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Compulsory Purchase Orders: how much compensation are farmers and landowners entitled to?

Compulsory Purchase Orders: how much compensation are farmers and landowners entitled to? What is CPO?Alex Rew FRICS FAAV, managing partner and head of Stags Professional Services, raises the issue of rural infrastructure and offers his advice on how much compensation farmers and landowners might be entitled to.

What is a compulsory purchase order?

A compulsory purchase order (CPO) is a legal order which allows certain bodies (known as acquiring authorities) to acquire land and property from its owner, whether they wish to sell it or not. A CPO tends to be used for projects such as new roads, new railways and new housing, amongst other things, and is used to take land where it is in the public interest, or for the greater public good as it is sometimes known.


When it comes to compulsory purchase powers and the statutory basis the legislation is complex and the need for professional advice is imperative. 

The legalities behind each scenario dictate the notice period that is required to be given to the landowner and the basis for compensation; however, there are many other points that require due consideration. These include negotiating the route of the scheme and access to the route and working area, considering the impact of timing on the farming business, the compensation to tenants and their legal interest, plus other mitigating works that could be carried out to help the farmer.

Purchase of the landOn the subject of compensation, Alex highlights, “there are many nuances around how much a landowner should be paid when rights are given away, or when land is physically taken. While there is a statutory basis of compensation, there are many points for negotiation along the way to protect the landowner’s position and a well-informed advisor will be able to capitalise on that.”

One of the key principles of compensation is that the landowner should be reverted back into the position they would have been in previously and this typically includes covering agents and legal fees incurred as a result of the scheme. As such, there is no financial cost to a landowner or tenant who seeks and obtains this essential advice.

Objecting a CPO

Any objections to a CPO must be made in writing and done so within the time period set out in the notice. You can write the letter yourself or you may appoint a professional adviser to submit the objection on your behalf.

Claims under the Part 1: Land Compensation Act 1973

You may not have ownership of the land affected; however, you could still be entitled to a claim.

Should a neighbouring land or house owner be affected by a CPO, you could be entitled to a compensation claim under Part 1 of the Land Compensation Act 1973. Compensation can be claimed by those who own or occupy property that has been reduced in value by “physical factors”, as a result of public works, such as a new or altered road. The physical factors considered are noise, vibration, smell, fumes, smoke and artificial lighting along with the discharge of waste onto the property.

Please note that the loss of view or privacy, personal inconvenience, and physical factors arising during the construction phase of the works, are not included under Part I compensation; However, Stags are able to advise and negotiate compensation on your behalf for damage to your property which occurs during the construction phase.

For more information and bespoke advice on compulsory purchase and compensation, or Part 1 claims, contact your local professional today.