Amidst mounting discontent within the farming community, the UK government is aiming to hit the reset button on its fractured relationship with the agricultural sector. Environment Secretary Steve Reed is set to unveil what he describes as a “new deal for farmers” at this week’s Oxford Farming Conference, hoping to quell the rising tide of protests that have gripped the industry in recent months.
At the heart of farmers’ grievances are controversial changes to agricultural inheritance tax rules and cuts to the long-standing EU-derived subsidy scheme. Tens of thousands have taken to the streets to voice their outrage, arguing that these moves threaten the very viability of their livelihoods. Reed’s “new deal” is expected to focus on making farming businesses “more profitable and sustainable” in the long run, but will it be enough to calm the storm?
Fairer Prices, Less Reliance on Subsidies
Central to the government’s vision is a push to ensure farmers receive a larger slice of the pie when it comes to the prices consumers pay for their produce. Research has exposed the stark reality that for every loaf of bread or block of cheese sold, a mere penny makes its way back to the farmer. Reed hopes to tackle this imbalance head-on.
However, the path to fairer prices is fraught with challenges. Increasing the amount that ends up in farmers’ pockets risks driving up costs for consumers, many of whom are already feeling the pinch. Additionally, unprecedented government intervention in the form of legislation meddling with supermarket practices and supply chain operations would likely be required – a tall order indeed.
The Subsidy Question
Under the EU’s Common Agricultural Policy (CAP), farmers were paid flat rates based on the acreage they maintained. Post-Brexit, this system is being phased out in England, with subsidies instead tied to environmental stewardship and nature restoration. But with average annual returns on land, livestock, and machinery a meager 0.5%, the prospect of inheritance tax on estates over £1 million combined with subsidy cuts has stoked fears of financial ruin.
For the 2025-26 tax year, the Department for Environment, Food and Rural Affairs plans to slash the first £30,000 of subsidies by a staggering 76%, with no payments at all beyond that threshold.
Yet despite the uproar, insiders suggest the “new deal” is unlikely to reverse course on either inheritance levies or subsidy reductions. The focus, it seems, will be on bolstering long-term profitability rather than providing immediate relief.
Safeguarding Food Security
Alongside profitability, Reed is expected to emphasize sustainability and resilience in the face of escalating climate pressures. 2024 marked England’s second-worst harvest on record, with over 1,000 flood warnings blanketing prime farmland and revenue plummeting by an estimated £600 million compared to the previous year. Adapting to this new normal is imperative.
Updates are anticipated on the government’s land use framework, which aims to strategically allocate areas for agriculture and environmental protection. A comprehensive food strategy to shield the nation’s food security from climate shocks is also in the works.
Nature-Friendly Farming in the Spotlight
While the industry grapples with economic woes, environmentalists argue that the climate crisis cannot be sidelined. Groups like The Wildlife Trusts assert that biodiversity-enhancing farming schemes are vital and must be prioritized in any “new deal” worth its salt.
The ambitions of too many farmers are being stifled by a lack of certainty about what actions will be available to them, and when they will be able to access payments.
– Barnaby Coupe, The Wildlife Trusts
The government’s farming roadmap, slated for release in early 2025, is eagerly awaited. To truly reset the relationship with the sector, it must offer a predictable, durable, and sustainable pathway for farmers to adopt nature-friendly and climate-resilient practices.
A Defining Moment
As Steve Reed takes the stage at the Oxford Farming Conference, the stakes couldn’t be higher. Farmers are looking for a lifeline – a genuine commitment to their survival and prosperity. The “new deal” promises much, but it remains to be seen if it can bridge the chasm of mistrust that has emerged.
Bold action is needed to secure a thriving future for British agriculture. Tinkering around the edges simply won’t suffice. The industry needs a transformative vision, one that unites profitability with sustainability, supports nature-friendly practices, and fortifies resilience against the climate crisis.
The fate of countless farming families, and indeed our nation’s food security, hangs in the balance. Will Labour’s “new deal” rise to the occasion, or will it be another missed opportunity to chart a brighter course? The farming community, and the country at large, awaits the answer with bated breath.
