Inheritance Tax Relief: Agriculture Sector

1. What assessment he has made of the potential impact of changes to inheritance tax relief on Scotland’s agricultural sector.

6. What assessment he has made of the potential impact of changes to inheritance tax relief on Scotland’s agricultural sector.

This Government appreciate the role of farmers and everyone involved in our agricultural sector, and I have been delighted to meet representatives of the National Farmers Union of Scotland and other stakeholders on numerous occasions. On each, I have reiterated that the Government want to strike a fair balance between supporting farmers and fixing our public finances and the public services on which our rural communities rely. As both hon. Members will be aware, the vast majority of farmers will not be affected at all. They will be able to pass the family farm down to their children, just as previous generations have always done. Only the richest estates will be asked to pay, not small family farms, and that is a policy that we on this side of the House are proud to support.

I welcome the new ministerial team to the Dispatch Box, and particularly the Secretary of State, who is back as Secretary of State for Scotland after nearly 20 years. Farmers watching that response will be thinking, “What a load of tosh!” What representations have the Secretary of State and the Minister made to the Chancellor on behalf of farmers in Scotland ahead of the Budget?

As I mentioned, we are in regular dialogue with farming stakeholders and we regularly consider the evidence that is presented to us. I would stress that, while we will always give evidence due consideration—indeed, the Prime Minister said that from this very Dispatch Box last week at Prime Minister’s questions—we will not deviate from our policy objective, which is both to raise revenue and to introduce greater fairness to our tax system. That is exactly what this change does.

It is clear that Scottish Labour and this Government do not care and do not understand our rural communities. If we have no farmers, there is no food. Will the Minister listen to the voices of rural Scots, NFU Scotland and communities up and down this country, and ask the Chancellor to rethink this ruinous inheritance tax reform?

I myself am a representative of rural Scots, as indeed is the Secretary of State for Scotland, who is meeting farmer representatives in his constituency this very week. We are in ongoing dialogue with our constituents and with farming stakeholders. I reiterate that what we say in the course of those dialogues is that we must introduce greater fairness to the system and that three quarters of farmers will not be impacted at all.

There are many factors that make family farms viable, including the ability to work the land and carry out what is a very physically demanding job. Does the Minister agree that tackling the fundamental problems in our NHS and the growing waiting lists in Scotland must be a priority when balancing competing pressures, given that poor access to healthcare disproportionately affects those working in Scotland’s farming and rural constituencies?

I could not agree with my hon. Friend more. Since the election, the UK Government’s plan for change has delivered an extra £5.2 billion to the Scottish Government—funding that can be used to improve the performance of devolved public services such as the NHS. In June, an additional £9.1 billion of funding for the Scottish Government was announced in the spending review, so rural communities like my own are right to ask when they will see improvements in their access to healthcare. I would also like to take the opportunity to commend charities such as the Farm Safety Foundation and its brilliant Yellow Wellies initiative for the work that they do to support the mental and physical health of farmers and all in our rural communities.

The proposed changes to agricultural property relief in Scotland will ensure that, by still providing full relief for the first £1 million of assets, farmers continue to benefit from Government support far beyond that which is available to other assets. Given that 7% of claimants—117 claimants—receive two fifths of all agricultural property relief at a cost of some £219 million, does the Minister agree that this Government’s reforms are essential not only for fairness but to help fund vital public services in rural Scotland?

Our reforms mean that the majority—almost three quarters—of those claiming the relief will not be affected. Only the richest estates will be asked to pay more. This is a fair approach that balances fixing our public finances with maintaining support for small family farms and businesses.

Order. It says Scotland in the title for these questions. They are not linked to Northern Ireland. I call the shadow Secretary of State.

The agricultural sector is woven into the fabric of communities across Scotland. It employs thousands and contributes millions annually to the economy, but farmers across Scotland have been left in fear for their families’ future and their way of life because this Government want to tax them out of existence. Despite the clear messages from the farming community, supported by the NFUS, this Government are ploughing on regardless and completely ignoring the damage they are doing. The truth is that they do not understand—and worse: because those people do not vote Labour, they do not care, do they?

I will reiterate it in case the shadow Secretary of State did not hear me: both myself and the Secretary of State represent semi-rural and farming constituencies. We are in ongoing dialogue with constituents. We absolutely understand the pressures they face, which is why we have said that we will support family farms and that only the very richest will be affected. Our constituents rely on public services and they require investment in those public services, and that is exactly what this tax change was designed to do: introduce fairness but also raise revenue that will benefit all our communities, including rural Scots.

I call the Liberal Democrat spokesperson.

Archibald Young, a foundry in my constituency, manufactures components that are vital to our national security, yet it now faces a devastating blow from Labour’s tax changes. We are hearing that food production—another cornerstone of national security—will also be decimated by these measures. This issue goes to the heart of the protection of our country. Does the Minister agree that Scottish businesses that are essential to national security must be safeguarded, and will she commit to meeting me and others with similar concerns to discuss that?

I would be delighted to meet the hon. Lady, and I welcome her to her new position. Food security is indeed national security, and national security is the No. 1 priority of this Government. We are trying to safeguard it in a number of ways, including through our commitment to food security and, indeed, energy security. I would be delighted to discuss it with her further.