Labour rebellion simmers over anti-farming Budget

Backbench Labour MPs representing rural seats are poised to push back against anti-farming measures in the government’s Budget, according to insiders.

A highly controversial change to agricultural property relief (APR), announced by chancellor Rachel Reeves, will place an effective tax rate of 20% on agricultural assets valued at more than £1m. 

In addition, there was a negative change in tax status for double cab pickups, a hike to the national minimum wage and increases to employers’ national insurance contributions.

See also: Defra secretary rules out U-turn on Budget measures

A source at the Country Land and Business Association (CLA) said: “It’s not yet a full-blown backbench rebellion, but rural Labour MPs are really worried about this. 

“Many genuinely recognise that government’s rhetoric doesn’t match the reality. 

“They were elected on the promise of delivering growth, but instead here they are being asked to support naked attacks on multigenerational businesses and farms in their own constituency. The mood in parliament is grim.”

For English farmers, the Budget brought further bad news, with cuts to delinked Basic Payment Scheme (BPS) payments accelerated.

Farmers selling up

Farmers Weekly has been made aware that some farmers who had budgeted for a more gradual phase-out are now facing the prospect of selling up.

Speaking to FW about the issue, Defra secretary Steve Reed said: “The choice I made was, given that the BPS is being phased out and offers poor value for money for taxpayers, we protected the ELM [Environmental Land Management] schemes and the flood recovery funds as well.

“And £5bn over two years is the biggest ever budget in our country’s history for sustainable food production. That tells farmers this is a government that’s backing them.”

Despite this defence of the government’s position, many farmers remain angry about the measures in the Budget, with a small group turning up to protest outside the Northern Farming Conference in Hexham where farming minister Daniel Zeichner was speaking on 6 November.

The demo was held after a number of campaigns calling for a rethink on APR had already been launched by industry bodies, the mainstream media and politicians.

A template letter for MPs put together by the CLA has been sent to Westminster by about 6,000 members, and a Scottish Conservatives petition to “drop the family farm tax” has also been signed by more than 6,000 people.

Petitions against Budget

Separately, more than 150,000 signatories have put their name to an NFU petition on APR, and NFU president Tom Bradshaw has met new shadow Defra secretary Victoria Atkins in parliament to discuss the issue.

The union is also organising a mass lobbying event to take place in Westminster on 19 November, when 1,800 farmers will arrange to meet their MPs.

Meanwhile, NFU Scotland is organising a rally outside Holyrood for 28 November before the Scottish government’s Budget on 4 December.

Ahead of these events, Mr Bradshaw joined Mr Reed and treasury minister James Murray in an emergency meeting on 4 November.

The NFU is disputing Treasury claims that just 27% of farms, mainly large estates, would be affected by the APR change.

According to the NFU, the figures showing 73% of APR claims being below £1m include claims for items such as single fields attached to a house, or smallholdings, so cannot be used as a suitable proxy for working farms.

Instead, they point to Defra figures which show 66% of farms are valued at more than £1m.