The NFU has written a letter to Prime Minister, Keir Starmer, on behalf of its 45,000 strong members of the farming community, calling on him to stand by his commitments to the sector by delivering a renewed agriculture budget and confirming the continuation of Agricultural Property Relief (APR).
At the NFU’s conference in 2023, while in opposition, the prime minister said that British farmers and growers need a government that forges a relationship with farming communities based on respect and genuine partnership.
“We can’t have underspends in the allocated money, we can’t have farmers struggling while they wait for the right Sustainable Farming Incentive (SFI) standards to be announced.
“We can’t have everyone burnt out by the bureaucracy and constantly moving goal posts, it’s too important,” Starmer reportedly said.
NFU president Tom Bradshaw, welcomed the prime minister’s sentiments which acknowledged the certainty and stability required of the agri-industry to thrive, which they currently estimate is valued at £148 billion.
He also expressed concern towards recent reports which suggest the government is currently considering cutting the agriculture budget to £358 million and a potential review of APR.
APR is a relief from inheritance tax (IHT) based on the transfer of ‘agricultural property’. It is available at either 100% or 50% against the value of the agricultural property, depending on the type being transferred.
“We are asking for a renewed multi-year annual agriculture budget of £5.6 billion, not because it would be nice to have, but because it is an essential investment to deliver the government’s environmental goals, to increase growth and to support the economic stability of farm businesses.
“The loss of APR could mean family farms, who are vital to producing food for the country, providing jobs and looking after our countryside, having to be sold to cover the costs. It would also have a devastating impact on tenant farmers and new entrants,” Bradshaw claimed
NFU analysis of APR suggests that a potential scrapping, in isolation, would only save the Treasury £120 million a year.
Around two thirds of the farmed area in England is occupied by working farmers who rent in some or all of their land and if APR was abolished, the NPU suspect it likely that land owners would no longer be willing to let their land and seek to end existing tenancies.
“At a time when farmer and grower confidence is at its lowest on record due to high production costs, extreme weather and uncertainty during the agricultural transition, we need stability and that genuine partnership with government which the prime minister spoke of.
“That is why on October 30, we’re asking for an increased agriculture budget and confirmation of no change to APR.
“This will deliver certainty to our food producing businesses and ensure our food security and environmental targets, all of which contribute to the government’s own missions for growth and prosperity,” Bradshaw said.
The NFU is also asking the treasury to:
- Ensure adequate resourcing to deliver the Farming and Countryside Programme, maintain flood defences and deliver the government’s new bTB strategy;
- Introduce enhanced capital allowance to incentivise investment in climate smart investments;
- Only apply Capital Gains Tax increases to non-business or short-term gains;
- Commit to a full consultation ahead of the proposed abolition of the Furnished Holiday Lettings regime;
- Confirm a further round of the Rural England Prosperity Fund.
