The family farm brought to its knees by Labour

Telegraph

19-04-2025

The Frazer farm in Poppleton, just outside of York, has been in the family since 1967.
However, arable farmer Andrew Frazer has said that the 'constant knocking' from Labour's policies on inheritance tax and net zero, as well as its U-turn on green support, may see it broken up.
His father, Douglas, bought the 650-acre farm and still owns the majority of the business.
But at 87, the family fears he has run out of time to pass the land on to Mr Frazer without incurring a vast inheritance tax under changes introduced by Rachel Reeves in last year's Budget.
That is likely to lead to the breakup of the farm, denting its profitability.
'We're in for a £1 million-plus bill when my father is no longer, which will be just impossible to pay,' Mr Frazer said. 'I'll have to sell land off.'
There had been a 'glimmer of light' in the prospect that he could cover some of the bill by selling some less efficient land at a decent price to developers after Poppleton was named as a prospective location for one of Labour's proposed new towns.
But he fears that plan has been killed off by Labour's strengthening of compulsory purchase orders – meaning the land could more easily be bought by the council at its agricultural value, rather than its value as land for development.
'That's kind of the kick,' Mr Frazer said. 'I'd be losing land for the basic price, which wouldn't cover the bill anyway. So I would have to sell decent farmland to pay the bill. It's pretty bad.'
'Can't plan when rules change overnight'
Amid this turmoil, Mr Frazer has been hit by a new hole in his budget after the Government suspended new applications for one of its agricultural payment schemes, the sustainable farming incentive (SFI).
The SFI is one of three schemes brought in by the Government to replace the EU-era common agricultural policy (CAP), which paid direct subsidies to farmers based on the amount of land they had in production.
The new schemes are intended to pay farmers for producing public goods such as cleaner water, better habitats for nature and improved soils.
Mr Frazer was hoping to secure around £15,000 in support for actions on his farm, including testing the soil health and creating new grasslands, for which he had already purchased the seed.
But last month, the Government halted the scheme with no warning, days before Mr Frazer was due to send in his application, after it maxed out the £1.05 billion budget set aside for 2024 to 2026.
The Country Land and Business Association (CLA) says 40 per cent of its 26,000 members were planning to apply for SFI but now cannot.
'This will cause a major cash flow crisis for thousands of businesses who have already been hit hard by other policy changes, but perhaps even more fundamentally, will stall progress in reversing nature decline and climate change,' said Joe Evans, the CLA vice-president.
Victoria Vyvyan, the CLA president, said farmers were facing difficulties on multiple fronts.
'Inheritance tax is forcing families to sell their land. New compulsory purchase rules create more doubt. And now the SFI scheme has been 'paused' without warning — cutting off income for the more complex environmental schemes that were preparing to apply,' she said.
'No farmer can plan for an environmentally sustainable farming future when rules change overnight.
'Trust must be rebuilt and the new SFI must be negotiated quickly. The future of sustainable farming depends on it.'
The scheme is expected to return at a much-reduced scale after taking a cut in the June spending review. For Mr Frazer, that will be too late.
'The carpet was pulled from under our feet,' he said. 'It's all useful money, because every year we're trying to scrape a profit together. So even £15,000 is a big deal for us.'
Mr Frazer compares his approach on the farm to some of his neighbours who, instead of trying to integrate greener farming onto their land, have simply switched to rewilding in their fields.
'When you sit down and do the sums, it's probably a good idea, because it does add up if you do a huge amount of land,' he said. 'But then us farmers naively think that we've got to do a hard working year to earn our money.'
Mr Frazer blames the delay in submitting his application on the final kick he has taken from Government policies: net zero.
The farm is host to electricity pylons, giving the National Grid access rights. Last year, workers came onto the farm after the National Grid said it needed to redirect the electricity lines as part of its upgrades for net zero.
The ' Great Grid Upgrade ' promises to be the largest overhaul of the electricity network in generations, helping to connect offshore wind turbines to homes. But landowners like Mr Frazer are caught in the middle.
'We haven't been able to plan properly in the autumn because they keep saying, oh, we need to put a road here,' said Mr Frazer. 'They have these compulsory rights now.
'We must have had 200 wagon loads of limestone creating new roads across fields on the farm, and it was all done over winter at the wettest time.
'It's made decision-making more difficult and basically put a kibosh on the SFI situation. It caused the delay, which meant we missed the boat.'
Mr Frazer is now exploring his options to limit the impact of the inheritance tax changes and mitigate the lost SFI payments.
'I will look at my options, but I think there aren't many really' he said. 'We will just have to swallow it.'
A Department for Environment, Food and Rural Affairs (Defra) spokesman said: 'The Government's commitment to farmers remains steadfast.
'That's why £5 billion is being invested into farming over two years, the largest budget for sustainable food production in our country's history.
'Our agricultural property relief reforms mean three-quarters of estates will continue to pay no tax at all, while the remaining quarter will pay half what most people would pay, and payments can be spread over 10 years, interest-free. This is a fair and balanced approach which helps fix the public services we all rely on.'