Investment needed to realise rural potential

Industry leaders are calling for targeted investment in agriculture following a disappointing Autumn Statement for the sector.

Many farmers will miss out on an £11bn corporate tax incentive unveiled by Chancellor Jeremy Hunt last month. Reductions in national insurance will be a benefit – but previously announced changes mean the overall tax burden will rise.

In a give-away for groups including “farmers who kept us fed” during the pandemic, Mr Hunt confirmed a 2% cut in National Insurance, the abolition of Class Two National Insurance and a reduction from 9% to 8% in Class Four National Insurance.

Living wage

Mr Hunt also accepted aLow Pay Commission plea for the largest-ever increase of the National Living Wage. This will rise almost 10% to £11.44 from April – and apply to 21- and 22-year-old workers for the first time.

But NFU president Minette Batters said many farmers would miss out. “While we acknowledge the announcement of full expensing, most farms are ineligible as the vast majority are unincorporated businesses.”

Rural potential

In a letter to the Chancellor ahead of the statement, Ms Batters said farmers were facing higher input costs and cuts to direct support payments while new environmental schemes were yet to offer similar levels of support.

She added: “Farm businesses form the bedrock of the UK’s largest manufacturing sector – food and drink. To make a real difference, the Chancellor’s focus must be on targeted investment incentives to stabilise, grow and decarbonise our sector.”

Country Land and Business Association president Victoria Vyvyan said the autumn statement failed to recognise the potential of the rural economy, with thousands of rural businesses excluded from what were largely urban-centric measures.

“Rural businesses have suffered a very high tax burden at the same time as high costs. While some measures, such as cuts to self-employed national insurance, are welcome, they will not help businesses in the countryside to grow.

“The tax system needs to be simplified and designed to modernise the sector, driving productivity growth. This means extending the full expensing regime beyond large corporates to include unincorporated businesses as well buildings and infrastructure.

“We welcome measures to help speed up the planning system and provide extra funding for house-building – but government has been talking about planning and housing reform for decades. It now needs urgently to deliver on its promises.”

New Defra secretary ‘backs British farmers’

North-east Cambridgeshire MP Steve Barclay has pledged to back British farmers following his appointment as Defra secretary.

Mr Barclay was given the role in last month’s cabinet reshuffle which saw his Defra predecessor Therese Coffey leave government. He is the ninth Defra secretary in just nine years and was previously health secretary.

First elected as an MP in 2010, Mr Barclay was brought up in Lancashire. He did a short-service commission with the Royal Regiment of Fusiliers and read history at Cambridge University before working in various financial roles.

“Backing British farmers is one of my top priorities,” he said, following his Defra appointment. “As an MP for a rural area I know how important these issues are to many people up and down our country.”

Mr Barclay met NFU president Minette Batters on the first full day in his new role. The two leaders discussed food security, ensuring the government’s farming schemes work for farmers, and delivering fairness in supply chains.