Environment secretary Steve Reed tells farmers it is 'hard to be sorry for trying to make UK's economy work'

21 November 2024, 13:13 | Updated: 21 November 2024, 13:57

Environment secretary Steve Reed said it is "hard to be sorry for trying to make the country's economy work" as he spoke to farmers for the first time since the budget.

Mr Reed acknowledged he had let farmers down by saying a year ago, at the same conference he was speaking at, that he would not change inheritance tax for farmers.

He told the Country Land and Business Association (CLA) conference today he recognises the "frustration and anxiety" introducing a 20% tax on farms worth more than £1m has had on farmers.

Mr Reed said he shared farmers' ambitions and although he promised not to introduce inheritance tax while he was shadow environment secretary, he said he did not know the financial situation the Conservatives had left them with so they had to take "difficult decisions".

Farmers in the audience were seen by Sky News rolling their eyes and audibly tutting every time Mr Reed said he understood the plight of farmers and the government needs to get "stability" back into the economy.

Speaking to reporters after his speech, the minister refused to say sorry and said: "We're taking decisions because they're in the interest of every part of the country.

"It's hard to be sorry for trying to make this country's economy work and our public services work again."

He also said there was no way he would raise the £1m threshold farmers will have to pay inheritance tax at from April 2026, after farmers have told him £1m adds up quickly when you have to include machinery, buildings and land.

Mr Reed told Sky News: "The tax policy is set, it was announced in the budget."

The environment secretary said he spoke to farmers during Tuesday's protest, which saw about 13,000 farmers walk on Whitehall, and said "it really struck me" they were talking about "the final straw".

He said they were marching against much more than inheritance tax.

"We had a proportion of rural Britain out on the streets of London telling politicians and politics they feel ignored, alienated and disrespected and that's what they want to change," Mr Reed added.

"So there's a much bigger issue with how politics engages with, listens to and responds to rural Britain and the way of life they value and want to protect.

"It's not just about a single tax issue, it's much much bigger.

"I heard the anguish of the countryside on the streets of London earlier this week.

"We may not agree over the inheritance tax changes, but this government is determined to listen to rural Britain and end its long decline."

Read more:
What's the beef with farmers' inheritance tax?
Clarkson says government should 'back down' on inheritance tax

Mr Reed said the way to help farmers is to make farming profitable, as many have said they will not be able to pay the tax because they make very little profit, even if they are asset rich.

He stuck to his guns on how many farms will be affected by the tax, saying the Treasury had looked at "hard data" to establish it will affect 500 farms a year out of the UK's 209,000.

The CLA has refuted that, saying it will affect more like 70,000 farms and accused the secretary of state of not looking ahead.

CLA president Victoria Vyvyan said she was pleased Mr Reed came to talk to the conference, and although he has been defensive since the budget, she believed him when he said he now understands more about farmers' concerns.

She told Sky News: "The no reversal on inheritance tax is just a pointless bit of sticking to your guns, it's the easiest thing in the world to make some slight changes.

"We're going to have to find another way to protect that community now.

"He's talking about figures from four years ago, we're talking about what will happen to the existing farming community if you bring in inheritance tax.

"Spreading payments over 10 years is just a slow car crash, you're slowly bleeding your business to death - £30,000 a year is not affordable to farm businesses."

(c) Sky News 2024: Environment secretary Steve Reed tells farmers it is 'hard to be sorry for trying to make UK's economy work'