Imagine working for 50-odd years at an RAF radar station in Yorkshire. You retire to a five-acre farm nearby with your comfortable but not exactly luxurious pension. You raise a few dairy goats. Then one day someone comes by and tells you that there are millions of tonnes of a fertiliser called polyhalite under your goats. They're going to start digging it up. And when they do, you'll get a cut of its value. Hello luxury.
That's what's happened to Liz Worthy.
Sirius Mining has broken ground on what the Sunday Times called the "biggest mining project ever undertaken in Britain" and she will get a cut of the £65m-odd a year they think they will be paying out in royalties to around 500 landowners (including the Crown Estate).
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
However, Worthy won't be getting anywhere near as much as some. Larger scale farms will bank "seven-figure royalty cheques".
It's heartwarming stuff. But is it reasonable? Why should a group of people who have done nothing in particular taken no risk, had no ideas, dug no holes receive a huge windfall just because they happen to own land in the right place at the right time?
It's a question you might also ask about anyone owning land near a big taxpayer funded infrastructure project (Crossrail for example)? And if you think about too long you will end up wondering about the concept of a land value tax as a possible replacement for our current system of taxation. You can read all about that here.
In the meantime, if you aren't lucky enough to own a farm in the right place in Yorkshire but still fancy an outside chance of getting rich from polyhalite you could buy the shares (LSE: SXX). We haven't looked at the company in detail but it is getting into a high-risk business: the construction work will be tough, the project is huge and the market is uncertain. Midas in the Mail on Sunday rates it "an adventurous long term buy."
-
House prices rise 2.9% – will the recovery continue?House prices grew by 2.9% on an annual basis in September. Will Budget policies and ‘higher-for-longer’ rates dent the recovery?
-
Nvidia earnings: what to expectNvidia announces earnings after market close on 20 November. What should investors expect from the semiconductor giant?
-
Beating inflation takes more luck than skill – but are we about to get lucky?Opinion The US Federal Reserve managed to beat inflation in the 1980s. But much of that was down to pure luck. Thankfully, says Merryn Somerset Webb, the Bank of England may be about to get lucky.
-
Rishi Sunak can’t fix all our problems – so why try?Opinion Rishi Sunak’s Spring Statement is an attempt to plaster over problems the chancellor can’t fix. So should he even bother trying, asks Merryn Somerset Webb?
-
Young people are becoming a scarce resource – we should value them more highlyOpinion In the last two years adults have been bizarrely unkind to children and young people. That doesn’t bode well for the future, says Merryn Somerset Webb.
-
Ask for a pay rise – everyone else isOpinion As inflation bites and the labour market remains tight, many of the nation's employees are asking for a pay rise. Merryn Somerset Webb explains why you should do that too.
-
Why central banks should stick to controlling inflationOpinion The world’s central bankers are stepping out of their traditional roles and becoming much more political. That’s a mistake, says Merryn Somerset Webb.
-
How St Ives became St Tropez as the recovery drives prices sky highOpinion Merryn Somerset Webb finds herself at the epicentre of Britain’s V-shaped recovery as pent-up demand flows straight into Cornwall’s restaurants and beaches.
-
The real problem of Universal Basic Income (UBI)Merryn's Blog April employment numbers showed 75 per cent fewer people in the US returned to employment compared to expectations. Merryn Somerset-Webb explains how excessive government support is causing a shortage of labour.
-
Why an ageing population is not necessarily the disaster many people think it isOpinion We’ve got used to the idea that an ageing population is a bad thing. But that’s not necessarily true, says Merryn Somerset Webb.
