Tim Bonner: Labour targets family farms

There are many models of agricultural land ownership in the UK, but the family farm remains the backbone of rural communities and the ideal, perhaps idealised, public vision of the British countryside. It seemed, from the careful courting of the industry by Keir Starmer and successive shadow Defra Secretaries while in opposition, that the Labour Party had grasped the political importance of farming and the countryside. However, the Chancellor’s decision to introduce an effective rate of 20% inheritance tax on agricultural property over £1 million has thrown family farms under the bus and at one stroke undone all that work.

There are many who are better qualified to comment on the practical implications of this and our colleagues at the NFU and CLA have reacted with real anger, not least because of the repeated commitments Labour had made, both in opposition and in government, that it would not change inheritance tax reliefs. However, the Chancellor’s decision will have implications far beyond the simple maths of taxation. Somewhere under 500,000 people work in agriculture in the UK with around two thirds of those being farmers, business partners, directors or spouses. Spread around hundreds of parliamentary constituencies there is an argument that this cohort is electorally insignificant, especially as there may be an assumption amongst Labour strategists that the majority are not their natural supporters. That, however, would be to misunderstand the totemic status of farming, the countryside and especially family farms amongst a much wider proportion of the electorate.

In the same way that there are not many more than 10,000 fishermen in the UK yet they had a seismic impact on the Brexit referendum, the future of family farms could have a significant effect on the government’s standing with a much wider part of the electorate. The simple ambition of family farmers to pass on their farm to the next generation in the same or better condition than they inherited it is something that everyone will understand whether they live in town or country. The countryside is central to people’s understanding of Britishness and a threat to the family farms which make up so much of the countryside is therefore a threat to us all. The idea that those farms might have to be sold off to meet the demands of the treasury (and the most likely buyers in many cases will be investors and large farming businesses) is politically toxic.

The NFU has estimated that the complete abolition of agricultural property relief would have raised £120 million a year and the Chancellor’s proposals will presumably raise significantly less than that. That is not a lot of money to destroy the carefully developed relationship Labour has built with the countryside and risk much wider electoral kick back. The government should think again.