Farming and Inheritance Tax

I inform the House that I have selected amendment (a) in the name of the Prime Minister.

12:47:00

I beg to move, That this House regrets that the Government has undone its promises to farmers, and is seeking to punish them with Inheritance Tax bills of hundreds of thousands, or even millions, of pounds by cutting Agricultural Property Relief and Business Property Relief; further regrets that the Government has provided conflicting information on the number of farms that will be affected, and has not conducted an impact assessment of this approach; notes that figures from the National Farmers’ Union suggest that some three quarters of farms will be affected; further notes that farmers tend to be asset-rich but cash-poor and that figures from the Country Land and Business Association suggest the average arable farm will have to sell 20% of its land to pay the Inheritance Tax bill that this policy will cause; notes that the Central Association of Agricultural Valuers anticipates that this will affect 75,000 owners of farming businesses over a generation; notes also that this land is not guaranteed to be used for food production if sold; and calls on the Government not to impose the cuts to Agricultural Property Relief and Business Property Relief set out in the Budget that will lead to the end of family farming as it has been known for many generations in the UK. This Government have driven farmers to despair. The hike in national insurance, the acceleration of delinked payments, the fertiliser tax, the double cab tax, the stalling of capital grants, the scrapping of the rural services delivery grant and the slowing down of applications to farming schemes are all conspiring against our rural economy and the survival of British farms. Yet the Government have added a death tax to that: the family farm tax, which is seeing families across the United Kingdom worry about whether they will be able to hand on their farms to their children, as generations before them have done. In the 36 days since Labour’s Budget, the Chancellor, the Secretary of State and Ministers have tried to justify their family farm tax, which will break up family farms, by claiming that only 500 farms will be affected each year. Awkwardly, the figures used by the Chancellor are contradicted by figures produced by the Department for Environment, Food and Rural Affairs. The left hand does not know what the far-left hand is doing. When the figure was queried by the National Farmers Union, the Country Land and Business Association, the Tenant Farmers Association, farmers across the United Kingdom and us Conservatives, Ministers told us all rather patronisingly that we did not understand and that farmers should seek professional advice. Well, farmers have sought professional advice, which has revealed just how badly wrong the non-economist Chancellor has got her numbers.

Will the shadow Minister give way?

In a moment. Since the Budget, the Central Association of Agricultural Valuers has analysed the family farm tax and applied tax law and the realities of modern-day farming to it. Its analysis has revealed that up to 75,000 individual owners of farming businesses could be affected over the coming generation, even before inflation, which is the equivalent of five times the Government’s figure of 500 farms affected in 2026-27. How could they have got this so wrong? It is because this city-dwelling Chancellor, Secretary of State and Exchequer Secretary do not understand modern farming or the countryside that they have overlooked a major area of tax policy and forgotten to consider thousands of farmers. As the Exchequer Secretary has confirmed, the Government forgot to include one of the three routes to the relief in their calculations. They have not included business property relief-only claims in their figures, which means that as many as 14,000 tenant farmers who cannot claim agricultural property relief because they do not own the land on which they farm are absent from their calculations. What is worse is that Ministers do not know how many farmers are affected by that. The city-dwelling Chancellor and Secretary of State have also forgotten about the farmers who in years gone by followed professional advice and transferred their farms into companies or partnerships. Those farmers will claim only BPR, so they have been left out of the calculations. Again, Ministers do not know how many farmers are in that position.

Will the right hon. Member give way?

I will in a minute. I am told by advisers that some farmers choose to use BPR only because it is easier in probate. Guess what? Yet again, Ministers do not know how many farms are in that position, and they have not been included. I will give way first to the hon. Member for Strangford (Jim Shannon) and then to the hon. Member for Scarborough and Whitby (Alison Hume). I have so much more to say.

I commend the shadow Minister for bringing forward the debate. The collective decision to have this debate in the House is one that my farmers and constituents very much support. Professional legal advice sought through the Ulster Farmers Union—I must declare an interest as a member of the union—indicates that somewhere in the region of 65% of small farmers and family farms in Northern Ireland will be affected. When it comes to understanding that, has Labour really got no idea what is going on?

I thank the hon. Gentleman for intervening. The evidence is building again and again against the assurances that the Chancellor, the Secretary of State for Environment, Food and Rural Affairs, the Exchequer Secretary and the farming Minister have given the House. Frankly, the farmers outside deserve better, and so do we as Members of Parliament. I will give way to the hon. Lady and then carry on with the calculations that the Government have got so wrong.

The right hon. Member left a trail of destruction across the Government. She was the Health Secretary who broke the NHS, the Prisons Minister who ran out of prison places and the Treasury Minister who crashed the economy—no wonder her constituency majority crashed from 28,000 to 5,000. [Interruption.] Does she not think it is time to apologise and for once to support the Government, who are bringing back stability to the British economy and farmers’ profitability?

Order. I know that Members are jeering about reading. I know that when I came to the House it was a rule that you should not read, but both sides are doing it. Remember that.

On a point of order, Mr Speaker.

I have a point of order—from the shadow Minister’s good friend, of course.

This point of order is spontaneous, unlike that intervention. [Interruption.] I am Mr Spontaneity. Mr Speaker, you are entirely right that many right hon. and hon. Members read their speeches almost verbatim, but surely it is just rude and discourteous to the House for the hon. Member for Scarborough and Whitby (Alison Hume) to read a supposedly spontaneous intervention as if it had just come into her mind. She managed to find a typewriter and a printer in order to write down two pages of intervention.

As I expected, spontaneity did not make it a point of order.

As the first female Prime Minister said, if they are going after you personally, it means you are winning the argument. Let me help the hon. Member for Scarborough and Whitby with the second set of calculations that her Chancellor has got so wrong, because the Chancellor’s cockeyed accounting extends to the claim that farmers will be able to transfer £3 million tax-free. That is wrong. Only a few in a specific set of circumstances will be able to claim that magic figure. [Interruption.] There are jeers from Government Members, but that amount is not available to widows, it is not available to people who are single and it is not available to people who own a farm with another relative. Labour’s magic £3 million figure assumes that the surviving spouse lives some sort of monastic existence where they have no personal effects to pass on to their loved ones. As farmers from Sussex have asked, why are widows’ families being targeted? A family wrote to me about their mother, who is a widow. They have calculated that they face an additional £200,000 tax bill from Labour because their father died before the Budget and so did not know to transfer his allowance. We know that some Labour Members of Parliament have concerns. The hon. Member for South West Norfolk (Terry Jermy), who represents over 500 farms—I do not know whether he is in his place—has asked for assurances on the accuracy of figures used by the Government. Given the demolition of the Chancellor’s figures by the CAAV and many others, will he vote for the family farms in his constituency or will he toe the party line? The CAAV’s concern about the figures being peddled by the Government is shared by the Institute for Fiscal Studies, CBI Economics and even the Office for Budget Responsibility. But it is not just about the numbers: Labour Members need to understand the emotional toll of this terrible tax. It is the worry, the distress and the sense of betrayal felt by families that should stop ambitious Labour MPs in their tracks before they parrot without question the figures given to them by their Ministers.

I will give way to the hon. Lady. I hope that she does not fall into the category that I just described.

The right hon. Lady talks about the figures. Does she accept that her Government’s record was one of leaving £300 million of the farming budget unspent in the Treasury coffers, not helping farmers?

I thank the hon. Lady sincerely for raising that point, because she has—perhaps unwittingly—identified a contradiction in DEFRA’s own claims. It talks about a £300 million underspend, but last week it was cancelling the very capital grants that farmers around the country have been investing in, saying that it had run out of money. Well, it cannot be both. Perhaps that is yet another example of the cockeyed accounting of the Chancellor and the Environment Secretary.

Does my right hon. Friend agree that what is quite frightening about this policy is that perhaps the Government know exactly what they are doing, and that, a bit like “Animal Farm”, they think everything should be collectivised?

My right hon. Friend, who has a wonderful way with words, asks a question that many members of rural communities up and down the United Kingdom are asking themselves. In fact, when the Prime Minister did regional media a couple of weeks ago, Sean Dunderdale, the wonderful presenter on BBC Radio Lincolnshire, asked him what he had got against the people of Lincolnshire. I might ask: what have this Labour Government got against the countryside?

I will give way to my right hon. Friend and neighbour and then I will make some progress.

As my right hon. Friend has said, the word “betrayal” is fitting because, long before the election, pledges were given, by both the Secretary of State and the Prime Minister, that these changes would not be made.

Order. The right hon. Member is a very experienced Member of this House, and he knows that he is meant to address the Chair, not the Front Bench.

Mr Speaker, I know that you, as a man of integrity and honour, will be as disappointed as I am that the Government should promise one thing and then do the exact opposite.

It is a great pleasure to have the right hon. Gentleman not just as a friend but as my Lincolnshire neighbour. He has put his finger on the point—genuinely, it is the next paragraph in my speech. Some Labour MPs must be haunted by the phrasing from the Secretary of State during the general election campaign—because I suspect that they repeated it up and down the market towns and villages in their constituencies—when he described fears that Labour would impose this family farm tax as “desperate nonsense”. Labour candidates will have repeated that line and assured the farming families in their constituencies that Labour would never treat rural communities in that way, yet within weeks the Chancellor was planning to do exactly that. Since then, families across the country have been trying to work out how to pick up the pieces after Labour’s family farm tax bomb. They will not forget. A farmer from Derbyshire emailed me this week to say: “Our hard work and investment as a family has been wiped away in the stroke of a pen.” They went on to say: “My 60 year old husband had a bleed on the brain in June and thankfully has made a full recovery but I’ve never seen him so stressed. He doesn’t know what to do”. Hon. Members representing seats in Derbyshire may wish to reflect on how they will respond to that. A farmer from Northumberland has written to me as follows: “We had to talk about which one of my parents are going to die first, in front of them.” He said that Labour is “destroying people’s lives with this policy. Many of us are worried about the mental state of many within agriculture and are concerned that it may be the final straw for some.” In fairness, the hon. Member for Hexham (Joe Morris), who is in his place, has voiced concerns about whether his Government are listening to ordinary people about this. Will he vote for his farmers or will he toe the party line?

As a farmer’s wife, I understand the emotional impact that my right hon. Friend sets out so clearly. This is about not only the farmers who will be affected but all the farmers who know that they might be affected. This is a tax on tragedy, and no one knows if it will befall them.

My hon. Friend and Lincolnshire neighbour sets out exactly the personal impact of the tax. I know how Treasury Ministers look at spreadsheets and those terribly impressive packs of information from civil servants. [Interruption.] I remind Government Members that this is deeply serious; it is not a joke. I also know that Chancellor after Chancellor has looked at the figures and come to the conclusion that this is a political decision. The current Chancellor has got it wrong.

The shadow Secretary of State made an important point about the health and wellbeing of our farmers. As operation waiting times were almost three times higher when she was Health Secretary than they were in 2010, does she not welcome the investment that this Government are putting into our NHS? [Interruption.]

Do not worry; I will deal with that. I thank the hon. Gentleman for raising the important issue of mental health in farming across the national health service. I was proud to work, as a Member of Parliament and as Secretary of State for Health, to massively increase investment in mental health services. If he is a rural MP, I am sure that he will know how isolated farmers can be and the pressures on their emotions at the best of times—they have the weather, diseases and crop cycles to contend with. This pressure merely adds to that, as we have already heard from farmers who have contacted me. I also gently remind the hon. Gentleman that the family farm tax—or tax on tragedy, as my hon. Friend the Member for Sleaford and North Hykeham (Dr Johnson) called it so bleakly—will raise £500 million in 2026-27. According to the King’s Fund, that is equivalent to about a day’s worth of services in the NHS in England. It will not be quite the game changer that some in the hon. Gentleman’s party believe it to be. What about the family in the south-west whose beloved father died a decade ago in tragic circumstances, leaving three young children who are now in their teens? The mother has run the farm and brought up their children in the midst of their grief. She has now been diagnosed with a life-threatening illness at the age of 50. Two of the children want to carry on the farm when they reach 18 but, should the unthinkable happen and they lose their mum, they will be saddled with Labour’s family farm tax of £700,000. What empathetic and meaningful response does the Secretary of State, who is not in his place—where is he?—or the Treasury Minister have for that family? They will be watching and listening. We took the unusual step of giving lots of notice to Labour MPs that we would debate Labour’s family farm tax today. We did that because we wanted to give Labour MPs in rural seats time to reflect and consider whether they can continue to support this vindictive tax. For example, a Welsh landowner told me that he will have to sell six tenanted farms to pay Labour’s family farm tax. That is six farming families—who we on the Opposition Benches would describe as working people—who will lose their businesses, their family homes and their children’s farming futures. Those six farming families have been forgotten by this Government. The hon. Member for Montgomeryshire and Glyndŵr (Steve Witherden) has called on the Treasury to produce its modelling on the impact on family farms. Will the Treasury do that, at the Back Bencher’s request? How will he vote today? The hon. Member for South East Cornwall (Anna Gelderd) met farmers earlier this month and claimed that she would take their concerns back to Westminster. Will she raise those today and vote against this tax?

I have consulted widely with farming communities and farmers in my constituency. I have not been able to identify a single farmer who feels that there is anything good in this policy whatsoever. Does my right hon. Friend know whether there is a single Labour Member of Parliament representing a rural community who genuinely believes that they will be voting in their constituents’ interests tonight?

I sincerely thank my right hon. Friend for setting out clearly the choice ahead of Members across the House. We on the Opposition Benches know who we are standing up for. We back our farmers. We understand how difficult farming is as a way of life. It will be for individual Members of Parliament to decide how they vote.

The right hon. Lady talked about choices and backing farmers. The current Leader of the Opposition did a trade deal with Australia and New Zealand that sold farmers down the river. Is that her version of backing British farmers?

I am pretty sure that the hon. Gentleman has his facts wrong about the then Trade Secretary. The Conservative party is in favour of trade deals, but we want trade deals that best support our farming industry. [Interruption.] Before Labour Members start shouting at me, he will know that the fears and concerns about those trade deals have not come to fruition. What is more, we as Conservatives are proud of the fact that we would not enter trade deals that require the flooding to these shores of chlorinated chicken or hormone-treated beef. I also gently remind the hon. Gentleman that, as a Back Bencher, talking about foreign territories given the context of the debate about the Chagos islands is a bit brave.

We do not have much trade with the Chagos islands.

My right hon. Friend is right to highlight the devastating effect of this policy and to highlight the incredible rounding-up exercise on the Treasury account books of the contribution that it will make to NHS expenditure. With the Labour party having a serious foothold in rural constituencies for the first time since 1945, does she not find this rather inept politics, which is perhaps not surprising from such a London-centric Front Bench? The policy shows a wilful ignorance of rural life and a deliberate attempt not to understand the pressures and is, in essence, selling those rural Labour MPs down the river.

I thank my hon. Friend for that point. There is some interesting polling coming out today, which I will deal with. Of course, Mr Speaker, I very much accept your point about trade, but we are genuinely concerned about the national security implications of the Chagos islands deal.

I can assure the right hon. Lady that so am I.

Very much so, Mr Speaker. I will give way to the hon. Member for Hexham (Joe Morris). Is he going to speak up for his farmers?

I commend the right hon. Lady’s commitment to honesty. She talks about giving Labour Members advance sight of the Opposition day motion, but when did the Labour Whips Office receive the title of the Opposition day debate? May I invite her to correct the record perhaps?

I am so sorry—in fairness, the hon. Gentleman was obviously speaking to farmers in his constituency on Sunday. Did I hear that there is a protest going on in his constituency at the moment? In any event, I actually made the announcement on national television on Sunday; perhaps he was not watching. Farmers at home will be wondering what on earth we are arguing over.

One word that the right hon. Lady has not mentioned is Brexit—the great Tory disaster of the last Parliament. How much does she estimate that Brexit cost farmers and the rural community?

The hon. Gentleman and I, unusually, can join forces on this matter. While I am going to resist the temptation to revisit Brexit, what I will do is point him to paragraph 4.11 of the CAAV report—

Order. You are facing totally the wrong way—I cannot pick up anything. Please turn around.

My apologies, Mr Speaker. I am reminded of paragraph 4.11 of the CAAV report, which sets out the peculiar legal problems posed by the family farm tax in the context of Scottish farming tenants. It is incredibly complicated, but that is a real concern, and I trust that the SNP will be exploring it alongside Conservative Members of Parliament. In conclusion, before ambitious Back Benchers, or, indeed, the Exchequer Secretary, get to their feet and accuse these farmers, and us, of scaremongering—something they have been happy to do in the past—they should think on, discover some humility and compassion, and ask why tens of thousands of decent, hard-working and sensible people across the United Kingdom know that the Chancellor has got it so wrong. Polling by the Country Land and Business Association today shows what the public think: they do not think farmers should be whacked with the family farm tax. They think that Labour has broken its promise to end countryside decline; they think the Government should be cutting taxes on rural businesses; and 70% are not confident that the Labour Government can deliver growth to rural communities. I say to every hon. Member on the Government Benches: do the right thing and stand up for our farmers, who are the best in the world and whose produce is renowned globally. They feed us, and now they need us. Labour MPs need to join us and axe the family farm tax.

13:13:00

I beg to move an amendment, to leave out from “House” to the end of the Question and add: “thanks farmers for their immense contribution to the UK economy and the nation’s food security; welcomes the Government’s commitment of £5 billion to the farming budget over the next two years, the biggest budget for sustainable food production and nature recovery in UK history; acknowledges that the Government is having to make difficult decisions to protect farms and farmers in the context of the £22 billion fiscal blackhole left by the previous Government; recognises that the Government is seeking to target Agricultural Property Relief and Business Property Relief to make them fairer whilst also fixing the public services that everyone relies on; and notes that under the changes announced in the Budget around three quarters of claims for Agricultural Property Relief, including those that also claim Business Property Relief, are expected to not pay more Inheritance Tax.” I welcome the chance to open the debate on behalf of the Government. The Government’s commitment to farmers is steadfast. As our amendment makes clear, farmers make an immense contribution to the UK economy and to the nation’s food security. We recognise and respect the crucial contribution that farmers make to our country’s way of life. We must also recognise, however, the state of our public services and the mess in which we found the public finances when we came into power. There was no way we could have left things as they were. Unlike the Conservatives, there was never any question of Labour ignoring the £22 billion black hole that we uncovered in the public finances. We had to bring the previous Administration’s fiscal irresponsibility to an end. We had to ensure that our country lives within its means. We had to get public services back on their feet while meeting our tough new fiscal rules, which end borrowing for day-to-day spending. That is what we, as a responsible Government, had to do. That is why, at the autumn Budget, the Chancellor set out a number of difficult but necessary decisions on tax, welfare and spending. These decisions were to restore economic stability, fix the public finances and rebuild our public services. One of the decisions we took was to reform agricultural and business property relief. We chose to do so in a way that maintains significant tax relief for family farms, while fixing the public finances as fairly as possible.

The hon. Gentleman will want to explain this, Mr Speaker. The Government have argued that only 27% of farms will be affected by this measure, while the National Farmers Union says it is 75%. Will he at least give us an indication from the Dispatch Box, perhaps supported by a note in the Library of the House, showing the modelling that contradicts the NFU’s figures?

I point the right hon. Gentleman to the letter the Chancellor recently sent to the Treasury Committee, which sets out some of these figures in detail. Some of the confusion that he and other hon. Members have encountered might come from the fact that there are different sets of data. The set of data he may be referring to relates to the total value of farms across the country, but if we are thinking about inheritance tax claims, it is right to look at His Majesty’s Revenue and Customs claims data on inheritance tax. Looking simply at the value of a farm does not tell us what the inheritance tax liability for that farm may be, given that we would have to look at the ownership structure—at who owns what—and at any liabilities, and so on. That might be where some of the right hon. Gentleman’s confusion is coming from.

At Treasury questions yesterday, I raised with the hon. Gentleman the case of Upper Peppershill farm in Long Crendon, a small 380-acre arable farm in my constituency, which the shadow Secretary of State and the Leader of the Opposition visited a few weeks ago. The family have calculated that if they borrow the money to pay this new tax, it will take them 40 years to pay it back. What does the Minister say to the Seed family in Long Crendon about the tax bill they face?

It is not appropriate for me, as a Minister, to give specific tax advice to one family, but I will talk about the general principles behind our reform. In fact, I was about to begin setting out some of the detail of our policy.

On the general principle, is the Minister seriously saying that all the tax advisers advising all the farmers across the country and all the land valuers, who are qualified in a way that he is not, are wrong, and that he is right?

What I am explaining is that the data for claims through HMRC, which shows the claims made under agricultural property relief and business property relief, is the correct set of data to work out future liabilities on that basis. That is what the projections that we have put out are based on. That is set out in the Chancellor’s letter to the Treasury Committee that I mentioned. I urge the right hon. Gentleman and his colleagues to review that letter to understand the data I am talking about in more detail.

I would like to make a bit of progress to explain some of the detail behind our policy, which may answer some of the questions that hon. Members are jumping to their feet to ask. We know that inheritance tax is always an emotive issue, and understandably so. It is a natural desire for people to want to pass on their assets to the people they love when they pass away. The standard single rate of inheritance tax has been 40% since 1988, and assets have generally long been entitled to nil-rate bands, reliefs and exemptions. A form of relief for agricultural property was introduced on estate duty in the Finance Act 1948, meaning that this duty was charged at 55% of the rate that would normally have applied. A new agricultural property relief and a business property relief were created in the mid-1970s with the introduction of the capital transfer tax. The rate of relief increased over time to a maximum of 50% relief; that maximum rate was then increased to 100% in 1992. This means that agricultural landowners and farmers did not receive 100% relief for almost all of the 20th century, and yet farms passed down between the generations.

I am grateful to the Minister for giving way. That was why the law was changed to introduce 100% relief. Family farms were not being passed down because the value of land was increasing. Will he consider that before bringing in these changes?

To address the right hon. Gentleman’s point, we recognise that agricultural and business property relief play an important role in supporting family farms, but the full unlimited exemption from inheritance tax has simply become unsustainable. The four most recent years-worth of data make clear why. The data shows that a very small number of agricultural property relief claimants, including those who claim business property relief too, benefited from a very significant amount of relief. In total, 47% of the Exchequer cost of the relief went to the top 7% of claims. To be clear what that means, I will put it another way. For every 14 or so estates, the top one among them claimed half the total relief.

Let me tell the Minister what concerns me most. There has not been an impact assessment, but if the major driver for the Government, whether we accept it or not, was to raise some money from this source, why were other more effective mechanisms not used, such as business roll-over relief, where a business could be sold in another context and rolled over into buying the land, deferring capital gains tax? If that mechanism had been used, the money would have been taken from much wealthier people who were not actually producing food in the first place. Now, we are capturing a massive proportion of small family farms completely unnecessarily, because due consideration of better alternatives was not done by the Minister.

I reassure the right hon. Gentleman, for whom I have a lot of respect personally, that we carefully considered how to calibrate the policy to ensure that significant relief from inheritance tax is still available to family farms, while at the same time fixing the public finances in as fair a way as possible.

I am very grateful to the Minister for giving way. He has just referred to his analysis of four years of data which led him and the Government to this position. That is an incredible thing to ask the House to believe, because just a few months ago his right hon. Friends the now Prime Minister and Secretary of State were specifically ruling out these policies to audiences of farmers and landowners. If the data of four years’ standing told him that this was the right policy, why were those now Ministers economical with the actualité when they spoke to the farmers themselves?

The data we did not have before the general election was the £22 billion black hole that the hon. Gentleman’s party left in the public finances. He knows that, because it is acknowledged by the Office for Budget Responsibility that the full information was not shared with it. It has said that its forecast would have been “materially different” had it known that that was the case. We have had to take a number of difficult decisions.

This talk of data reminds me that over 12,000 farmers and agribusinesses have gone out of business since 2010. Will the Minister reassure me about what we are doing to improve profitability in British farming?

My hon. Friend is absolutely right to highlight the decimation of businesses during the Conservatives’ time in office. Businesses across the economy need stability, public finances on a firm footing and investment in our public services. That is what businesses across the country need to invest for the future and grow.

I am very grateful to the hon. Gentleman for giving way. He is a Treasury Minister. May I suggest that some of the disparity between the Treasury figures and those of other reputable bodies representing agricultural interests is because of land values? Average values for ordinary land in the Cotswolds are now £15,000 an acre. Will he accede to the request of my right hon. Friend the Member for Salisbury (John Glen), a former Chief Secretary to the Treasury, and publish an up-to-date impact assessment on how many farms this tax will affect?

A lot of data has already been published. I mentioned the Chancellor’s letter to the Treasury Committee, and further details on the impact will be published alongside the draft legislation in the normal way. I suggest that the hon. Gentleman reads the letter to the Select Committee. As he and the his right hon. Friend will know, the impacts are typically published at the time of draft legislation. That is the normal process. Indeed, it was the norm under the previous Government.

I will take one more intervention and then I will make progress.

Some of the correspondence I have received on this issue talks about the fact that the measures inflate land value. Does my hon. Friend agree with that assessment, and what will the changes do to help farmers across the country in that respect?

My hon. Friend is absolutely right to highlight the fact that some of the features of the current inheritance tax relief system mean that it is an attractive vehicle for tax planning to reduce inheritance tax liability. People who have wealth who have never been farmers and do not intend to become farmers have been using it as a way to avoid inheritance tax. In fact, reducing that should take some of the pressure out of agricultural land values and, I would hope, help to make a more sustainable farming sector in the future.

It is important to get the facts right and to get the right number of farms in frame. The Minister must know that the CAAV has said that the Government estimate is down by a factor of five. According to its impartial independent review, 75,000 farms will be in frame for this tax, not the figure the Minister is relying on.

My response to the right hon. Gentleman is the same as that to the right hon. Member for South Holland and The Deepings (Sir John Hayes). I believe he is looking at the data for the total value of farms, rather than for inheritance tax claims. The two are different things. For instance, a farm worth £5 million owned in equal shares by five individuals would have no inheritance tax liability because of the way claims work. That is where I think some of the confusion has come from. There is different data around the value of farms and around the value of inheritance tax claims. For the purpose of today’s debate, it is the inheritance tax claims that are the right data to focus on.

On the point about facts, I was fascinated by the end of the shadow Secretary of State’s contribution. She opined on whether Labour was sticking to its promise to end the decline in the countryside. I wonder who was in government for the last 14 years while the countryside was declining. The Conservative Government sold out British farmers through trade deals and 12,000 farming businesses went out of business. Does my hon. Friend agree?

I very much agree with my hon. Friend. He points out a repeated pattern of the Opposition: their total refusal to take any responsibility for the damage they caused over the past 14 years. They may wish it never happened; the British people disagree.

I am going to make some progress. I just set out some statistics that show how this tax relief is very concentrated in a small number of claims. In the context of the dire fiscal situation we inherited and the critical need to fix the public finances and get public services back on their feet, it cannot be right to maintain such a significant level of relief for a very small number of claimants. That is why, from 6 April 2026, the full 100% relief from inheritance tax will be restricted to the first £1 million of combined agricultural and business property. Above that amount, there will be an unlimited 50% relief, so inheritance tax will be paid at a reduced effective rate of up to 20%, rather than the standard 40%. The new system, it should be noted, remains more generous than in the past. As I mentioned, the rate of relief prior to 1992 was a maximum of 50% on all agricultural and business assets, including the first £1 million. The reliefs we are providing will be on top of all the other exemptions and nil-rate bands that people can access for inheritance tax. Taken in combination, this means that a couple with farmland will typically be able to pass on up to £3 million-worth of assets to their descendants without paying any inheritance tax.

I thank the Minister for giving way. The CAAV calls the £3 million figure “unrealistic” and “unreasonable”. Does he not agree?

The £3 million figure is what a typical couple could expect to pass on to their direct descendants using the various nil-rate bands and inheritance tax reliefs. I would advise any specific family to get advice from an accountant or financial adviser. In terms of the scale of reliefs, when we combine the inheritance tax relief to agricultural and business property relief, along with the nil-rate bands, nil-rate residence bands and the transferability between spouses, that is how we come to the figure of £3 million.

Given that he appears to be leading for the Government on this issue, rather than the Secretary of State for Environment, Food and Rural Affairs, can the Minister tell me how many farmers he has met personally over the last three months? He seems very confident about how this will affect them. The exact number, please, of the farmers you have met personally over that period.

Order. The hon. Lady should ask how many farmers the Minister has met, rather than how many I have met.

I have met members of the National Farmers Union, representing the farming industry, a number of times since the Budget for detailed discussions. That has helped us to understand the impact that this policy will have and to ask for their support in communicating how it will work.

I am going to make some progress. I am going to continue to explain how some of the other exemptions within the inheritance tax system will benefit people affected by this policy.

Can the Minister confirm that in the case of farms worth several million pounds, any mortgageable value is not included for the purpose of inheritance tax? Might that explain the discrepancies in some of the figures that are being bandied around, in which I believe mortgages have not been taken into account?

That is an important point. Looking at the pure asset value of farms does not tell us what their inheritance tax liability might be. As my hon. Friend rightly points out, any liabilities must be netted off against the value of any estate, and the ownership structure—the various nil rate bands, previous spousal transfers, giftings and so on—need to be considered.

Will the Minister give way?

No. I am going to make some progress. As my hon. Friend the Member for North East Derbyshire (Louise Jones) has pointed out, a range of exemptions need to be taken into account. Full exemptions for transfers between spouses and civil partners will continue to apply. Any transfers to individuals more than seven years before death, as gifts, will continue to fall fully outside the scope of inheritance tax, and taper relief will apply in certain circumstances within that time. Furthermore, any tax that is due in relation to these assets can be paid in instalments over 10 years, interest free. Those payment terms are more generous than in any other part of the tax system. As I have mentioned several times during the debate, these decisions have been based on understandings that draw on data from both DEFRA and HMRC. I note that there has been some confusion on the Opposition Benches, whether wilful or not, about what the data shows.

The hon. Gentleman has made an important point, but analysis will show that over a 10-year period, 99% of the profit from the average 350-acre arable farm owned by a couple will go back towards paying inheritance tax. That does not leave enough money for them either to invest or to live. I wonder how the hon. Gentleman thinks they can deal with that.

I have confidence in the way in which we have calibrated the policy. As I said to the right hon. Member for Salisbury (John Glen), it has balanced the need to retain significant, generous provision of inheritance tax relief for family farms with ensuring that, at the same time, we fix the public finances in the fairest way possible.

The hon. Gentleman is being very generous with his time. In view of the point that has just been made by my right hon. Friend the Member for Stone, Great Wyrley and Penkridge (Sir Gavin Williamson), will he not consider, at the very least, looking at some dispensation for farmers above a certain age, given the lack of time that they will have to plan for this intervention? The truth is that someone who is near retirement age will be faced with the prospect of 10 years of all their projected profits being eaten up by this tax, which will mean that the farm cannot go to the next generation. The hon. Gentleman must surely look at some mitigations to deal with that reality for so many farmers who are concentrated in that older age group.

We know that individual circumstances will vary. Any individual who is concerned about their specific tax liability should obviously consult an accountant or financial adviser. We would not know, from a thumbnail sketch, whether that person had any inherited nil rate bands, what their liabilities were, what decisions they had made about gifting, and so on. A huge number of factors will play into this, and it is right for individuals to seek specific advice. Things that are said in this Chamber may be creating undue anxiety, when people should be looking into the detail.

The Minister seems to be trying to suggest that not much farmland will have to be sold off as a result of this policy. However, on 4 November, following an urgent question, when I asked his colleague the Minister for Food Security and Rural Affairs, the hon. Member for Cambridge (Daniel Zeichner), how food security would be preserved if farms had to be broken up and sold off possibly for development, he replied: “Of course there are trade-offs. There are a range of pressures on our land, in respect of housing, food, energy and so many other things. That seems to constitute an acceptance that we will lose farming land, and people will be building on it instead.

That is not how I interpret the comment, but I make no apology for the fact that we want to support farmers, as well as making our energy transition and building homes for people across the country. We need to ensure that we are achieving all the goals that the people of this country elected us to achieve. I want to say more about data, because several Members have raised the subject. As I have explained a few times now, the DEFRA data shows the asset value of farms in England, but it is not possible to accurately infer a future inheritance tax liability from data on farm asset values. Any inheritance tax liabilities that farming assets may face will be affected by who the owners are, the nature of the ownership, how many owners there are, any borrowing that they have, and how they plan their affairs.

The Minister talks about data. Given the massive discrepancy involved, and the impact of this policy, if the data shows in 12 months and 24 months that the Government have got this catastrophically wrong, will they revisit the policy and do a U-turn?

When we approach policies in government we test them thoroughly and consider the details and the data, and we ensure that any conclusions we draw are based on the correct set of data, which is part of the conversation that we are having today. I do not know whether it is due to mischief or misunderstanding, but there is a certain focus on the total value of farms rather than on inheritance tax liabilities. The data on inheritance tax liabilities is the correct data to look at when evaluating the impact that the policy may have.

Will the Minister give way?

I am going to make some progress. As I said earlier, a farm worth £5 million but owned by five relatives in equal shares could have no inheritance tax liability.

Will the Minister give way?

I will give way to the Liz Truss cheerleader on the Back Benches.

The CLA has pointed out that 46% of farms are owned by individuals. The data produced in the letter does not take that into account; it concentrates on couples who will receive the relief.

I note that the hon. Gentleman’s grasp of economics is about as good as Liz Truss’s was. As I have said, the importance of the claims data is that it tells us what the inheritance tax liability will be. I understand that Members are referring to many other sources and sets of data, but when we are looking at the impact of a change in inheritance tax relief, it is claims data that tells us what that is likely to be.

Will the Minister give way?

I am going to make some progress. I have given way many times already. Looking at the HMRC data, which relates to estates making claims for agricultural and business property relief, is the correct way to understand inheritance tax liabilities. That data shows that our reforms are expected to result in up to 520 estates claiming agricultural property relief, including those that also claim business property relief, paying some more inheritance tax in 2026-27. Let me put that in context. It means that nearly three quarters of estates claiming agricultural property relief, including those that also claim business property relief, will not pay any more tax as a result of these measures. As this change is introduced, we expect people to respond in a number of ways to reduce their inheritance tax liabilities, and the costings by the Office for Budget Responsibility assume that that will be the case. People may change ownership structures, plan for their succession differently, and make greater use of gifting provisions and insurance.

I thank the Minister for giving way; he is being generous. He has mentioned claims for agricultural property relief and business property relief, but what about claims for business property relief alone? Have they been included in his figures?

I thank the hon. Lady for her intervention. As we know, any farmer who is renting out land or farming it themselves will typically have an estate that includes an element that is eligible for agricultural property relief. The figures I set out include those who claim for business property relief as well, and those figures are set out in the Chancellor’s letter to the Treasury Committee.

Despite attempts by the Opposition to hijack this debate, I can honestly say—[Interruption.] If they want to champion our agricultural communities, they might have started around 14 years ago. The conversations that I have had with farmers in my constituency have been balanced and productive in their scope, with an understanding of why the provisions have been brought in. Given that two thirds of the land bought in England in 2023 was bought by non-farmers, does the Minister agree that it is right that this Government are taking the opportunity to close what is essentially a tax loophole for non-farmers?

I thank my hon. Friend very much for her intervention. It is telling that when she makes such an important and sensible point, the Opposition do not want to hear it and try to shout her down. As she rightly points out, our changes to the reliefs will make buying land less attractive as a means of inheritance tax planning. This means that land prices are likely to become more affordable for farmers, thanks to a reduction in tax-motivated investment in agricultural land.

Will the Minister give way?

I have given way already, so I am going to make some progress. The reforms should be seen in the context of the significant existing support for the farming industry in the wider tax system, including the exemption from business rates for agricultural land and buildings, the ongoing entitlement for vehicles and machinery used in agriculture to use rebated diesel and biofuels, and the exemption from the plastic packaging tax for the plastic film used to produce silage bales. On top of that, farmers are able to add together their profits from farming over two to five years and be taxable on the average of those profits, building flexibility into their tax arrangements for difficult years and unexpected challenges.

Does the Minister agree that in the Government’s haste to target tax avoiders such as Jeremy Clarkson and others, as has been mentioned, they have actually caught a lot of small and medium-sized farmers in their sights, in a completely irresponsible way?

Although our policy should discourage the kind of tax planning to which I think the hon. Gentleman refers, the policy is broader than that. It is necessary to balance significant relief from inheritance tax on family farms with the need to fix the public finances, and that is the balanced decision that we have taken with this policy. Of course, the decision on this tax policy sits alongside the Government’s wider decisions at Budget 2024. There is £5 billion over two years for farming and land management in England, which will help restore stability and confidence in the sector. That includes the largest ever budget directed at sustainable food production and nature recovery in our country’s history. Despite the difficult fiscal inheritance, £60 million of funding has also been prioritised for the farm recovery fund, to support farmers impacted by severe wet weather over the last year.

The Minister rightly mentions the need for more sustainable land management, but is it not the case that the changes to APR will actually undermine the sustainable land management initiatives that farmers in Mid Sussex are trying to deliver every day?

No, that is not the case. The Minister for Food Security and Rural Affairs, my hon. Friend the Member for Cambridge (Daniel Zeichner), who will be responding at the end of this debate, can set out more about what the Government are doing to support farmers in their work on land management across the country.

I backed British farming ahead of the general election, and I back the farmers in my constituency. I am proud to sit on these Benches with a Labour Government who are backing British farmers with an investment of £5 billion in the recent Budget. Does my hon. Friend agree that it is absolutely essential that we make sure that the money gets into the pockets of our farmers? My farmers complain about the delays that they experienced when the Conservative party was in power.

My hon. Friend is absolutely right to draw attention to the mismanagement under the previous Government and to how important it is that, through the commitments we made in the Budget on the farming budget over the next two years, we support farmers across the country as evidence of our steadfast support. I recognise that the reforms we are making to agricultural and business property relief will have an impact on some individuals. I recognise that some of the larger estates, particularly those worth over £3 million, may be affected by the changes, but the reforms to the reliefs will maintain significant levels of relief from inheritance tax, at a total Exchequer cost of over £1 billion in the year that the reforms take effect, before rising further. They offer support for family farms and businesses across the country. We could not justify leaving the situation unchanged, with a full, unlimited tax relief benefiting a very small number of estates by a very significant amount.

Does my hon. Friend agree that perhaps unsurprisingly, given the name of their political party, Conservative Members seek to preserve the status quo, which includes the top 7% of claimants—the wealthiest—accounting for 40% of the overall APR budget? Does he agree that the Conservatives need to set out how they would make the situation fairer and provide a better deal for our agricultural sector?

My hon. Friend is absolutely right to point out that the Conservative party has no ideas about how the country needs to change, no ideas about how to get the public finances back in order, and no ideas about how to get public services back on their feet or how to deliver economic stability.

Farmers in my constituency tell me how much they are struggling to see a GP and to get public transport—the buses just are not there. The rural economy has been ruined by 14 years of Conservative Government. Can the Minister reassure us that the necessary actions that we are taking in the Budget will get our public services working again for our farming and rural communities?

Order. Interventions should relate to the debate in hand.

I will not try your patience, Madam Deputy Speaker, but I feel that my hon. Friend’s intervention relates to the debate in hand, as we have had to take a tough decision on taxation policy in order to fund our public services. Those public services are, of course, enjoyed by people across the country, including farmers and those in rural communities.

Will the Minister give way on that point?

I will make some progress. As I was saying, we could not justify leaving the situation unchanged, with a full, unlimited tax relief benefiting a very small number of estates by a very significant amount, given that there is such an urgent need to repair the public finances and to improve the hospitals, schools and roads on which people across the country depend, including those in rural communities.

There is a lot of talk from the Opposition, who are getting very excited by this debate, about farms, but we have to remember that farms rely on farm workers. In the name of accuracy, could my hon. Friend put on the record a reminder of which Opposition parties, including the Lib Dems, voted for the abolition of the Agricultural Wages Board under the last Government? That actually drove down rural wages, and we should be talking about farm workers. Is it not true to say that when the Opposition refer to exemptions, the only thing they want to talk about is exemption from their own record being under scrutiny?

My hon. Friend makes a powerful point about the record of the Opposition parties. In our Budget, we made sure to protect the payslips of working people by not increasing income tax, employee national insurance or VAT. Our approach to reform strikes the right balance between providing significant tax relief for family farms and fixing the public finances in a fair way. As such, I commend the Government’s amendment to the motion before us today.

I call the Liberal Democrat spokesperson.

13:48:00

It is my utter privilege to speak on behalf of my party and 1,500 farmers in Westmorland and Lonsdale. I represent people all the way from the Yorkshire dales and the North Pennines to the Lake District and the Cartmel peninsula. We are proud of our farmers not just because they feed us and care for our environment, but because they are the stewards of our heritage. When UNESCO awarded the Lake District world heritage site status, it gave as much credit to the farmers as it did to the glaciers that formed the landscape in which we live, which drives a tourism economy with more than 20 million visitors a year. We seriously value our farmers, and they need to hear that, because the tone of the debate—not just today, but over the last few months—has suggested that politicians do not value farmers. However, words are cheap.

I have no doubt about the hon. Gentleman’s personal commitment, but do not the Liberal Democrats have a credibility problem? For all the rhetoric in this Chamber and outside, when they actually get their hands on power in local government, such as in Oxfordshire, they brutally attack their farmers by banning all meat and dairy?

That is nonsense. Wherever Liberal Democrats are in control, we back and support our farmers and are proud to do so. Talk is cheap, and most people in this House will at some time quite rightly have uttered the sentiment that British farmers are the best in the world, without actually understanding why. It is true that they really are the best in the world, and that is because the way in which our farming economy is structured is based on the family farm. Family farming makes a difference because it has close husbandry, higher environmental standards, higher welfare standards and better quality produce. It is not an accident that British farming is the best in the world.

Does the hon. Gentleman think that the difficulty with the Labour party is that it just does not understand farmers, because they do not fit neatly into its clumsy definition of what a working person is? These are people who work 12 hours a day, outside in the toughest environment, and who work into their old age, but they do not get into the Labour club.

There is something in that, and I will come to that in a moment when I talk about poverty in our countryside, when it just does not look the way people in urban communities think it ought to look. There is no doubt that family farms are under attack, but this did not start on 4 July, and I want to go through why we have ended up where we are now. The botched transition from the old farm payment scheme to the new one is the principal source of hardship among our farmers. Let us start with the fact that the environmental land management scheme—ELMS—budget saw a £350 million underspend under the last Government, and that was not an accident. It was blindingly obvious that that was going to happen. One hill farmer I spoke to just last month told me that, as a consequence of the transition, he will lose £40,000 a year in basic payment. To replace it, he will gain £14,000 under the sustainable farming incentive. By the way, it cost him £6,000 to go through a land agent in order to get in in the first place.

The hon. Gentleman is making a profoundly important point. Not for the first time he is speaking as a Liberal Democrat, but also in a way that belies the fact that he is a Liberal Democrat, because he is genuinely committed to the countryside. He has made a point about family farms; the important thing about them is not only the arguments that he has already advanced, but the sense that they represent a continuum—an investment for the future. The reason this policy is so detrimental is because it impacts on that sense that farmers are investing now for generations to come.

I am going to get to that, but the right hon. Gentleman will have to tolerate me accurately pinning blame on his side before I do so. We were told by the last Government that they would maintain the amount of funding that we used to spend when we were in the European Union. In England, that was £2.4 billion. In one sense, and one sense only, they kind of kept that promise because it was £2.4 billion throughout that five years. However, they did not spend it, because they phased out the old scheme very rapidly, causing a great hardship, particularly to small family farms, and they brought in the new schemes far too slowly and made it very difficult for people to get into them. By the way, the people who were able to get into the new schemes were the big farmers. They were the landowners who had land agents to help them get into the schemes. So the large landowners with the bigger estates managed to get into those schemes. They are all right, broadly speaking. It is the smaller family farms—the farmers who own their own farms and the tenants—who have struggled. It is also worth bearing in mind that there has been a little bit of inflation since 2019. The cost of running a farm has gone through the roof when it comes to feed, energy, fuel and all sorts of input costs. So the fact that we are at just £2.4 billion now, as we were five and a bit years ago, is absolute nonsense. It is important also to recognise that the grants that were available under the last Government, and now, are in reality often only available to those who have the cash flow to be able to get them in the first place.

If land prices were to go down, as has been described by the Minister—I am not sure I believe that—and a farmer had borrowed heavily from the bank, the bank might look at the value of their asset and could possibly call in the loan, which would put the farmer out of business right away.

I have heard that from land agents in my own constituency, and my hon. Friend makes a really interesting point. We obviously do not know what will happen unless and until it happens, but that could be exactly what happens, in which case there would be no money to invest in businesses and people would end up not being able to pay back their loans. Also, the Government would not make anything like the amount of money that they think they are going to, so whatever the outcome, it is bad news for farmers and also for the Exchequer. It is also worth bearing in mind where the money that the last Government spent has gone. It has gone on landscape recovery and other schemes mostly taken up by very, very large estates, where either smaller farmers got nothing or tenant farmers had to do exactly are they were told. In my part of the world, we have seen something akin to lakeland clearances over the last three or four years as a result of all this. So let us not forget that before 4 July, the farming economy was under enormous threat and in enormous danger, either by accident or design, due to the failures of the previous Government, and the Conservatives need to take that on the chin.

The hon. Gentleman mentioned tenant farmers, and I know that he will have some in his constituency, as I do in mine in Shipley. Nationwide, a third of all farmland is managed by tenant farmers. Last month, the Department announced the appointment of a new commissioner for the tenant farming sector in England, which I hope that the hon. Gentleman will welcome. Does he agree that the last Government were operating much more in the interests of large landowners than of tenant farmers?

The hon. Lady makes a good reference to the outcome of the Rock review, which took place under the last Government, although they took too long to put those things into practice. I am pleased that this Government have said that they will implement the recommendations of the Rock review. Baroness Rock deserves enormous thanks and praise from all of us for her work defending tenant farmers, and the fact that she has not been replaced is very regrettable. We are talking today about farming and the consequences of the inheritance tax issue. It would have made so much more sense, given the impact on tenants, if the commissioner and their framework had been put in place before this policy was brought into practice. This feels like putting it the wrong way around.

I am going to crack on now and not take any more interventions because, with help from Members on either side, I have already taken up nine minutes of this place’s time. I want to give the House a final run-through of some of the consequences of the terrible failure of the Conservative Government on farming. In the last five years alone, livestock farm incomes have dropped by 41%. Year on year, there has been a drop in sheep numbers of over 4%, and a 6% annual drop in the number of dairy farms. We lost 440 dairy farms last year alone. So that is where we are, and that is before we get into trade deals or the attack on rural services, healthcare and dentistry. I am also going to quickly make a reference to Brexit because, without a doubt, our leaving the European Union and the terrible deal that the Conservative Government signed us up to have had the biggest impact of all on agriculture. Madam Deputy Speaker, you would think that the new Labour Government had a massive open goal in front of them, given what they inherited from the Conservatives. They had a massive open goal, with no goalkeeper between the posts, but somehow the ball ended up in row Z. I find it almost impossible to countenance how they have managed to fluff that opportunity. I want to talk about two people in my constituency who gave me a really useful insight into the family farm tax in the last couple of days. Both of them gave me four separate case studies. The first was a land adviser who talked to me about four farms. Their story was about shrinking businesses as a result of the family farm tax, and about the potential reduction in the value of land, which would mean that they would not be able to invest in their businesses and there would not be the tax yield that the Government were banking on. Another, a local accountant, gave me four anonymised case studies of local family farms in my communities. Of those family farms, only one was earning above the minimum wage, and three were earning significantly below the minimum wage. In those four cases, two would have to sell parts of their farm and two would have to sell their entire farm to pay the inheritance tax. The next question is: who would those farms be sold to? The hon. Member for Shipley (Anna Dixon) spoke a moment or two ago about the proportion of farmland being sold into private hands, into private equity and so on. Farms will go into those hands even more—as if a neighbouring farmer is going to buy that land when they are in the same predicament. We are seeing hard-working farmers, on less than the minimum wage, having to sell off their land to private equity. Is that a very Labour thing to do? The hon. Member for Perth and Kinross-shire (Pete Wishart) spoke about Labour not getting the working class in the countryside, and this is a perfect example. It is not too late for Labour to learn.

It seems clear that, as with the winter fuel allowance changes, the Government have missed their target here. As my hon. Friend rightly says, it seems obvious that large landowners will have the ways and means to avoid this tax. Does he agree that there should be some form of working farm test?

Yes, and the Government should have been thinking about these things. We heard from the Minister that lots of planning and diligence went into this before it came out of the Chancellor’s mouth on Budget day, but it does not feel like it, because there is a whole range of issues that could have been considered in advance. There is something that will do more immediate harm to farming than even the inheritance tax changes, and that is the Government’s decision to summarily reduce basic payments by 76% in a single year. This will have a direct impact, in particular, on tenant farmers who rely on that money and will end up missing their rent payments. We will see evictions as a consequence. The Government have trumpeted the £5 billion over two years, which my basic maths tells me is £2.5 billion a year. I am always careful, or nervous, about making confident predictions, particularly in this place, but my confident prediction is that they will not spend that budget. If the basic payments are cut by 76% without the new schemes being up and running to replace them, the Government will not spend that money. By underspending, this Government will end up in the same mess as the last one.

I have huge respect for the hon. Gentleman, my constituency neighbour, but I have a question. I think the hon. Member for North Cornwall (Ben Maguire) suggested a working farm tax, and it was not clear to me whether the hon. Gentleman accepted or rejected that suggestion. We have heard Liberal Democrats talk in recent weeks about land taxes and wealth taxes as alternatives to raise the revenue to fund their many, many spending commitments. Could the hon. Gentleman clarify that point?

To clarify my response to my hon. Friend the Member for North Cornwall (Ben Maguire), the Government could have looked at a working farm exemption so that these people will never have to pay this inheritance tax. Who knows, the Government might consider putting people who are not active farmers under the HMRC microscope instead. That would be far preferable to what we have. Grant payments are a significant issue. With the cut to basic payments and the Government’s failure to be as quick as they should have been on the new payments, I am pretty confident that we will see an underspend from this Government, just as we did from the last one. In recent days we have seen the Government’s decision to pause capital grant payments, which will be a huge blow to our farmers. The areas that will end up being cut or paused include: hedging, walling and fencing; countryside stewardship grants to allow nature-friendly farming; work to prevent pollution of waterways; slurry storage; covered yards to clean up our rivers; peatland restoration; carbon storage; and being the cornerstone of natural flood management. My constituent Matthew, who farms in Eden valley, explained yesterday that he has just finished installing 10,000 metres of fencing for a nature-friendly farming project. The pause in the grant funding means that he will not be able to buy any hedge plants to finish the work, and nor will he get the mid-tier countryside stewardship annual payment. He says: “Some say it could be paused until June…this is a business-breaking issue.” On top of that, the higher-level payment has not increased since I entered this House in 2005. It was £40 per hectare for moorland restoration in 2005, and it is £40 per hectare today. That is a brutal attack on hill farmers and those who farm our common land. Again, some of the sustainable farming incentive options on common land are good, and they should be applauded because doing more for nature is a good thing, but the SFI moorland options are currently closed to all common land because of technical issues online. We can see those consequences very clearly. Among all this, farmers are struggling, often with their mental health. The isolation that people feel when their family have farmed a valley for generations and they might be the one who ends up losing the family farm is utterly devastating. However, farmers just crack on with the job, so our job is to be their voice. Farming is a glorious vocation. Farmers work to protect our towns and villages from flooding, to promote biodiversity, to back the tourism economy, to tackle climate change, to underpin landscape heritage and to produce our food. The fundamental failure of both the last Government and this one is that they have brought together agricultural policies that actively disincentivise the production of food. That is criminal, and it is foolish. The first thing the Liberal Democrats would put right is a food strategy and an additional £1 billion a year for ELMs to back our family farmers. It is time we listened to farmers such as Liz and Matthew Staley from near Kirkby Stephen, and their sons Luke and Lewis. I regularly talk to Liz, and she says: “There is so much anguish out there for farmers.” On the new schemes, she says: “They aren’t working and there isn’t that crossover just yet… They’re just making it harder to make a living.” I want to encourage people on all sides, especially in government, to listen to Liz. It is the vocation of farmers to save our planet and to feed our country. The least we can do is give them the value and the future they deserve.

This debate is already oversubscribed. To point out a simple fact, if you were not here for the shadow Minister’s opening speech, you will not be called. That is basic etiquette.

14:06:00

I represent Ribble Valley in Lancashire, one of the most beautiful constituencies in the country and one of the most rural. There are 820 farms on my patch, including 121 dairy farms. I single out dairy farmers as probably the most passionate and dedicated farmers I have encountered. The problem with this motion is that it ignores the wider context of what is happening in our rural economies, and I will briefly talk about how remarkable those rural communities are. Not only are our farmers vital to our food security, but they often do the intangible work that we do not see on a local authority balance sheet, including gritting and clearing smaller roads that councils cannot get to in winter, and maintaining all those beautiful countryside walking routes that we all enjoy for much-needed rest. There are endless examples of how farmers are the best examples of the community spirit that we are rightly so proud of in this country. I will share a quick story about a farm company in my constituency called Butlers farmhouse cheeses. Butlers produces the famous Blacksticks blue cheese and, I believe, is the second largest producer of cheese in the UK. Last year it suffered a devastating fire that completely destroyed its packing and logistics hub. Remarkably, the company rebuilt a whole building in a few weeks by using all of its supplier networks, and that was based on the faith and goodwill that farming communities engender. Butlers was able to retain the 95 staff it had, as well as supporting jobs in 20 to 30 local suppliers. These are the kinds of farms we are supporting, and we must ensure that our strategies work for them in the long term. Butlers is a fourth-generation farm that would not be back on its feet today without the relationships and trust that are so embedded in our rural communities. I am excited for what Westminster can do, and is doing, for farmers. We can provide clarity on the mission. One of the best things about this new Labour Government is our focus on overall missions for this country, to be able to be clear to farmers and farming communities about exactly what this Labour Government plan to achieve over this decade of national renewal, with a clear ask for farmers on how they can contribute to that mission and how they can benefit. I heard about the need for such clarity time and again while campaigning. For years, farmers lacked clarity under the Conservative party, and they desperately need it.

I fully recognise how much the hon. Lady wants to serve her new constituents, and I hope she is right. Does she recognise how difficult it will be for farmers in her constituency, as it will be in mine, to pay the inheritance tax? Land values are very high and the abstract capital value can be in the tens of thousands, but the income that an acre of land generates can be in the hundreds, so there is an enormous disjunct between the value of the land in the abstract, as far as His Majesty’s Revenue and Customs is organised, and the actual money that the farm will generate. How does she think that farmers in her constituency are going to pay the inheritance tax?

I will come on to opportunities to increase the prosperity of farmers, which should be our mission. The second opportunity for farmers is around procurement and trade, and using the Government’s own purchasing power to back British produce, so that 50% of food brought into hospitals, Army bases and prisons is locally produced. We can protect farmers from being undercut by low welfare and low standards in trade deals, and we are seeking a new veterinary agreement with the EU to get our exports moving. I want to touch on devolution and its ability to empower local understanding. Anyone who lives in a rural community knows that part of its strength is a deep generational knowledge of the land and local area. Nowhere is that more evident than in generational farming. Indeed, it is that knowledge, passed down through generations and trained into children from the time they can walk, that ensures some of the efficiencies that keep our farms going. I am a huge advocate for devolution, especially for areas such as Lancashire, where Ribble Valley is located, that include vast rural areas, because it brings democracy and understanding closer to communities. That is a huge issue that the Government are progressing at pace in order to do right by rural communities. I am grateful to all the farmers who have been having open conversations with me about how past and future policy has and could affect them. Any new Government will take some time to unpick how relationships have worked in the past, and how they might want to change them. I came to Westminster as someone who is passionate about local leadership and devolution, and there is much that this Government can do to help farmers by taking decisions.

The hon. Lady is making an eloquent speech about farming and the importance of farmers to our communities; they undertake roles such as gritting the roads and cutting our hedges, as well as feeding the nation we live in. She talks about devolution. Does she agree that the Department of Agriculture, Environment and Rural Affairs of Northern Ireland has said that one third of farmers will be impacted by the agricultural property tax, with 75% of our dairy farmers being the hardest hit? The policy is not working. Stop the family farm tax grab.

If the hon. Lady will allow me, I will come to how we can help the farmers who will be affected by the measures. To finish my point about devolution, as an MP in an area with huge extents of rural economy, it is critical to me that devolution reflects our rural areas as much as our metropolitan ones. I look forward to seeing how the upcoming devolution White Paper addresses that challenge. Town and parish councils really understand our rural communities and can play a bigger role in local democracy.

The hon. Lady is making an interesting speech, and I am grateful for it. She is right that we should import less food and use Government procurement to help with that, and she is right about the inter-generational quality of family farms. Will she acknowledge that, in delivering the kind of food security that her speech implies, we cannot have the most productive farmland eaten up by large-scale solar developments and housing? We need to protect our grade 1, 2 and 3 land for the very reason she gave, because that allows us to deliver the food security that she and I both want.

As the Minister pointed out, many farms will not be affected by the measure and it will not have the impact that Opposition Members are leading people to believe. We have an opportunity to support our farmers, as I touched on in my response to the hon. Member for Upper Bann (Carla Lockhart). I have sat down with farmers in my community and worked through the issues. They have taken their own tax advice. For example, there is a farm in my constituency that is worth around £3.6 million, so it will be liable for around £12,000 a year in inheritance tax over 10 years. However, if we are able to increase that farmer’s profits by £20,000 a year, by reducing energy prices, increasing British-supplied procurement so that 50% of public sector food comes from those farms, and providing a better health service that ensures all members of the family can be strong and well to work, that is the opportunity. Yes, we need to make our tax structures work better—that is fixing the foundations—but the real aim and prize is increasing the opportunity for farmers, so that they have the stability, investment and real sense of purpose and mission that allows them not just to survive, but to thrive.

On that point, will the hon. Lady give way?

I am sorry, but I will not. I spoke earlier about the strength and efficiencies in family farming. From everything that I have seen and heard from farmers so far, it is clear that while valuing embedded ways of working and learning is important, there is also much appetite for innovation and doing things better.

Will the hon. Lady give way?

I will not, as I want to make progress. Just look at how farmers have led the way in restoring biodiversity and are diversifying into all sorts of new business ventures. The industry is not scared of change or opportunity, but much of it relies on and is driven by what Government determine is important through subsidies and trade agreements. After 14 years of uncertainty about what Government want from farmers, we must and will do better. Our farms are the lifeblood of this country, along with nurses, teachers, and, yes, train drivers. I know that farmers in my constituency of Ribble Valley are ready to do their bit to tackle the dire situation in which we find this country. I do not know a group more ready to pull up their sleeves and muck in than that lot. We, as a Government, are meeting that energy and have a similar level of ambition, vision and commitment. We are looking at how these pillars of our community can work with us to achieve what we all strive for: greater prosperity for every person in this country.

On that point, will the hon. Lady give way?

I am sorry, but I will not. The motion tabled by the Conservatives today is not clear or specific on what they would do differently to fix the economy. That, along with the continual lack of clarity and consistency on rural and farming policy when they were in power, suggests that they never had a vision of how they would support these communities well. It is easy to criticise; it is far harder to come up with a long-term vision and do the hard graft to make it a reality. I will be voting with the Government today, but not because we do not need to push for more understanding of rural communities in Westminster. Generally in the UK, we need a better understanding of the role that farms and rural communities play in our culture and potential prosperity, across all parties and among those who work for us. I am voting with the Government today because we can better push for that change with a Labour Government, as part of a wider plan to improve things for everyone—a plan that is truly ambitious for this country and makes the brave call to take the hard, unpopular decisions now, so that in 10 years something has actually got better for everyone. I would far rather have that than a Government who go for popular headlines today, but to find that in 10 years’ time we are still facing the same challenges that we always did, and that they are getting worse. I have a lot of faith that tomorrow, and over coming months, this Labour Government will set out an exceptionally clear and visionary plan for what our rural economies mean to Britain. We will respect them and make the most of them by providing long-term stability and a clear route for farmers to contribute to our national missions, and to benefit from them. Anyone who has waited 14 years for a Labour Government to come in and start to tackle the fact that a quarter of our children are living in poverty knows that getting the result they want takes time and hard work. We have been in desperate need of grown-ups to tackle what is coming down the line. I trust this Labour Government to do that and I will work hard with them to get it right. Finally, I pay tribute to all the incredible farmers across Ribble Valley for continuing the conversation with me, so that we can build the strongest possible vision for farming and the rural economy in the UK.

14:18:00

I declare my interest as a working farmer and a chartered surveyor. When I drive through my constituency, I am always reminded that farmers are the most underrated and essential workers in the rural Cotswolds and many other rural areas. Many have worked the land for generations, and I think in particular of my constituent, Nigel—I will avoid his surname to avoid press intrusion—who is still farming at the age of 93. This Government forget that farming is not a hobby. It is farmers who wake up at the crack of dawn to ensure that the rest of the population have food on their table, who clear the roads when trees fall on them or they are blocked by snow, and who plant trees and wild flowers to ensure that our biodiversity is protected for future generations. The hard-working farming community was dealt a massive blow by this Labour Government’s Budget in October. As my right hon. Friend the Member for Louth and Horncastle (Victoria Atkins) on the Front Bench says, this is about not only the IHT changes, but the national insurance contributions, the change in minimum wage, the tax on fertiliser and an up to 211% tax hike for double cab pick-ups. All those extra costs take money out of a business. I know that the Chancellor and the Prime Minister have both stated from the Dispatch Box that the IHT changes will not affect the vast majority of farms, and the Treasury has forecast that only 27% of all farms will be affected. However, as the Minister for Food Security and Rural Affairs knows, DEFRA’s own forecasts suggest that two thirds of farms will be affected by this destructive policy, and the National Farmers Union has recently published an analysis of the 27% figure, which found that it “materially underestimated the true proportion”, with around 75% of commercial farms to be affected. That is due to the Treasury using figures that are based on the 2021-22 agricultural property relief data, which is not representative of the current situation.

Will the hon. Gentleman give way?

We have already had an exchange in interventions, so I ask the hon. Gentleman to first let me say this about land prices. I disagree with the point about land prices being inflated. We cannot buck the market. It is not the policies that inflate land prices; it is people coming in from outside agriculture who are putting up the prices.

The NFU said that farms may be affected by the policy—that is the language that it used—taking no account of estate planning or any other mitigations that people might use. As the Secretary of State said, people take action in the event of change. The NFU has ignored that in quoting its statistics.

If the hon. Gentleman will just listen to my speech and the examples that I am about to give with an open mind, he might change his mind. The Treasury does not include in its figures the impact of business property relief claims; that also fits under the same £1 million ceiling. According to the NFU, 40% of farmers also claim BPR on machinery and livestock, which makes the £1 million ceiling even more restrictive. As shown in an earlier exchange, the Government have failed to complete a proper impact assessment of the changes to APR and BPR on the rural economy. The hon. Member for Rossendale and Darwen (Andy MacNae) might be interested to hear that the CLA modelling has shown that the changes will lead to 5% of rural businesses closing, with up to 190,000 jobs lost from the rural economy, some in very remote areas, and it will be difficult to replace them.

Will the hon. Gentleman give way?

I do not want to give way to too many people, but I will to the hon. Gentleman.

The hon. Gentleman mentions 5% of agricultural businesses being at risk. Is it not true that under the last Government, between 2019 and 2024, there was an 8% reduction in agricultural businesses in his constituency of North Cotswolds, thanks to the policies of his party when they were in government?

That was over a much longer period, but these changes will take effect much quicker. I can assure the hon. Gentleman that once the tax starts to bite, those jobs will be lost quite quickly. To put that into perspective, the OBR has predicted that only £590 million a year is due to be raised from this destructive policy. This Budget gave the Department for Work and Pensions a whopping £275.8 billion a year. The revenue raised from this tax would be a mere 0.2% of that total amount. Over the past few weeks, I have had countless emails from worried farmers about their future, and I was lucky enough to meet some of them when they came up to London to protest recently. They varied in age from their late 20s to their early 90s, and it was a valuable meeting. Many had never protested in their lives, but they have chosen to use their voices now when their livelihoods are under threat. Again, to avoid press intrusion, I want to cite the case of David and his younger son, whose farm in the North Cotswolds has 265 acres, a suckler herd of 200 and a small flock of pedigree poll Dorset sheep. They have a range of modern and traditional buildings and have already diversified those. When they include their house, they estimate that their business is worth £5.5 million. David would be entitled to about £1.5 million in relief, and after the 50% relief from inheritance tax, with an effective rate that the Exchequer Secretary went through, that would leave him with a taxable amount of £800,000 on his death. The Minister might like to listen to this: that farmer only earns in total, on average, about £40,000 a year. How on earth is he expected to pay the tax and live on that £40,000? He will not. The farmer will have to sell up and the farm will not be available to future generations.

Will the hon. Gentleman give way?

It is the last time.

Would the Tories not have a lot more credibility on this issue if they owned up to the disaster that was Brexit? It opened us up to cheap imports, increased costs for farmers and put up barriers and obstacles to trading. Would they not have much more credibility in attacking the Government on this if they admitted that that was an absolute disaster for farming communities?

If the hon. Gentleman wants to call an Adjournment debate on Brexit, he is entitled to do so. I was talking about the serious issue of how this farmer and many others up and down the country will be able to afford the tax—they will not. I understand that the Government have suggested that farmers should be forward-planning and gifting their farms to their children now, which would mean that they could avoid the tax in future. However, for many farmers, that is not an option. I will take another constituent of mine, who farms near Fosse Way. He is still working on his farm at 93. He did not retire at 65 like many of us, but has kept working the long, hard days, as he did during the second world war, to ensure that we have enough food on our table. He has spent years planning to ensure that his grandchildren could inherit and take over the farming business. Instead, under this Government, his plan has gone completely out of the window, because he will have to live until he is 101 if he is to avoid the tax altogether. The only option facing many farmers across the country is to sell off their land and stop farming. Those farmers have worked the land for generations. Their children will have seen their parents take over and will have expected to take over when they can, but now face a future of uncertainty. The Government fail to answer the question of what kind of person will buy the land when it goes on the market. It will not be the ones who have farmed the land all their lives. It will likely be foreign investors and hedge fund managers. They will not have generations of knowledge of how to work the land and will likely take prime arable land out of production, as they could possibly make more money from alternatives. When I worked on the previous Public Accounts Committee—I urge the Minister to listen and to pledge that he will do this—I managed to obtain a commitment from the last Government that the food security index would be published in Parliament every year. Will the Minister give that pledge so we can continue doing that? That way we can see what effect the tax, the selling off of farms and taking land out of production is having and whether our food production is dropping. I end with a plea to the Government to go back to the drawing board. I understand that a technical tax consultation on the changes is due to be published early in 2025. I urge the Government to use this time to talk to farmers and professionals across the country and find a way that will ensure that farmers such as Nigel do not lose their life’s work to the taxman. Some obvious alleviations and changes to APR and BPR would be to raise the threshold, so that more smaller farm owners and rental farmers would be exempt, and to have a longer transitioning period. That will help farmers like 93-year-old Nigel. However, the best outcome would be to reverse the policy altogether. Farming is under threat. I do not want to see the fabric of our countryside destroyed for future generations.

At some point, speaking limits will be introduced, so please think about editing your speeches. Before then, I call Andrew Pakes.

14:28:00

That was quicker than I expected, Madam Deputy Speaker, so thank you. It is a privilege to speak in the debate. Nothing goes to the heart of the health, wellbeing and prosperity of a nation more than being able to feed and look after ourselves. Britain’s farmers and our farming workforce are part of the essential infrastructure that keeps this country going. I am proud to represent a constituency with such a rich food and farming heritage. Farming is in our DNA. I pay tribute to our farmers and farming workforce. When we talk about any other industry, we recognise the skilled workers that deliver for Britain: the steelworkers, the miners, the nurses and the doctors. We should start every debate on food and farming with the same recognition for farmers. Food security begins with the incredible work of our farmers, and I thank them. We talk about people going the extra mile to look out for each other and care for our communities; farmers do that every day. This should therefore be a welcome debate on the future of farming. It should mention farming profitability and allow the hon. Member for Mid Norfolk (George Freeman) to talk about agri-technology and how we increase profitability. I hope that he does so shortly. Instead, what do we get? It is political opportunism from a party that should know better. I am proud to be part of the largest contingent of rural Labour MPs in Britain’s history. Labour Members were elected to protect and support our rural communities, and we will do just that. After 14 years, it is a bit rich of Conservative Members now to claim that they are backing Britain’s farmers.

I entirely endorse what the hon. Gentleman, my constituency neighbour, said about recognising and celebrating the work of farmers, and indeed farm workers, but does he understand—I am sure that most Conservative Members understand this well—that assets and income are entirely different things? Farmers’ assets are our landscape. Their wealth is our common wealth—something that the Government have seemingly failed to appreciate by imposing a tax on farmers that confuses their ability to make a living with the asset that is essential for them to feed the nation.

I thank the right hon. Member for being a champion in this House of skills and trade unions, which are sadly too rarely championed by Conservative Members. I recognise his points on our common wealth and the work that goes into looking after and protecting our land, but I also recognise the impact of the last Government on land and our farming communities. Let us look at the Conservatives’ record: 14 years of running down the DEFRA budget; a decade of austerity, which became a decade of insecurity; a Brexit turkey half-cooked; flood funding cut; trade deals that sold out British farmers; a farming budget £300 million underspent. If Conservative Members want to discuss food security and the future of our rural communities, bring it on. The Conservative party saw more than 12,000 farmers and agribusinesses forced out of business since 2010. Farming has the lowest profitability of any sector in the economy. Conservatives abolished the Agricultural Wages Board and saw rural wages stagnate, as did many Liberal Democrat colleagues, who voted in the same Lobby. Now the Conservatives are defending the status quo when it comes to big business, big landowners and rising land prices. At the start of this debate, I thought that they were literally the last people on earth defending the status quo, but some of them seem to be talking about accepting some kind of policy, while those on the Front Bench seem to be saying that there should be no change whatsoever, so the merry-go-round continues. The Opposition want all the spending but none of the responsibility. We talk about change. We know the change that this country voted for in our rural and farm communities. People voted for change because public services were broken, with rural schools crumbling, NHS waiting lists soaring, and rural GPs and NHS dentists harder to find. The Government are rightly focused on the cost of living crisis and improving access to GPs in our rural communities. What are the Opposition focused on? They are defending a tax break for estates worth up to £3 million while attacking a pay rise for the lowest paid workers in our rural communities. That says everything that we need to know about today’s Tory party.

As a fellow Cambridgeshire MP, will the hon. Member give us some examples of farms in his constituency that support the measure?

I certainly recognise from door-knocking in rural communities and talking to rural workers that food poverty has gone up in my constituency. People have found it harder to get a bus to go and work on a farm, and people working on farms are struggling with the result of Liz Truss’s mini-Budget, which crashed our economy. The reality of the debate that we should be having is that profitability for British farmers goes back a generation, not to 4 July. That is why the Government are pledging to put £5 billion into the farming budget and are committed to working with farmers and the sector to get that money into productive food production. It is why we will use the heft of public procurement to buy British farming produce. Food security goes to the heart of the challenges facing our country. Fixing our public services goes to the heart of rebuilding our rural communities. If the House wants to do both, it will start by rejecting the Opposition motion.

After the next contribution I will impose a time limit of five minutes on speeches. I call the Chair of the Environment, Food and Rural Affairs Committee.

14:34:00

I remind the House of my entry in the Register of Members’ Financial Interests. It is a pleasure to follow the hon. Member for Peterborough (Andrew Pakes), who is a fellow member of the Select Committee, and the hon. Member for Ribble Valley (Maya Ellis). They both, in their own way, made an important contribution to the debate by giving a bit more context to it. I will vote for the motion in the name of the Leader of the Opposition, not because it is the most elegant piece of drafting that I have seen in 23 years in the House, but because there is nothing in it with which I really disagree. It does feel, though, like a bit of a missed opportunity to move the debate onwards. I say that not as any real criticism, because it is a response to a Government measure in the Budget, which was also a bit of a missed opportunity. It is worth taking a minute or two to pause and reflect on how things might have been done differently. We could have gone through the process that multiple Governments and Departments have gone through over the years by starting with a Green Paper or a White Paper, and looking at the way in which inheritance tax has worked, and some of the unintended consequences that it has generated. We have all heard of the super-rich buying up land and inflating the price as some sort of tax avoidance measure. I have not met a single working farmer who wants to defend that, so there was a real opportunity to do things differently. We could have built a consensus about the proper value of land, and about some stuff that is not really being spoken about in this debate. I speak as a former solicitor. Thankfully, I never did any executory practice, but some of those who are still in practice and with whom I am in contact tell me candidly that, because there was 100% relief on agricultural land, they did not really give a great deal of thought to the valuation that went into the application for confirmation. That is bound to have had an impact on the figures on which the Government rely. Had we done things in a proper and reflective way, we would have been able to build consensus on values and thresholds, for example, and do things very differently.

I welcome the contribution of my former ministerial colleague. Had the tax been levied on exactly the people he describes—the super-rich, and non-working farmers—few would have complained, but it has been set at the wrong level. That is why I asked for detailed modelling to be made available to the House.

I think I just said more or less exactly that. A debate of the sort that I am talking about would have allowed for a wider debate about farming finances. We have had 70 years of very direct Government intervention in the agricultural economy through farm subsidies. Taking a step back, critical though those farm subsidies are, their net effect has ultimately been to keep farmers poor. There is now such an enormous mismatch between the capital value of the assets being farmed and the derisory return on them. DEFRA tells us that there is a 0.5% return on capital. Farmers in my constituency tell me that a £3 million farm will give them an income of about £25,000 a year. That is pretty much in line with DEFRA’s figures. We hear about farmers working into their 80s. It is a slightly patronising and very romantic view of doughty farmers working on into their 80s because they are seized with a sense of vocation. There absolutely is a sense of vocation among farmers, but let us not forget that a lot of them work into their 70s and 80s because they have been running businesses that have had no spare money to put into a pension so that they can look after themselves in their old age.

The right hon. Gentleman makes an important point about just how little farmers earn, and yet they are consistently being described by Labour Members as asset-rich. Should farmers not fall into their definition of working people, and therefore Labour should be on their side rather than what they are doing to them?

“Working people” hardly does justice to farmers. Some of my young constituents told me they were working for returns of about £6 an hour. There is a reason I chose not to become a farmer at 16 and why I thought law was a more attractive career opportunity to pursue, but I bow to no one in my admiration for those who make that choice. Of course, there is the question of those who have made their estate planning decisions on the basis of APR being available. Others have pointed to that, but it is absolutely critical, and it goes beyond estate planning. I wonder how many farmers over the years decided in a divorce settlement to take the farm as their part of the capital, because they have a familial and emotional connection to the land, and are now finding that what looked like an equitable settlement a few years ago risks being much more inequitable. The particular opportunity I fear we have missed is that in relation to tenant farmers. The Tenant Farmers Association came up with an excellent proposal, which would reward landlords who grant leases in excess of 10 years with exemption from inheritance tax liability. That would be good for the very people who everybody on both sides of the House says they want to help: the small family farmers. There are multiple reasons why people might buy up agricultural land. I do not know anybody who takes an agricultural tenancy thinking that it will make them a member of the super-rich as a result. The idea that is being mooted of a clawback—something on which we could see a bit of a sensible discussion and a consensus between the Front Benches—or the idea of a suspended inheritance tax liability which would crystallise only at the point of the land sale after the death of the owner, would both work to keep land in active food production. The irony of the way in which the Government have structured the measure is that, by allowing a 50% relief on farmland above £1 million, the purchase of agricultural land will probably remain an attractive proposition for the super-rich. We have reached a point in the debate where we need to broaden it out beyond just inheritance tax, and look at the wider question of farming finance and ask ourselves how we can build a consensus that puts farming and food production at the heart of the countryside, where it truly belongs.

Now, with a speaking limit of five minutes, I call Matt Bishop.

14:43:00

My constituency is a very rural one with 751 farms. It is an extremely important issue to my constituents and me. I hear their concerns and deeply empathise with their worries and fears. While it is a difficult decision for the Government to introduce an inheritance tax, it is one that is unfortunately necessary. I welcome the opportunity from the Opposition to debate the matter, largely because it allows us the time to discuss the reasons why inheritance tax has to be introduced. There is a crucial need to understand the unique challenges faced by rural communities and the immense value they add to society. Farmers across the country, and most definitely in my constituency, are not just farmers; they help in a number of different situations, including recently with the floods in the Forest of Dean. They are vital to all of us in the community. However, the economic turmoil of the past 14 years has left the Government with the difficult task of balancing the needs of the British people with the economic realities of running the country. The failure of the previous Government to secure a Brexit deal that protected the interests of farmers left many in a vulnerable position, struggling with increased costs, trade barriers and uncertainty. This Government’s new deal for farms aims to safeguard farmers’ interests, and we will do all we can to support them. We are using the Government’s purchasing powers to ensure that 50% of food consumed in hospitals, army bases and prisons is from British farmers, putting more money in their pockets. We are introducing grid reform, allowing farmers to plug their renewable energy into the national grid. We are also seeking a new veterinary agreement with the EU to ensure that our friends on the continent can enjoy the incredible produce that Britain has to offer. This Government are actively working to improve the lives of farmers in a way that will benefit the agricultural sector and the broader economy.

Will the hon. Member accept that the changes to inheritance tax damage the economic realities in the UK because farmers will be disincentivised from investing in their land and increasing its productivity?

Although I empathise with the hon. Member’s comment, that is not exactly what I hear from the farmers in my constituency, which I will get on to shortly. The impacts of Brexit, including trade barriers, labour shortages and disruptions in supply chains, have undeniably placed significant pressure on our farmers. It is somewhat ironic that the Opposition choose to complain about this Government’s actions when it was their failures that created this mess. The NFU even criticised DEFRA as recently as September for significant underspending amounting to £358 million over the past three years. My constituents and, more importantly today, farmers in the Forest of Dean have felt the impact of the challenges first hand. Small businesses and families are all facing tough times, and the Opposition must acknowledge the broader context. The new initiatives that the Government are introducing, from the support for British farmers to green energy reforms, are vital steps forward, and I do not underestimate the difficulties that lie ahead for all of us. There is no quick fix for the challenges we face, and I fully recognise the pain and frustration felt by those who are struggling, especially in rural areas such as mine. But the Government’s focus is on long-term growth, sustainability and providing the tools that our farmers need to thrive. It is inaccurate to say, as has been raised, that no farmers agree with this policy; some farmers agree with it. They want better services, and they are happy to accept that reform needs to take place. Some might be surprised to hear that I agree with the Leader of the Opposition’s recent comments to the media reminding us of the profound impact of the rising cost of living on individuals across the UK and farmers. She is correct that the impact is felt deeply and intensely by all in the country, including my constituents and farmers in the Forest of Dean, but let us not forget one important factor: it was under the previous Conservative Government that the cost of living crisis began for farmers. It is under this Government that it will end.

14:48:00

The Government have made many claims about this policy that are not credible, but I wish to address only four. First, they outrageously claimed that they would not do it. The Secretary of State, the right hon. Member for Streatham and Croydon North (Steve Reed), said last year: “We have no intention of changing APR.” He said that given the situation that farmers are in, a Government cannot possibly go to people and demand more taxes. I am sorry he is not here today to hear his own words. Secondly, the Government claim the change is unavoidable as they desperately need the £500 million they claim that it will raise. The £500 million that they give to farms overseas and the £9 billion that they were all too happy to hand over to public sector unions says otherwise. Thirdly, the Government claim that these people are rich. That completely misunderstands agriculture and the countryside. A farm is not an asset on a balance sheet. Our farmers are stewards of their land, holding it for the next generation and the generation after that. It is not the fault of farmers—especially those in places such as my constituency in Kent, with its astronomical house prices—that their land is so valuable in a way that does not at all reflect their farm’s profitability.

Is the hon. Member, like me, slightly irate when she hears UK Government Ministers talking about how the terms of the proposed agricultural property relief are much more favourable than the rate that other people have to pay? Inheriting the family farm is not like inheriting your mother’s house. You do not liquidate the asset and then live the high life; you just get on with the job that you were doing the day before and the day before that. There is no enrichment involved, making the Government’s policy utterly baseless.

I could not agree more with the hon. Gentleman. My farmers tell me that these inheritance tax bills will take decades of profit to pay off, so they will keep doing the job that they were doing yesterday, but with a fraction of the cash that they had before—which was not a lot to begin with. Finally, I want to address the idea that farmers can simply give farms away and live another seven years. It is incredible that the Government should introduce a tax in one breath and encourage people to avoid it in the next, and it makes a mockery of the whole policy. If it is true, then the tax will not raise any money for the Government, but instead increase bureaucracy and advisory fees for farmers. Mostly, though, for many people, it is not an option or it will not work. People have not been given enough time to plan for these changes. My constituent Ross grows hops in Tenterden. As he watched the Budget, his father, who is in his 70s, was suffering from sepsis and fighting for his life in hospital. Especially in farming, our most dangerous industry, people cannot guarantee that they will live another seven years after having handed over the farm. Another of my constituents is in remission, having recently recovered from cancer. If the cancer returns, it is likely to be terminal. This constituent is in their early 50s. Are the Government seriously suggesting that my constituent should hand over, not just the farm, but the home that they live in to their teenage children? Many of my farmers live in their farmhouses and are planning to work the rest of their days. They do not have pensions; they do not have plans that would allow them to spend the last decade of their lives—of course, it may be much more—no longer farming the land that they have farmed for the whole of their lives up until this point. Finally, to raise a point that seems to have been almost entirely ignored, doing this will incur eye-watering capital gains tax bills. For some of my farmers, it will mean hundreds of years’ worth of land revaluation that they similarly cannot afford to pay.

Is the hon. Lady aware that the capital gains tax starts from the moment of a person deceasing, not from when they bought that land?

What I have been told by my farmers, based on the tax advice that they have been given, is that the bills—and not just the inheritance tax on decades of profits—will be completely unaffordable. Farming is hard. It is not like any other industry: it is a culture and a way of life. It is lonely, revenues are uncertain, profits are tiny and cash is tight.

Will the hon. Lady give way?

I will not, as I am coming to the end of my speech. It is absurd and shameful that this Government, looking to fund their union pay rises and vanity energy projects, are putting this pressure on those who do the back-breaking work of growing our food. Farmers already have appalling problems with mental health and suicide: the Royal Agricultural Benevolent Institution tells us that a third of farmers may be depressed and half may be suffering from anxiety. One of my farmers says that his father is now kept up at night by the thought that he will leave his children a crippling debt that will make their lives financially impossible. Another told me that his father says that he just hopes that he dies before the changes come in. This policy is illogical, inconsistent, dishonest and wrong.

14:53:00

To misquote Brian Clough, I would not say that my constituency is the most beautiful in the country, but it is certainly in the top one. We have generations of farmers to thank for that beauty—those who protected the land and nurtured nature long before the Peak District was designated Britain’s first national park. If I thought for one second that these changes to agricultural property relief threatened future generations of farmers in my constituency, I would not vote for them, but I do not.

Last month, I spent a very enjoyable afternoon scoring the senior young farmers at Radnor young farmers club. These are really admirable young people who spend their afternoons and evenings looking after youngsters, often those as young as 10, and trying to encourage them into farming. Is the hon. Gentleman not concerned about the message that this change sends to our young farmers?

No. The message from this Government is that we are committed to farming, and to making it profitable and sustainable. That has to be the message that we send out to those young farmers. There is no doubt that farmers in my constituency have been struggling terribly for the past 14 years, working seven days a week, 12 hours a day, for very little reward. The last Government promised them the earth, but left them in the sheep dip. After all the Brexit promises, what they got was the Leader of the Opposition selling them out in trade deals with New Zealand and Australia. Boris Johnson promised farmers that subsidies would stay at 100%, but then the Government phased out the basic farm payment. The Opposition’s incompetence saw farmers miss out on £358 million that could have been in their back pockets when they desperately needed it, and then came Liz Truss. Her mini-Budget and all those unfunded tax cuts—a point that I will return to—crashed the economy, causing interest rates to rise and driving many farmers to the brink. Over 12,000 farmers and agricultural businesses were lost under the last Government, so we will not take any lectures from the Opposition about the farming industry.

The hon. Gentleman has 428 farms in his constituency. How many of those farmers will thank him for supporting the Government today?

I live in one of the rural villages and speak to the farmers in my villages all the time. The fact is that those farmers voted for me because they were so let down by the last Government.

I will not take any more interventions at the moment. Before the Budget, I sat down with farmers in my constituency. They wanted to talk about two things. First, they were concerned about the effect of the changes to APR on family farms.

Will the hon. Gentleman give way?

No, I will not. Secondly, they were concerned about cuts to the farming budget. The Chancellor delivered £5 billion for the farming budget, the largest ever investment in sustainable food production and nature recovery, and she delivered in terms of protecting family farms in my constituency.

Will the hon. Gentleman give way?

No, I will not give way at this stage. Let us be clear: only 4% of estates in this country pay inheritance tax. As we have repeatedly heard, these changes will mean that a couple will be able to leave £3 million-worth of estate to their children without paying a penny in inheritance tax. To put that in context, if a couple owned a £3 million mansion, they would be paying £940,000 in inheritance tax.

I will not give way at this stage. Those estates over the threshold will have a 50% reduction in the amount they pay. We have already heard that the seven-year rule will continue to apply, so farming families will be able to make plans for the future.

Will the hon. Gentleman give way?

Sorry, I will not give way at this stage. This debate has, however, shone an important light on one issue, which I am grateful to the right hon. Member for Orkney and Shetland (Mr Carmichael) for raising: the fact that our farmers are working day in, day out, for very little profit. The question is how we support them to be profitable again. Energy bills are one of the biggest costs farming businesses face. This Government will help bring down those costs through GB Energy and by introducing grid reform to allow farmers to plug renewables into the national grid. We must protect them from being undercut by foreign imports.

Will the hon. Gentleman give way?

I am sorry, but I will not. We must create a greater marketplace for farming businesses by using the Government’s purchasing power to ensure that 50% of the food bought for our hospitals, prisons and army bases is produced by local farmers. Here is the most important point: we have to provide farming businesses with economic stability. The Leader of the Opposition has already failed to learn the lessons of the Liz Truss Budget, with £6.7 billion of unfunded tax cuts already announced in a matter of weeks. The Opposition need to tell us how they are going to pay for that. What are they going to cut? Are they going to cut the farming budget—are we going to lose the £5 billion from the farming budget?—or are they going to borrow and put us right back in the position we were in with Liz Truss, with interest rates rising and farms going out of business? I will not be voting for the Opposition motion; I will be supporting farmers in my constituency and providing the economic stability they need.

15:01:00

I share the frustration of my right hon. Friend shadow Secretary of State that the Secretary of State for Environment, Food and Rural Affairs cannot be with us today. I wanted to offer him some sympathy, because I do not believe that either he or the farming Minister cooked up this terrible plan. It was thrust on them by the Treasury because, as has been said before, the Treasury knows the price of everything and the value of nothing. It clearly does not know the value of a family farm or the value of our farmers to this country. The purpose of this policy, as was outlined by the Chancellor in her Budget statement, is to stop wealthy individuals avoiding inheritance tax, but to protect family farms. As my right hon. Friend the Member for Stone, Great Wyrley and Penkridge (Sir Gavin Williamson) said, the CLA has highlighted that the average 300-acre arable farm owned by a couple would have to spend 99% of its yearly profit over a decade to afford an inheritance tax bill. More starkly, a single farmer with 200 acres would have to pay 136% of their yearly profit to cover the bill. Clearly, that is unaffordable. A real-life example was sent to me by a constituent. He is a farmer whose elderly father is still alive but no longer works, and whose son is at a local agricultural college and hopes one day to follow in his footsteps. Such an inheritance tax bill makes his farm unviable and puts his son’s future in doubt. His father is distraught. He said to his wife that morning, “What is the point of even going to work?”

I have had correspondence from an agricultural accountant in my constituency who says that, since the Budget, his job has changed from being an accountant to being a counsellor as more and more farmers contact him with serious concerns about their mental health, because of the fear that has been introduced by this policy and the fact that their children are now telling them that they do not want to go into the family farm.

My right hon. Friend is absolutely correct. Farming is a lonely existence at times, and farmers have traditionally suffered from mental health difficulties. This policy is making things far worse, and for small family farms it really is devastating. As others in the House have said, tenants have not been taken into account in any of this. The impact of business property relief is far greater than any of us have discussed so far, because it does not just relate to farms. It relates to any unquoted business, which could be a local haulier, an abattoir or a feed merchant. All of these—the tapestry of our agricultural economy—are impacted by these measures. It really is a devastating attack on our way of life. If we take the Treasury’s figures, which show that £500 million will be taken each year by these taxes, that is £500 million that will no longer be spent in the rural economy. For example, a farmer who wants to expand his livestock herd needs to build a new shed, and that means paying a planning consultant, a construction firm, a mechanic and an electrician. It means a greater feed bill for his new livestock, and he has to buy the livestock. All of those things are part of the wider economy. It is not just the farmers who will be hit by this policy; it is everyone in rural communities. The Secretary of State told us at the Environment, Food and Rural Affairs Committee that it will all be fine because farms, under his tutelage, will become more profitable. The only way to make farms profitable that quickly is by greatly increasing food prices. If we are to go down the route of food inflation and of inflation more widely, then fine, but the Government are going to have to explain that to consumers in the supermarket.

Does my hon. Friend agree that, as part of Labour Members’ total failure to understand the countryside, they probably do not get that farmers are one of the very few sectors that have to buy retail but sell wholesale?

My hon. Friend is absolutely correct. Farmers are of course price takers, not price setters, and they have always been under great pressure from the retail chain to keep their prices to a minimum, so that we can all enjoy cheaper food. That is a fact of life, and a very difficult challenge.

My colleague on the Select Committee has great expertise on the farming industry. He will therefore know that, for the last 14 years, the record of his party in government has been one of failure for our farming industry, with 12,000 farms closing since 2010 and energy bills skyrocketing because the Conservative party failed to invest in energy independence, hitting our farmers and reducing profitability.

We are going to have to agree to disagree on that point. Frankly, this is a policy dreamt up by the Treasury on a spreadsheet. There has been no impact assessment, and there is no understanding of its impact on rural communities. This is not just an assault on farmers; it is an attack on the entire agricultural economy. The end result will be less British food, reduced British food security and fewer British jobs. Will the Minister please give our farmers some hope this Christmas, and look at this again?

15:06:00

I must admit that, as a new Member and a novice when it comes to the fine details of parliamentary procedure, I am surprised that we are debating this issue in this way today. As the Opposition know, the agricultural property relief measures announced in the Budget were not included in the Budget vote last month. They also know that the measures will be included in a future Finance Bill alongside other measures that will be subject to the technical consultation in the new year. This decision is simply not being made today, despite the disingenuous social media posts that imply otherwise. This detail matters to me, because I have spent the last few weeks speaking to farmers in Penrith and Solway to try to understand the full impact of the inheritance tax proposals, knowing that I have months left to engage with DEFRA and the Treasury and to seek important amendments. Let me be clear: if today was the real vote, I would vote against the Government’s plans. I am no rebel—I am a moderate—but during the election, I read what I thought were assurances from my party that we had no plans to introduce changes to APR. On that basis, I reassured farmers in my constituency that we would not, and now I simply am not prepared to break my word. I am told that there is no Labour MP in the country with as many farms as I have in Penrith and Solway, and I hope my colleagues will understand my feelings on this. Today, however, we are debating a frankly irrelevant motion from the Conservatives. The motion fails to acknowledge how they failed to deliver for my farmers, how they failed to deliver on trade deals after Brexit, and how they set budgets for new rural payment schemes, but could not make the schemes accessible. They made manifesto commitments for the public sector to buy British that never materialised, and they failed to spend flood prevention money that is desperately needed by my farmers on the Solway plain. They failed to deliver reforms of inheritance tax rules that farmers know were being abused by non-farmers at their expense. I simply will not walk into a Lobby with people who talk a good game on farming but do not deliver. Their motion starts with the words, “That this House regrets”, yet 14 years of failure do not even get a whisper.

I listened to the Member’s speech very closely. Paragraph 20.13 of “Erskine May” states: “Formerly, the House strictly observed a rule against anticipation”. That was designed to restrict debate on a subject to the type of proceedings deemed to be the most effective. As the word “formerly” suggests, the rule is no longer strictly observed and has not been for many years. The principal provision in the Budget relating to agricultural property relief is not contained in the Finance Bill currently before the House, so the question of anticipation does not arise. In any case, I am firmly of the view that any absolute rule should not prevent Members, whether acting individually or as parties, from holding the Government to account. I hope that that satisfies the Member; it is not a point for him to respond to right now.

15:10:00

I rise to join Conservative colleagues in calling on the Labour Government to stop this farm tax. It is a pleasure to follow the hon. Member for Penrith and Solway (Markus Campbell-Savours) and to have heard what he said about those false promises before the general election. Perhaps he, too, wants his Government to think again about what they are doing. The other week, thousands of farmers took the extraordinary step of coming to Westminster to protest against this misguided policy. Unfortunately, the Government have put their head in the sand and are pursuing this policy. I hope this debate will make them think again and make them listen. I give the Exchequer Secretary 10 out of 10 for appearing in the Chamber today, even though he is a junior Minister at the Treasury—he certainly pulled the short straw by being put on the Front Bench today. I ask Ministers not just to come here, but to listen to what is being said and to really listen to the needs of our farming community. We have heard a lot today about what British farmers do—they are stewards of the land, guardians of our food security and the backbone of the rural economy—yet the Government show a fundamental lack of understanding of how their policy will affect the industry. They are pushing ahead with it, even though it jeopardises not just farmers’ livelihoods but the very future of our countryside. The numbers speak for themselves. While the Government claim that only 27% of farms will be affected, the National Farmers Union has warned that 75% of family farms will be affected. If I were in government and I saw the discrepancy between those numbers, I would go back to the drawing board, check the figures and ask why those discrepancies are there, not dig in deeper. I think the curse of this Labour Government and what they will be remembered for is their distinct lack of grasp of detail and of how the economy works, rural and otherwise. [Interruption.] Yes, this Budget has been a disaster of a Budget.

My right hon. Friend is making excellent points. Does she agree that there is not only a lack of grasp of detail, but an astounding sense of arrogance—an inability to listen to those who know what they are doing, the farmers, and who have the experience and the expertise? There is just a blank inexplicable unwillingness by this Government to listen to the voices of expertise and of experience.

I thank my hon. Friend for bringing that point to the House. This debate allows those on the Labour Benches to say, “Actually, let’s go back to the drawing board. Let’s look at this discrepancy in the numbers.” For all their talk of growth—I return to the Budget—this Government’s policies are delivering the exact opposite of growth, with the change to employer national insurance contributions and the change to rights from day one. They are talking down the economy and crushing growth in the economy, with the forecast being revised to be lower than it was. Even if the Government do not want to hear this from me, and even if they do not want to hear it from the farmers, I want them to hear it from a Labour-supporting tax expert, Dan Neidle. He has eventually come to the conclusion that Labour’s farm tax is a dog’s dinner of a policy. Originally, Dan had criticised what he saw as “over-the-top coverage” of the impact these tax changes would have, but he says that on closer inspection he has reversed his decision, remarking that these Budget changes would hit “farmers too hard and tax avoiders too lightly.” He argues that the policy needs to change. Dan Neidle has said that the Treasury should raise the inheritance tax cap dramatically to around £20 million so “only the largest and most sophisticated farm businesses become subject to IHT”. Those on the Labour Benches might not want to listen to me, but I hope they will listen to one of their own tax experts.

A moment ago, we heard talk from the Liberal Democrat Benches of a family farm tax and land taxes. It now seems that the right hon. Lady is suggesting we take up Dan Neidle’s suggestion. Will she confirm whether that is the case?

It would be good if Members listened to what I said. I said it is not too late for Labour to reverse this policy; even their own tax advisers are saying, on closer inspection, it needs to be reversed. That is what I am asking those on the Government Benches to do. We have heard today that farmers are asset-rich, but in reality they are cash poor, and that is the crux of the matter before us today. In the time I have left, I will mention a couple of farmers from my constituency. A seventh-generation farmer told me she was hoping to pass her farm on to the eighth generation, but that now does not seem possible because if they have to sell a proportion of the land, which they will, that will make the whole farm is unviable. Another farmer of mine, Richard Shepherd, a few years ago built a state-of-the-art cow cubicle shed for their dairy herd, a piece of modern technology he believed would prepare the farm for the challenges of the 21st century, investing in methods to produce high-quality, affordable and nutritious food—the type of innovation this country will come to rely on for food security in the future. However, now, with this change from the Labour Government, he will owe between £600,000 and over £1 million in inheritance tax. He has said that, “Like any other business, we need confidence to invest in our farms. That’s what we wanted to do: we wanted to grow our farm, invest in it, and this will destroy this.” Richard Barnett, an accountant who works with many farmers in my constituency, has warned of two immediate consequences of these proposed changes. First, there will be an increase in the number of individuals seeking to acquire farmland up to £1 million to mitigate inheritance tax, resulting in a reduction in the amount of tax that the Treasury can expect to generate from this policy, as well as an increase in land prices. Secondly, he expects a consequence of these changes to be that the financial industry will enter the land market with individuals investing up to £1 million in farmland, acquiring it and then we will see farmland being lost—

Order. I call Callum Anderson.

15:18:00

I associate myself with the excellent speeches by my hon. Friends the Members for Ribble Valley (Maya Ellis), for Peterborough (Andrew Pakes) and for Forest of Dean (Matt Bishop), who were all absolutely right to say that this Government are committed to standing shoulder to shoulder with British farmers and ensuring their voices are heard and their future is secured. Nowhere is this more vital than in Buckinghamshire, where farming is not just an industry, but an integral part of our local identity. It supports our economy, shapes our landscape and is woven into the fabric of our communities. Since I was elected in July I have engaged closely with farmers across north Buckinghamshire, and I have been grateful to meet local agricultural and rural businesses in my constituency such as Boycott farm in Stowe and Hogshaw farm and wildlife park; I thank them for welcoming me to their world. These visits have reinforced my commitment to representing their interests and addressing the challenges they face. I have been struck this afternoon as I listened to speeches from across the House by the inability of the Conservatives to confront and defend their own record in office. Time and again, the previous Government failed to stand up for Buckinghamshire farmers. As has been said, they failed to spend £358 million of the UK’s agricultural budget, and that money should have gone straight into the pockets of Buckinghamshire farmers. Instead, the Conservatives left it on the table, not because it was not needed, but because they could not be bothered to make sure that their policy to replace the basic payment scheme was completed on time. That was their attitude when in office. The gaps and the unanswered questions in the schemes left many farmers in my constituency in limbo, undermining their confidence and threatening their livelihoods. When in government, the Opposition failed again when they negotiated trade deals with Australia and New Zealand, removing most tariffs on beef and lamb. Even the Conservative Cabinet Member responsible for negotiating the deal said it was a bad one. These deals have opened the floodgates to imports that threaten to undercut our domestic producers, leaving British farmers struggling to compete against lower-welfare and lower-cost alternatives. Our farmers deserve better. That is why this Government are determined to do things differently. We have committed, as others have said, £5 billion to the farming budget over the next two years. That is the largest investment in sustainable food production in our history, because we know that food security is national security. In the coming year alone, £2.4 billion will go directly to supporting British farmers, ensuring that they can thrive in a rapidly changing and uncertain world.

Will the hon. Member give way?

I would be happy to were there not too little time. These investments are about more than money. They represent a vision for a resilient and sustainable future. On the inheritance tax point, the Government’s approach is balanced and fair.

Will the hon. Member give way?

I will not on this occasion. Just last night, the former Conservative Chancellor Lord Clarke agreed with our approach, saying that he was team Chancellor. He said it was “a strange exemption…which is why so many rich people buy agricultural land”. He is not wrong. As others have said, in 2021-22, the top 7% of wealthiest claimants accounted for 40% of the total value of APR, at a cost of £219 million to the taxpayer, as my hon. Friend the Member for Rugby (John Slinger) said. The majority of claimants will not be affected. Couples inheriting farms can still pass up to £3 million tax-free, and any additional assets will be taxed at half the standard rate, with payments spread over 10 years. This Government are delivering a new deal—a square deal—for farmers, including measures to ensure that British produce is prioritised in Government procurement, that farmers are not undercut by low-welfare imports and that energy costs are reduced through innovative solutions. Our farmers deserve a Government who listen, support and invest in them, and this Government are committed to doing just that.

15:22:00

I rise to speak on behalf of Mid Norfolk, a rural, agricultural, food-processing constituency that is reeling from this surprise and savage attack that was not in the Labour manifesto. I have no direct interest in farming, but I am the child of a farming family—my stepbrother runs that business. I worked on farms from the age of 15 to 21. I was going to go into farm management, and I think I still have a place at Harper Adams agricultural college if this career does not work out. My first job was with the NFU, working here in Parliament. I was a director of Elsoms Seeds and I was proud as a Minister to lead the agritech industrial strategy. I am chair of the all-party parliamentary group on science and technology in agriculture. This is a hugely important strategic industry to the UK. It is key to our food security—now, gratifyingly, a Government priority—and it is completely key to the world’s ability to feed 9 billion mouths. We are a great agricultural research and technology economy, and the world is hungry for our innovations. Agriculture is also completely key to net zero. Agriculture and transport are the two dirtiest industries, and agriculture is moving more quickly than any, pioneering regenerative systems of agriculture and carbon-capturing systems. Those innovations are being driven by a new generation of young UK farmers, who are different from the post-war generation. They take their responsibilities to the broader planet and regenerative agriculture seriously. At the same time as agriculture being a key strategic industry, farmers look after our countryside and keep our rural economy healthy. All of those are achieved in the most extraordinary way, in an industry not dominated by big companies. This industry is made up of millions of small businesses. Moreover, they exist in the most extraordinary business climate. They operate on incredibly expensive assets—the land—which they never seek to monetise, as colleagues have pointed out, in an industry in which their costs are fixed. They invest in all their costs up front and wait hopefully for a price for their product, which is subject to the vagaries of the weather and of climate change. Most business people looking at that business model would say, “That is not a business I want to be in.” Why do our family farmers do it? They do it because it is a way of life and because it is deeply embedded in the values of their families, their countryside and their communities. It is about stewardship, and it makes it all the more remarkable that this Government have decided to attack that very bit of the agricultural economy. What are the aims of this policy? What is the impact of this policy? How should this House and those MPs who understand the rural economy respond? If the Government had said, “Our aim is to close the loophole of land asset speculators enjoying the legitimate family tax relief that the Conservatives put in place in 1984,” I probably would have supported them. If they had said, “We want to stop international hedge funds enjoying a tax relief designed to protect family farms,” I suspect many of us would have supported them. If they had said, “We want to support new entrants to the industry to promote diversified, regenerative agriculture, to increase investment and to promote the vibrant rural economy,” I probably would have supported them. That, however, is not the aim of this policy. The truth is that we do not know its aim, because the policy was never in the Government’s manifesto and it is not from DEFRA. It is a Treasury policy that has been landed on unwitting Ministers, who are now having to carry the can. We know it is anti-small business, anti-family business and anti the rural economy. The former Labour adviser, John McTernan, let the cat out of the bag. He said that Labour has waited a long time to seek revenge for the Tory attacks on the miners, and it was going to attack the farming community now—[Interruption.] That is exactly what he said. The impact of the policy is clear; we only have to read the CLA and NFU briefings. I have met Gavin Lane, Phil and Sophie Ellis, Oliver Munday and Nigel Stangroom. Most of our average family farms will have to pay tax bills of £400,000, £500,000 or £600,000. Where will they get the money, when the businesses do not generate the profits to pay those bills? They will all have to sell land, but who will buy it? It will not be their neighbour, because they will be selling land, too. I fear that this policy was designed in the Treasury with the support of bits of the Department for Energy Security and Net Zero and DEFRA. The people hanging over Mid Norfolk waiting to buy the land are the big solar developers and the big mass housing developers.

Will the hon. Member give way?

I will not, as time is short and colleagues want to speak. This policy is a prescription for the industrialisation of the countryside, cooked up in the Treasury in the summer when nobody was looking. It will lead to family farms being broken up and sold, farm investment falling and young farmers leaving, with a major economic impact and tertiary impacts in my part of the world. Those industries that support farming are already seeing the effects. The response of rural MPs should be to move fast behind the hon. Member for Penrith and Solway (Markus Campbell-Savours) and make it clear to the Treasury that it needs to adjust the mechanisms, change the thresholds and change this policy, unless Labour wants to be the party of rural devastation.

15:27:00

It is always a privilege to speak on behalf of my constituency, which is the largest in England and one of the most rural. I start by paying tribute to the farmers I have engaged with, both as a Labour candidate—I had my selection meeting at a Hexham farmers market—and since I have been elected, whether in London, on their individual farms, through the NFU or otherwise. have had genuinely balanced and informative conversations about them, and I have shared the outcomes of those conversations with Ministers and through the appropriate channels. What really strikes me is that this is an unserious motion brought by an unserious party; one that fails to understand the countryside and fails to understand why it lost seats that it had held—in the case of Hexham, for 100 years. The Conservative party undermined the confidence of young people to remain in the communities where they grew up, and it cried foul at any attempt to provide housing in my local community. I spent this morning meeting with Hexham Community Partnership to talk about the appalling overcrowding in Hexham and the need for genuinely affordable housing. The problem is having a devastating effect, forcing people out of the towns they grew up in. The Conservatives had oversight of that in my part of the world for 100 years. They need to look in the mirror and genuinely consider why rural communities turned against them so much.

Will the hon. Member give way?

I will. The vast expanse of green on the Opposition Benches reminds me of the British countryside.

Does the hon. Member think that perhaps the reason the good people of Hexham voted for him is because they were promised explicitly that his Government would not do what they are currently doing?

When we start a new job and find that the previous person in that job had not paid invoices for the previous year and deliberately withheld financial information, we have an honest conversation with the public about what is achievable. In any business, we have to be honest with people about deliverables. [Interruption.] Well, ultimately people in my constituency were sick of the chaos. They were sick of seeing Liz Truss plastered all over the newspapers. When I speak to my farmers, I hear a real cry for security and genuine forward-planning from a DEFRA that listens and is not turned into a political football, as it was too often by the Conservatives. I know, having grown up in a rural community alongside the children of farmers, that they value roads that are not full of potholes, a stable economy and libraries that are not falling down—exactly the public services that every one of us expects.

Will the hon. Gentleman set out how many farmers he has spoken to since the Budget and, of those, how many support the Government’s policy?

The hon. Member is welcome to come and take a look at my diary at some point. On the Saturday after the Budget, I went to a farm. On the second Saturday after the Budget, I went to a farm. I then met with NFU members at my office in London. Believe me: Labour Members work their constituencies a lot harder than Tory Members.

I hope that my hon. Friend sees me as a fellow Labour MP who works his constituency hard and speaks to residents. Farmers tell me that they are concerned about rural crime. We can all agree that something that DEFRA has got right under the Labour Government is tackling rural crime, and the rural crime strategy in particular. Do farmers speak to him about that, as they do to me?

They absolutely do; my hon. Friend is right. What people—not just farmers—speak to me about is the need for that growing, stable economy. They are infuriated with the Conservative party for pretending to jump on a bandwagon after taking farmers for granted for 14 years while in government.

Before the Budget, the hon. Member will remember attending a Westminster Hall debate that I organised specifically on agricultural property relief and business property relief. Will he agree that the Conservatives have not jumped on that since the Budget? We have been speaking about it for a very long time.

I thank the hon. Member for her intervention. She and I must have a slightly different view of a very long time. A few weeks ago is not a very long time for me. I am talking about years in which local farming communities were ignored. The botched Brexit deal that the Conservative party secured did not do any farmer any favours. Labour is the only party that is genuinely serious about countryside renewal. We cannot pack communities across Northumberland in aspic and pretend that they do not need houses or services. That is why the Conservatives lost. That is why I am here.

Will the hon. Member give way?

I have taken plenty of interventions in a short time. Ultimately, the Government will be judged on the success of our record and whether we can get the farming budget into the pockets of farmers. I have every faith that the Government and DEFRA will do that. I do not believe that the Conservative party could honestly say that it ever trusted its DEFRA Ministers to do the same.

15:33:00

I rise to support the many farmers in my constituency and the rural communities that farmers are the very heart of. I want to do something a little different in this debate and try to figure out what is behind some of the moves that the Labour party has put in place when it comes to farming. [Hon. Members: “What about Brexit?”] Believe me, I am coming to that, but I want to try to understand a little bit about the Government’s motives. What I think it comes down to is a clumsy attempt to try to define what working people are. It is clear that farmers do not fit that bill. Even though they work 12-hour days in backbreaking conditions, mainly outdoors, right into older age, they just do not seem to fit into that particular clique. Labour has always had an urban-centric view of our country. Everything it does in politics is viewed mainly through a metropolitan lens. Farmers have never really had a chance with this Labour Government. It should come as no surprise—I know why Labour Members shouted down the hon. Member for Mid Norfolk (George Freeman)—that someone as thoroughly unpleasant and John McTernan, Tony Blair’s former aide, would say something like farmers should receive the same as what Margaret Thatcher dished out to the miners. I think his view that we could do without our farming industry has just a little currency in the Labour party. Labour Members would do well to be honest about these things. For our comrades on the Government Benches, farmers are simply not “one of us”. The last time we had a whole cohort of Labour Members on the Government Benches, we would mercilessly tease them that there were “nae ferms in Scottish Labour.” Two things about that quite unjust slight: first, they did not respond—they did not seem to care, it was a matter of “Whatevs”; and secondly, it was patently untrue. There were lots of farms in Scottish Labour, and there are with the cohort down here. A great number of Scottish Labour MPs represent rural and farming constituencies. But the point remains the same: they just do not care about what happens to farmers. I think the general view is that Labour MPs do not rely on a rural farming vote—they could just about muddle through their elections without the support of the rural community. They see farming as just another business that they might find in one of their town or city centres. They understand nothing about how it is possible to be asset rich and resource poor, land values and the intimate nature of family farms, which are dependent on fixed assets to generate business and activity. The simple fact is that this Government do not understand the rural community, or how the generational continuity of farms works. And now, loads of new Labour MPs represent rural constituencies in England. Rural Labour Members of Parliament do not tend to last all that long—they may be in for one term, or possible two terms at most. That is generally because they are forced to accept and subsume the agenda put forward by their Government. My bit of advice to them is to start thinking about the farmers and their communities, start to think about their own electoral arithmetic and try to be on the side of farmers for a change.

I cannot believe what I am hearing. I am a four-time Member of Parliament for a semi-rural seat, having first been elected in 1997. The hon. Member is just talking nonsense. I have never heard anything like it.

I am a bit familiar with the hon. Gentleman’s electoral history—he was out of Parliament for quite a long time. It is good to see him back in his place, obviously, but he was booted out, which was basically down to his lack of interest, concern or care about what was happening in the rural community. If I were NFU England, I would be sure to put that in front of the Members of Parliament who represent rural constituencies in England. I have a couple of bits of advice for some of the UK farmers and their representatives. First of all, Jeremy Clarkson is not their friend. He represents the part of the rural community that is so far away from the real struggle that farmers face that he may as well be in an urban Labour constituency. Secondly, farmers must be very careful of what the Conservative party is offering. Let us remember that the Conservative party oversaw the cost of living crisis, the ending of thousands of farms, and who—to come to the point made by hon. Members—brought in the absurd and economically illiterate Brexit. The Tory hard Brexit increased farming costs, introduced unnecessary barriers to markets, allowed lower-quality competitors in the marketplace and has taken billions of pounds out of the rural economy. How the Tories were able to sell this chaotic Brexit pup to so many rural communities will go down as one of the worse pieces of mis-selling in British farming. There is a different way to do it. In Scotland, we do things differently. We are making sure that there will be a constant farm payment to farmers in Scotland. We have also put food production at the very heart of our farming policy. Today, in the Scottish Budget, as well as introducing a winter fuel payment, we will abolish the two-child benefit cap. On top of that, £660 million will be going to farmers. All the money that was kept for Government emergencies in the past few Budgets will be returned in full. That is how the Government can support farmers. It would be good to see this Labour Government doing a bit of that in the future.

15:39:00

I welcome the opportunity to speak in this debate, and I am grateful that the Conservatives, after many years of ignoring farmers, have finally decided to pay attention to farming and food security. Farming plays a vital role in the past, present and future of North Northumberland. There are almost 2,000 farms across Northumberland, in my constituency and that of my hon. Friend the Member for Hexham (Joe Morris); each of them proudly and patiently shaped the landscape that we view as quintessentially British, and they play a crucial role in sustaining local communities. Farmers are good for North Northumberland. Since becoming a Member of Parliament, I have spent a great deal of time meeting them and representing their concerns in Parliament. In fact, my first non-maiden speech was on the virtues and challenges of sheep farming. I have done that because I understand, as the Government do, that farming is central both to the communities I represent and to our way of life in the UK. Put simply, our country cannot flourish without a flourishing farming sector. Farming has been battered for 14 years under previous Governments. As I was preparing for this debate, I read a recent letter from a farming constituent about a range of difficulties he faces: “For many years government intervention has always dominated the top of my risk register, due to inconsistent policy and its oft re-enforced reputation as a poor payer.” It would be convenient for the Conservatives if farmers across the UK were to forget about the past 14 years and blame all the current difficulties on a Government who have been in office for just six months. However, creating a reputation for Government as a “poor payer” and having inconsistent policy takes years, not months. In July 2023, the Competition and Markets Authority found that the post-2020 squeeze inflicted on our food supply chain was a combination of significant rises in energy, commodity and labour costs, made worse in some cases by adverse movements in the exchange rate. In other words, farmers have been squeezed for years by energy prices, labour costs and a depreciation of the pound, and the previous Government bear some responsibility for all those factors. In April 2024, the Energy and Climate Intelligence Unit found that since Russia’s invasion of Ukraine, the Government had enacted only three out of 10 policies necessary to improve energy security and bring prices down in the long term, which speaks to years of failure on energy, whether that is selling off gas storage capacity, dodging tough decisions on nuclear or going cool on the urgency of global warming by banning onshore wind. When global energy fluctuated, the lack of long-term preparation left our farmers exposed to rocketing prices. Another matter I would like to raise is the issue of large retailers at times letting down our farmers. They are able to dominate negotiations around own-label products, and, with 90% of farm-produced vegetables being sold by supermarkets, farmers are stuck in a monopoly position that threatens their business. I urge the Government to do what they can to ensure reliable pricing and supply arrangements can be set between farmers and retailers that benefit our national food security. There is also the issue of subsidy. We need to get the money out the door to farmers, and make sure they can actually get the funding that they did not get under the previous Government. I will finish by mentioning another of the issues we have talked about today on APR. There is a need for continued constructive engagement around the recently announced proposed reforms. While every farmer I have spoken to welcomes the proposal to end taxpayer subsidies for the super-wealthy buying up land in order to avoid inheritance tax, I am aware that the Government are facing two competing responsibilities. The first managing the national finances, and the second is ensuring that every community can follow its traditions and dreams. As a farmer recently wrote to me: “Despite all that was thrown at my father over the years, all he ever wanted to do was farm and he LOVED it. Somehow, it was in his blood.” I know the Government understand this. I urge the Minister to continue to keep that front and centre as we support the contribution of farmers to our national life. After many years of ineptitude, neglect and the doling out of crumbs by the Conservatives, it must be Labour that truly becomes the party of farming and rural life.

15:44:00

As many Members know, I am able to speak with some expertise on this subject, as I was the first female director of the NFU in some 100 years and I now represent a constituency, in which I have lived for 34 years, where there are 1,006 farms or holdings. The Country Land and Business Association says that 432 of those farms will be affected by the measures. I am known as somebody who tries to reach across the Chamber and make friends with hon. Members on both sides. I do not particularly enjoy confrontation, so there are elements of the debate that I have found unpleasant and disappointing. I do not like the references to class coming from the Labour Benches, or the suggestions that it has anything to do with class coming from hon. Members on the Conservative Benches. That is an irrelevance. Please do not play politics with my farmers—they are too important. My plea to the Minister, when he is listening, is that he looks again—I am not asking him to change the policy; I understand that it is Treasury-driven—at some things that need to be looked at again. It is a flawed assumption that ownership is split 50:50 between spouses. That is not the case across Exmoor. And if it is not the case, especially in cross-generational farming families where older farmers hold on to the property so as not to burden the younger generation with increased capital gains tax on any future sale should they wish, then the relief stated by the Chancellor will not add up to the value stated. Another flawed assumption is that average family farms are worth under £3 million. They are not. I am grateful to my constituent and good friend Guy Thomas-Everard, who went out of his way to give me the bill of sale for a perfectly average farm outside Winsford in my constituency. It is valued at £3.5 million, and that is before we count the deadstock and the livestock.

Will the hon. Lady give way?

No. Another flawed assumption is that the residential nil rate band will be applicable. If the value of the farm business is worth over £2.65 million, there is no residential nil rate band, so that swallows up large numbers of family farms. I know that many Members are very, very unhappy indeed with the proposals. The hon. Member for Penrith and Solway (Markus Campbell-Savours) said he will vote with the Government because of the dire state that the former Government left farmers and agriculture in, but he is right when he says that this is a flawed piece of legislation. It will devastate family farms. I implore and beg the Minister to look at it again—and at least to get the facts right.

15:48:00

All Governments have to make tough decisions. Faced with a £22 billion black hole, Labour has chosen to raise taxes on only the very wealthiest. The Conservatives’ record was instead to choose to place the burden on the poorest in society—those with disabilities and those who are very young. In fact, I am seeing that in real time in Derbyshire, as the Conservative leader of Derbyshire county council has chosen not to spend his time dealing with the disastrous recent Ofsted report on the sorry state of special education needs and disabilities provisions in Derbyshire affecting thousands of vulnerable children, or trying to deal with the terrible county finances which it is trying to plug by closing much-loved care homes, again leaving some very vulnerable people with an uncertain future. Where was he? He was marching with wealthy landowners down here in London. I ask the shadow Minister what she thinks first attracted various multimillionaires in various industries to suddenly discover a passion for farming and buy farms in their late middle age. I had thought that the Conservatives would want to discuss the huge challenges facing our NHS, the cost of living crisis affecting so many of my constituents or their failed track record in delivering vital regional infrastructure; but no, we have had silence on those issues. What has got them out literally marching on the streets is a rush to defend multimillionaires. My constituents can see what is the No. 1 priority, and it is not the same as theirs. Let us be clear: retaining the status quo, for which the Conservatives are arguing, would see 7% of claimants receiving 40% of the relief. That is £219 million given to just 117 estates. Why should 117 of the richest get £219 million in tax relief, and not ordinary families? One would have thought that, after such a profound rejection of their party’s record in government back in July, the Conservatives would have taken some time to listen to the electorate and learn. The electorate saw that this Labour party was different, and voted us in. Perhaps the Conservatives should take a closer look—and here I include the hon. Member for Perth and Kinross-shire (Pete Wishart). Many of my colleagues are deeply rooted in their rural communities, and I myself come from a family of farmers. In fact, I spent most of my family Sunday lunch listening to an in-depth monologue on SFI technical details, which was of course very welcome. While the Conservatives are rushing to defend the wealthiest in society, we in Labour will be focusing on what matters to rural communities: access to rural health facilities, a record £5 billion for farmers, a new commissioner for tenant farmers—which is fantastic—a new rural crime strategy, and protecting farmers from bad trade deals. Coming from a family of farmers, I know a wolf in sheep’s clothing when I see one. However much the Conservatives bleat about standing up for farmers, their bushy tails and terrible record for farming over the past 14 years tell me otherwise. I will always fight for farmers, to improve farming incomes and to support farming communities. That is my priority, and it is the priority of this Government.

15:51:00

I must begin by drawing attention to my entry in the Register of Members’ Financial Interests. I rise to support the land-based and agrifood sector in my constituency, a sector that stands bewildered at what this Government are doing to it—a Government who it thought had its back, and that were going for growth. A farmer constituent wrote to me shortly after the Budget, saying: “All these changes have meant that our already tight margins are non-existent. The next few months are going to be spent calculating if it would be better to just sell up and no longer farm.” That is hardly surprising, given that the average salary of a farmer in this country is a little over £22,000, although farmers are described by many as being multimillionaires. My constituents’ disappointment is heightened by the Government’s assurances before the election, and the specific promise that they made on APR and BPR. I think that, if I may say so without damning his career too much—I see that he is no longer in the Chamber—the hon. Member for Penrith and Solway (Markus Campbell-Savours) did us a service by reminding us of that promise. However, we should not be surprised. My hon. Friend the Member for North Norfolk (Steff Aquarone) and the hon. Member for Perth and Kinross-shire (Pete Wishart) have already drawn attention to John McTernan, who very helpfully allowed the mask to slip when, referring to farmers, he said that we should “do to them what Margaret Thatcher did to the miners.” He went on to say that farming was “an industry we can do without… we don’t need small farmers.” I hope that when the Minister winds up the debate, he will do us a service by distancing himself completely from those sentiments. The Government’s estimate of in-scope farmers is either incompetent or tricksy and duplicitous. Setting aside Ministers’ apparent confusion over what constitutes an acre and what constitutes a hectare, we are of course indebted to the Central Association of Agricultural Valuers, which says that 75,000 farms over a single generation will be affected—five times the Government’s estimate. I think the Minister should reflect on that, because there is no shame in admitting that the Government and their officials have got this wrong. There is time to fix it, and there is time to look at such independent sources, to compare and contrast their data with the data that the Government’s officials have produced, and to tack accordingly. Were the Minister to do so—I appreciate the Treasury pressures that he is under—his stock among the farming community would rise substantially in these early few months of his tenure. I have a helpful suggestion: the Government have picked the wrong target. I think that many Members of this House would be perfectly happy for this Government or any Government to target those who have, over years, used land to avoid inheritance tax, particularly institutional investors, hedge fund managers and oversea investors, who have artificially put up the price of land in this country, which forces new entrants out of the market and distorts it. That is a perfectly legitimate thing for any Government to do, but what this Government are doing is picking on small and medium-sized farms, many of which have been in families for generations. The Government are doing the productive sector of our land economy in this country a massive disservice and, frankly, are acting in a way that is unfair and unworthy. I implore the Minister, who I know is a good man, to think again. He should talk to the Treasury, and turn his fire on individuals and institutions using land to avoid tax, which forces up land prices. Hands off our family farms!

15:56:00

Bassetlaw has a heritage and a future in energy production, with coalmining and power stations once dominating the skylines, the workforce and our communities. Although its focus is now shifting towards bringing world-leading fusion energy production to the area, we also have a proud tradition of food production, with farms and rural communities covering over half of my constituency. The farmers in Bassetlaw are deep-rooted and a proud part of our history. It was essential that I met local farmers both before and after I was elected in July, so that I could understand their priorities and represent their interests. Following my election, I immediately joined the NFU scheme, and I look forward to visiting a chicken-packing centre at the end of this week. I want to know at first hand the difficulties, the conflicts and the changes that our farmers are making to meet today’s challenging needs, expectations and market forces. In Bassetlaw, we have a mix of mainly arable farms, with some farms combining livestock and arable, and a small number that focus solely on livestock. In recent times, they have had to deal with the impacts of Storms Babet and Henk, with water sitting in fields for months, which has turned them into pond bottoms and impacted on production plans and opportunities. Over the last 14 years, hikes in the cost of living and rises in the price of fuel, seed and grain have all had impacts. Getting people to work on our farms has proved to be a perennial problem, which has been made much more difficult in recent years because apprenticeship opportunities remain unfilled and finding reliable crop pickers is becoming as rare as hen’s teeth. Rural crime is a huge issue. Fly-tipping and the theft of livestock and equipment are daily threats that interrupt people’s working lives and impact on production and profits. The Tories’ Brexit deal ignored the needs of farmers. We have all seen the queuing at the ports, with rotting fruit and vegetables and an inability to safely transport livestock. The last Government’s trade deals have allowed cheaper food to be imported due to the lower farming standards in overseas nations. I welcome the £5 billion commitment to British farmers in the recent Budget—the largest ever financial commitment in farming history. It will be directed at sustainable food production so that we eat more British-produced food. There will be an additional £60 million to support farmers affected by the storms last winter, alongside the new flood resilience taskforce that will work to protect farmers’ fields from the extremes of the weather, and on top of this the Government have committed £208 million to rebuild the armoury against disease threats that impact so greatly on the farming industry. For the first time ever, there will be a cross-Government rural crime strategy focused on cracking down on the criminals who blight our countryside. I want to live in a country that puts pride into buying British food. My challenge is that we lead that campaign in our advertising, our supermarkets, our restaurants and cafes, our high streets and our markets. Aligning the Union Jack with the food we eat is the key to strengthening our commitment to buying British, whether it is on our menus or on the shop counter. Choosing British must become the first and best choice. We need to adapt to once again buying and eating seasonal food. That was a way of life and is something that we should be proud to return to. Forget convenience and buy British! That is why I welcome the Government’s using their purchasing power across the public sector. Some 50% of the food eaten in hospitals, prisons, schools and army bases will now have to be locally produced. This Government will protect farmers from being undercut by the low welfare standards and poor standards in trade deals. I am proud to sit on the Bill Committee that is steering through a new veterinary agreement with the EU to get our live food exports into overseas markets. I am proud of my country and I am proud of the farmers in Bassetlaw. I will continue to listen to their concerns and I am speaking to DEFRA and Treasury Ministers about those concerns. Their voice is my voice.

16:01:00

I commend my near neighbour, the hon. Member for Penrith and Solway (Markus Campbell-Savours), on his brave contribution. It is hard to come to this Chamber and tell the truth when the pressure from the Whips and the party is to defend the Government at all costs. He made it absolutely clear that this measure will have a devastating effect on farms and the farming industry in his constituency if it goes through as currently set out. The hon. Gentleman’s constituency and mine have something in common in that, in the 2001 foot and mouth outbreak, which devastated the farming industry, we saw for sure how important farming was to the whole community. Because farming was shut down, business was shut down. Shops were shut and lots of businesses including garages and all the services in rural areas could not function because farming was not functioning. That showed me the great importance that farming has. Ironically, however, the outcome for my constituency of this measure from a Labour Government will be the further acquisition of land by private equity companies. This is because, thanks partly to the Scottish Government’s lifting of restrictions on land that can be afforested, good farming land in my constituency is under huge pressure from private equity funds buying it up to plant trees for carbon capture reliefs. It often seems that it is a great thing to plant trees and that we should all be in favour of it, but the reality is that these trees are Sitka spruce trees that are planted very close together. There is no light or environmental content within these forested areas. No creatures can survive in them. They are not environmentally friendly or sustainable, but they are financially attractive. They employ nobody. There is no employment once the forest has been planted. When farmers come under pressure, as they will, to sell land to meet the inheritance tax, this is who the buyers will be. It will be these private equity firms, and if it is not them, it will in many instances be those who want to develop solar panels in a farming scenario, as other Members have highlighted.

Does the right hon. Gentleman agree that even the most ambitious estimates show we could cover only 1% of agricultural land with solar farms? Does he agree with Tom Bradshaw, the NFU’s president, who told journalists 85 days ago: “What I do want to say is that an individual solar farm is not something which risks national food security”? And does he agree with the CLA, which said in 2022: “Solar is also a valuable diversification and cost reducing land use for farms—helping to shield exposure to volatile agricultural markets”?

No, I do not agree with the hon. Gentleman’s proposition. I do not think that viable prime agricultural land should be used for solar farms. I believe there is plenty of other brownfield land, or land that is not prime agricultural land, that could be used for solar farms. I am, therefore, not supportive of some of the huge developments proposed for my constituency. I will now touch on one or two other points that have been raised but not expanded on. First, a lot of this discussion has been as if the sole structure of a family farm is mother, father, son and daughter. Brothers and sisters, or cousins, are often involved in the farming business, and it is quite wrong to suggest that some of the reliefs that can be applied would work in that situation. I have constituents who are in exactly that situation. A family farm is not just mum, dad, son and daughter. It is brothers, sisters, cousins and extended family. The right hon. Member for Orkney and Shetland (Mr Carmichael) touched on tenant farmers. Tenant farmers in Scotland, in particular, are in a very difficult position because they cannot sell a couple of fields to pay their inheritance tax. They will have to give up the whole of their business, if they cannot find the money in other ways to pay these bills. We need to understand the issues that face tenant farmers. I also commend the right hon. Gentleman’s suggestion that there should be a much wider debate about farming finance. The way to secure farming finance, and to secure our farmers, is not to destroy the family farm.

I am quite astonished because, as we sat in a pub car park in the run-up to the general election, farmers in my constituency told me—I kid you not—that they know they do better under a Labour Government but they often vote Conservative. It feels like the Conservatives have taken their loyalty for granted. The right hon. Gentleman has been talking about how hard things are, and I agree with him. Farmers talk about their margins, and those margins are tight, but who caused them to be in that situation? We are now in a position of power—

Order. I remind Members that interventions need to be interventions. They should be brief and ask a question that is relevant to the speech being made.

I do not know whether the hon. Member for South Derbyshire (Samantha Niblett) was here for the speech of the hon. Member for Penrith and Solway, but he set out exactly what happened to him as a Labour MP, having given farmers assurances about what Labour would do in government and the farmers finding that they had been betrayed. Now, the choice is not final, as he said, and hopefully this debate has shown the passion of both farmers and those who represent rural constituencies.

I am glad that the right hon. Gentleman enjoyed my speech. Did he enjoy the bit at the end where I listed the abject failures of his Government?

I liked the honesty of the hon. Gentleman’s speech in setting out how the Labour Government had let down his voters by going back on their undertakings in relation to the policy. They should listen to what has been said in today’s debate, to farmers and to the hon. Gentleman, and they should change the policy.

16:09:00

As someone who lives on a farm, which is surrounded by farms, and whose family has farmed, and diversified, for generations, I add my voice to all those who have paid tribute to farmers for the crucial role they play in our economy. Many other hon. Members have said it more eloquently than I can, but let us all recognise the vital role of farms in our economy. In common with colleagues, I met with farmers in the post-Budget period. Frankly, I was expecting a pretty hard time and there were some robust discussions, but they were also civil, constructive, informative and understanding. I pay tribute to the farmers and the NFU representatives who took that approach to the discussions. What most surprised me was how quickly the discussions immediately pivoted to the sense of anger, abandonment and betrayal that arose from the past 14 years, which have decimated the industry. Fellow Members have described in detail—the hon. Member for Westmorland and Lonsdale (Tim Farron) described the situation particularly well—the betrayal of Brexit, the spiralling energy and feed prices, the spiralling land costs, and the terrible trade deals that opened the doors to poor-quality imports, which undermined the very farming markets that Conservative Members claim to value. As we have heard already, that dire management resulted in over 12,000 farms and agribusinesses going out of business since 2010. That is a terrible, shocking, shameful legacy. For Conservative Members to now present themselves as the champions of farmers is outrageous. They have used the word “arrogance”, but that is what they have displayed—a refusal to reference, understand or learn from their own history and failings.

Conservative Members talk about being friends of the farmers but for the past 14 years they were not. It shows how little they care that only 18% of their parliamentary party is present for a debate that they have called—[Interruption.] Only 21 out of 120 Conservative Members.

It is amazing; one of my colleagues talked about “the green fields opposite” in reference to the empty Conservative Benches. Given that background, it is no surprise that farmers are angry, worried and feeling vulnerable. I associate myself with the remarks made by the hon. Member for Tiverton and Minehead (Rachel Gilmour), who called for calm and sense in the debate. Emotive language, designed to sow fear and cause concern is irresponsible at the very least, so let us try to keep to the facts and keep things calm and reasonable. The focus of Conservative Members seems to be family farms, but the phrase “family farm tax” immediately creates a sense of fear and targeting, which is completely wrong. With some sensible tax planning, £3 million of assets can be exempt. Many speeches have glanced over the importance of gifting rights. Let us take the scenario of a family farm, in its truest sense, that is to be passed between generations. Surely, gifting rights are a massive opportunity to avoid all inheritance tax and remove the sense of fear that Conservative Members are trying to create. Most of the rest of the country has to do that simple estate planning by default.

As the hon. Gentleman will be aware, reservation of benefits applies when an asset that is still being used is passed on under the seven-year rule. Is he suggesting that a farmer who has been on their farm for their whole life should move out of their farmhouse, get off the land and pay market rate rent? Where will they get that money from, given that, as we know, farm profits are so small?

A range of reliefs, benefits and rights create an ability, in most cases, to avoid tax. Let us take the seven-year rule. It is a tapered rule, so after four years, the liability drops from 20% to 12%. Also—this has not been mentioned much today—inheritance tax insurance is available. Particularly for younger farmers who wish to gift those assets to the next generation, inheritance tax insurance effectively mitigates any risk of death inside seven years. I recognise that for older farmers that can become quite expensive; none the less, it is a mitigation that is open to anybody. I recognise the issue of gifts with reservation, but that is my central point. It is not just me saying this; the Institute for Fiscal Studies has said that with sensible, realistic and relatively straightforward estate planning, estates worth considerably more than £2 million will remain exempt from tax. There are many measures that can be taken. However, in this context, one of the great benefits of having detailed discussions with farmers is the ability to recognise the practicalities and the detail. By talking to Becki, who runs a multi-generational farm in Darwen, I came to recognise that there are very good arguments for a degree of flexibility around gifting rights and timescales for the over-80s. It is a perfectly good argument for the provision of professional and detailed tax advice to allow genuine family farms to take full advantage of all the reliefs that are available. I genuinely believe that well-advised true family farms can, with a plan to pass those farms between the generations, mitigate or completely avoid any liability from these taxes. I will finish by going back to the main point that Members have made: farms do not make enough money. Turning things around, getting back to a situation—[Interruption.] We need to get back to a situation where farms can succeed as businesses and where we bring costs down, not just raise prices as was suggested. We need to bring energy costs down and make bills are more stable, use the Government’s purchasing power to buy locally produced food, protect farmers from being undercut through bad trade deals, and remove risk through a rural crime strategy and the floods resilience taskforce. Our plan for farms is supported by £5 billion, which is the biggest investment in farms in generations. Let us stop the scaremongering, get behind British farming and reverse 14 years of decline.

16:17:00

Staffordshire is the largest dairy-producing county in the midlands and across the county we have 9,600 people working on farms. Four hundred and thirty-two of those farms are in my constituency, and they are an incredibly important part of the fabric of the area. So many of my constituents who listened to the Budget were genuinely shocked. They were shocked because they took it at face value when the Labour party said that there would not be any changes in inheritance tax for agricultural land. They listened and they believed. I know—I always like to believe the very best of people—that the Ministers on the Front Bench from the Department for Environment, Food and Rural Affairs would have fought for that position, but this policy was a diktat from the Treasury. In my experience, there is a tendency for the Treasury to do that to many Departments. That diktat has meant a change in position, and one that has a severe impact on many people’s lives. If there were a factory in Staffordshire employing 9,600 people and its future viability was in jeopardy, Ministers would be rallying to its support. Members across the House would be saying, “Let us do something to save these jobs and save these livelihoods.” But that is not the case here.

Will the right hon. Member give way?

I will, of course, give the hon. Gentleman the opportunity to burnish his potential to be that Parliamentary Private Secretary in DEFRA that I know he is so desperate for on any occasion.

Why is the right hon. Member so dismissive of DEFRA, which is a fine Department whose work those of us who believe in the countryside value? I wonder why he was not so loud when 875 agribusinesses in his region closed in the last 14 years.

All the while I have been a Member of Parliament, I have fought for my farmers, and I will continue to do so. I invite the Minister for Food Security and Rural Affairs to the next Staffordshire agricultural show as my guest. I will happily take him around, and he can look for farmers who are in favour of the Government’s policy. He can talk to my farmers. There are 446 farmers in the Stafford constituency, which neighbours my own, who I imagine will have a very similar view to that of farmers in my constituency: that this policy will put them out of business. If I take the Minister around the Staffordshire agricultural show, he might meet some of the 351 farmers from the neighbouring Lichfield constituency. Let him see how many of them believe that his policy will help them to grow their businesses. A family business, whether it is a farm or a manufacturing business, invests not just for five years but for a generation and more. The Government’s policy will drive large financial institutions to own much more of our land—not local farmers who are invested in the community and care about the villages and towns that serve them. This policy is already having an impact. Many businesses that supply farmers are already seeing a significant drop-off in orders, whether it is people who supply agricultural machinery, people who supply seed or many more. I urge the Minister, who I believe comes to this House with a good heart, to look at the wider impact that the policy will have on our countryside, and at how it can be changed and improved. The Labour party says that it wants to capture the large landowners—the James Dysons. I have a great deal of confidence that such people will be able to find different arrangements that mean that their wealth will never be touched, but many small farmers, who have worked hard all their lives to build something that they can hand on to their children, will be impacted. I fear for them, and I urge the Government to put the dogma of party politics to one side and really think of the impact that the policy will have on the lives of so many farmers who are trying to do the right thing for this country and our countryside.

16:22:00

I thank the farmers who visited me in the House for the good and respectful conversation that we had. I reflected their concerns to Ministers, and will continue to do so. The Conservative Government trashed our economy. Mortgage rates went up, interest rates went up, prices went up, and taxes on working people, including farm workers, went up. The Conservative party smashed public services, with unprecedented and often unnecessary cuts to the services that our country relies on, including farmers—our roads potholed; GP surgeries under-resourced; a lack of mental health provision; schools struggling, sometimes crumbling; housing unaffordable, especially in rural areas. I could go on. The Conservatives dashed the hopes of farmers when they were in government. They tried to sell out farmers with their trade deals, often gleeful about cheaper imports or hinting at support for chemically treated or hormone-injected meat. They gave farmers the chaos of delayed stop-start support schemes; cuts to the police, including rural policing; neglect of flooding in rural areas; and the incompetence of not even managing to spend £300 million that they had not managed to cut. Now the Conservatives speak—perhaps exaggeratedly —about the impact of this Government’s plans. Where was their outrage when 12,000 farmers and agribusinesses were forced out of business from 2010 onwards, or when services were being cut by their Government? They are unabashed in their defence of the status quo on inheritance tax, which means that they are content to see the top 7% of the wealthiest claimants account for 40% of the total value of APR, costing the taxpayer £219 million. They are unashamed in their overall position on a Budget that, as a result of the tough decisions taken by my right hon. Friend the Chancellor, has provided £5 billion to the farming budget over two years, the largest ever budget for sustainable food production, £60 million for farmers affected by last winter’s wet weather and £208 million to protect against future diseases. Contrary to some recent campaigning, Labour is investing in British farming. Equally, the Government’s Budget is investing in our entire nation—in our economy and our public services—and we will build the growth and prosperity that we all rely on. We have made our decisions; now Opposition Members, especially Conservative Members, must justify why they continue to support the status quo, why they oppose our Budget with its funding for farming, and why they rail against our Budget’s investment in the economy. If they oppose this, they owe it to people outside this House to say which taxes they would increase, which public services they would cut and how much they would increase borrowing by.

When the hon. Member considers how much money will be raised by the family farm tax, how many hundredths of a percent is it against total annual Government spending?

The hon. Member will not be surprised to hear that I do not have that precise detail to hand. To those who trashed our economy, who smashed our public services, who dashed the hopes of farmers over 14 years, who are unabashed in their defence of the status quo and who refuse to set out a credible alternative to our Budget, I say we will decline their advice today. I urge hon. Members across the House to do the same.

16:27:00

It is a privilege to contribute to the debate. I represent Salisbury and south Wiltshire, which has a large number of farmers. A large number of them visited me here in the House of Commons and, a week later, I had the largest meeting of farmers I have ever had in Salisbury. They were gravely disappointed and concerned about the implications of this Budget measure. It was a shock, because it was widely expected that this measure would not be on the table when the Labour Government came in. One of the greatest privileges of my career was to spend most of the past eight years—six and a half of them—in the Treasury in various roles. I was PPS to a Chancellor, Philip Hammond, and then I was Economic Secretary and Chief Secretary. I understand the dynamic between spending Departments and the Treasury in the run-up to a Budget, and I have a serious degree of sympathy for the Ministers who were in DEFRA in the run-up to this Budget, but when APR and BPR were put on the table in front of me and my ministerial colleagues at numerous points during our time in the Treasury, we said no. I acknowledge—I am trying to be as reasoned and as reasonable as I can—that other choices would have had to be made, and I recognise the difficulty of those choices. We faced difficulties when we came into government in 2010 with a 10% deficit. This Government had a different set of challenges, although I would dispute some of the numbers. However, I want to keep my remarks focused on the measure at hand. The reason I would never have wanted to progress the removal of APR and BPR was that that policy was the product of a technical desktop economist’s view of tax raising. It was not an option when one took into account the reality of what would actually happen to the rural economy and the implications for farming. A number of colleagues have rehearsed excellent examples where farms of quite modest size but serious capital value would be massively compromised by that policy, even with an opportunity to repay that inheritance tax interest-free over 10 years, as the Chancellor said to the Select Committee. I acknowledge that—it is standard practice for this sort of relief—but given the profitability of the typical farm, it is just not a realistic prospect. I have had some dealings in the past with the farming Minister, the hon. Member for Cambridge (Daniel Zeichner), and I genuinely have a great deal of respect for him—I do not want to embarrass him by saying anything more. He has a large number of issues to deal with, and I think all of us in this House want to see some clarity around the land use framework, and how we reconcile the question of where we build more homes with the challenges of renewable energy. However, we have to keep in focus the core function of our farmers, which is to produce food. I recognise the point made in an intervention earlier, and I am not suggesting that the Government are going to say, “We are going to have solar farms everywhere,” but we do need to have a coherent farming policy as a whole and a land use strategy that people understand. The issue with this policy is that it is going to decimate the number of family farms unless there is a significant increase in thresholds, there is an age limit on when the policy applies, or an alternative tax mechanism like business asset roll-over relief is examined by the Treasury. Unless those changes happen—and there is time to consider those changes before the legislation comes before this House, which will probably be at the end of next year—we in this country are going to be in real trouble with the legacy of this decision. I urge the Minister’s colleagues in the Treasury to think again and come back with better proposals for their colleague.

16:32:00

I came here today to speak up for upland farmers in my constituency. Although I am not a farmer myself, I grew up within smelling distance of a dairy farm, and coming from a working background, I have earned a living working outdoors in all weathers as a gardener, so I know what it feels like to have mud on my boots and frozen fingers. For a lot of our farmers, though, the physical strain is only part of the daily struggle; the other part is the anxiety of having so much invested in such a precarious business, and the burden of responsibility for keeping the farm alive in an era of shrinking profits. Because farmers are working people who deserve secure livelihoods, and because food security is essential for our national security, I hold quarterly forums with the farmers in my area—I say that before anyone tries to intervene to ask me how many I meet with. I hold regular forums and, in fact, some of our council candidates are local sheep and cattle farmers. Of course, I have met with them more in the last few weeks than I had been doing. In the meantime, I am having conversations with fellow MPs and with DEFRA and Treasury officials and Ministers to push for the issues that matter to farmers in our area. As such, when I went to the Bill Office last night to receive the motion for today’s debate, I was genuinely unsure how I would vote. I read it with an open mind, but when I saw it, I thought, “What a load of tripe.” By the way, I thank the right hon. Member for Salisbury (John Glen) for taking a much more constructive tone in his speech a moment ago. The Opposition could have come to the Chamber today and presented a constructive motion that many rural MPs on the Government Back Benches would have sympathised with. Instead, this motion seems calibrated to make us want to oppose it. It seems to me that the Opposition are more interested in playing party politics and cosplaying as the friends of farmers with this motion than they are in genuinely addressing issues that they both ignored in government and are now ignoring in opposition. Some legitimate concerns about the policy have been expressed to me by farmers in my constituency. By the way, many farmers in my constituency sympathise with its aims and with what the Government are trying to achieve. One told me recently that he cannot stand the James Dysons of this world who are hoovering up agricultural land. However, they are concerned that there remains a tax incentive to invest in agricultural land, and I would be grateful if the Treasury reported on some of that modelling. For example, we know that 7% of wealthy claimants account for 40% of the cost of APR, but that means that 93% are costing only £382 million. It would be interesting to know how much money it would cost to slightly lift the thresholds or to address the concerns about life insurance.

I will not take any interventions, but only because other colleagues want to get in. There are concerns, but I must say that when I met farmers in my constituency recently, they agreed with me that a bigger concern for them, as many colleagues have said, is profitability. The motion could have talked about economic stability for lower inflation and interest rates, and it could have talked about cutting rural crime, which would also cut insurance premiums. If I may say so, I welcome the Equipment Theft (Prevention) Act 2023 from the hon. Member for Mid Buckinghamshire (Greg Smith), but there needs to be secondary legislation.

I agree.

Thank you. Let us work together. I am pleased that the Government are defending against floods and disease. I am pleased that we are committed to protecting standards in trade deals. I am pleased that we are committed to getting a veterinary agreement with the EU to cut red tape. I am pleased with the public sector procurement targets. However, we need to do something on rules about food labelling in order to prevent “farmwashing.” We also need to do more to strengthen farmers’ bargaining power with supermarkets. I am pleased with the changes to planning laws that will allow a lot of farmers to invest. I would just say to my own party and to the Government that we need to bring these forward faster. Farming in my constituency is on life support. There is, in fact, good will towards this Government and what we are trying to do, but we cannot afford to wait another 18 months, particularly for the basic payment scheme transition. We need upland farmers to be able to access the sustainable farming incentives. I know the SFIs are in the pipeline, but they cannot wait 18 months to receive them.

Order. Members will be aware that I am starting the wind-ups at 4.40 pm precisely. For the last few minutes, I call Lewis Cocking.

16:37:00

Thank you, Madam Deputy Speaker. Broxbourne is not known for its farms, but this year’s boundary changes have seen my agricultural land increase. This tax will also affect thousands of my constituents through the supply chain and buying food at supermarkets. However, I want to concentrate on something we keep hearing from Labour Members. We are told that the farmers represented by Opposition MPs or Conservative MPs are completely against the policy, and we are told time and again by Labour Members, as a number have stood up to say today, that they have spoken to their farmers, who seem happy about it, and they are going to vote with the Government. So I thought I would go out there and put that to the test. As I have said, my seat has had boundary changes and farms have moved into my constituency. If this one farm had remained in the original seat before the general election, it would now be represented by a Labour Member, but it is not: it moved into my constituency and it is represented by a Conservative Member. I asked this farmer, when I went to visit them, if they are completely against this policy. They said, “Yep, absolutely, Lewis. This will destroy our family farm.” I asked them if, pre-boundary changes, they were in their old seat and had a Labour Member of Parliament, their view would still be the same. They said to me, “Don’t be so silly, Lewis; of course it would be the same.” So I do not understand which farmers Labour Members are speaking to, because their views cannot be different from the views of my farmers. Thousands of them from across the country, including my constituency and the wider Hertfordshire area, came to Westminster to show their displeasure with the Government, so will Labour Members please think again, vote with us today and stand up for their farmers?

I call the shadow Minister.

16:39:00

This morning, ordinary farming families across all four corners of our United Kingdom will be waking up to another day of hard graft. If it is anything like my upbringing, the kids will be out early helping their parents feed the livestock, dad might be milking the cows or perhaps out crop-walking with the agronomist, rightly concerned about the impact of recent wet weather, and mum will no doubt be battling the elements, keeping the whole operation running smoothly and somehow still finding time to make sure everyone has their wellies on the right feet. Anyone with experience of rural life understands all too well the constant struggle of keeping a family farm afloat. It is tough work—long hours, barely any room to breathe and a financial struggle for many. As I have said many times in this House, our farming families are not multimillionaires; many will be striving to make a profit, but a lot of our families will not be, with many of our farmers earning less than the minimum wage. But today these farmers will also be waking up with the crushing reality that they now face losing everything they have ever worked for—everything that their mum or dad or the generations before them worked for—all because of this Labour Government’s disastrous farm tax. I have spoken to hundreds of farmers in the days since the Budget, as have the shadow Secretary of State and many colleagues sat behind me, and we have learned that Labour’s catastrophic Budget really is an anxiety that very few farmers were ready for. We have heard about many of their concerns in the debate. My hon. Friend the Member for Weald of Kent (Katie Lam) spoke about those, such as Ross in her constituency, who may have ill health and other challenging circumstances, who do not have time to plan. My right hon. Friend the Member for Braintree (Mr Cleverly) talked about farming accountants raising incredibly distressing calls from farmers. My hon. Friend the Member for Bridlington and The Wolds (Charlie Dewhirst) and my right hon. Friend the Member for Stone, Great Wyrley and Penkridge (Sir Gavin Williamson) raised the impact on the wider rural economy and the whole of the UK production sector. My hon. Friend the Member for North Cotswolds (Sir Geoffrey Clifton-Brown) and my right hon. Friend the Member for South West Wiltshire (Dr Murrison) rightly mentioned the challenges the whole Budget will have on our farming, including the dire consequences of employer national insurance. My hon. Friends the Member for Mid Norfolk (George Freeman) and for Broxbourne (Lewis Cocking) rightly highlighted the concerns of family farms that will have been in the family for many generations facing being split up. My hon. Friend the Member for Gordon and Buchan (Harriet Cross) and my right hon. Friend the Member for Salisbury (John Glen) rightly challenged the Government’s own data and figures and lack of understanding of values. But the core issue is that this is all about trust. Before the general election, Labour looked our farmers in the eye and told them continually that there would be no changes to inheritance tax. Indeed, the hon. Member for High Peak (Jon Pearce) even at a hustings before the general election classified this as Conservative scaremongering, and many Labour MPs now sitting opposite proudly stood with placards saying they would back British farming. Yet here we are, 35 days after Labour introduced the family farm tax and 15 days after thousands of family farmers rallied in London, and there is not a shred of contrition from the Ministers sitting opposite—not even the slightest bit of empathy for those ordinary farming families who know the value of their businesses and who have looked at the detail and have been hit hard by Labour’s family farm tax—and that is because their level of arrogance is stark, as we have seen in this debate. The hon. Members for Ribble Valley (Maya Ellis), for Peterborough (Andrew Pakes) and for Forest of Dean (Matt Bishop) could not even mention one farmer in their constituency who supported this policy. The hon. Member for North East Derbyshire (Louise Jones) seems to be convinced that this will impact only the wealthiest. The hon. Member for Hexham (Joe Morris), who I believe is not in his place, and the hon. Member for North Northumberland (David Smith) both say they have engaged with their farmers and heard their views, but then failed to mention anything in support of scrapping Labour’s disastrous family farm tax. No wonder their farmers are up in arms. The hon. Member for Bassetlaw (Jo White) turned up but failed to mention anything about inheritance tax relief. And the hon. Member for Penrith and Solway (Markus Campbell-Savours) rightly highlighted Labour’s broken promises. I pay tribute to him for mentioning it, but will he have the courage to commit, to back our farmers and to vote with us for scrapping Labour’s family farm tax? The hon. Member for Rugby (John Slinger) spoke, made no reference at all to inheritance tax, but did mention the Budget. I can tell him that after the Budget, in one single week ending 8 November, 1,022 companies filed to shut down. I also point out that we saw 1.1 million more businesses between 2010 and 2023. The NFU, the CLA, the TFA and farming organisations up and down the UK say that Labour’s Budget will tear apart British farming, UK food production and our domestic food security agenda. The Central Association of Agricultural Valuers, whose members’ job it is to determine the value of farms, says that the Government have got their figures completely wrong. Those very same tax experts who the farming Minister rolled out in defence of this policy just a few weeks ago have now gone on to criticise it. The Government are looking incredibly isolated. Public support for this policy has been wiped out since it was announced, leaving Labour MPs as its only defenders. Up to now, they have all failed to publicly call out our city-dwelling Prime Minister and Chancellor’s callous Budget. Now, we have even had the Exchequer Secretary, the hon. Member for Ealing North (James Murray) being wheeled out to open this debate, as the Government’s last remaining hope to try to defend this disastrous attack on our farming families. The Government have lost the experts, they have lost the industry and it now seems they have lost their own Secretary of State from the Front Bench—it is great to see that he has just walked into this debate and turned up—and it is weak and embarrassing.

The shadow Minister says that Labour Members do not know any farmers—I do. I am proudly a sixth-generation farmer’s daughter. My brother still farms, but for how much longer I do not know. My dad died exactly a year ago today. My mum is a partner in the business, and she is now 81. My brother is not married and he lives in a rather lovely farmhouse, but we do not know for how much longer that will be. He is worried about his farm. He is worried that he will be the one to close the gates for the very last time. Does the shadow Minister agree that we must move to a compromise, a transition and a clawback mechanism? Let us look to incentivise our farmers, rather than this punitive tax.

The hon. Member highlights the devastating consequences that Labour’s Budget will have on our family farms. Many questions remain unanswered, so with the opportunity of Treasury and DEFRA Ministers sat side-by-side, I will put a few to them. First, if this is a unified Government, why did the Treasury tell DEFRA about this policy only the night before the Budget? Secondly, why did Ministers not take into account claimants of BPR in the limited datasets they have released? I am happy to give way to the farming Minister if he wants to answer that specific point, because he has not answered it to date. Thirdly, why do the Government believe it unnecessary to take into account the size of family farming businesses when determining the impact of their £1 million cap on agricultural property relief and business property relief? Finally, for the sixth time of asking in this place, why has no detailed economic impact assessment for this policy ever been produced? Our position is clear: we back our British farmers, and the Conservative party will reverse this family farm tax. That is exactly why we will force this vote today, but we cannot do it alone. I therefore conclude by reaching out to Labour MPs across the Chamber. I know there are some sitting behind the Front Bench who have first-hand experience of rural life, who understand the consequences of this family farm tax and who are saying in private that the Government have got this terribly wrong. I say to those Members that it is not too late to save our farming families from this cruel farm tax and from those faceless multinational corporations that will no doubt sweep up any land that is forced to be sold as a result of this policy. It is not too late to join our British farmers, many farming organisations across the UK and the tens of thousands of farmers who were in Whitehall just a few weeks ago. Many Labour Members committed to back British farming before they entered this place, and now is their chance to prove it. British farmers are watching, and Labour MPs have a clear choice either to back British farming and scrap this catastrophic tax or to put party politics before the voices of their constituents and farmers. I urge everyone in the House to do the right thing: to put British farmers first and vote against Labour’s family farm tax.

16:50:00

I am grateful for the opportunity to close this debate on the planned reforms to agricultural property relief. It has been important to hear from people on all sides of the debate and to outline the steps that the Government have taken to reach the decision on agricultural property relief. The reforms to APR are just one of the tough decisions that the Government had to take across the board on tax, welfare and spending to plug that £22 billion black hole that we inherited from the Conservatives and restore our public services. We have had many contributions to the debate; I am sorry that I cannot respond in detail to all of them. On my side, we started with an excellent account from my hon. Friend the Member for Ribble Valley (Maya Ellis). My near neighbour, my hon. Friend the Member for Peterborough (Andrew Pakes), spoke eloquently about the workforce issues; it is astonishing how rarely they are raised from the Conservative Benches, although there are some noble exceptions. We heard from my hon. Friend the Member for Forest of Dean (Matt Bishop) and from my hon. Friend the Member for High Peak (Jon Pearce), who, along with a number of others, rightly raised issues of profitability in the sector. My hon. Friend the Member for Penrith and Solway (Markus Campbell-Savours) made the important point that we are not discussing the Finance Bill today. My hon. Friend the Member for Hexham (Joe Morris) asked why it takes Labour Members to raise rural crime issues, because anyone who has been out talking to farmers will know that that is their top concern. From my hon. Friend the Member for North Northumberland (David Smith) we heard a powerful account of the value of rural life. My hon. Friend the Member for North East Derbyshire (Louise Jones) again talked about the national health service. These are the concerns of people in rural areas. From my hon. Friend the Member for Bassetlaw (Jo White), we heard about rural crime again. We heard from my hon. Friend the Member for Rossendale and Darwen (Andy MacNae) and from my hon. Friend the Member for Rugby (John Slinger), who rightly outlined the Conservatives’ atrocious record over 14 years on public services. Finally, my hon. Friend the Member for Bishop Auckland (Sam Rushworth) rightly dismissed the Opposition motion as a load of tripe—although perhaps that is tough on tripe. A huge range of figures and analysis have been quoted in the debate so far. I have to say that part of the problem with those figures is that they seem to be about different things. Only one set of figures actually gives guidance on this issue, and that is the Treasury figures showing that about 500 estates a year will be affected. That is based on the hard data of the actual claims. It includes the impact of APR but also takes into account business property relief. I urge some Opposition Members to look at the Chancellor’s letter to the Chair of the Treasury Committee, which outlines all the details, taking into account those personal circumstances, the nil-rated inheritance allowances and the other capital allowances. It is available to all Members. Those figures, of course, are endorsed by the independent Office for Budget Responsibility.

Opposition Members have had a lot of time to make their points. I am going to make mine. Would Conservative Members have been so interested during the last Parliament? I remember sitting on those Opposition Benches hour after hour on the rare occasions when there were rural debates. They had no interest then; suddenly now.

No. I am afraid that the right hon. Gentleman came in late, and if you turn up late, you do not get to speak. [Interruption.] I recognise the frustration and anxiety being felt by farmers around the country. [Interruption.]

Order. I am sure that hon. Members want to listen to the Minister. I know that my constituents certainly do, and farmers across the country certainly will.

Thank you, Madam Deputy Speaker. I am not sure that Conservative Members do want to listen, really. As a result of the anxiety that we know people are feeling, it is right that the Prime Minister, the Environment Secretary and I have all met with the NFU president Tom Bradshaw to talk about the proposed reforms. The Government have and will continue to engage with the NFU, the CLA, the Tenant Farmers Association and other stakeholders. The reforms will not be introduced until April 2026, so there is plenty of time for people to plan for change and to get, as they always should when running major businesses, professional advice about succession planning. Let us be honest: last month’s protests were not just about APR. Rural communities have felt ignored and let down by this place after decades of failure. The Conservatives sold out British farmers in trade deals with New Zealand and Australia. I listened to the shadow Secretary of State, the right hon. Member for Louth and Horncastle (Victoria Atkins)—did we get any apology for the trade deals? Not a word; no contrition. They have learned nothing. They left farmers facing spiralling energy bills because they refused to invest in cheaper home-grown British power—a decision that sent fertiliser and animal feed costs soaring. The Conservatives were so incompetent that they failed to get £300 million earmarked for farmers out the door, leaving farmers out of pocket as the money sat idle in Treasury coffers. The disastrous kamikaze Budget crashed Britain’s economy and sent interest rates and mortgages skyrocketing, at massive cost to our farmers and rural communities. As a result of all that, public services are broken; hospital waiting lists are at record highs; schools in rural areas are crumbling—if Conservative Members use them, of course—and roads across country areas are cratered with potholes. Rural communities are rightly feeling ignored and left behind. This Government will not accept that. These reforms will disincentivise the wealthy from buying up agricultural land to shield their wealth from inheritance tax, and they will also raise the money needed to fix those public services. This is a turning point for national renewal. The Budget also commits £5 billion to agriculture over the next two years.

claimed to move the closure (Standing Order No. 36). Question put forthwith, That the Question be now put. Question agreed to. Question put accordingly (Standing Order No. 31(2)), That the original words stand part of the Question.

55|16:57|181|339|The House divided:|Question accordingly negatived.||0|0

Question put forthwith (Standing Order No. 31(2)), That the proposed words be there added. Question agreed to.

That this House thanks farmers for their immense contribution to the UK economy and the nation’s food security; welcomes the Government’s commitment of £5 billion to the farming budget over the next two years, the biggest budget for sustainable food production and nature recovery in UK history; acknowledges that the Government is having to make difficult decisions to protect farms and farmers in the context of the £22 billion fiscal blackhole left by the previous Government; recognises that the Government is seeking to target Agricultural Property Relief and Business Property Relief to make them fairer whilst also fixing the public services that everyone relies on; and notes that under the changes announced in the Budget around three quarters of claims for Agricultural Property Relief, including those that also claim Business Property Relief, are expected to not pay more Inheritance Tax.