Helen Morgan

I am speaking in favour of the amendments and new clauses tabled by my hon. Friend the Member for St Albans (Daisy Cooper), and against the changes to APR in general, and its less conspicuous but equally ugly twin sister, the changes to BPR, because they are downright destructive to the economy in rural places like North Shropshire. The Conservatives showed that they took farming communities for granted, presiding over botched trade deals and an unfair transition from the old basic payment system to the environment management scheme, and leaving the farming budget with an underspend of hundreds of millions of pounds, but the new Labour Government have shown that they do not understand rural communities whatsoever. It is utterly inexcusable that family farms have been put through over a year of uncertainty and anguish since the Government first announced changes to APR. I have had the pleasure of visiting many farms and attending roundtables with farmers in my constituency. The uncertainty, anxiety and fear caused to them and their families because of the changes has been appalling for Shropshire, not only because those farmers are part of the economic backbone of the economy, but because they are part of the community. As we have disputed with the official Opposition, the Liberal Democrats were the first to call out and oppose the unfair family farm tax in last year’s Budget. We have been proud to stand alongside our farming communities in campaigning against it ever since. December’s U-turn, which increased the farm inheritance tax threshold from £1 million to £2.5 million, has been hard won, and we are grateful to all the farmers who have fought tirelessly to achieve it. It is a step in the right direction, and it would be churlish not to acknowledge that, but having spoken to farmers in my constituency, I can say that the change just does not go far enough. I will focus on the dairy industry, because North Shropshire has a lot of dairy farmers. Dairy farming in the modern era is capital-intensive. You need expensive assets, like automated milking systems, cooling units, feed systems, housing and slurry storage. They are all essential for operating the modern dairy farm, but incomes are low and volatile. The reality is that the industry is becoming increasingly unprofitable, and many smaller dairy farms have already sold up in North Shropshire. To make matters worse, milk prices have recently fallen below the cost of production, while the price of feed and energy and labour costs remain historically high. Last week, two North Shropshire dairy farmers outlined the crisis that their sector has been put in. As partners in their farm, they told me that even with December’s increase in the threshold, the family farm tax incentivises them to keep their business small—they describe the tax as putting the dairy industry in a straitjacket. Because they have borrowed to finance their assets and capital expenditure, these farms are in a position where they are worrying about servicing their debts, maintaining production and remaining viable, yet the value of their land and machinery is in excess of the cap. There is already no money left for future capital expenditure, and now they have to plan to be able to pay off IHT in the future as well, which will not be achievable for them without selling parts of the farm to big players whose methods will be far less sustainable and worse for the environment than their current low-input model. Ending capital investment not only affects family farms and their growth, but puts our nation’s agricultural equipment producers and suppliers out of business, damaging growth and reducing our food security.