Minette Batters — a farmer, former NFU President and a Baroness sitting in the House of Lords — has a harsh warning for Keir Starmer's government.
Not since I left the NFU has my phone been so busy, either with distraught, angry farmers or media requests. Today decided to broadcast from the farm on the morning of the NFU mass lobby and farming rally in Whitehall. The presenter Jonny Dymond and the production team turned up the afternoon before and were back at 3.50am the following morning. I’m used to getting up early, but 3am felt very early.
Being interviewed live for Today in my own home seemed slightly surreal; I worried the dogs would bark, but Sophie the producer assured me it wouldn’t matter in my slot, although if they could be quiet for discussions of the Middle East or Ukraine it would be appreciated. A bone each worked wonders.
The point I made on Today was that farmers feel the family-farm tax is ‘the straw that has broken the camel’s back’. They have faced huge uncertainty during the past five years through negative trade deals and many have seen their costs rise by 30% since the war started in Ukraine. The transition to the post Brexit Environmental Land Management schemes has faced problems and now it has been announced that the entire grant system has been put on hold. Farmers feel betrayed and trust must be rebuilt. There has been no coherent plan for five years now; no wonder farmer confidence is at an all-time low.
As soon as my interview was over, I left the farm and headed to London; the train was packed. I sat next to a farmer who told me that his son was leaving the construction industry to come back and take over the farm. The Budget had hit the family hard and they were busy getting advice from their accountant. He asked me if I thought the Prime Minister had imposed the tax deliberately. Sir Keir Starmer has visited my farm, as has Defra Secretary Steve Reed. Perhaps I’m naïve, but I don’t believe this Government set out to wipe out the family farm as we know it. Yet it will be the consequence, unless a solution is found.
After 10 years at the NFU, I have grave concerns about advice given by the Treasury to the Government. The family-farm tax is classic ‘desktop economics’, devoid of understanding of how the rural economy functions. Civil servants didn’t engage with Defra and decided against any consultation with the industry (Leader, December 4). Had they done so and acted responsibly, this whole debacle could have been avoided.
“If I owned our farm, there is no way my children could avoid selling land to pay inheritance tax on my death”
I’m a tenant on my farm, which is only 300 acres with a farmhouse and a couple of cottages. My life’s work has been building the business. Like many farmers, I’ve had times when I haven’t had £10 in cash to my name. Many farms have an overdraft, no savings and, in some cases, no pension. Often, good businesses are carrying substantial investment debt, usually offset over many years.
If I owned our farm, there is no way my children could avoid selling land to pay inheritance tax on my death. Our farm, like many others, would then become a far less viable farming business. What would happen to the people I employ: Rae the secretary, Josh our vet, Richard the agronomist? The countryside is a living, breathing landscape, with so many livelihoods dependent on family farms.
This was the point I made recently on Question Time when I was asked why farmers should be treated differently. It’s a fair question — farmers certainly don’t want to be treated as a special case. There are many reasons why farming is asset-rich and cash poor, with failure to get a fair return for producing food being one of them.
The Government is the largest landowner in the country, alongside charities, Oxbridge colleges and Church Commissioners, none of whom have to pay inheritance tax. Yet private-equity businesses, celebrities, asset and fund managers continue to have access to business-asset rollover relief to offset capital gains tax. Therefore, if they sell a business and buy land with the proceeds, they defer their capital gains tax. These are not businesses with £10 in their pockets — they’re often multinationals and FTSE 100 companies. The cruellest twist of fate is that all of these can now access Defra’s taxpayer funded investment to rewild and plant trees.
The institutional machine that advises Government is, in my opinion, at a crossroads. Their need to balance the books is clear, but no country can tax its way to prosperity alone. Although AI and new tech are perceived to be the tools of the future, they are worthless without people. We need farming entrepreneurs more than ever. If Government puts the right plan in place, farming could deliver so much more than the £115 million from the family-farm tax.
Baroness Batters is a crossbench peer and former NFU president. She runs a beef farm and rural business in Wiltshire
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