Farm Diversification: Benefits and pitfalls of holding an on-farm temporary event
Government incentives to boost the rural economy during the Covid-19 pandemic have accelerated a shift towards farm diversification into temporary public events on farmland. There was already an upward trend in demand for outdoor activities before the pandemic, according to rural consultant Bidwells. The firm’s senior rural surveyor Louise Newton explains why the trend has grown and offers advice on the potential benefits and pitfalls of holding a temporary event. We also address the legal and tax issues and take a look at two farm case studies – a music festival and an outdoor cinema.
Events held on farmland include:
Car club meets
Mountain bike trials
Bring-a-dog fun runs
Fetes and fairs
Farm diversification into many of these ventures increased last year, mainly due to extended Permitted Development Rights (PDRs), according to Louise Newton, senior rural surveyor. These rights allow farmland to be used for non-agricultural purposes for a temporary period each year without requiring planning permission. Previously, the allowance was 28 days a year. But this was doubled to 56 days last year to help rural businesses recover after the pandemic. The extension will continue until January 2022 to support further recovery.
Alternative land use limit for BPS
As well as the PDRs, there is also a 28-day alternative use limit on land where the Basic Payment Scheme (BPS) is claimed. This has not been extended in line with the PDRs. Although the Rural Payments Agency has suggested it may take a relaxed stance to enforcement, Ms Newton says that officially, land used beyond the 28-day limit would not be eligible for BPS. This should be factored in when calculating the costs versus the benefits of a farm diversification venture. Landowners must also be able to verify how long the land has been used for the alternative activity, using diary records and images taken on smartphones.
Alternatively, landowners could get full or temporary planning permission instead of using PDRs. Local council application fees amount to around £462 for either a full planning application or temporary consent (typically for a three-year period). This requires a plan or map with red lines indicating the site plan and needs to include access considerations. Any restrictive land designations that may influence the outcome must also be researched.
The Farm Diversification Venture
Broadly speaking there are two options. First, the landowner or farmer can run the activity and take all responsibility for the venture, or they can let the land to an event company that handles everything. For first-time ventures the lower-risk approach is to let land to a business with the expertise to hold the event.
In this case a contract stipulating arrangements of how the landowner is to be rewarded for the use of the land should be agreed. This is usually a straight rental fee or a percentage of profits from the event. However, smaller farm diversification projects like farm walks could easily be run by the landowner, provided care is taken and planning is done well ahead, sometimes needing professional advice and consultancy support.
Costing’s for your farm diversification
Before deciding to go ahead, farmers should set out all the potential upfront costs, such as hiring toilet blocks and equipment, health and safety assurance and providing water or electrical supplies to the site. With the costs known, the potential returns can be estimated, followed by likely margins.
Farm diversification site considerations
When bringing the public on to a site there must be proper access. A narrow field entrance can cause dangerous congestion to build up on a public highway, while an exit straight from a field can mean mud being left on a road. This needs careful consideration and one tip is to use a one-way system, with separate entrances and exits. Sufficient staff should also be employed to manage and direct the vehicle flow.
Queues are potentially dangerous and can be frustrating, leading to negative reviews. A wet weather plan should also be drawn up, with tractors on standby to pull vehicles off the site and road sweepers available to clear mud. It is advisable to use hard tracks and surfaces to limit difficulties and mud on vehicle tyres. A site should ideally be level and well-drained, but gentle slopes or undulations are acceptable. Grass leys or arable ground that is more likely to suffer from compaction or damage are best avoided.
Gauging visitor numbers is important, as too few could lead to financial loss, but too many could cause traffic congestion, and health and safety issues, overwhelm facilities and lead to bad reviews. This will be less problematic if the initial approach is to let the land to an experienced company that will better gauge likely visitor numbers. If the farm diversification project is run by the farm, it would be sensible to ask visitors to book, either over the phone using a simple spreadsheet, or through an online ticket service.
Advertising an event is more straightforward and cheaper than in the past. Facebook can spread the word without cost through local village pages or target groups of potential customers. Other social media sites including Instagram or Twitter also provide a chance to push an upcoming event. Local newspapers can still provide high-profile coverage and should not be overlooked.
It would be wise to employ an independent assessor to ensure that all risks are taken into account. The advice should be documented and understood. It is not enough to have the paperwork alone – all staff must act on the assessment advice. As well as site safety, food safety is paramount. Training and licensing are complex, time-consuming and costly. Using outside catering companies, hiring out pitches or taking a share of the takings according to a contracted arrangement can reduce risk for the landowner or occupier.
Licences, insurance and legal issues
The licence or contract with an outside event company should set out the responsibilities of all parties involved and specify the area of land where the event can take place. As such, it is a vitally important document that should be agreed and signed by both parties. It should include issues such as health and safety, who provides facilities and services, security, insurance cover and liability, along with limits for visitor numbers and duration of the event. It is also crucial to establish who is responsible for the site clean-up. This should be followed up by an inspection and an inventory to ensure the site is returned to its former condition.
Standard farm policies are unlikely to cover all of the risks involved in hosting an event on farms, says William Kendrick of insurance broker Lycetts. A standalone policy may be needed to meet particular risk levels, which vary considerably according to individual circumstances. Much will also depend on whether the farm is hosting the event or letting land to a third party. Letting to a third-party organiser is undoubtedly simpler and transfers much of the risk.
Whatever the scenario, it is important to involve an insurer early on in the process to ensure all risks are assessed and addressed, Mr Kendrick says. The main cover needed is public liability, and risk assessments must be in place, along with a plan for traffic movement. Traffic congestion could lead to accidents, so there must be a carefully worked out plan, including a contingency for bad weather.
If the landowner is hosting the event, then as well as public liability cover, employer liability for staff working at the event will have to be included. Equipment should be covered for risks such as theft or damage. The landowner will be responsible for insuring public safety when using any equipment, so it must be erected properly and assessed, along with checks on all of the electrics. The total cost of insurance for an event varies widely, but can be anything from £250 to many thousands of pounds.
Having a contract drawn up between the farm business and anyone letting land for an event is a crucial step, according to Jeanette Dennis, partner at Ashtons Legal. Although a written document is not a legal requirement, setting out an agreed contract will provide a solid reference if something goes wrong.
For example, a festival operated by a third party could lead to issues over noise, light pollution or dust, mud and waste. Mud on highways is a risk to public safety and it must be made clear before the event who is responsible for clearing it up. It is important a contract sets out who is responsible for control of these issues. If not, then the landowner is likely to carry that responsibility in the face of any challenge.
The contract should stipulate that health-and-safety measures are put in place, based on a thorough assessment, and set out what activities are allowable. It should also set out the condition of the land or buildings before the event and an agreement to have them fully restored afterwards. In addition to these suggestions, if the farm is tenanted, there must be an agreement in place with the landlord. It is important to remember that every event is different, so anyone thinking of holding an event should seek professional guidance.
Farm diversification case study – Farmfest music festival, Gilcombe Farm, Somerset
Gilcombe is a 120ha organic farm with 200 milkers plus followers. Farm manager George Portch advises anyone considering a non-agricultural venture to start small and carry out detailed costings and planning. Mr Portch’s involvement in the Farmfest music festival venture began 15 years ago under a land-letting arrangement with a group of friends who organised the event. However, he bought the festival rights and is now organising the first event completely under the farm’s control this summer.
Over the years, Farmfest has grown from a few hundred attendees to offering 5,000 tickets at £99 each. Despite its scale, the event is still carried out under a 28-day PDR period on the farm’s permanent pasture. Mr Portch says the principles and potential pitfalls are applicable to anyone planning an event. Public safety must be planned long before the event takes place and documented in an event safety-management plan. The plan involves a risk assessment, which he suggests should involve an independent safety assessor. Assessors are trained to identify potential problems that might otherwise be overlooked.
Practical farming pitfalls also exist. Harvest, fieldwork and silaging are all pinch points, so these times should be avoided, with a wide margin of error to allow for weather changes. Mr Portch also urges farmers to think about potential damage to land. A grass ley can be ruined by heavy footfall or traffic, so event ground should ideally be older pasture, he advises. There must also be a wet weather contingency plan in place. Rain can play havoc in car parks unless movements are carefully planned.
“Our fields slope so we park cars facing downhill,” he says. The farm also has a local contractor on call to ensure no mud is left on the road.
Luton Hoo is a 485ha estate made up of mostly arable land. Luton Hoo in Bedfordshire was approached by an established outdoor cinema company requiring just a small area of land. The company, called Drive and Dine, needed less than 1ha of level grassland to site a temporary cinema in June 2020 over a two-week period. Estate manager Amelia Newman says the agreement was for the company to take the responsibility for the event while Luton Hoo took a percentage of the profit. The event caused little impact on the estate and its neighbours because noise and light pollution were minimal.
Cars arrived and drove to a plot marked out by the company. There was a crate in each designated plot containing a radio to pick up the film soundtrack and pre-ordered food and drink, Ms Newman explains. Despite the relatively small size, the field took 250 cars for each screening with up to four shows a day. Tickets were £18 each for adults and the event ran for 14 days.
“With up to 1,000 cars a day our key consideration was traffic, so we devised a one-way system and put down wood chip when the weather was wet,” she said.
The estate insisted on drawing up a licence agreement for the company to sign. It is important to have a documented arrangement, just in case something goes wrong or there are disagreements,” Ms Newman says.
The licence included:
Requirement for a spreadsheet to be kept, recording all vehicle number plates for estate security
An agreement on reinstatement of land to its former condition
The company’s insurance details and scope of cover
Risk assessments and all health and safety documents
Set-up and removal times
Maximum visitor numbers
Usage and noise restrictions
Agreement on stewardship margins so event company employees knew where to avoid.
The venture proved a success and the estate has learned enough from the company to move into running its own open-air theatre this year.