Rural England, and of PPGs published since 1992; o to advise on achieving good quality development and respecting the character of the countryside; o to re-state and clarify policy on protecting the best agricultural land; o to clarify policy on the re-use of rural buildings, allow greater discrimination in favour of re-use for business rather than residential purposes, and advise on incorporating a residential element within a scheme for business re-use; o to stress the importance of thoroughly checking the lawfulness of developments to be carried out under agricultural permitted development rights, and advise on the possible removal of new buildings erected under them but not used for agriculture; o to strengthen the agricultural dwellings concession to counter abuse; and o to advise on local countryside designations and on the planning implications of Rural Development Areas and European Union Objective 5(b) areas. In March 2001 Paragraph 2.8 and 2.9 of PPG7 was amended with the following paragraphs:(2.8) When preparing their development plans and deciding planning applications, local planning authorities should take account of any statutory designation (see part 4 of this PPG) and then weigh the need to: • encourage rural enterprise, including the diversification of farm businesses; • protect landscape, wildlife and historic features; • safeguard best and most versatile agricultural land (see paragraphs 2.17 and 2.18); • have regard to the quality and versatility of land for use in forestry and other rural enterprises; • protect other non-renewable resources; JS/GC/N Norfolk/rpt Page 104 of 174 • strengthen rural communities by encouraging new employment, facilitating an adequate supply of affordable and market housing and underpinning services and community facilities; • achieve good quality development which respects the character of the countryside; and • secure safe development by taking account, where appropriate, of the stability of the land (see PPG14). • (2.9) Local planning authorities should take account of the advice in Planning for Rural Diversification: A Good Practice Guide on: • assessing the economic and social needs of their areas; • devising positive development plan policies for economic activity which respects the countryside; and • taking a constructive approach to planning applications. The Good Practice Guide on Rural Diversification – A good practice guide was produced in 1992 and was a key influence on development plan policies from that time. Part of North Norfolk was designated as an objective 5b area and this also had a key influence in terms of positive advice and grant aid. 4.3 Results of Current Advice The advice within the existing North Norfolk Local Plan and National Policies clearly has had an impact on the type of development that has been both encouraged and discouraged and ultimately permitted through the application process. Understanding what has worked and what has not is important before deciding on changes that can be made in the light of new guidance as outlined in Section 7. JS/GC/N Norfolk/rpt Page 105 of 174 SECTION 5 What has been Achieved and What Lessons have been Learnt The positives and negatives Introduction Focus Groups Farmer Surveys Agricultural Business Surveys Analysis of Planning Application Analysis of Local Plan Policies JS/GC/N Norfolk/rpt Page 106 of 174 INTRODUCTION The existing policy framework has been assessed to analyse practical implementation, consider relevant issues such as infrastructure, market demand and effect on the rural economy. Research was undertaken through the following methods:i) Farmer Focus Groups ii) ADAS North Norfolk Farmer surveys. iii) Agricultural Business Survey iv) Analysis of rural planning applications submitted to North Norfolk District Council during the life of the existing local plan. The first three of these methods are based on ‘grass roots’ perceptions and opinions and should be considered as such. 5.1 Focus Groups A series of four farmer focus groups were held with attendance of between 10 and 20 farmers at each. The attendance list showed a spread of size and type of agricultural businesses and included representatives from the National Farmers Union. The eight key issues listed in Section 2 were considered in terms of existing local plan policy, national planning polices, problems with policy relating to actual proposals and potential solutions. The results of the focus groups are included at Appendix 2 of this report but the main findings and feelings that came forward from farmers included the following:Key issues from Focus Groups: The following are some of the perceptions and opinions identified (note not all attendees necessarily shared all these views). They have been reported in the form expressed by farmers during this consultation process. • Agricultural Occupancy Conditions – no local workers available. • Seasonal workers were a key resource but the provision of permanent accommodation was considered to be a problem. JS/GC/N Norfolk/rpt Page 107 of 174 • Relocation of intensive agricultural sites currently in/or adjacent to villages, should be considered. • Holiday accommodation too expensive in terms of capital investment with low returns. The fact that grants were ending was also an issue. • Retail in rural areas had potential, in terms of re-use of buildings. • Highways conditions on access were often too onerous and too expensive. • Diversification is essential and should be based on a sound financial plan. • Diversification of the wider rural economy was needed not just on working farms. • There are likely to be more redundant buildings due to CAP reforms and sugar beet regime. • There is a shortage of rural housing. • There is an over supply of holiday lets. • Restrictive policies on farm shops are preventing development. • The policies on diversification are seen as too restrictive. • Business growth is seen to be more restricted in AONB and other landscape areas. • Policies on agricultural buildings and development only consider permitted development and give no guidance on planning applications. • AONB/Areas of High Landscape Value/County Wildlife sites cover large areas of the district. Agricultural development in these areas is restricted to the detriment of businesses due to these large designations rather than each site considered on landscape issues. • North Norfolk District Council is not positive towards agriculture and seems to be contrary to other government and DEFRA guidance. • Replacement farmsteads/new farmsteads not considered. • Highways always a problem. JS/GC/N Norfolk/rpt Page 108 of 174 5.2 Farmer Survey In order to gather as much first hand information and to give the farmers an opportunity to participate in the process a survey of agricultural holdings was carried out. A paper based survey was chosen, as in an industry that is associated with extended and unpredictable working hours, a self-completion questionnaire can allow respondents the flexibility to participate, at a time that best suits them and to give due consideration to the questions being asked. A survey questionnaire was constructed that would gather details about the farm business and cropping, diversification enterprises, attitude to farming and the CAP reform as well as various issues regarding housing, redundant buildings and planning. A sample of the questionnaire is contained within Appendix 3. The questionnaire and a covering letter were sent out in early June 2005 to 500 of the 1,000 holdings in North Norfolk. 81 completed questionnaires were returned and these were analysed by ADAS Market Policy and Research department. The analysis is contained within 177 tables and can be provided on request. Below is a summary of the main findings: Farm Details 86% of the land is owned and farmed by the owner and 51% of farmers also had additional land that was farmed under an agricultural tenancy. Within the last 5 years 25% had increased their acreage (mainly those growing field vegetables) and 6% had decreased their acreage (mainly within the dairy, pigs and poultry sectors). 70% of respondents said that their areas farmed would not change within the next 5 years. JS/GC/N Norfolk/rpt Page 109 of 174 Percentage of holdings with livestock/arable or horticultural enterprises 12 Other cash crops 25 Field vegetables 90 Combinable crops 88 Root crops 5 Intensive poultry 4 Intensive pigs 9 Outdoor pigs & poultry 4 Dairy 33 Beef & sheep 5 Forage maize 57 Grassland 0 10 20 30 40 50 60 70 80 90 100 Only 1 respondent had some organic enterprises. Percentage of respondents with the following cropping 98 Set aside 7 Claim SP without cropping 9 Non-food crops 51 Woodland 30 Rough Grazing 57 Grass 25 Field Vegetables 48 Potatoes 86 Sugar Beet 90 Combinable crops 0 10 20 30 40 50 60 70 80 90 100 Over 90% of livestock farmers presently market their produce through livestock markets or direct to an abattoir. In the next 5 years it is indicated that this will fall slightly with more of the produce being sold direct to customers (e.g. farmers markets and farm shops). JS/GC/N Norfolk/rpt Page 110 of 174 Diversification - Percentage of the different enterprises among those respondents who have diversified Off-farm non-agricultural business Leasing of land Leasing of buildings Farm-based craft business Other farm-based leisure business (eg sports, open farms) Equine (eg livery, grazing, riding trail) Future Current Discontinued Farm-based accommodation (eg B&B, self catering) Farm-based food retailing Farm-based food processing Agricultural services Non-food crops Novel livestock (eg ostriches, rabbits) Novel food crops 0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50% Percentage of respondents that listed the factors as barriers to diversifying Agricultural tenancy agreement restrictions Difficulty obtaining planning permission Unable to supply enough produce Poor access and road network to farm Difficulty getting people with the right skills for the job Future Current Discontinued Lack of land Lack of capital or cashflow problems Difficulty obtaining the right advice or information Lack of buildings Lack of expertise or training 0 JS/GC/N Norfolk/rpt 10 20 30 40 50 60 Page 111 of 174 28% of respondents indicated that “farming has a limited future – I need to diversify”. 33% indicated that “I see my future in farming but I expect that I will have to change my farming practice”. Only 1% indicated that they would give up farming altogether. Percentage of respondents who replied to “How likely are you to do each of the following in the near future 70 65 65 60 50 41 40 38 36 Yes/possibly No/unlikely 30 30 25 23 19 20 14 10 0 Develop alliances with other farmers Develop alliances with customers Develop alliances with service providers Market directly to consumers Forward sell CAP Reform - 40% of respondents indicated that they foresee no significant changes to their main farm enterprises. Of those that do foresee changes the most likely changes would be: • • • • • Cease and decrease combinable crop acreage Cease and decrease sugar beet acreage Increase field vegetable area Claim SP without cropping Due to the low number of livestock respondents it is difficult to draw out any conclusive trends with statistical significance except an increase in free range poultry. JS/GC/N Norfolk/rpt Page 112 of 174 Percentage of respondents that replied to the likely changes in labour requirements 50 45 43 40 37 35 35 30 Increase No change Decrease 25 20 14 14 15 10 10 5 0 Paid Labour Unpaid labour Housing – 43% of respondents had one or more dwellings with an agricultural occupancy condition. 60% would consider letting these dwellings for local housing as a form of diversification. Redundant Buildings – 73% of respondents indicated that they had redundant buildings (this was across all of the different farm types). 33% indicated that there would be further redundant buildings in the future. 94% of the redundant buildings could be described as traditional. JS/GC/N Norfolk/rpt Page 113 of 174 Percentage of respondents that chose the following purposes would encourage them to convert their redundant buildings 12 On farm processing 29 Office 14 Leisure Retail 12 44 Holiday Residential 70 32 Industrial 0 10 20 30 40 50 60 70 80 Percentage that replied to “If planning permission for an alternative use was achieved what would you do with the building?” 60 54 50 40 30 19 20 15 10 0 Sell it JS/GC/N Norfolk/rpt Let it Use it yourself Page 114 of 174 5.3 Agricultural Business Surveys To gather information to inform an analysis of trends within the agriculturally related sectors, perceived demand for services and future requirements, a cross section of businesses that are directly involved with offering services to farmers were interviewed. The interview was conducted following a predetermined format that gathered information about their core business, areas of operations, and perceived changes in the agricultural sector and how this would impact on their businesses and how they would react. Also views on planning issues to do with their business and those of their customers were obtained. A total of 30 telephone and one-to-one interviews were carried out. The following categories of ‘business’ were contacted: Business Link Agricultural Supply Co-operative Agronomists Machinery rings Machinery dealers Agricultural mechanics NFU Banks Accountants Land Agencies Agricultural Management Consultants CLA Fertiliser Supplier Federation of Small Businesses Farmers Market coordinators Grain merchants Millers Agricultural engineers Farm Building manufacturers and erectors Farm Shops The main points to be drawn from the interviews are: • There is great inertia within agriculture, farmers will take the next 3 years to adapt to the SPS. • The changes will focus the grower into cost of production and marginal land will come out of production. • Farmers will look to co-operate more with one another. • Biofuels could be a saviour to the sugar beet industry; if not there may not be any sugar beet within the UK within 15 years. • Whilst the banks recognise the need for more ‘financing’ within the sector and are happy to provide it, they are making it their duty to inform their JS/GC/N Norfolk/rpt Page 115 of 174 clients about the long term sustainability of their businesses, and the urgent need to resolve problems. • Professional marketing of produce will become more important. • Farmers markets are expanding and there is scope for more within the area if satisfactory sites are forthcoming. • The supply industry will have to fight for a share of a smaller market. • The contraction of farming activities will seriously impact on the supply industries and there is great concern. • Slow down in erection of new buildings within medium sized businesses. • Highways are perceived as a thorn in the side of many failed planning applications. • The road structure is limiting future prospects. • Current planning policies are too rigid and not flexible enough. • There is a “stone wall, no can do” attitude from planners. • Current planning policy is too narrow. • Should not impose ‘city policies’ in rural areas. • There is a need for more local housing. • More site meetings would be useful. • As farming ‘rationalises’ more redundant farm buildings will be created, both traditional and the more modern steel frame type. What can be done with them? JS/GC/N Norfolk/rpt Page 116 of 174 5.4 Analysis of Planning Application A total of 30 case studies were selected at random by N.N.D.C. The samples provided a background to the type of application and the development proposed. 26 case studies were analysed in detail in order to identify the nature of the application and its relevance to the rural economy. The major issues and the relevant planning policies were extracted to enable trends to be observed and the following became apparent. 5.4.1 Conversion of rural buildings was the most popular type of application with a diverse range of uses, including: Farm Shop, Hotel, Holiday Lets, Swimming Pools, Stables, Visitor Centre, Coffee Shop, Business Units, Day Nursery, Arts studies, Bird Centre and a Restaurant. The survey showed that diversification including re-use of rural buildings, to tourism was extremely popular and the majority included some form of self catering holiday accommodation. The main issues relevant to these applications were: • • • Highways and Parking Provision Landscape and AONB impact Effect on wildlife. Specifically Bats and Owls. 5.4.2 Agricultural and other occupational dwellings were also popular, with all cases analysed being approved but at Committee level. Objections and concerns centred on: • • • Size Location Landscape Impact The applications analysed had the model agricultural occupancy condition attached in most cases, but some were specific to the other rural business operated which was not agricultural. The majority of the applications required some form of landscaping or tree survey as standard, particularly in AONB. 5.4.3 Agricultural Buildings were also a popular form of development. In these cases the majority of decisions were delegated Landscaping requirements and the presence of AONB status were some of the key issues. In particular siting was deemed to be more important in the AONB and use of natural features to reduce impact of the proposed building was noted. 5.4.4 The survey showed that approximately 90% of applications gained planning approval with a high proportion having implemented or intending to implement their development in due course. The survey JS/GC/N Norfolk/rpt Page 117 of 174 also indicated that the two most quoted reasons for influencing the decision to submit a planning application were as follows: • • Maximise capital value of assets; Change in enterprises. These above reasons were followed closely by: • • • • Re-use of redundant buildings Increase in the size of the business Customer requirements Increased farm profitability The survey responses clearly show that economic reasons have major influences on farmers decisions to submit applications. With increased capital values and farm incomes being consistent responses. The rural enterprises and customer requirements are all influences which are driven by market and economy conditions. JS/GC/N Norfolk/rpt Page 118 of 174 5.5 Analysis of Local Plan Policies Based on the evidence gathered and views of those surveyed and/or attending the focus groups, the following conclusions were reached on the current policies. 1. Agricultural Buildings and Development North Norfolk District Policy 23 Positive aspects of policy • Covers prior approval. • Practical guidance in part 9 (design guide). • Aims to protect the AONB. Areas for modification/improvement • No specific policy on full planning applications for agricultural buildings. • No specific policy on important and varied roles of agriculture in managing the countryside and valued landscapes. • Does not take account of the requirement for farmers to become more competitive, sustainable and environmentally friendly. • Allowing farmers to adapt to new and changing markets (e.g. free range egg/table bird production). • Comply with changing legislation (IPPC). • Diversifying into new agricultural opportunities (e.g. renewable crops). • Broaden their operations to ‘add value’ to their primary produce (e.g. diversification/development of successful farm shops). • Farms within the AONB, county wildlife sites and areas of high landscape value perceive that their businesses are constrained by Policy 23. They also believe the beauty of these areas is dependent on their continued farming and management of the countryside. • In terms of highways there is no positive policy in rural areas, this constrains the rural economy. JS/GC/N Norfolk/rpt Page 119 of 174 2. Agricultural Dwellings and Occupancy Conditions 2.1 North Norfolk District Council Policy 66 Positive aspects of policy • A functional test is required. • There is specific criteria on siting design and landscaping • Requirement for alternative accommodation redundant buildings to be considered. or Areas for modification/improvement 2.2 • The policy is specific to agricultural or forestry workers – other occupational dwellings e.g. equestrian are not detailed as now covered in PPS 7. • Consideration of financial sustainability is only required if the functional test proves inconclusive. Financial sustainability should always be considered for a permanent dwelling. • Imposing conditions on other houses on the farm can prove to be impractical e.g. large listed houses. North Norfolk District Council Policy 67: Removal of Agricultural Occupancy Conditions. Positive aspects of policy • There is a policy relating to removal of agricultural occupancy conditions which includes guidance for potential applicants. Areas for modification/improvement JS/GC/N Norfolk/rpt • Criteria ambiguous – the words ‘reasonable’ and ‘genuine ability’ are open to interpretation. There are no additional guidance notes. • There is no information on alteration of conditions to include diversification or alternative occupations. • The policy is not clear in its requirements. Page 120 of 174 3. Conversion of Rural Buildings North Norfolk District Council Policy 29: The Re-Use and Adaption of Buildings in the Countryside. Positive aspects of policy ƒ Policy 29 supports the re-use of appropriately located and suitably constructed rural buildings. ƒ The policy considers the importance of design in conversion. ƒ The Wildlife and Countryside Act 1981 is considered. ƒ Policy considers impact on the overall landscape. Areas for modification/improvement 4. • The policy which considers residential conversion appropriate in or adjacent to towns or villages does not necessarily encourage the most appropriate scheme. • The policy includes detail on highways and may not allow for small traffic increases and should be brought in line with PPG 13. • Commencement of development within two years can be restrictive if the applicant needs to gain building regulations, grant approval and funding. A two year timescale may be too short. • Current policies are preventing full utilisation of the existing rural built environment. AONB and Other Landscape Issues North Norfolk District Council Policy 20, 21 & 24 This was not specifically within the remit of this study but arose as it has relationships with other policies. Positive aspects on policy • JS/GC/N Norfolk/rpt The AONB is protected. Page 121 of 174 Areas for modification/improvement • 5. Policies 21 and 24 are unnecessarily restrictive. The AONB and the Broads and its setting cover a large area of agricultural land and can be negative towards agricultural development proposals, unnecessarily. Farm Diversification North Norfolk District Council Policy 76: Farm Diversification Policy 88: Farm Shops Positive aspects of policy The plan recognises farm diversification Areas for modification/improvement 6. • The policy does not set out specific criteria relating to agricultural diversification. • It is not supportive of well conceived farm diversification schemes. • It does not give detailed criteria on the wider benefit of diversification. • It does not give detail on acceptable highways implications. • The policy on farm shops is restrictive on sale of non local produce. This is constraining businesses and resulting in local foods being harder to market. Replacement Buildings No policy exists in the North Norfolk District Council Local Plan 1998 due to changes in Government Policy since its publication. PPS7 states the following:The Government is also supportive of the replacement of suitably located, existing buildings of permanent design and construction in the countryside for economic development purposes. The replacement of buildings should be favoured where this would result in a more acceptable and sustainable development than might be achieved through conversion, for example, where the replacement building would bring about an environmental improvement in terms of the impact of the development on its surroundings and the landscape. Local planning authorities should set out in their LDDs the criteria they will apply to the replacement of countryside buildings. These should take account of the considerations set out in paragraph 17 that apply to the conversion JS/GC/N Norfolk/rpt Page 122 of 174 and reuse for economic purposes of existing buildings in the countryside. Authorities should also set out the circumstances where replacement would not be acceptable and clarify the permissible scale of replacement buildings. 7 Recreation and Tourism 7.1 North Norfolk District Council Policy 108 Positive aspects of policy • Includes the re-use of existing rural buildings. • AONB protected. Areas for modification/improvement 7.2 • All proposed developments should be outside the AONB and the special landscape area which may restrict occupational schemes within the areas. • Restrictive policy and provision of indoor sports facilities in rural locations due to accessibility and highways. North Norfolk District Council Policy 117: Horses Positive aspects of policy • Guidance is given in a policy. • Specific policy exists. Areas for modification/improvement 7.3 • Restrictive policy in relation to highways and bridleways when on-farm riding could be provided. • Policies open to interpretation. • No inclusion of set criteria for supporting equine enterprises that maintain environmental quality and countryside character. North Norfolk District Council Policy 123: Static Caravan Sites Positive aspects of policy JS/GC/N Norfolk/rpt • The AONB is protected. • Enhancement and improvement of existing sites is encouraged. Page 123 of 174 Areas for modification/improvement • 7.4 There is no specific policy on small scale log cabin siting as farm diversification e.g. log cabins with fisheries or horse riding facilities. Policy 125: Touring Caravan Sites Positive aspects of policy 7.5 • There are specific policies. • The AONB and undeveloped coast is protected. North Norfolk District Council Policy 128: Holiday Accommodation Loss of Un-serviced Positive aspects of policy • Retains important holiday accommodation which is site specific. Areas for modification/improvement • JS/GC/N Norfolk/rpt Does not consider circumstances when holiday occupancy conditions should be lifted. Page 124 of 174 SECTION 6 Other Local Authority approaches to Rural Policy – Beacon Status Introduction Reasons for Beacon Status Analysis of Policy JS/GC/N Norfolk/rpt Page 125 of 174 INTRODUCTION Whilst all Local Authorities take Government advice as the basis of their forward planning process significant variations in approach do arise. Differences can be due to specific local factors, which is an important element of formulating local policy, or just due to varying approaches during preparation. As part of this study councils who have Beacon status in terms of supporting the rural economy were looked at in more detail. These councils are :Lancashire County Council East Riding of Yorkshire Council Waverley Borough Council Caradon District Council Richmondshire District Council Tynedale Council Lincolnshire and South Holland District Council 6.1 Reasons for Beacon Status The beacon scheme exists to facilitate the sharing of excellent practice so that best value authorities can learn from one another. Stimulating and supporting service improvement are the scheme’s aim (www.idea-knowledge.gov.uk ). Authorities apply for beacon status under a variety of themes. Those that are then chosen as beacons engage in an extensive period of dissemination activity, whereby their policies and practices, initiatives and change processes are publicised and policy makers and practitioners alike are given unprecedented access to beacon officers and members (www.idea-knowledge.gov.uk) . Local Authority Lancashire County Council East Riding of Yorkshire Council Waverley Borough Council JS/GC/N Norfolk/rpt Why did they achieve Beacon Status? Recognition of its work in “Supporting the Rural Economy”. The award recognised the work Lancashire County Council has done to regenerate and support the county’s rural economy. Recognition of its work under the theme of “Supporting New Businesses”. The award was achieved by the business services team. The success of “supporting new businesses” is underpinned by a strong infrastructure of support from council’s business services section. The council also achieved beacon status for supporting the rural economy in 2003/04. Achieved beacon status for the rural economy for 2003/04. Examples of best practice submitted by Waverley for the scheme included: partnership funding Page 126 of 174 Caradon District Council Richmondshire District Council 6.2 programmes for community schemes; its support for market towns to improve their vitality and viability; and its success in delivering effective projects with a range of partners. Caradon Council is just one of seven councils nationwide to be named as a Beacon Council in the “Supporting the Rural Economy” category of awards. The council won recognition in the following categories: Business infrastructure, sustainable tourism, agriculture, and fishing. Richmondshire was awarded the Beacon status in recognition of the excellent service being provided in its support for the rural economy. Richmondshire’s examples of best practice included the Community Investment prospectuses (CIP); specific actions taken and a flexible approach to community economic development (responding and reacting positively to feedback from local consultation). Analysis of Policy Analysis has taken the format of the 8 areas identified as being the cornerstone of rural policy. The following tables confirm some of the key features of the beacon status Local Authority plans. Table 1. Comparison and Discussion of Local Plan Policies relating to Agricultural Buildings and Land Local Authority South Holland District Council JS/GC/N Norfolk/rpt Policy Development on agricultural land and Greenfield sites only allowed after all other sites considered. Recognises that PPS7 encourages farmers to diversify. Local plan seeks to minimise loss of agricultural land. Seeks to concentrate new development in towns and selected villages. Recognises that the countryside plays an important role within recreation. Whilst supporting diversification and conversion of farm buildings, the Page 127 of 174 Tynedale District Council Caradon District Council Richmondshire District Council Waverley Borough Council countryside must be protected. Development for the purposes of agriculture or forestry within the countryside will be permitted provided it does not have an adverse impact on the landscape, conservation sites, monuments or listed buildings. The use of sympathetic materials will be required in sensitive locations The use of best and most versatile agricultural land for any development associated with agriculture or forestry will not be permitted unless there is a strong case for development. Proposals for intensive agricultural development will be permitted if they do not harm views, the colour of the buildings is minimised, proper vehicular access is provided and there is no impact in terms of smell, noise and discharge. The use of land for development in upland or on best and most versatile land will not be permitted unless there is an overriding need. New farm buildings sited on sites of an open nature will require considerably higher design and landscaping standards. Permission will be granted for agricultural development provided that the proposal is reasonably necessary, does not detract from the character of the rural landscape and the materials etc are appropriate to the surrounding area, the proposal would not give rise to significant noise and disturbance, the amount of traffic generated would not prejudice safety and vehicular access can be achieved. Table 2. Comparison and Discussion of Local Plan Policies relating to Agricultural Dwellings and Occupancy Conditions Local Authority South Holland District Council JS/GC/N Norfolk/rpt Policy Proposals for new dwellings in the open countryside, including other rural settlements, will only be permitted where such development is specifically provided for under other policies of the plan. Page 128 of 174 The only exception to policies which resist new housing development in the open countryside is where accommodation is required to enable a farm worker or other essential workers to live in the immediate vicinity of their workplace. Applicants must demonstrate that there is a genuine need for the proposed accommodation, and that an enterprise to which the functional need relates is profitable. Size, siting and design are also considered. The process is the same as that in PPS7. Tynedale District Council Planning applications for the removal of a rural workers occupancy condition will only be approved where it can be convincingly demonstrated that the longer term need for dwellings for rural workers in the locality no longer warrants reserving the dwelling for that purpose. Caradon District Council The removal of an occupancy condition will only be granted where it is demonstrated that there is no longer a functional need and it is demonstrated that there is no need in the area for agricultural worker’s dwellings and a sustained attempt has been made to market the property. Table 3. Comparison and Summary of Local Plan Policies relating to the conversion of rural buildings Local Authority South Holland District Council JS/GC/N Norfolk/rpt Policy Proposals for the re-use or adoption of existing buildings outside defined settlement limits to residential use will only be permitted where the council is satisfied the building is unsuitable for employment uses, the building is of permanent and substantial condition, conversion can be achieved without affecting the merit of the building, the Page 129 of 174 Tynedale District Council design is sympathetic to the building and the building is capable of conversion without significant alteration. The change of use or conversion of existing buildings in the open countryside will be permitted for the following uses: Small scale employment, holiday accommodation, recreational uses (including camping barns and bunk houses), tourist facilities and new rural enterprises, including farm diversification. All proposals for the change of use or conversion of existing buildings in the open countryside will be required to fulfil criteria such as construction criteria, affects on other rural amenities, the effect on the surrounding landscape and nature conservation issues. The change of use or conversion to residential use will only be permitted where it can be demonstrated that employment generating uses are not suitable. Conditions withdrawing agricultural permitted development rights may be attached to permissions for the conversion of existing buildings to non agricultural uses. Table 4. Comparison and Summary of Local Plan Policies relating to the conversion of low cost housing Local Authority North Norfolk District Council JS/GC/N Norfolk/rpt Policy In the countryside development proposals for affordable housing schemes promoted by the council, housing associations, civil parish councils, village trusts and other similar organisations may be permitted on sites not appropriate for general housing development, provided that the applicant demonstrates that there is a genuine local need, the scheme will meet the need, the Page 130 of 174 number of houses proposed does not exceed the need, existing housing cannot meet the need, the site adjoins the boundary of a village, there would be no adverse effect on the character of the village and the scheme does not include any element of market housing. In selected small villages development proposals for more than four dwellings may be permitted provided that all the excess dwellings are for affordable housing. South Holland District Council The District council considers the provision of affordable housing to meet the needs of local people to be one of the most important issues facing it. The council therefore defines “Affordable Housing” as being homes provided to meet the needs of people who cannot afford to buy or rent suitable property on the open market. The council is following the following three routes to ensure maximum delivery: Direct Provision by the District Council; Provision by Registered Social Landlords or Charities; or Provision by Private Developers. Tynedale District Council JS/GC/N Norfolk/rpt The council will, where a relevant local need has been established, seek to negotiate with developers to secure an appropriate element of affordable housing on allocated and windfall sites. The housing provided under this policy should, where appropriate, be amiable for the life of the property to provide affordable housing for local people Page 131 of 174 Table 5. Comparison and Discussion of Local Plan Policies relating to AONB’s and landscape designations Local Authority South Holland District Council Tynedale District Council Caradon District Council JS/GC/N Norfolk/rpt Policy For designated sites, the Council will seek to conserve the critical nature conservation value for which they were designated, Proposals for development which may affect such sites will be assessed. Such sites will be assessed against a number of criteria. Development will not normally be permitted which may directly or indirectly destroy or adversely impair the integrity of wildlife corridors and other areas which are of major importance for wild flora and fauna. The District Council will, in cooperation with others, seek opportunities to consolidate and strengthen wildlife corridors. Priority will be given to the protection and enhancement of the landscape qualities of the North Pennines Area of Outstanding Natural Beauty. Development within or adjacent to the AONB which adversely affects the special scenic quality of the AONB will not be permitted. Any large scale development within or adjacent to the AONB will only be permitted, when it is proven to be in the national interest and there are no alternative sites in less sensitive areas. Development in the AONB’s and Heritage Coast will not be permitted unless the development is sited as to minimise its visual impact on the landscape, is designed so as to reflect locally distinctive character, traditional building styles and local materials and conforms with the locally characteristic patterns of settlement. Page 132 of 174 Table 6. Comparison and Discussion of Local Plan Policies relating to Farm Diversification Local Authority South Holland District Council Policy Proposals for farm diversification projects will be permitted provided that the following criteria are met: It is considered as a legitimate form of farm diversification The economic activity proposed relates to a specific use or range of uses rather than to a use class Existing or redundant rural buildings are utilised wherever it is practical to do so It does not result in excessive expansion and encroachment of building development into the countryside It does no result in an unacceptable traffic impact on roads servicing the site Tynedale District Council The development would not result in an adverse impact on neighbouring residential properties or the local landscape and environment Outside settlements, proposals for farm shops and other small scale retail outlets will be permitted where criteria such as the scale, design and landscaping of new or converted facilities does not detract from the visual amenity of the surroundings and no detriment would be caused to highway safety. Proposals for the diversification of a farm enterprise will be permitted, where the criteria including the following are met; Where relevant, the proposal retains existing, or provides additional or alternative employment; and where possible, existing buildings are utilised. JS/GC/N Norfolk/rpt Page 133 of 174 SECTION 7 Introduction National Planning Policy Other Guidance/Influences to Future Policy Rural Delivery Pathfinders – DEFRA Regional Rural Delivery Framework for the East of England East of England Delivery Plans for Sustaining Farming and Food PPG 7 Implemented in Relation to the Diversification of Farm Business –ODPM The Federation of Small Businesses East of England Area Policy Unit The Characteristics of Businesses Using Rural Buildings RICS Consultation Draft – Strategy for the Horse Industry in England and Wales, British Horse Industry Federation February 2005 Norfolk Country Council Local Policies and Standards for Highways Development Control in Norfolk. Norfolk County Council December 2004 The Price and Affordability of Dwellings with Occupancy Conditions. Acorus May 2004. National Farmers Retail and Market Association. Research by NCC – Through re-use of redundant farm buildings. North Sea Rural Project North Norfolk Community Partnership (NNCP) Farmer’s Voice Survey and Farmers attitudes survey (ADAS) JS/GC/N Norfolk/rpt Page 134 of 174 INTRODUCTION The new North Norfolk Local Development Framework needs to take account of current Government advice but should also draw on other studies and reports of which a number were identified as detailed below. These are not intended to be an exhaustive list but are those documents/studies which provided useful guidance. 7.1 National Planning Policy 7.1.1 PPS 7 Planning Policy Statement 7: Sustainable Development in Rural Areas was published in August 2004. The policies set out in this document will need to be taken into account by local planning authorities in the preparation of local development documents. Other national planning policies considered in this report are PPG13 and PPG3. Government objectives for rural areas in PPS 7 include the following:(i) To raise the quality of life and the environment in rural areas through the promotion of: - thriving, inclusive and sustainable rural communities, ensuring people have decent places to live by improving the quality and sustainability of local environments and neighbourhoods; - sustainable economic growth and diversification; - good quality, sustainable development that respects and, where possible, enhances local distinctiveness and the intrinsic qualities of the countryside; and - continued protection of the open countryside for the benefit of all, with the highest level of protection for our most valued landscapes and environmental resources. (ii) To promote more sustainable patterns of development: - focusing most development in, or next to, existing towns and villages; - preventing urban sprawl; - discouraging the development of 'greenfield' land, and, where such land must be used, ensuring it is not used wastefully; - promoting a range of uses to maximise the potential benefits of the countryside fringing urban areas; and JS/GC/N Norfolk/rpt Page 135 of 174 - providing appropriate leisure opportunities to enable urban and rural dwellers to enjoy the wider countryside. (iii) Promoting the development of the English regions by improving their economic performance so that all are able to reach their full potential - by developing competitive, diverse and thriving rural enterprise that provides a range of jobs and underpins strong economies. (iv) To promote sustainable, diverse and adaptable agriculture sectors where farming achieves high environmental standards, minimising impact on natural resources, and manages valued landscapes and biodiversity; contributes both directly and indirectly to rural economic diversity; is itself competitive and profitable; and provides high quality products that the public wants. Paragraph 27 of PPS7 covers agricultural development. The Government recognises the importance and varied roles of agriculture, including the maintenance and management of the countryside and most of our valued landscapes. Planning policies in RSS and LDDs should recognise these roles and support development proposals that will enable farming and farmers to: (i) become more competitive, sustainable and environmentally friendly; (ii) adapt to new and changing markets; (iii) comply with changing legislation and associated guidance; (iv) diversify into new agricultural opportunities (e.g. renewable energy crops); or (v) broaden their operations to 'add value' to their primary produce. Paragraph 10 of PPS7 covers policy on new agricultural dwellings. Isolated new houses in the countryside will require special justification for planning permission to be granted. Where the special justification for an isolated new house relates to the essential need for a worker to live permanently at or near their place of work in the countryside, planning authorities should follow the advice in Annex A to this PPS. Paragraph 17 of PPS 7 details re-use of buildings in the countryside. The Government's policy is to support the re-use of appropriately located and suitably constructed existing buildings in the countryside where this would meet sustainable development objectives. Re-use for JS/GC/N Norfolk/rpt Page 136 of 174 economic development purposes will usually be preferable, but residential conversions may be more appropriate in some locations, and for some types of building. Planning authorities should therefore set out in LDDs their policy criteria for permitting the conversion and reuse of buildings in the countryside for economic, residential and any other purposes, including mixed uses. These criteria should take account of: - the potential impact on the countryside and landscapes and wildlife; - specific local economic and social needs and opportunities; - settlement patterns and accessibility to service centres, markets and housing; - the suitability of different types of buildings, and of different scales, for re-use; - the need to preserve, or the desirability of preserving, buildings of historic or architectural importance or interest, or which otherwise contribute to local character; - the need to preserve, or the desirability of preserving, buildings of historic or architectural importance or interest, or which otherwise contribute to local character. In planning for housing in their rural areas, local planning authorities should apply the policies in PPG3. They should: (i) have particular regard to PPG3 guidance on the provision of housing in villages and should make sufficient land available, either within or adjoining existing villages, to meet the needs of local people; and (ii) strictly control new house building (including single dwellings) in the countryside, away from established settlements or from areas allocated for housing in development plans. Paragraph 24 and 25 of PPS7 gives advice on local landscape designations. The Government recognises and accepts that there are areas of landscape outside nationally designated areas that are particularly highly valued locally. The Government believes that carefully drafted, criteria-based policies in LDDs, utilising tools such as landscape JS/GC/N Norfolk/rpt Page 137 of 174 character assessment, should provide sufficient protection for these areas, without the need for rigid local designations that may unduly restrict acceptable, sustainable development and the economic activity that underpins the vitality of rural areas. Local landscape designations should only be maintained or, exceptionally, extended where it can be clearly shown that criteriabased planning policies cannot provide the necessary protection. LDDs should state what it is that requires extra protection, and why. When reviewing their local area-wide development plans and LDDs, planning authorities should rigorously consider the justification for retaining existing local landscape designations. They should ensure that such designations are based on a formal and robust assessment of the qualities of the landscape concerned. Paragraph 30 of PPS7 advises on farm diversification. Recognising that diversification into non-agricultural activities is vital to the continuing viability of many farm enterprises, local planning authorities should: (i) set out in their LDDs the criteria to be applied to planning applications for farm diversification projects; (ii) be supportive of well-conceived farm diversification schemes for business purposes that contribute to sustainable development objectives and help to sustain the agricultural enterprise, and are consistent in their scale with their rural location. This applies equally to farm diversification schemes around the fringes of urban areas; and (iii) where relevant, give favourable consideration to proposals for diversification in Green Belts where the development preserves the openness of the Green Belt and does not conflict with the purposes of including land within it. (Where farm diversification proposals in the Green Belt would result in inappropriate development in terms of PPG2, any wider benefits of the diversification may contribute to the 'very special circumstances' required by PPG2 for a development to be granted planning permission). Paragraph 19 of PPS7 gives specific guidance on replacement of buildings in the countryside. The Government is also supportive of the replacement of suitably located, existing buildings of permanent design and construction in the countryside for economic development purposes. The replacement of buildings should be favoured where this would result in a more JS/GC/N Norfolk/rpt Page 138 of 174 acceptable and sustainable development than might be achieved through conversion, for example, where the replacement building would bring about an environmental improvement in terms of the impact of the development on its surroundings and the landscape. Local planning authorities should set out in their LDDs the criteria they will apply to the replacement of countryside buildings. These should take account of the considerations set out in paragraph 17 that apply to the conversion and reuse for economic purposes of existing buildings in the countryside. Authorities should also set out the circumstances where replacement would not be acceptable and clarify the permissible scale of replacement buildings. Paragraph 34 of PPS7 outlines detail on tourism and leisure. Regional planning bodies and local planning authorities should recognise through RSS and LDDs that tourism and leisure activities are vital to many rural economies. As well as sustaining many rural businesses, these industries are a significant source of employment and help to support the prosperity of country towns and villages, and sustain historic country houses, local heritage and culture. RSS and LDDs should: (i) support, through planning policies, sustainable rural tourism and leisure developments that benefit rural businesses, communities and visitors and which utilise and enrich, but do not harm, the character of the countryside, its towns, villages, buildings and other features; (ii) recognise that in areas statutorily designated for their landscape, nature conservation or historic qualities, there will be scope for tourist and leisure related developments, subject to appropriate control over their number, form and location to ensure the particular qualities or features that justified the designation are conserved; and (iii) ensure that any plan proposals for large-scale tourism and leisure developments in rural areas have been subject to close assessment to weigh-up their advantages and disadvantages to the locality in terms of sustainable development objectives. In particular, the policy in PPG13 should be followed in such cases where high volumes of traffic may be generated. Equine related activities are also covered in paragraph 32. Horse riding and other equestrian activities are popular forms of recreation in the countryside that can fit in well with farming activities and help to diversify rural economies. In some parts of the country, horse training and breeding businesses play an important economic role. Local planning authorities should set out in LDDs their policies for supporting equine enterprises that maintain environmental quality and JS/GC/N Norfolk/rpt Page 139 of 174 countryside character. These policies should provide for a range of suitably located recreational and leisure facilities and, where appropriate, for the needs of training and breeding businesses. They should also facilitate the re-use of farm buildings for small-scale horse enterprises that provide a useful form of farm diversification. 7.1.2 PPG 13 Transport – gives detailed policy on transport, the objectives of this guidance are to integrate planning and transport at the national, regional, strategic and local level. Specific guidance on transport in rural areas is included at paragraph 40 – 44. Paragraph 43 is of particular importance to the key issues considered by this report and is detailed below. In order to reduce the need for long-distance out-commuting to jobs in urban areas, it is important to promote adequate employment opportunities in rural areas. Diversification of agricultural businesses is increasingly likely to lead to proposals for conversion or re-use of existing farm buildings for other business purposes, possibly in remote locations. PPS7 indicates that for development related to agriculture and for farm diversification, appropriate new buildings may also be acceptable. In plan policies and development control decisions, local authorities should encourage farm diversification proposals particularly, but not exclusively, where this enables access by public transport, walking and cycling. They should be realistic about the availability, or likely availability, of alternatives to access by car. Similarly, they should not reject proposals where small-scale business development or its expansion would give rise to only modest additional daily vehicle movements, in comparison to other uses that are permitted on the site, and the impact on minor roads would not be significant. 7.1.3 PPG3 Provides policy guidance on housing – Policies 69 and 70 were considered to be specifically relevant to this study. In terms of overall housing provision, only a limited amount of housing can be expected to be accommodated in expanded villages. Whilst occasionally a village could be the basis for a new settlement where, for example, the development accords with the policy of developing around major nodes in transport corridors, most proposals for additional housing will involve infill development or peripheral expansion. Villages will only be suitable locations for accommodating significant additional housing where: • JS/GC/N Norfolk/rpt It can be demonstrated that additional housing will support local services, such as schools or shops, which could become unviable Page 140 of 174 without some modest growth. This may particularly be the case where the village has been identified as a local service centre in the development plan; • Additional houses are needed to meet local needs, such as affordable housing, which will help secure a mixed and balanced community (see Annex B); and • The development can be designed sympathetically and laid out in keeping with the character of the village using such techniques as village design statements. 7.1.4 PPS 6 This statement whilst not applicable to rural development was produced to protect and develop town centres which can on occasions conflict with positive rural policies. 7.2 Other Guidance/Influences to Future Policy Rural planning has achieved greater provision over the past two to three years due to a number of economic and political factors including reducing agricultural incomes, increasing farm diversification and the increasing attraction of both living and working in the countryside. PPS7 contains up to date government advice as outlined in the previous section. However, there are a number of other reports and studies which can provide assistance when looking at formulating local policy. The following is by no means an exhaustive list but does encompass many of the issues previously identified. 7.2.1 Rural Delivery Pathfinders - DEFRA In March 2005 the government produced a prospectus for these covering eight areas of the country following the launch in October 2004. The aim of pathfinders is to ‘pilot’ processes which will potentially be useful nationwide. The aims of pathfinders are to experiment with and test: • ways of achieving more joined-up delivery of services in rural areas, addressing economic, social and environmental issues through a partnership approach; • where practicable, innovation in rural development and delivery of services in rural areas, building as appropriate on existing best practice; and JS/GC/N Norfolk/rpt Page 141 of 174 • 7.2.2 better prioritisation of existing resources, in line with local priorities, towards areas, communities and people with the greatest needs. Regional Rural Delivery Framework for the East of England The draft was produced in December 2004 with a second iteration to be produced in 2005. Paragraph 8.11 outlines the challenges facing rural areas in the East of England. These are: 7.2.3 • support entrepreneurship and sustainable rural business growth; • ensure that the least well performing rural areas in the region are addressed in terms of increasing productivity; • create and regenerate thriving communities in which there are local employment opportunities for good quality jobs, a supply of affordable housing for local people and access to services including health, education, skills, transport, business support and ICT; • enable a productive and sustainable food and farming industry to flourish, mitigating the impacts and optimising the opportunities of CAP reform whilst conserving and enhancing the potential of the natural environment and heritage. East of England Delivery Plans for Sustaining Farming and Food The government sustainable farming and food strategy (SFFS) was published in December 2002. The government office for the East of England have developed their own plan with action areas and projects. These include the efficient use of water, marketing of local food and development of food trails. 7.2.4 PPG 7 Implemented in Relation to the Diversification of Farm Businesses – ODPM The Study looked at some of the key issues from PPG 7 and how they were being implemented by various local authorities. 24 Local Plans were specifically examined with a number not including policy on farm diversification. The documents contain what can be described as a best practice, approaches to policy formulation. The study also looked at reuse of buildings and how Local Authority’s deal with economic and residential re-uses. In a survey of planning officers a number saw their plans as being more restrictive than PPG 7 JS/GC/N Norfolk/rpt Page 142 of 174 7.2.5 The Federation of Small Businesses East of England Area Policy Unit The section on Rural Issues calls for the following: For many who live or work in rural areas existing planning legislation is perceived to be designed to meet the needs of urban communities and then applied to rural ones, irrespective of whether or not it is appropriate. Often applicants find the process difficult and advice hard to obtain, especially where the planning office is based miles away from where they live. With many more businesses now having access to the internet such advice should be available in an easily understood format on council websites, or else in booklet form. We believe that such problems could be alleviated by planning officers having surgeries where business owners and managers could meet them to discuss planning issues affecting them. The lack of consistency in policies is a major issue and often influenced by national guidelines or regulations rather than the need for local considerations. The tendency to produce one size fits all regulations at a national level rarely address local differences and needs and we believe that a more localised approach is the best one. Despite encouragements from central government to encourage enterprise and diversification in rural areas members have reported difficulties in obtaining planning consent for the conversion of redundant farm buildings with highways issues often overriding economic ones. We would like to see such issues highlighted and discussed before planning applications are submitted, and often refused. JS/GC/N Norfolk/rpt ƒ Better provision of advice on planning issues for small businesses, either in booklet form or on local authority websites. ƒ Greater access for small business owners to meet planning officers and training for members of planning committees to enable them to better understand the needs of small businesses. ƒ Greater consistency in planning policies with increased emphasis on a more localised rather than a one size fits all national approach. ƒ A presumption in favour of conversion to alternative use applied to all redundant farm buildings. ƒ Business rate relief to be offered to all eligible businesses in all rural districts. Page 143 of 174 7.2.6 The Characteristics of Businesses Using Rural Buildings - RICS Research February 2005 The document provides useful background to government policy on the change of use of buildings. The report uses primary research of businesses using rural buildings some of the main findings were: ƒ Almost all the businesses considered themselves successful. ƒ Over one third said they intended to expand on their current site. ƒ The majority of the businesses were involved in some sort of service provision. ƒ A high proportion were new start ups (41%). ƒ 68.5% were local businesses with no other site. ƒ HGV use was rare with 68% stating no HGV deliveries. ƒ The main travel distances were 8 miles for employers and 11 miles for employees. ƒ A significant proportion of workers commute from urban areas to converted buildings. ƒ Very little use of public transport areas found. In conclusion the study found that the re-use of rural buildings was a very dynamic force in the rural economy although it was dependant upon the private car. The study recognises that its findings were too late to have an influence on government policy in PPS7. 7.2.7 Consultation Draft – Strategy for the Horse Industry in England and Wales, British Horse Industry Federation February 2005 The government has recognised the importance horses now play in the rural economy hence their inclusion in PPS7. The strategic aims and objectives of this strategy are all about raising skills and provision and facilities which will have planning implications. 7.2.8 Norfolk County Council Local Policies and Standards for Highways Development Control in Norfolk. Norfolk County Council December 2004 The role of highways in rural developments are significant, especially when many proposals are not served by ideal roads in policy terms. JS/GC/N Norfolk/rpt Page 144 of 174 Ensuring highway safety in line with Highways Policies whilst ensuring rural businesses can thrive is a key challenge in any local policy formulation. 7.2.9 The Price and Affordability of Dwellings with Occupancy Conditions. Acorus May 2004. Acorus have produced two of the above reports, the last in Mid 2004. By analysing a number of sales of agriculturally tied property the aim was to identify what the market was for agricultural dwellings with agricultural occupancy conditions. This is important where a Local Authority is seeking to establish whether there is a need for an agricultural dwelling based on marketing evidence. The study showed that agricultural dwellings sold for between 5% and 28% of the value if a tie wasn’t present. This would back up a view that when a house is marketed above their levels and doesn’t sell, it is the local market not the price which prevented a sale. The study also looked at affordability. There was no noticeable pattern as to what type of house was in demand nor did cheaper houses have a higher demand. This reflected the varying degrees of wealth within agriculture that was also identified in the study. 7.2.10 National Farmers Retail and Market Association This organization supports and promoted farm shops and markets nationwide. They currently have a campaign titled “21 reasons to be excited about local food” 7.2.11 Research by N.C.C – Through re-use of redundant farm buildings. North Norfolk Country Council currently operates an advice and grant scheme on the re-use of rural buildings. The results of their initial research were looked at related to this project. 7.2.12 North Norfolk Community Partnership (NNCP) North Norfolk Community Partnership (NNCP) brings together the Parish and Town Councils, the District and County Council, the police, the health service, businesses, community and voluntary groups to work together to produce a concerted and co-ordinated approach to the delivery of services in the communities of North Norfolk (www.northnorfolk.org/nncp/default.htm ). The partnership aims to promote the community, economic and environmental; sustainability of the District, in particular by: • JS/GC/N Norfolk/rpt Ensuring decent housing for all residents Page 145 of 174 • Developing the local economy to provide better job, career, and training opportunities for local residents and those who want to come and live in North Norfolk. • Maintaining the high quality of life and attractive natural environment that exists now and makes North Norfolk unique. (www.northnorfolk.org/nncp/default.htm). Future Community Aspirations Research carried out in 2002/03 identified eight key areas as themes for action. They were: • Housing • Transport • Community safety • Economy • Heath and Social care • Environment and Outdoor Recreation • Leisure and culture • Learning and skills 7.2.13 Farmer’s voice survey and Farmer’s attitudes survey (ADAS) The findings from the latest ADAS Farmer’s Voice Survey show that nearly a quarter of all farmers in England and Wales are expecting their farming practices to change. A similar number (20%) either have no idea what that change will need to be, or think that they will have to give up farming completely as uncertainty and pessimism about CAP reform pervades many sections of the farming industry. The results from the survey also showed a complete lack of engagement in the CAP reform process by the farming industry, with 25% describing themselves as not concerned. 46% of the farmers questioned believed that the impact of CAP reforms in their regions will be negative. The findings of the Farmers Voice survey pointed to the fact that farmers do not fully understand the implications of CAP reform. The survey also revealed that farmers planned to reduce the intensity of how they farm. Those responding predicted an average decline in winter cereal area of 4% while a decrease of 12% in suckler cow numbers was envisaged (ADAS News Release: Farmers Concerned over CAP Reform). JS/GC/N Norfolk/rpt Page 146 of 174 SECTION 8 The potential implications of land use planning policies on agricultural trends JS/GC/N Norfolk/rpt Page 147 of 174 8.1 The potential implications of land use planning policies on agricultural trends. The key trends for the rural economy and their implications have been identified within Section 1 and summarised in paragraph 9 of Section 1. They are based on two main shifts in agriculture, namely rationalisation and broadening operations to add value to primary produce. Land use planning policies are likely to have an impact on these trends:a) b) The rationalisation of the agricultural industry in North Norfolk is likely to create the following land use issues:• A requirement for larger more centralised purpose built agricultural buildings to become more sustainable competitive and adapt to new and changing markets. • A surplus of outdated buildings both traditional and modern available for re-use subject to planning permission. • A further reduction in labour employed full time in agriculture, which will in turn lead to houses with agricultural occupancy conditions no longer required for agricultural labourers, on some farms. • An increase in the employment of seasonal workers in areas associated with high labour cropping i.e. vegetables, fruit etc. • An increase in grassland but reduction in agriculture livestock. • IPPC Regulations will lead to loss of pig and poultry units but others will need to improve facilities, expand or relocate. Businesses are being encouraged through government initiatives to add value to their produce which will create the following land use issues. There is likely to be an increased requirement for smaller high labour specialist enterprises producing high quality products for niche markets e.g. organic. These may require on site supervision and specialist buildings which would require planning permission. Products could be marketed through farm shops and farmers markets on farms. Products could be processed and packaged on farm e.g. organic milk processing or biofuels prior to being directly distributed to the customer where appropriate. JS/GC/N Norfolk/rpt Page 148 of 174 c) Diversification Diversification of the whole rural economy is already taking place. This trend continues in North Norfolk through a variety of initiatives. These diversified enterprises utilise redundant land, buildings and rural labour force in addition to stimulating the rural economy as a whole. The continued development of the rural economy in the UK is likely to follow the trends of rationalisation of agricultural production, adding value to produce and diversification. Due to economics, market demand and government initiatives, land use planning polices will have an impact on the direction of these trends and should consider the maintenance and management of the countryside, in addition to the rural economy as a whole. Production will be increasingly driven by economic viability so economies of scale and efficiency of capital investment will be crucial to land remaining in production. Positive policies on agricultural buildings should enable the continued rationalisation of agricultural businesses enabling land to remain in production. These policies would need to consider size and design, level of impact on the rural landscape, nuisance, traffic and legislative requirements. If there is no positive policy on the development of agricultural buildings, more land and buildings could come out of production which could have negative landscape impacts in addition to further rural unemployment. Larger farming businesses and associated agricultural industries could consider relocation out of North Norfolk. Continued rationalisation will inevitably lower demand for agricultural dwellings. Planning policies could enable these conditions to be altered to provide local or low costs housing. This would need to be triggered by an application from the owner of the property. Research showed this would be unlikely as a large number of these properties were owner occupied which would force them to vacate their homes if they were no longer employed in agriculture or took alternative part time work. In addition these houses by their very nature are likely to be isolated with no shops or public transport which is essential for low cost housing. Any policy on removal of occupancy conditions should be specific in terms of exact requirements for removal. It should consider changes in markets and requirements for agricultural dwellings on the holding and in the locality. This should prevent abuse of the planning system and retain agricultural housing where it is required. JS/GC/N Norfolk/rpt Page 149 of 174 If policies allowed amendments to other relevant occupations e.g. equine it could help to facilitate an efficient diversification of the rural economy reducing the need to build more new houses in the countryside. Adding value and concentration of niche products together with new enterprises in the countryside e.g. equestrian may lead to a requirement of new dwellings in the countryside. Policies should enable dwellings to be built in countryside locations where essential. These dwellings can enable rural businesses to be profitable and well managed which can have a positive impact on the rural landscape and economy in terms of employment. If policies prevented development of these dwellings the types of rural business could be limited which could have an effect on the diversity and character of the rural landscape. Policies should however ensure the dwellings are essential and that the associated business is likely to be financially sustainable in the future. This should prevent abuse of the concession that the planning system makes for such dwellings. Rationalisation together with on farm processing and packaging has led to the use of seasonal workers in some areas. These workers require accommodation which is currently being provided under permitted development rights through mobile homes. This can create landscape problems and a poor standard of housing. A planning policy allowing conversion of existing buildings to seasonal workers’ hostels could mitigate the impact of housing seasonal workers in rural areas. This study shows that the trends in agriculture are likely to continue to create redundant buildings in rural areas. The re-use of these buildings could help to stimulate the rural economy and avoid dereliction and adverse impacts on the landscape. However, the re-use of these buildings will be dependant on the economic viability of potential uses. If no economically viable use can be found, the buildings will fall into disrepair and dereliction before being lost as an asset to the rural built environment. Planning policies could encourage a diverse range of business uses including mixed uses where appropriate. There will be some buildings that are unsuitable for business (including tourism use) due to their scale, design or location. If planning policies do not consider residential use in these situations the buildings are likely to become derelict creating an adverse impact on the character of the landscape. JS/GC/N Norfolk/rpt Page 150 of 174 Farm diversification is likely to become more important to the viability of the rural economy. Positive policies on diversification will encourage this. With the change in agriculture it is likely that smaller farming businesses will no longer be involved in agriculture and diversification of the wider rural economy and not just on working farms will be required e.g. diversification of a redundant specialist pig breeding unit to light industrial units. If policies restrict diversification to working farms the previous example may not be considered to be within policy. Diversification policies should consider landscape implications, traffic generation, and impact on neighbours and should be planned on a sound financial basis. This will prevent damage to the character of the landscape, road network problems and nuisance. A business plan should show the level of employment and economic value to the area associated with the development. It would also explain environmental land management issues for example if the diversification included grazing livestock for a farm park or livery yard, as these are often site specific. Keeping horses is a growing trend in the UK and in North Norfolk, it can encourage tourism, provide employment, utilise existing buildings and land that could otherwise go out of production. With the reduction in livestock, horses can be used as an alternative when keeping grassland in well managed production. Planning policies should support equestrian development that maintains environmental quality and landscape character. Floodlights, outside storage of hay and straw bedding and show jumps could have adverse impacts on the landscape. Policies should consider the impact of the proposal with regard to horses requiring exercise off the site (not always required). If policies do not consider this issue horses on busy roads could cause accidents. In addition policies that consider nature conservation and landscape implications could prevent over grazing through allowing too many stables for the amount of grass available etc. Diversification can often utilise existing buildings but occasionally new build is more appropriate e.g. environmental requirements of food processing plants. Replacement of redundant buildings could be an alternative to new build in this situation. Policies could provide for this type of development but would need to consider the size and scale of replacement buildings, the importance of the existing buildings and the effect on the existing surroundings. If these issues are not considered JS/GC/N Norfolk/rpt Page 151 of 174 inappropriate developments could damage the existing build and natural environment. These recommendations have been based on a detailed rural economy study. Policy decisions in these areas must be linked with the overall strategy of the district. JS/GC/N Norfolk/rpt Page 152 of 174 SECTION 9 Recommendation for North Norfolk’s Future Policy Direction Introduction Agricultural Buildings Agricultural Dwellings and Occupancy Conditions Permanent Dwellings Temporary Dwellings Hostels for Seasonal Workers Occupancy Condition Removal Amendments/Alterations of Conditions Conversion of Rural Buildings Low Cost Housing Land Use in ANOB and Agricultural Land Quality Farm Diversification Replacement Building Recreation and Tourism Highways JS/GC/N Norfolk/rpt Page 153 of 174 INTRODUCTION Based on the primary research and desk research of published data including National Polity it is considered North Norfolk District Council should formulate policies that strike the correct balance between protecting the countryside and in particular the ANOB but also recognising the significant changes in agriculture both historically and in the future. The following recommendations have been based on a detailed rural economy study. Policy decisions in these areas must be linked with the overall strategy of the district, for example; housing strategy, tourism, transport, industrial development/employment. 9.1 Agricultural Buildings Specific policy on planning applications for agricultural buildings is required with particular reference to intensive livestock and relevance of new regulations e.g. IPPS (Integrated Pollution Prevention Control Regulations) is required. Any such policy should take account of the advice in paragraph 16 of PPS 7. The current policy on prior approval should remain but a new policy is required for agricultural development to cover crop and general stores, livestock buildings and horticultural development. In this respect a policy similar to East Yorkshire 1997 adopted policy would be suitable i.e. “Permission will be granted for agricultural, horticultural or forestry related development provided that:(a) the proposal is related to and located on an existing unit, and is reasonably necessary for the purposes of agriculture, horticulture or forestry within that unit; (b) it would not significantly detract from the character of the rural landscape; (c) the location, scale, design, colour and materials are appropriate to the character and appearance of the surrounding area; (d) the proposal would not give rise to significant noise and disturbance to the occupiers of nearby residential properties or otherwise adversely affect residential amenities, for example by reason of dust, odour or effluent; (e) the amount of traffic likely to be generated would not prejudice highway safety or cause significant harm to the environmental character of country roads, and (f) satisfactory vehicular access can be achieved”. JS/GC/N Norfolk/rpt Page 154 of 174 A footnote to the effect that proposals required to meet the requirement of new legislation, i.e. IPPC would be viewed favourably. In assessing their application account will be taken of the improvement on the existing unit. A key issue is the more restrictive treatment of agricultural buildings in the ANOB, which is generally accepted to be the right approach. Greater difficulties arise with the area of High Landscape value which is seen to be too restrictive given it covers a large area of the district. 9.2 Agricultural Dwellings and Occupancy Conditions It is recommended that 2 policies for new dwellings are appropriate. One for permanent agricultural dwellings and one for temporary, reflecting the differing approaches in annex A of PPS 7. The policies also need to reflect other occupational dwellings. 1) Permanent Dwellings A policy similar to the following could be appropriate. New permanent dwellings in the countryside for agriculture, forestry or other occupational requirements will only be permitted where: i) There is a clear functional requirement for a person to be resident on site; ii) The need is full-time; iii) The unit is established, profitable and economically viable; iv) There are no other dwellings on the holding or locally which would fulfil the need. A footnote to the effect that when a need has been identified an agricultural dwelling should be of a size the unit can sustain. Some Local Authority’s are given guidance on size although this is subject to debate and variation and should not be a fixed maximum. A guide of 180m² - 200m² maybe appropriate. 2) Temporary Dwellings A policy along the following is required A temporary dwelling for agriculture, forestry or other occupational purposes will only be permitted where: i) JS/GC/N Norfolk/rpt Significant evidence is provided to show the business has been planned on a sound financial basis; Page 155 of 174 3. ii) There will be a functional requirement to live on site; iii) There are no other dwellings on the holding or locally which would fulfil the need; iv) There is a realistic prospect that the business will meet the requirement of policy X (permanent dwellings) Hostels for Seasonal Workers An issue which arose during consultations was the housing of seasonal workers. In some areas of the country large grouping of mobile homes which can be exempt from planning permission have created landscape and other concerns. North Norfolk should consider introducing a policy which may support conversion of buildings for the provision of hostels when they are relevant to the units they wish to serve. 4. Occupancy Condition Removal The first paragraph of the existing policy is entirely suitable but criteria a) and b) are not clear and references to parishes are too prescriptive and gives rise to differing geographical interpretation. An alternative maybe; 5. a) the applicant has shown that the property has been marketed with sufficient publicity to the agricultural community, over a minimum of 6 months; b) The property has been available at a price reflecting the condition which would normally be a 30% reduction on its open market value. Amendments/Alterations of Conditions A further consideration is amendment of the conditions to include other occupational businesses (e.g. equine), local need housing and holiday use. In these cases it should not be necessary to undertake any marketing. Such applications should be judged favourably. The study looked at whether agricultural dwellings could be used for low cost housing and investigating this could be made a requirement of any removal. However it is considered the range of housing types and issues make this inappropriate. JS/GC/N Norfolk/rpt Page 156 of 174 9.3 Conversion of Rural Buildings The existing policy, number 29, needs little change other than related to residential use and to reflect the latest advice in PPS 7 to encourage buildings to be converted to the most appropriate use. The recommendation is to remove the first section “in the case of a conversion to residential use (excluding holiday accommodation), the building is adjacent to the boundary of a Growth Town, Small Town, Large Village or Selected Small Village”, and introduce a policy on residential along the following lines:Conversion to residential use will only be permitted where: i) The residential element is part of a mixed scheme including business reuse or ii) The building is worthy of preservation and residential use is the only way this can be achieved iii) The conversion scheme can be incorporated without alteration to the fabric and retains the barns appearance. This will encourage the development of mixed schemes including in or on the edge and within villages to meet sustainability objectives and will ensure important buildings wherever they are located have a chance of preservation. 9.4 Low Cost Housing This was not specifically part of the remit although it did arise in relation to removal of agricultural occupancy conditions. It is not considered that a restrictive policy requiring such a use is achievable or appropriate in North Norfolk although it should be an option (see 7.2). 9.5 Land Use in ANOB and Agricultural Land Quality Protecting high quality agricultural land is no longer the cornerstone of Government advice and should be viewed alongside other sustainability considerations (paragraph 28 PPS 7 refers). Given the importance of agriculture in the North Norfolk district retention of a policy maybe appropriate. An alternative wording to policy 22 should reflect that other sustainable issues maybe more important and developers should not make decisions based too heavily on land quality considerations. JS/GC/N Norfolk/rpt Page 157 of 174 9.6 Farm Diversification Generally A clear policy is essential to recognise the Government policy in PPS 7. Whilst other policies in the LDF will be important diversification should have its own policy and criteria. Suggested wording would be as follows:“Farm diversification proposals will be allowed where:1) the proposal does not unacceptably impact upon the amenities of residents; 2) the proposed access and level of traffic generated by the proposal is within the capacity of existing approach roads, when compared with the permitted agricultural use and would not be detrimental to the amenity of the locality or prejudice highway safety; 3) the proposal does not result in demonstrable harm to the landscape and nature conservation; and 4) building requirements are met through the conversion of suitable existing buildings or replacement buildings. New buildings will only be approved where the activity proposed cannot be met through the conversion of an existing building and where the new structure does not result in excessive expansion of built development into the countryside. 5) The proposal should be planned on a sound financial basis. Farm Shops A policy on farm shops should be retained but needs flexibility in terms of ‘imported’ goods to ensure farm shops can operate all year round especially when local produce might not be available and labour needs to be retained. The existing policy may also have implications regarding European Union Legislation and use of the word ‘locally’. Horses North Norfolk Policy is written in a restrictive manner. A policy similar in nature to the existing policy is appropriate, although given the importance of horses to the rural economy the policy should be more positive and state: “development proposals involving horses will be permitted subject to: (a) would have no detrimental effect upon the appearance and character of the surrounding landscape; JS/GC/N Norfolk/rpt Page 158 of 174 (b) would have no detrimental effect upon areas of nature conservation interest; (c) would have no significant detrimental effect on the residential amenities of nearby occupiers; (d) would not impair highways safety; and (e) are well sited in relation to bridle-ways, roads used as public paths and unclassified metalled roads if required or unless on farm riding is provided.” The current local plan in its definition reference paragraph 12.63 outlines the unsightly nature of many equine facilities. Any new LDF should explain that these facilities require planning permission as only grazing is exempt from specific permission. A supplementary document maybe appropriate. 9.7 Replacement Building Given previous diversification of the rural economy and the fact that some rural buildings may not necessarily be of the best design or layout, Government policy recognizes that replacement maybe appropriate. North Norfolk Should have a policy to cover such development along the following lines: The replacement of buildings in the countryside outside the development boundary will be allowed subject to the following:- 9.8 1) The building is not of historical or architectural importance; 2) The building to be replaced is of permanent construction and structurally sound; 3) The replacement building is of a similar size and scale as the building to be replaced. 4) The new building will provide environmental improvement compared to the old building; 5) There will be no detrimental effect on surrounding buildings especially those of historic or architectural importance. Recreation and Tourism Again this was not a specific area subject to the study on which specific recommendations are required but does have significant Rural Economy implications, particularly related to change of use of buildings and farm diversification. JS/GC/N Norfolk/rpt Page 159 of 174 The various surveys and workshops identified a possible over supply of holiday accommodation although that is an economic matter and should not necessarily be restricted within planning policy. 9.9 Highways Highways is a common theme which has an effect on all levels of development. There is a perception that in some cases highways advice is over negative and does not recognise the level of traffic that would arise from the permitted agricultural use. Advice also needs to be tempered against the general standard of roads in North Norfolk. Whilst highways policy is a county matter and cannot be specifically addressed in the new LDF, it is an area North Norfolk need to be aware of and if necessary encourage a more flexible approach. JS/GC/N Norfolk/rpt Page 160 of 174 SECTION 10 Appendices JS/GC/N Norfolk/rpt Page 161 of 174 Table 1: DEFRA June Census Data for North Norfolk 1990 and 2004 1990 Category (Landuse/Crops) Farm type - Cereals Farm type - General Cropping Farm type - Horticulture Farm type - Pigs & Poultry Farm type - Dairy Farm type - Cattle and Sheep Farm type - Mixed Farm type - Other Size - less than 5 ha Size - 5 to <20 ha Size - 20 to < 50 ha Size - 50 to <100 ha Size - 100 ha or greater Total area Rented Owned Crops and fallow [see note *] Temporary grass Permanent grass Rough grazing Woodland Setaside All other land Wheat Winter barley Spring barley Oats Other cereals Total cereals [see note *] Potatoes Sugar beet Horticulture [see note *] Field beans Peas (harvest dry) Oilseed rape Linseed Turnips etc Other crop stock Maize Other arable Bare fallow Peas and beans All other veg and salad Total veg in open [see note *] Area under glass or plastic Top fruit (Orchards) Small fruit Total fruit [see note *] Hardy nursery Bulbs flowers Dairy Beef Breeding herd (to replace) Other cattle over 1 yr Cattle under 1 yr Total cattle [see note *] Breeding pigs Other pigs Total pigs [see note *] Breeding ewes Other sheep Lambs under 1yr Total sheep [see note *] Goats 2004 No. of No. of Holdings Holdings 98 90 463 356 33 39 60 85 10 8 54 138 55 56 69 339 187 515 137 158 160 97 134 119 224 224 842 965 392 336 660 796 681 510 185 134 499 533 194 141 263 271 14 392 502 339 415 285 471 243 446 282 36 12 15 12 609 411 292 201 505 381 237 130 70 47 54 31 39 ## 28 9 45 16 117 50 22 36 ## 47 ## 79 153 52 78 49 203 77 19 17 22 33 16 45 28 11 30 11 ## 48 23 139 105 134 110 182 138 203 130 266 183 71 50 102 100 102 104 104 101 73 94 99 86 113 140 16 55 % Change -8% -23% 18% 42% -20% 156% 2% 391% 175% 15% -39% -11% 0% 15% -14% 21% -25% -28% 7% -27% 3% 2700% -32% -31% -48% -37% -67% -20% -33% -31% -25% -45% -33% -43% -68% -64% -57% 64% -66% -37% -62% 29% -52% -38% 173% -52% -24% -18% -24% -36% -31% -30% -2% 2% -3% 29% -13% 24% 244% 1990 2004 Ha or Number Ha or Number 77,672 32,753 44,918 63,063 1,651 6,647 1,662 2,320 427 1,901 16,141 14,139 8,499 223 136 39,139 3,794 12,258 4,956 736 702 ## 370 142 323 164 ## ## 3,589 858 4,448 74,778 23,000 53,642 54,865 1,240 8,619 2,229 2,816 4,372 1,621 14,098 8,725 10,103 157 194 33,951 4,433 10,025 1,948 872 572 1,769 165 40 142 531 229 451 1,215 768 1,728 2 24 119 110 25 87 1,625 3,238 1,999 3,396 4,212 14,367 4,264 63,729 69,015 10,549 1,742 10,190 21,659 225 71 309 380 15 ## 3,927 3,560 2,751 3,827 8,052 22,117 7,907 66,208 74,115 13,558 774 12,858 27,190 135 % Change -4% -30% 19% -13% -25% 30% 34% 21% 924% -15% -13% -38% 19% -30% 43% -13% 17% -18% -61% 18% -19% -55% -72% -56% 224% -66% -11% -61% -66% -61% -71% 64% -59% -9% -27% -11% -48% -35% -46% -4% -7% -22% 125% -21% -20% 67% * Note: there are no results at level 5 (ward) for items that are sub-totals of other items, these are only available at higher levels. JS/GC/N Norfolk/rpt Page 162 of 174 Organic Statistics January 2005 Table 2: Table 3: JS/GC/N Norfolk/rpt Page 163 of 174 Table 4: (Source: Defra, Jan 2005 Organic Statistics England www.statistics.gov.uk) JS/GC/N Norfolk/rpt Page 164 of 174 Table 5: Diversified Enterprises (Farmer’s Voice Survey 2004) Question 34: Which, if any, of the following types of diversified enterprises do you currently operate? Enterprises Novel food crops Novel livestock Non-food crops Agricultural services Farm-based food processing Farm-based food retailing Farm-based accommodation Equine Other farm based leisure businesses Farm based craft businesses Leasing of buildings Leasing of land Off farm non agricultural businesses Not stated JS/GC/N Norfolk/rpt Any Organic % 5 4 4 8 7 22 15 6 3 12 17 27 31 Non Organic % 1 5 10 2 6 6 10 4 1 15 11 16 49 Page 165 of 174 Table 6: Agricultural financial performance in 2002: Agriculture’s Agriculture Gross share of total Intermediat Total ’s share of value regional Gross e income total added at gross value output (a) consumptio from regional basket added at n farming employment prices basic (c) (d) prices(b) £ million £ million £ million £ million % % United Kingdom England Wales Scotland Northern Ireland English Regions North East North West Yorkshire and Humberside East Midlands West Midlands East of England South East and London South West 15,519 8,381 7,137 2,418 0.8 1.9 11,453 1,012 1,923 6,045 631 1,032 5,408 381 891 1,812 116 365 0.6 0.9 1.1 1.5 4.5 2.8 1,131 674 457 126 2.9 7.2 415 1,072 222 600 193 472 56 71 0.7 0.8 1.2 1.3 1,462 746 717 329 1.3 1.7 1,675 876 799 348 1.6 2.1 1,330 706 624 203 1.2 1.8 2,116 1,050 1,067 528 1.4 2.0 1,317 657 659 136 0.4 1.3 2,065 1,187 877 142 2.0 1.9 Imported livestock, including purchases of store cattle and sheep, are included as negative output. In order to estimate the total gross value added at basic prices for the entire economy, the fourth quarter has been estimated suing the trend of the previous three quarters. Data for 2002 is not available from the Office for National Statistics (ONS) for individual countries so data for 2001 has been included for illustrative purposes. Data given for the English regions relate to 2000 and refers to the latest data available from the ONS; these figures relate to the category “Agriculture, hunting, forestry and fishing.” The total workforce in employment consists of employees in employment, the self employed and people in work related government training schemes. JS/GC/N Norfolk/rpt Page 166 of 174 The agriculture industry includes a high proportion of part-time workers. A comparison on the basis of full-time equivalents would show lower percentages. (Source: Defra website, http://statistics.defra.gov.uk/esg/) Table 7: Changes in the near future (Farmer’s Voice Survey 2004) How likely are you to do each of the following in the near future? Yes/possibly (%) Any Nonorganic organic Develop alliances with other farmers Develop alliances with customers Develop alliances with service providers (e.g. machinery/feed/seed supplier) Market directly to consumers (e/g farmer’s markets, farm shop) Forward sell, e.g. grow to contract Cease agricultural production but maintain the land in good agricultural condition JS/GC/N Norfolk/rpt Unlikely/no (%) Any Nonorganic organic 51 40 36 45 45 36 39 46 28 27 56 53 47 19 41 62 33 30 50 51 38 30 55 54 Page 167 of 174 SECTION 11 Bibliography JS/GC/N Norfolk/rpt Page 168 of 174 BIBLIOGRAPHY BASC. 2005. BASC to help DEFRA correct shooting guidance on farm payments. [On-line]. Available from: www.basc.org.uk/content/basc_to_help_defra BHS. 2005. East of England Regional Routes. [On-line]. 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