Serving the Farming Industry across the Midlands for 35 Years
The autumn Budget shows Labour doesn’t care for farming families – or their farms, says Clodhopper. So now we know. Despite all its pre-election... Don’t bite hand that feeds you

The autumn Budget shows Labour doesn’t care for farming families – or their farms, says Clodhopper.

So now we know. Despite all its pre-election promises, this Labour government doesn’t care for farming. And neither does it care for farmers.

The autumn Budget is a disaster for farming. Not just for the removal of agricultural property relief. But for the decision to tax pick-ups as if they are company cars. And the faster and harder phase-out of the basic payment scheme.

National coffers

Farmers will also be hit by measures affecting other businesses. Including changes to business property relief and the hike in employers’ national insurance contributions – which the government claims will raise £20bn for the national coffers.

I doubt very much whether Rachel Reeves calculated the impact of ending 100% agricultural property relief on farmland. She didn’t even bother telling Defra until the eve of the Budget.

Not one senior figure in this government – from Keir Starmer down – has ever run a business where a monthly wage bill must be met. Neither have they dealt with rule changes that threaten their very existence.

Imposing 20% inheritance tax on farms passed down to the next generation shows a total lack of understanding of how farming works. Certainly in this neck of the woods, I cannot think of one single farming business that will be unaffected.

‘Good life’

True, £1m sounds like a great deal of money. But sadly not in farming terms, where land prices have been inflated by big corporations, housing developers and wealthy celebrities looking to live the good life.

We all know how low the returns are from food production. They are certainly not high enough to pay this sort of tax – despite Defra secretary Steve Reed asserting that farmers must learn to do more with less.

Farming families are rightly angry. We have been betrayed. If we were French, I suspect Parliament Square would have been blocked with various agricultural machines and implements during last month’s London rally.

Given the Chancellor’s obvious disdain for farmers, it is unlikely that the government will abandon its inheritance tax decision completely. But it seems bizarre to impose a tax and then argue that farmers won’t be affected. Why pick that fight?

Family farms

I could understand the government clamping down on wealthy individuals – including, ahem, Jeremy Clarkson – who buy swathes farmland simply to avoid inheritance tax. Instead, Rachel Reeves chose to target family farms.

So how do we deal with these new rule changes? Big business manages the land for short term profit and to satisfy shareholders. Perhaps areas of farmland will now be sold off to reflect the budget changes.

Smaller farms take the long view. We hope to see our businesses grow so our grandchildren can enjoy the fruits of our labour. Sadly, for many family farms, this may no longer be the case.

Having to find hundreds of thousands of pounds to settle inheritance tax bills will cause massive financial pressure – a burden that will result in many families deciding that the only way to settle is to sell.

Acceptable answer

For others, a life insurance policy could help pay the tax when the demand hits the post box. But given that the average age of farmers is pushing 60, premiums will be expensive and unaffordable if health complications come into play.

At the same time, investment in farm businesses may have to be reduced. In many cases, any spare money will be needed to pay accountants, solicitors and farm business advisers for an acceptable answer.

Rather than making any rash decisions, it is certainly better to sit tight and wait for the heat to go out of the situation. But I can’t see this being reversed completely, even following a change in government – which could be five years off anyway.

Handing over the farm now or selling up are two further options. Neither inspires peace and harmony within many farming families. It is a terrible dilemma – and with mental health issues coming to the fore, let us hope a sensible solution can be found.