As I write this, more than 600 tractors, some of which have travelled from as far away as Exmoor, Worcestershire, Somerset and even the Isle of Wight, are circling Parliament Square protesting the recent Labour Government budget.
So far, I’ve not joined any of the London farmer protests as it seems to me that the demonstrators, by endlessly banging on about inheritance tax, are highlighting the wrong problem with the budget.
Farmland was subject to inheritance tax for much of the 20th century at much higher rates than the 20% now proposed, and the industry survived it. And DEFRA secretary Steve Reed himself has taken the trouble to remind farmers that paying inheritance on farmland can quite easily be avoided by us giving away our land at least seven years before we die.
But what would get me heading up the A22 from Eastbourne (although even my best tractor is so worn out I’m not sure I’d trust it to take me to Brighton, let alone to Whitehall and back), would be to demonstrate against the shock near-complete immediate removal of basic payments (or ‘delinked payments’, as we have been told to call them since 2023) announced in the budget.
The impact of this on farmers has hardly got a mention, even in the farming press. I did raise the subject briefly in these pages a month ago, but I suppose the accelerated removal of an old EU subsidy that’s already in the process of being phased out is not a very sexy issue to demonstrate about.
But the immediate 76% reduction in the first £30,000 of delinked payments and a 100% cut to any payments above will hit many farm businesses hard, my own included. This has now been confirmed by a piece of research just published by land agents Knight Frank. The average English arable farm can expect to see a 24% drop in profit next year due to delinked payment cuts, with even worse outcomes predicted for livestock farms. Less favoured area (LFA) farms will see incomes nearly halved.
Why is the NFU not making more fuss about this? It’s not as if delinked payments are going exclusively to wealthy landowners. Nearly 31% of UK farms rent land, and the rents they pay are very much ‘linked’ to assumptions about subsidy receipts through to 2027. Similarly, many farmers’ borrowing commitments to banks and planned mortgage repayments are ‘linked’ to receipts of this subsidy.
By introducing these massive cuts, Chancellor Reeves has simply misunderstood what delinked payments are. They are not ‘delinked’ at all but very much something that tens of thousands of farmers are dependent on for their livelihood.
The NFU needs to make the catastrophic cuts to delinked payments the centre of its protest. Then I too will be giving my best tractor the mother of all services and setting the sat nav for Cromwell Green.
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