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Budget explained – Overturn family farm tax

Monday, 4 November, 2024

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What does the Chancellor’s budget announcement mean?

Following the budget announcement (30 October) by Chancellor Rachel Reeves, the Ulster Farmers’ Union (UFU) warns that these new fiscal measures jeopardise farm family livelihoods, Northern Ireland’s food security, and the future of its largest industry. The Chancellor’s budget underestimates the essential role our farming community plays in the UK’s food supply, rural economy, and environmental stewardship.

The UFU is deeply concerned about the changes to Agricultural Property Relief (APR) introduced in the budget, which threaten the viability of family farms across Northern Ireland. We urge all farmers, landowners, and supporters of the farming community to unite and make their voices heard.

Agriculture property relief

The budget introduces a £1 million threshold on APR and BPR, with inheritance tax charged at 20% above this level. This change could mean that family members who have worked on farms for decades may need to sell to cover the tax bill after a parent’s death. While APR is just one inheritance tax relief tool, it’s crucial in unplanned circumstances, like sudden deaths. The Treasury asserts that three-quarters of farms will remain unaffected by the change. This imposes a substantial tax burden on everyday family farms with assets above £1 million. These changes to APR compromise the liquidity needed for succession planning on farms of all sizes, eroding the very foundation of our agricultural sector.

NI farm support budget

The NI farm support budget for 2025-2026 will be maintained, but no longer ring-fenced. This means Northern Ireland’s farming sector will now compete directly with critical services like health, education, and social care for essential funding. Responsibility for agriculture funding allocation rests with the NI Executive, which recently agreed that agriculture needs increased and protected funding. The UFU is calling on the Executive to fulfil this commitment.

The UFU’s next phase of action will focus on driving change at every level:

Lobbying key decision makers: The UFU has formally requested meetings with Chancellor Rachel Reeves, DEFRA Minister Daniel Zeichner and other senior figures in Westminster to outline the devastating impact of these changes.
Engaging with the public: The UFU will ramp up efforts to educate the public on what the loss of APR truly means. Not just for farmers, but for food security, rural economies, and household food prices. UFU will require the support of its farmers to talk to non-farming friends, family and neighbours. It’s critical that we share the reality of what this decision will do to our farms and rural communities.
Legal and professional challenges: The UFU is exploring all legal avenues to challenge this decision. In parallel, we are working with independent professional bodies to debunk Treasury’s misleading figures and provide accurate data to policymakers and the public.
Building broader support: The UFU is collaborating with the wider business community to highlight how these tax changes will ripple across the economy, affecting every household and business in NI.
Securing political promises: Strong cross-party support for a ring-fenced agricultural budget in NI was voiced at the UFU’s rally. The UFU will now hold political parties accountable to deliver on these commitments.

What has the UFU done?

Lobbying key decision makers

They also voiced their concerns to:

NI Secretary of State Hilary Benn MP
NI Office Minister Fleur Anderson MP
DAERA Minster Andrew Muir MLA
NI Affairs Committee Chair Tonia Antoniazzi MP
EFRA (Environment, Food and Rural Affairs) Select Committee Chair Alistair Carmichael MP
SF MLAs/MPs
DUP MLAs/MP/Lords
Alliance MLAs/MPs
UUP MLAs/MPs and Lords
SDLP MLAs/MPs
TUV MLA/MP
Baroness Margaret Ritchie
Claire Sugden MLA
Baroness Hayman
NI Rural Valuers Association

UFU lobby AERA committee

The UFU office bearer team and parliamentary officer attended Stormont’s Agriculture, Environment and Rural Affairs committee on Thursday 5 December. Representatives reiterated budget implications and how disproportionately NI’s farm families are affected by the changes to Agricultural Property Relief. Price per acre is much higher and more farms are under sole ownership so there is less opportunity to use inheritance tax reliefs from other individuals including spouses.

Opposition day vote update

On Wednesday 4 December, Conservative leader Kemi Badenoch forced a major non-binding parliamentary vote on Labour’s family farm tax in Parliament. A debate about the ‘future of farming’ also took place in Westminster Hall. The on-going work of UFU in representing its members was mentioned numerous times and the recent UFU rally held at the Eikon Exhibition Centre. Thank you to all members who contacted their local MPs and to those MPs who raised our concerns in Westminster.

UFU met with DAERA Minister

On Tuesday 26 November, the UFU met with DAERA Minister Muir to discuss the inheritance tax changes. This meeting was part of the broader push to ensure NI’s unique agricultural landscape is fully understood and respected in any policy decisions made at a local level.

UFU rally

The NI farming community sent a loud and clear message to the Labour Government that they will not stand by as Agricultural Property Relief (APR) is stripped away, jeopardising local family farms, rural communities and the UK’s ability to produce food. Over 6,200 people attended the UFU’s rally to overturn family farm tax at the Eikon Exhibition Centre.

UFU overturn the family farm tax petition

UFU representatives delivered its petition with over 15,000 signatures to the Secretary of State for Northern Ireland, Hilary Benn, in London on Tuesday 19 November. This petition entitled “Overturn the Family Farm Tax”, showed the overwhelming public support for the cause.

UFU attended NFU mass lobby

UFU representatives attended the NFU’s mass lobby in London. Representatives also attended the alternative rally to stand in solidarity with farmers across the UK and make their voice heard. The UFU next generation forum also voiced their concerns to the Secretary of State for Northern Ireland, Hilary Benn, on the changes to APR and inheritance tax and the effects it will have on their future.

Prior to UFU rally

The presidents of the four UK farming unions wrote to the Chancellor (25 October), urging the government to maintain Inheritance Tax Reliefs for farm businesses
The UFU requested an urgent meeting with the NI Secretary of State Hilary Benn to discuss APR
The UFU urged the Chancellor to revisit these measures and engage in meaningful dialogue with farming unions to protect the future of agriculture and rural communities
The UFU requested an urgent meeting with the First and deputy First Minister

UFU interviews on budget

UFU deputy president Glenn Cuddy: Cool FM interview with chief reporter, James Gould
UFU deputy president John McLenaghan: The View with Mark Carruthers and guests
UFU president, William Irvine: BBC Nolan Show – “Agriculture ‘reeling’ after a ‘very difficult budget’ for farmers – and subsidies no longer ‘ringfenced’.”
UFU president William Irvine: BBC Nolan Show – (31 October, 56 minutes onwards)
UFU president William Irvine: GB news
UFU president William Irvine: Good morning Ulster
UFU deputy president John McLenaghan: BBC Newsline and BBC Talk Back programme (6 minutes onwards).
UFU deputy president Glenn Cuddy: Cool FM, Downtown radio and Downtown country – “This budget will be detrimental to all family farms in NI.
UFU deputy president John McLenaghan: The View politics programme
BBC newsline: www.bbc.co.uk/news/articles/clygwpe17evo and https://twitter.com/BBCNewsNI/status/1858606596596637770
UTV
The Nolan Show: UFU president William Irvine and UFU member Sam Chesney