How Keir Starmer can escape damaging family farm tax row
There is cross-party support for pausing changes to inheritance tax which are putting the future of family farms at risk
It would take a brave soul to claim that the first months of Keir Starmer’s government have gone to plan. Even on the most generous assessment, ministers have been fighting on all fronts almost from day one – some conflicts inherited from the previous government, and some created by Labour themselves.
No government can expect to fight every political battle at once and win. On at least one front, however, Starmer has the opportunity to make a gracious retreat – by accepting the cross-party consensus to pause changes to inheritance tax which are putting the future of family farms at risk. That is the conclusion of the report published today by the Commons’ Environment, Food and Rural Affairs Select Committee, which I chair.
The committee took its work extremely seriously in agreeing our findings. I would be remiss if I did not acknowledge the constructive approach taken by my Labour colleagues on the committee in particular.
Select committee work is hard enough at the best of times, let alone when you are dropped into a contentious debate just weeks after you were first elected. For us to come to a cross-party consensus in calling for a pause on the farm tax should be a red flag to ministers in Defra and the Treasury.
READ MORE: 'It's had a chilling effect' – Almost half of farmers stop investing with impact of tax changes
Growing drumbeat of protest
The way in which the government has acted over recent months has clearly badly affected the confidence and wellbeing of farmers. Our report’s figures are stark: before the Autumn Budget, 70 per cent of farmers felt optimistic about the future of their rural businesses. That number has collapsed to just 12 per cent.
Ministers have done their level best to dismiss farmers’ concerns and ignore the strength of feeling in rural communities. The months of protests that saw tractors converge on Westminster and parade up and down the country should tell you how well that is going.
Not every problem facing farmers was created by the current administration, but there has been a growing drumbeat of protest, culminating in the farm tax row, with farmers left feeling they cannot rely on the government to live up to its commitments, past or present.
A positive story
What our report makes clear is that there is a better and more constructive path forward, for both the government and farmers. There is a consensus to be found on inheritance tax that protects working family farms while tackling tax avoidance – if ministers can pause and rethink.
After all, farmers ought to be the essential element in the government’s goals to achieve food security and restore and protect the environment. There is a genuine opportunity for ministers to set out a positive vision for farming in a way that no government has managed to do for decades.
It is the battle over inheritance tax that is getting in the way of that potentially positive story – and it will continue to do so for months to come if the Prime Minister does not grasp the nettle now.
I hope that the government will take our recommendations seriously and pause their inheritance tax plan. There is a chance here for Starmer to rebuild trust and confidence in the farming sector – if he calls off the fight.
Alistair Carmichael is the Scottish Liberal Democrat MP for Orkney and Shetland
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