Rachel Reeves has angered the farming community in recent months (Image: Getty/PA)
Rural communities face the “double whammy” of farming budget cuts and an inheritance tax raid, MPs have warned. Rachel Reeves’s spending review revealed the Department for Environment, Food and Rural Affairs’ budget will be cut by ￡355million by 2028-29. This is after the government announced a real terms cut of minus 2.3% annually from 2025-26.
In particular, the farming budget will see a real terms cut of ￡100million - which is significantly less than what whas expected.
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An analysis by the Liberal Democrats found Defra’s capital budget will see a ￡194million cut between 2025-26 and 2029-30, off the back of a yearly average real terms cut of minus 1.8%. Liberal Democrat Environment spokesman Tim Farron MP said: “This Spending Review is a double whammy for rural communities. Labour is slashing vital farming support by cutting DEFRA’s budget, while clobbering rural communities with the family farm tax.
READ MORE: Labour must U-turn on 'vindictive' farm tax following winter fuel climbdown
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“The farming budget cut is short-sighted and shows how out of touch this Government is with the needs of the countryside. Let’s not forget, it is farmers who put food on our table and look after our countryside and without them we would all be worse off.
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“Britain’s rural communities deserve better. Liberal Democrats will always stand up for our farmers. We will continue to fight for an extra ￡1 billion a year for the farming budget to support profitable, sustainable and nature-friendly farming.”
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The slashed funding comes despite an agricultural budget underspend of ￡358million in the three years from 2021/22 to 2023/24 under the Tories.
The Chancellor said that from April 2026, combined agricultural and business property assets up to ￡1 million will still receive 100% relief but anything above that will be taxed at an effective rate of 20%.
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Asset rich farmers who are cash poor fear they will have to sell off their land - making it unviable for food production - to foot the tax bill.
The Daily Express's Save Britain's Family Farms crusade has demanded a U-turn.
The Government has allocated ￡7.9billion for new and upgraded flood defences in England over the next decade.
But campaigners have raised concerns about the budget for this being slashed over the Parliament.
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Heather Shepherd, founder of Flooded People UK, said: “It’s irresponsible of any Government not to recognise and act on the continuing increase of flooding in this country.
“Without substantive increase in budgets and a carefully crafted integrated flood mitigation plan using multiple interventions including capital defences, it leaves already traumatised people and those yet to suffer flooding compromised. It is just unacceptable.”
A Defra spokesman said: “The Government is investing ￡2.7 billion into farming and nature recovery, with funding for Environmental Land Management schemes increasing by 150%. In addition, we have announced the largest investment in flood defences in history with ￡8 billion being invested to protect hundreds of thousands of homes.”