Talking to farmers impacted by the A5 Western Transport Corridor project, there is a lot of anguish around how they have been treated by authorities to date.
Last October, the then Infrastructure Minister John O’Dowd announced the decision to proceed with the new road between Strabane and Ballygawley, which equates to 55km out of the total 85km route between New Buildings and Aughnacloy. Over 3,000 acres of farmland is expected to be lost to the £1.6bn road project. While most people accept there is an urgent need to upgrade the A5, it is important that landowners are treated fairly when it comes to valuing their land.
The principle being used is that of equivalence – you should not be better or worse off after compulsory acquisition than you were before.
The relevant Land and Property Service guide sets out that compensation is based on the value of the land that would be realised if it was placed on the market by a willing seller. On top of that, there is then compensation available for the likes of severance and injurious affection.
In the case of severance, it applies where a field is split into two, rendering part of it less valuable. Injurious affection applies where the new road has a considerable impact on the entire farming operation, leaving retained land less valuable. It is already clear there is significant complexity involved for landowners and that is before we even consider issues around future Capital Gains Tax (GCT) or Inheritance Tax liability.
To avoid CGT liability, it is inevitable that impacted farmers will be keen to re-invest in land at some stage over the next three years. That has already forced on land values in the area, but according to landowners, any local price rise since vesting orders became operative last November, is being ignored in discussions around valuation.
With uncertainty caused by the latest legal challenge against the road, it effectively means landowners neither have their land or their compensation.
It all makes for a very stressful situation for those concerned.
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