Energy and Climate Change CommitteeSupplementary written evidence submitted by the Country Land and Business Association

The CLA

The Country Land and Business Association (CLA) represents 34,000 members who between them own and manage about half the rural land in England and Wales. We have 170 members owning 13,000 ha along the Severn Estuary from Cardiff and Weston-super-Mare up to Gloucester, this figure does not include members on the important tributaries of the Wye and Usk. We also have members with agricultural and other businesses on the Somerset levels who may also be impacted by any changes in water levels.

The landownership includes low lying highly productive agricultural land that may be required to deliver compensatory habitat in England and Wales, and the fishery assets on the Severn and its tributaries which are important to the rural economy.

For many years now, the CLA has led the debate both on compulsory purchase reform and land based renewable energy.

On compulsory purchase reform it was the CLA who set up the Property Industry Group which precipitated the establishment of the Compulsory Purchase Review Advisory Group and the Law Commission Review on compulsory purchase. The Law Commission report Towards a Compulusory Purchase Code published 2003 was very detailed and outlined the many shortcomings of the current system and recommended reform. It is iniquitous that after 10 years successive governments have ignored these recommendations whilst compulsory acquisitions by profit seeking companies continue to take place. This demonstrates a woeful lack of regard for private property rights.

In November the CLA launched “Fair Play” which seeks to open the debate about how to overcome problems of blight through a property Bond Scheme, introduces a duty of care and a right of appeal to an independent expert and codes of practice to ensure that the impact on the land and business owner remains foremost in the discussion making process.

What are the shortcomings of compulsory purchase?

Overall the CLA has many misgivings about the operation of the current compulsory purchase system which are detailed within the CLA Policy Document “Fair Play”. The details pertinent to the Severn Barrage are dealt with below:

Compulsory Purchase is a blunt instrument for purchasing land required for public infrastructure. Whilst this might suit the developer, it raises many issues in relation to the property owner.

The current statutory regulation deals poorly with issues of Blight. This arises when property cannot be sold because of the existence of a proposed scheme—this impact starts when the scheme, or its many proposed options, first appears on a map through to its completion. During this time it may be very difficult for the property to be managed as its future use is always under threat. In some cases infrastructure proposals can take as long as 30 years to come to fruition—that is one generation’s worth of stagnation. Even the most optimistic timescales for the Severn barrage estimate that it will take over 15 years to complete. Blight is already an issue as artists impressions have already appeared in local papers showing the impact on properties (in one case showing one of the main routes on the Welsh side going straight through a property owned by a CLA member).

Because acquirers have a duty to pay for no more than the owners’ direct loss, this has lead to agents acting for the acquirer being overzealous and offering only to pay rock-bottom for the property.. It is important not to under-estimate the financial and time penalties that a landowner endures as a result of compulsory purchase, often being the only person in the vicinity to make sure that contractors stay within the boundaries and that stock are either no let out or are retrieved promptly.

If there is a dispute over the level of compensation offered then the only right of appeal at present is to the Upper Tribunal (Lands Chamber). This is a litigious step that is usually prohibitively expensive for the normal landowner—and the acquirer knows this which further strengthens their position. There needs to be the right of appeal to an Independent Person or expert that is quick and cost effective.

Furthermore when Compulsory Purchase is applied to the provision of compensatory habitat there is no guarantee as to how that land will be managed and whether the acquiring authority has prior knowledge or the ability to manage the land to the best standard (these are often decided after the event).

The delivery of the Severn Barrage through a Hybrid Bill is of particular concern to the CLA. The true extent of the scheme, including the areas of compensatory habitat will not be known until the Draft Bill and the Draft Environmental Statement are published shortly before the proposal goes before parliament. Whilst the Hybrid Bill process may be seen as democratic because of its passage through Parliament, however it is very difficult for the individual land or business owner to petition parliament. By the time the proposal reaches Parliament many see the opportunity of getting alterations to the scheme as slight.

Why should it not apply in this case?

Firstly the scheme is being put forward by a profit-seeking company that aims to achieve an income stream either by the operation of the barrage, or a capital receipt through the sale of the concept once they have the powers through the Hybrid Bill.

No such opportunity is afforded to the landowner. He will face years of uncertainty and blight with only the knowledge that should the scheme progress that he will have a protracted battle to negotiate what will only ever the minimal compensation for a proportion of his loss.

If the property or business owner suffers from the construction of barrage or its associated works but does not lose land to the scheme then his ability to claim is severely limited and can only be made a year after the scheme has been completed (more than 15 years away).

Landowners not acquirers are best placed to choose the best land for compensatory habitat.

The areas discussed for the compensatory habitat are huge and cannot be met wholly in the Severn Estuary. This may lead to landowners with land no where near the estuary being compulsory purchased. In the last proposals it was thought that some of this habitat might be found as far away as the east coast estuaries.

There are currently no figures that suggest the land requirements for the barrage itself, nor the amount of compensatory habitat. The only figure within Hafren’s evidence relates to the loss of habitat being 49km² (4,9000ha). Compensatory Habitat provision is set out in the Habitats Directive and its accompanying Guidance with says that it should be at a greater ratio than 1:1. In reality this is delivered in the range 1:3 or 1:4 (14,700 to 19,600ha). However a figure of 16,000ha has been referred to.

Hafren are a commercial company proposing a commercial scheme, they should not be given access to preferential land purchase so that they can make money fromthat purchased land. In addition it is important that the land best able to provide the compensatory habitat is selected and the best management applied. This is arguably best managed by individuals that have owned and occupied the land for generations.

What do you think should be used instead—Voluntary system?

If you remove the threat of compulsion there will be a change of stance by many affected by the route. From opposing the scheme there may be real benefit derived of engaging within the scheme, rather than just an imposition after many years of blight. A voluntary scheme would work well both for the purchase of land required for the scheme as well as the provision of land for habitat creation.

The key factor is that land required for compensatory habitat may not necessarily have to be purchased; it could be managed on a long term contract for the environmental objectives of the scheme. The important aspect of the voluntary scheme is that it can have total flexibility, and there will only be a need to purchase land that needs to be owned.

A voluntary scheme would work in two ways. The promoter could look for the land that it wishes to purchase and then reach agreement with the landowner. Or it could look at the compensatory habitat that it wishes to create and draw up specifications for its character and its management and then ask individuals to tender both for the creation of the habitat and it management.

This could create a tender situation where there may be a choice of sites and a “value for money” decision can be taken to ensure that the best habitat can be delivered for the best price. This would be true commercial delivery and an exemple demonstrating what can be delivered through partnership.

Level of compensatory habitat:
— Is there enough land available?
— Is a voluntary scheme realistic considering the levels of land needed?

If one takes 16,000ha as the amount of compensatory habitat required it would be difficult to understand as to how this can be provided within the estuary itsellf.

If this is the case then a voluntary scheme may work well because there is a sizeable requirement for new habitat and therefore preparing and promoting a scheme becomes worthwhile. It can also open up the delivery of additional habitat to different locations. It also provides for that habitat to be provided in such a way that that land remains in profitable management into the future, rather than more marginal schemes the only compensate for generic losses.

However, greater than that, it will allows sites with the best potential to be married up with the project funding to ensure the best environmental outcome.

What is the impact on local fisheries and the wider rural economy?

The Severn Estuary gives access to 25% of the UK’s salmoid spawning grounds. The Severn itself provides plenty of fishing opportunities and the Wye and Usk tributaries well known salmon fishing rivers. The capital value attached to salmon fishing was found by the Environment Agency to be £9,000 per salmon (or £129 million total market). The Wye and Usk Foundation report that both Salmon and Shad are found in less than favourable conservation condition. There is a need to improve their habitat and increasing breeding numbers and arguably this should be done before the scheme progresses. If the scheme impacts on migratory fish then the £129 million value of salmon fishing would be lost forever, not to mention the loss on other fishing receipts.

It is more difficult to quantify the impact on tourism. There may be an increase in visitors to see the barrage, there may be greater leisure potential within the estuary, but the estuary will be a very different place. Tidal flows will be different, the estuary character will be different, and this may deter people who currently visit from returning.

What, however, is clear is that there will be mismatch between those who lose and those who gain as a result of this scheme. Whilst the scheme spends years in the planning stages, there will only be losers in the rural economy—There will not be anyone who gains.

As soon as any large proposal is unveiled local housing markets are thrown into turmoil because of the uncertainty. Properties with land taken will be compensated after the purchase takes place, but other properties with no land taken will suffer from noise, traffic, dust and will only be able to claim limited compensation resultant from these nuisances a year after the scheme is completed (perhaps15 or more years hence). It is questionable whether the housing of additional workers would make any difference to the market.

Would we support other tidal power schemes- maybe one that allowed the passage of fish?

The CLA has no objection to tidal power, and indeed has always supported renewable energy schemes. However the CLA is not convinced by the arguments put forward for this proposal and the lack of information available regarding the impact of the scheme.

Having a scheme that protected migratory fish would resolve only part of the problem. The impact on flooding (both sides of the barrage), tourism, farming, property values and construction are also big issues. However the delivery of tens of thousands of hectares of compensatory habitat is by far the biggest challenge.

Hafren need also to study the impact of their proposals on flooding in the Somerset Levels. This is already a sensitive area and the impact on this area (which stretches many miles inland) needs to considered at a very early stage in the process, it is unclear as to why there appears to be no detail on this within the proposal. If flooding of this area increases, it will have a negative impact on farming land may miles inland.

Nothing in Hafren’s evidence sheds any comfort on these, very real, current concerns. Hafren must disclose their full plans and all the mitigation measure necessary. Local papers have already published plans showing the barrage which are already impacting on individuals/businesses.

Should the scheme be started on a smaller scale and built up?

The main advantage in building the project up is that you can monitor and regulate the environmental impact. As the scheme develops you can ensure that the most up to date equipment and construction techniques are used.

The disadvantage is that you can never benefit from the economies of scale of the construction and there will always be a lack of vision as to what the project will look like and whether the full benefits will materialise. In addition smaller phased losses of habitat might be seen as acceptable when the cumulative impact would not.

Given the large amounts of land that will be taken out of food production what effect will that have on UK agriculture and food security?

In order to deliver the compensatory habitat of 16,000 ha there would be a considerable impact on local agriculture. Crudely if you assumed that half this area was grass and half cereals the loss would be 55,000 tonnes of grain at a £13 million and the loss of £12 million meat sales. Therefore it is estimated that the total loss from agriculture would be approx £25 million per annum.

Grain and meat would have to be imported or produced elsewhere. Local markets would change leading to increased transport.

Whilst other forms of renewable energy might not deliver the energy output of the Severn Barrage, they would allow the management of habitat whilst generating the energy, rather than needing huge areas of artificial habitat creation.

February 2013