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Rural Affairs

I fear that there absolutely is that impact. That is why I gently caution those who frame the issue as a debate between urban and rural communities to think a bit more carefully. There is a strong case to be made for explaining to people in towns why people in the countryside matter to them, their future and the economy, rather than setting this up as a contest between the two.

Beyond inheritance tax, other issues in the Budget caused me concern, including the return of changes to the treatment of double cab pick-ups, and the effect of the carbon border adjustment mechanism on fertilisers. We all know what happened to food prices the last time we saw a spike in fertiliser prices. That was not caused by the imposition of a tax, but it does not matter what causes it; the effect will still be felt by families. There are

also the measures on furnished holiday lets. Farmers have for decades been encouraged by successive Governments to diversify their business. Many have gone into furnished holiday lets for extra income, but they now find that they are being clobbered again. They are having the rug pulled out from underneath them.

The inheritance tax changes have generated the greatest concern. I hear talk of scaremongering, but there has to be better respect than that for those concerned about the changes. I suspect that a lot of the figures that we hear have been affected by inter-vivos transfers between the generations. That is the most obvious way that inheritance tax can be dealt with by an estate or a family, but it leaves families open to difficult conversations and to the law of unintended consequences. Nobody knows what is around the corner, especially in farming, which, as we know, is one of the most dangerous occupations out there.

I have sympathy with the Government wanting to close fairly well reported and documented loopholes, but to do that at the expense of family farms is unjustifiable. The root of the problem, and the issue on which the Minister needs to engage with the Treasury, is that the threshold has been set far too low. When the Budget changes were announced, I went to estate agency websites in Orkney and Shetland, and I found two farms currently on sale in Orkney, both on one of the outer isles—further away, where we would expect land prices to be slightly lower—and both were being sold by the same family. One was for £2 million and the other was for £2.2 million. If those are the prices on an outer isle of Orkney, I can only assume that one would add a significant margin in Aberdeenshire, and a larger margin in Fife and the Borders. By the time we get to the home counties, goodness only knows what the price would be.

The concerns of agricultural and rural communities are genuine and well founded, and they need to be addressed. There is a serious debate to be had here, and I very much hope to be part of it. The Minister is well intentioned and diligent, but he needs to listen more to the people affected by his decisions—and, I am afraid, to listen less to the Treasury.

7.7 pm