Farming: Financial Sustainability

I beg to move, That this House has considered the financial sustainability of the farming sector.

It is a great pleasure to serve under your chairship, Mr Turner. In a shameless effort to garner sympathy, I thank you for allowing me to sit down if I need to; I have a bad back today. Members can feel free to be sympathetic in their interventions.

It is a great pleasure to be here for this debate on the financial sustainability of the farming sector. The best beef in the world is reared in my constituency of North Northumberland. There may be some competition there, but let me assure the Chamber that that is true. However, farmers are not taking home the best cuts in terms of profitability. The Food, Farming and Countryside Commission—the FFCC—found that in 2023-24, an average cereals farm in England took in a quarter of a million pounds from selling crops such as wheat and barley, but after costs, it made a loss. For profit, it relied on subsidies, diversification and environmental schemes. Those are all good things, but they come with an underlying challenge.

As the party of labour, we should be alarmed when any worker receives a poor return for their work. I know that alarm is shared by my colleagues in the Labour rural research group, many of whom are present, and by the Minister, whom I welcome to his new role and to this debate. In her profitability review, Minette Batters was very clear that “there is no silver bullet to achieve farming profitability.”

Today, by genuinely happy coincidence, the Government have published their 25-year farming road map, with a focus on profitability, productivity, sustainability and resilience. I look forward to digesting the road map, which I have with me, and I trust that many of the points raised in the debate will chime with its contents. I hope that the Batters review, the farming road map and the LRRG’s upcoming report on farming profitability can help the Department for Environment, Food and Rural Affairs and the Government to tackle the wide range of reasons why farming often does not pay.

I want to focus on three elements: protecting our farms from the global markets as part of a drive for food security, regulating the marketplace so that produce receives a fair price, and cutting costs and boosting innovation so that farmers have more at the end of their work. On food security, one farmer recently told me that “covid and the current conflict in the Gulf have shown that globalised supply chains do not have the resilience of a strong indigenous industry.”

He is right, and I am glad that the Government share that view in the road map, but our industry is not strong enough. Our farmers earn a lower share of food chain gross value added than farmers in Germany, France or the Netherlands. Just 9% of farms produce 62% of our food, and high production costs mean that high quality British produce struggles to compete with the international market on price.

I thank the hon. Member for securing a very good debate. On food security, in south Shropshire, just outside Onibury, there is a campaign to stop over 130 acres of solar panels going on good agricultural land. The plans would make it harder to be resilient and to provide food security as a country. Does he agree that no solar panels should go across good agricultural land?

Order. I remind Members that there are lots of people who want to speak. Interventions really do need to be short.

I thank the hon. Gentleman for his question. He will see this in the road map and in the Government’s approach. There needs to be the right balance between environmental approach, renewables and food production. I agree that the decision about where solar farms go is key.

We need to help British farming to develop greater financial resilience and shield it from external pressures. That starts with ensuring that imported food products meet the same high standards as home grown produce. I ask the Minister to offer some thoughts on what guarantees he can make so that alignment with the EU and other trade deals will maintain a level playing field on quality. That subject was not heavily touched on in the road map.

Stability is also vital for our farms. Although agri environmental schemes should not be the difference between the black and the red, they have a role to play in farm budgets. They can cover a bad year or provide extra on top, but take up, delivery and financial sustainability demand stability. The withdrawal of the sustainable farming incentive last year dented farming confidence; I encourage the Minister to pay very close attention to roll out of that, which we expect imminently.

Devolved economies have a role to play in developing food security, too. Farming should be part of a tightly bound regional ecosystem in which regional investment banks, devolved funding pots and local authorities work together to match up funding, skills and procurement pathways. In our manifesto, we promised that half of all food purchased across the public sector would be locally produced or certified to higher environmental standards—a great ambition. Will the Minister update us on the progress towards that, and on what work he is undertaking to create a public record of how much of public institutions’ food is sourced from the UK? We can create a virtuous circle in that way.

The hon. Member is right to say that we need to produce more food in this country but, at the moment, farmers are telling me that they are not putting crops in the ground because they cannot afford the fertiliser to sustain them because of the situation in the Gulf. What does the hon. Member think the Government should do to support farmers right now?

If the right hon. Member bears with me, I will get to exactly that point.

The second area of concern is the marketplace. The FFCC reports that farming productivity increased by 60% from the ’70s to the 2020s, but that farming incomes have not increased in line with that. The size of and competition between supermarkets have forced farmers to accept bargain basement farm gate prices at times, and the middle men have consolidated too. The National Farmers’ Union reports that, in the ’70s, there were 2,500 abattoirs across the UK; there are now just 200. The reality for the fragmented farming sector has been bleak: its increased productivity still ends in lower prices.

One of the best responses to this high cost, low price trap is to create a new labelling and welfare system based on the Made in Australia approach, which the LRRG has advocated for. I pay tribute to my hon. Friend the Member for St Austell and Newquay (Noah Law) for his work on that. Every food product in supermarkets, wholesalers and catering should clearly tell consumers how much of it was made in the UK, ideally in which region and to what welfare standard. Indeed, regional identity systems should be supported and verified. Instead of superb Northumberland beef being thrown into the same mincer as low cost, low welfare imports, packaging can help consumers choose between different quality products at different price points and different welfare standards. The farmers who invest more in their produce can then negotiate for more at the farm gate.

The Government have to develop tighter rules on what can and cannot be claimed as “farmer supported”, “grown in Britain” or other heartwarming slogans that do not reward the hard graft of British farmers. I welcome the fact that the Groceries Code Adjudicator has already been taken into DEFRA following the Batters review.

We should help farmers consider how to develop better collective bargaining power. My understanding is that the Agriculture Act 2020 provides a framework for producer organisations to form co operatives. We should give that our full support. At the end of the day, we the Labour party are a party of mutuals and co operatives.

The third and final string of the bow is innovation. There have been some major steps in this direction under Labour. I am really pleased that the road map is so committed to innovation, and that £123 million has been committed to investing in innovation this year alone. The NFU has urged the Government to implement the national policy planning framework as soon as possible, which would really help.

We need to look at how we can cut inputs and free up capital for farmers to reinvest in their farms. Energy prices are too high. The recent red diesel fuel duty cut was an incredibly welcome step and has been well received by my farmers. I am now interested to see what options are open to help farmers install renewable energy supplies on their estates via GB Energy. I support the NFU’s ask of the Government to help farmers cut electricity prices by opening a standard industrial classification subdivision for energy intensive farming.

Fertiliser prices are too high. There is massive unease about the incoming carbon border adjustment mechanism regime and its effect on fertiliser prices, which is already one of the biggest costs for farmers. We can transform the fertiliser conversation altogether by restarting ammonia production in this country. Sadly, the last plant to produce virgin fertiliser in this country was allowed to wind down by the previous Government in 2023. I know that the Minister for Industry has been working hard in this area already, and I hope that the shadow farming Minister can look at this.

All that strategic support would cut input costs, thus freeing up capital for farmers to use on developing new technologies that help them produce more for less. The Government’s farming innovation fund will have £200 million up to 2030. That is an excellent example of state backed innovation. Farmers in North Northumberland are already experimenting with using soil and sampling and targeted purchases to cut their fertiliser bills. The Government need to find those farmers and invest in their work.

A local farmer told me recently: “As a farming family we often accept that we are privileged to work in the profession that we do…but it is often somewhat demoralising (and distracting) to consider what little relative financial reward we receive for the work we do.”

Other industries grow and shrink as conditions change, but we will always need food, and we will always need much of our food to be grown here in the UK. The issue is that what we pay for food today is also what we are paying for our food tomorrow. While farmers remain stuck at the wrong end of the low price, high cost cycle, our national food security is also at risk.

It is the role of Labour, not a laissez faire Conservative party or a rootless Reform UK party, to dignify the work of farmers by ensuring that they receive proper reward for what they do. All workers should be supported by the Labour party, whether they are blue, white or green collar workers. By developing more resilient British farming as part of our national security, regulating the marketplace so that quality produce gets a fair price, and opening up opportunities for farmers to innovate and increase their margins, we can make sure that farming is sustainable for years to come, and we can keep North Northumberland beef on the menu.

I remind Members that they should bob if they wish to be called in this debate. Given the number of Members wanting to take part, I have to impose a formal time limit of one minute and 30 seconds—90 seconds. I call Olly Glover.

Thank you, Mr Turner—I am in a state of astonishment at being called first. It is a pleasure to serve under your chairship once again. I thank the hon. Member for North Northumberland (David Smith) for his articulate opening speech. Most of what I am going to say follows a recent farm visit and farmers’ roundtable. I thank the NFU and the Country Land and Business Association for arranging that, the 20 attendees who gave their time, and Robert Clayton for having us at Mill Farm in West Hendred.

Three key challenges face farmers in my constituency and across the country. The first is the question of regulation and costs, with the impact of the Iran war a major concern on top of existing Brexit related challenges, with red diesel and fertiliser subject to major inflation, and electricity standing charges for farmers having risen by 44% to 91%. Secondly, prices incentives and food culture need to change. We need to strengthen the Groceries Code Adjudicator. It is welcome to finally see a Government response to the Minette Batters profitability review today, but fundamentally what farmers raise is a lack of Government understanding and listening to farmers about the challenges that they face.

Thirdly, we need more investment and funding for our farmers. Food security should be thought of in the same way as wider national and defence security. That is why the Liberal Democrats are calling for investing £1 billion extra in environment land management schemes, so that we can properly support our farmers and make sure they contribute to a resilient food supply chain.

It is a pleasure to serve under your chairship, Mr Turner. As I frantically go through the speech that I wrote before the statement today, I might end up saying a load of things that have been covered already, so I will snip it really short, mindful of the short amount of time that we have.

I want to raise awareness of something I have already written to the Secretary of State about: the recent introduction of crippling electricity standing charges in the farming sector. I also want to put back on the agenda using the sustainable farming incentive to fund increased uptake of leguminous protein crops, and recognising the value of those crops as nitrogen fixing tools in arable rotation. That would allow growers to optimise the efficient use of artificial fertiliser alongside strategically and environmentally beneficial crop production methods that also support domestic food production.

I am mindful, as always, of the need to support our farmers—now more than ever. We need to show our farmers that we care by taking action to support and celebrate them. I very much look forward to reading in full this report in my hand. I could not be in the Chamber for the statement, but I look forward to watching that back and to listening to everybody else’s questions.

It is a pleasure to serve under your chairship, Mr Turner. I will be brief.

It is wonderful that we are having this debate, and indeed that we had today’s statement, although sadly I was not able to be in the Chamber to hear it. We need to recognise that farmers are central to our health, wellbeing and security as a nation, for three reasons. The first is good food: we need to produce as much of our food as possible as locally as possible. The second is good land: we need to care for our land; after all, it is the soil on which everything that farmers produce depends. The third is good livelihoods: rural farming communities, such as mine in North Herefordshire, are entirely interlinked with health, wellbeing, and financial and ecological sustainability.

It is disappointing that the Government sadly got off on the wrong foot with farmers, but I hope today marks something of a turning point. We need two things from the Government. First, we need regulation that works for farmers, with a level playing field. That means consistently applied regulation across the country and internationally. We cannot have our farmers undercut by imports produced to lower standards. Secondly, we need investment in farming, to enable farmers to transition to more nature friendly and river friendly methods, and to support the security and sustainability of farming in the UK.

It is a pleasure to serve under your chairship, Mr Turner. It was in this Chamber, on 28 January 2025, that I was the only Labour MP to speak out against the Government’s proposed changes to agricultural property relief. I did so in the knowledge that such changes would have been damaging to the livelihoods of huge swathes of my constituents.

There is no industry more important than the food industry. The food sector employs 17% of Wales’s total workforce, and at the heart of that sector lie our farmers. A sustainable farming sector requires fairness and transparency throughout its supply chain. An industry built on long term planning, fair returns and transparency will make for a more resilient industry in the face of current challenges than one based on short term decision making.

As most farmers do not sell directly to retailers, the NFU has long campaigned for the Government to extend the code to include more retailers, food service businesses and manufacturers in order to oversee the trading relationship between farmers and their intermediaries, ensuring that farmers get the best possible deal. We must also recognise the importance of trading with the European Union, on which Wales relies heavily for 75% of our food and drink exports. A commitment to strengthen our relationship with the EU would create valuable opportunities for Welsh producers and support growth across the sector.

It is a privilege to serve under your chairmanship, Mr Turner. Let me start by inviting the new Minister—I welcome him to his place—to visit Dartmoor over the summer to meet farmers, commoners, the Dartmoor hill pony organisations and, importantly, the Dartmoor Land Use Management Group. I invite him to bring Natural England, too, because it is at the centre of quite a lot of what has been said about Dartmoor in the past few weeks.

Previous meetings with Ministers and officials since the Government came into office do not seem to have made a difference and have not delivered a plan for sustainable farming on the moors. In 2023, the previous Government launched the Fursdon review on the future of Dartmoor. Its report includes a recommendation —No. 27, or paragraph 23.2 according to gov.uk—to ensure that ponies remain on the moors, but it also reports, in paragraphs 23.1 and 23.3, that cattle and sheep in significantly deliverable numbers are an intrinsic part of delivering that and the land management needed for Dartmoor; otherwise, farms on Dartmoor are not sustainable.

The Dartmoor Land Use Management Group was set up following the Fursdon review to assess how farming and environmental land management can co exist. It has yet to report back, which is why it is so disappointing that the Department for Environment, Food and Rural Affairs and Natural England are pushing ahead with livestock stocking numbers that risk the sustainability of farms right across Dartmoor and, with them, the ponies themselves. A petition to adopt recommendation 27 has more than 200,000 signatures. Ponies, cattle and sheep are intrinsically linked on the moors. In a visit over the summer, the Minister could be assured of a friendly welcome and hear directly from those involved.

Newcastle under Lyme is home to many brilliant farmers who work relentlessly to supply our shops, pubs and restaurants and to tend to our green and pleasant land. When I was elected I promised my farmers and their families that I would fight their corner every single day. We need a fairer deal for our farmers and the supply chain. Our farmers are the price takers, not the price makers. They are feeling the squeeze from our supermarkets. We must deliver and enforce fair contracts across all sectors.

Our farmers also need long term certainty. Although I welcome the new 25-year farming road map, our farmers need more from us. They need a sustainable framework that lets them plan for the next decade, not just the next season.

Our farmers in Newcastle under Lyme and across our United Kingdom are the backbone of our country. We must go further and do more to give them the power to earn a fair return and to give them and us the certainty to plan for the future. I gently encourage the Minister to look for the letter I sent him last week. I congratulate him on his appointment and look forward to welcoming him to Newcastle under Lyme before too long.

It is always a pleasure to serve under your chairmanship, Mr Turner. I rarely miss an opportunity to speak about farming in this place. It was a privilege last October to be elected by Government MPs as the co chair of the all party parliamentary group on farming.

I suspect that there is too often a perception in Whitehall that farmers do rather well. Land rich? Perhaps. Cash rich? Rarely. It is too rarely acknowledged that many farmers earn little more than £20,000 a year. My region, the south west, has the lowest average farming business income of anywhere in the country, at just £35,100 per farm. My farmers are not landed gentry. They are people who work with their hands. They are up before dawn, toiling through the winter. As I said in the House yesterday, the Brexit deal we ended up with has strangled trade in food, farming and fishing. We need a comprehensive sanitary and phytosanitary agreement with the Europeans as soon as possible. It would reduce trade friction and lower costs for farmers directly.

The effects of getting things wrong in this area spread far beyond the farm gate. As farms fall, so do butchers, delivery drivers, packagers, suppliers, labourers and contractors. The elephant in the room is that food security is national security. There is simply no substitute for a farmer. Without them, we all go hungry.

It is a pleasure to serve under your chairship, Mr Turner.

About 55% of my Carlisle constituency is agricultural land. Farming remains vital to our local economy, our identity and our communities. However, more than half of the farmland in our county—some 54%—is classified as “less favoured area”. As a result, farmers in my area require substantially more land to support their livestock and maintain viable businesses than is the case in other areas. That is why it is important to recognise the distinction between a farm’s physical size and its economic size. A holding may cover a large number of hectares but that does not mean it generates a proportionally large income or profit.

Against that backdrop, in February I wrote to the then Minister of State with concerns about the first round of SFI allocations because SFI funding was open only to farms under 50 hectares. My concern is not with the principle of supporting smaller farms but rather that an approach that focuses solely on physical size does not always reflect the realities of farming across different parts of the country. Farmers in my constituency with holdings of more than 50 hectares will have to go into the next round of SFI and compete with farms that are genuinely large in terms of productive output, with farms that are much larger, and often with land agents.

I therefore have two questions for the Minister. Will he please consider how future schemes will consider the impact of LFA land? Will he also confirm that common land farmers will be eligible to apply for the SFI?

It is a pleasure to serve under your chairmanship, Mr Turner.

The farming sector is vital. I know that because 88% of my constituency is agricultural land. Farms are a unique sort of business because they not only have to make our food and protect our countryside but, like all businesses, have to make a profit. We must respect and understand that. I appreciate that the Government have published their farming road map, and I am grateful that they have finally recognised that farming needs long term planning but, ultimately, actions speak louder than words.

The NFU has highlighted many issues that we need to focus on but, given the limited time available, I am going to focus purely on energy. The Food and Drink Federation told the Environment, Food and Rural Affairs Committee that food inflation will reach 9% by the end of this year and that energy prices are at the heart of that inflation. The Government have put in place help for energy intensive industries, but subsections of farming are not recognised under that scheme and are therefore excluded. I raised that point with the Chancellor. I urge the Minister to go back to her and consider whether the Government can include farming and food producers in those schemes to allow them to get support. While he is doing so, perhaps he will ask again if she will scrap the family farm tax in order to give farmers the support they ultimately need.

I thank my hon. Friend the Member for North Northumberland (David Smith) for securing the debate. I have been applying for a debate on this subject for many months, so it is great that we are having one. I warmly welcome the new farming Minister to his place, too.

I recently had a catch up with farmers in Cannock Chase and heard about various challenges that they are facing. We are living in highly uncertain times. The new series of “Clarkson’s Farm” is shining a light on how financially tough farming can be, but also on the many ways that technology can improve that picture environmentally and financially. The Government’s investment of £123 million to help farmers boost their productivity is therefore very welcome.

I am also very pleased that the farming road map is now out. As chair of the APPG on UK food security, I was particularly pleased to see the restated commitment to maintaining our food production at at least current levels. I am also keen on making sure that supply chains are fair for our farmers—something that we often could not have said in recent years. Over the last couple of weeks, the EFRA Committee has had the privilege of visiting New Zealand, where I was struck by the prevalence and power of agricultural co operatives and the power that they give Kiwi farmers. I would love to see more of that here, because it would go a long way to redressing the imbalance that we all too often see in our supply chains here in Britain. I look forward to working with the Minister on that and many other issues that colleagues have raised, but in the interests of time I will leave it there.

It is a pleasure to serve under your chairship, Mr Turner. I thank the hon. Member for North Northumberland (David Smith), who set the scene incredibly well. I have four points of 30 seconds each. When we talk about farming in Northern Ireland, we are talking about family farms. Over 27,000 farming families across Northern Ireland work the land day in and day out. Financial sustainability requires three things from this Government: certainty, equity and protection. We need an increased multiannual farm support budget that is fully inflation proofed. If there are no farmers, there is no food. That cannot be right.

Financial sustainability is impossible if farmers are forced to sell their top quality, world leading produce at or below the cost of production. The Government must use their powers to enforce fair dealing and transparency right across the agrifood network, and they must protect the family farm structure from punitive taxation. Recent proposals and changes threatening agricultural property relief and business property relief strike at the very heart of generational sustainability. Forcing a grieving family to sell off parcels of land just to pay an inheritance tax bill destroys the viability of enterprise overnight. It is a tax on food security and the Democratic Unionist party will stand four square against it.

I thank my hon. Friend the Member for North Northumberland (David Smith) for securing this timely debate and welcome the Minister to his place.

I asked local farmers in Ribble Valley what they would like to highlight in this debate about profitability. As hon. Members would expect, the responses included the increasing tax on fertiliser, energy prices, the short sighted farming vision, the public’s understanding of where our food comes from and its value and quality, seasonal staff and many other things, so I am really grateful that the Government today outlined their farming vision to 2050.

In the interests of time, I want to highlight a broader question about who we what to be as British society. We could choose just to import most of our food, but to me, farming is core to our Britishness. We value our local farm cheese brands, we value our rolling green hills, and we value the role farmers play in maintaining our walkways and gritting our paths in winter.

My hon. Friend is making an excellent point. It is not just about identity; we also cannot be reliant on food imports if we are going to be food secure as a nation.

I completely agree. The main point I want to make, alongside all the powerful financial and security arguments that have been made, is that we need farming to be financially sustainable because we want it to be sustainable. We want it to be part of what we prioritise as this country. A More In Common poll found that, after the NHS, our British countryside is what British people value most about this country, so please, let’s not take it for granted. With no farmers, the countryside is not sustainable either.

It is a pleasure to serve under your chairship, Mr Turner. My constituency is built on the backs of family farms that I have visited, many of them run by the same family for generations. I have had the privilege of sitting around kitchen tables with farmers and the NFU, and I hear the same thing time and again: making a profit from growing food in this country is almost impossible. However, North Somerset farmers do not do this job for the money; they do it as a way of life, and with the hope—often a distant one—that one day prices will allow them, or their children, to make a decent living from this land.

I warmly welcome the long term farming road map published today and the Government’s response to the Baroness Batters review. I also welcome the action on supply chain fairness and the transfer of the Groceries Code Adjudicator to DEFRA. That matters because farmers need a fair price. As a member of the Labour rural research group, I asked the Minister, as this road map is delivered, to keep welfare labelling firmly in view. It could put an extra £60 million into farmers’ pockets. LRRG research suggests British farmers are losing out by as much as half a billion pounds, undercut by lower welfare imports. A mandatory tiered labelling system would build on the excellent foundations laid today.

Farmers in North Somerset have waited a long time for a Government willing to back them with a genuine plan. Today, they have one.

Diolch yn fawr, Cadeirydd; it is a pleasure to serve under your chairmanship. I declare an interest as a dairy farmer and a member of the Farmers’ Union of Wales.

The costs of farming have spiralled over many years, particularly since Brexit. I want to concentrate on the cost of fertiliser and fuel, both of which have been affected by the war in Ukraine and, most recently, the war in Iran. Input prices affect profitability, and too often profitability is what forces decisions on whether farmers remain on the land, give up, move on or start over.

Farming is a hard life, with long hours and hard graft—I can tell hon. Members that from personal experience. We need stability in the market on costs but also on farm gate prices that farmers receive for their goods. Milk prices have crashed, leading many smaller dairy holdings to make the decision to leave the market. Sheep and beef prices have steadied but are now showing signs of decline, and horticultural producers also want a steady market for their produce.

We need to seriously value food production. Since I have been in this House, I have heard hon. Members talk about food security time and again, but in all honesty the meaning of that phrase is often lost, I am sorry to say. My ask of the Minister is simple: will the UK Government commit to action to improve resilience across the food system and supply chains, so that we can invest, stabilise the industry and encourage growth?

It is a pleasure to serve under your chairmanship, Mr Turner. I thank my hon. Friend the Member for North Northumberland (David Smith) for securing this debate, which I know resonates deeply with many farming families living and working in my constituency.

Farming is more than a job: it is a lifestyle, a history and an identity that has defined rural communities for the entirety of this country’s history. Last week in my constituency, I spent time with members of my local NFU—a quiet and shy bunch. We spoke about the challenges they face, the concerns they have and the support they need from Government. They told me about pressures from rising fertiliser costs, driven in part by the conflict in Iran, and about how so called equivalent standards are giving favourability to imported foods over home grown produce. I have also heard from local farmers who say that outdated and underfunded rural infrastructure is preventing them from scaling up and delivering growth.

It is clear from those conversations that food production must be a priority in planning for growth and in ensuring that the UK is resilient in the face of global instability. That also means creating a level playing field that does not restrict farmers with complex regulation, and that supports them with predictable funding streams. The financial sustainability of the farming sector depends on forward thinking and informed planning. I am grateful this key sector is the focus of today’s debate, and I hope meaningful conversations continue.

I thank the hon. Member for North Northumberland (David Smith) for securing this debate. I am the vice chair of the APPG on food security. Agriculture makes up 20% of businesses in North Shropshire, with well over 1,000 agricultural holdings, so it is a huge part of our local economy.

In the short time I have, I will focus on two issues. For the roughly 130 dairy farmers in North Shropshire the huge pressures of climate change, increased input costs, rising energy and fertiliser prices, and hostile trade deals have come at a time when milk prices are simply not keeping up with the cost of production, as we have heard.

One farmer in Market Drayton reports being down £25,000 a month on his milk price, while a family farming in Maesbrook told me that they have been selling off livestock just to keep their heads above water. On top of that, several farmers in the area have reported being unable to reach their milk buyer for information about pricing, meaning that they are unable to plan ahead. Farmers suffer time and again for their lack of power in the supply chain. Will the Government outline the action they will take to bolster the role and effectiveness of the Groceries Code Adjudicator and to enshrine its golden rules in law so that producers are properly protected, as recommended by the EFRA Committee and the Batters review?

Farmers in my constituency are particularly concerned about the proposed changes to water abstraction licences due in 2028, which could have a huge impact on the viability of many farms in my area. Water security is central to food security, so I would appreciate the Department outlining what those changes will mean in real terms for our farmers.

I will be honest: I had quite a different speech prepared for today, but I have scrapped a lot of it following today’s statement.

When it comes to farming, we have heard all sorts of fantastic slogans, promises and tributes but, when I meet farmers or hold my farming forum in Yeovil, it is clear to me that farmers have had enough of that. They have had enough of words, enough of this place and enough of this Government, and they want some clear action. With the publication of today’s farming road map, we are starting to go in the right direction, even if it has taken two years to get here. The road map sets out a vision for the future direction of farming, and I think that DEFRA has actually gone out and listened, which is a big change from the family farm tax and the sudden cut to SFI.

However, there is no long term funding to go with it. I expect that that is because of the Treasury, which I feel just does not understand rural communities and the farming sector, and I am sorry, but that is not good enough. Farmers like Nick from South Petherton are telling me that they have to take so many more costs on the chin. He and others across Yeovil and Somerset are paying thousands of pounds extra a week for diesel and fertiliser. I had so much more to say today but, given the time limit, I will stop there.

It is an honour to serve with you in the Chair, Mr Turner. I congratulate the hon. Member for North Northumberland (David Smith) on securing this important debate.

Farmers are the foundation of communities across the country, but British farming is in crisis—not a crisis of effort or ambition, but a crisis of confidence that successive Governments have chosen to ignore. Chris, a farmer in Babcary, has spent his whole life in agriculture, building a business worth passing on to his son, but Chris has terminal prostate cancer. For 18 long months, what caused him the greatest anxiety was not his health, but the tax bill his son would soon face following the Government’s cut to agricultural property relief, should he not survive seven years. I know how he feels, as I had very similar painful conversations with my mother. Like many farmers across the country, I was relieved when the Chancellor has moved the threshold to £2.5 million, but the family farm tax should be axed altogether.

Somerset farmers are struggling because successive Governments have let them down. The Conservatives gave farmers a kick in the teeth with their £358 million underspend on the farming budget, and Labour has delivered more of the same: a family farm tax with no consultation, a real terms DEFRA budget cut of 2.3% a year, a farming budget slashed by more than £100 million and the closure of the SFI last year without notice. The Liberal Democrats were the first party to oppose the family farm tax, and we will keep opposing every policy that treats our farmers with disdain rather than lifting them up, because they are critical to our national security.

Jonathan, who farms in Little Weston, looked to the Rural England Prosperity Fund, only to find that DEFRA excludes farmers who want to diversify into food and drink. It is a fund for rural businesses to apply to, but it excludes adding value to the very products that farms produce. DEFRA also promised uplifted stewardship payment rates in April, but that promise has not been fulfilled, and there is no clear route from old schemes to new ones. The Government are asking farmers to transition and then shutting the door in their face.

British farmers are the best in the world, and the Liberal Democrats would invest an additional £1 billion a year into the farming budget so that they can continue to produce high quality food for our tables while protecting and enhancing our natural environment. We would set payments over 10-year periods and ensure that every farmer has a route from old schemes into new ones.

In February I visited Andrew Moon, a third generation pig farmer based in Baltonsborough who has more than 400 sows. His business is fighting for survival. Without warning, processors demanded a 30% cut in production, but Andrew asked a question that I could not answer: if farmers are forced to cut herds by 30%, where will the pork come from? Perhaps the Minister can help me answer that question.

Producers are being squeezed out of their own supply chains, with no commitment from retailers and no consultation—just an immediate demand to produce less. The Liberal Democrats have long called for a strengthened Groceries Code Adjudicator, with real teeth, to protect producers like Andrew, as well as public procurement that supports high standard food and a guarantee that future trade deals will never undercut British farmers.

Yesterday marked 10 years since the Brexit vote, and it would be remiss of me not to address the impact that it has had on British farming. The botched deal has strangled trade across our food, farming and fishing industries. Every border check, every lorry held at port and every delayed consignment is a cost absorbed somewhere in the supply chain, and it is rarely the supermarkets that suffer. That is why the Liberal Democrats are calling on the Government to sign a sanitary and phytosanitary agreement with the EU as soon as possible, so that Somerset’s pork, cider and cheese reach European shelves without the paper eating into their profit.

We are sleepwalking into dependency on fragile global supply chains and into a crisis of empty fields and empty plates at home. The Government must treat farming as critical infrastructure, because Britain is not secure unless food supply is secure. That means providing long term financial security for our farmers.

It is a pleasure to serve under your chairmanship, Mr Turner. I thank the hon. Member for North Northumberland (David Smith) for securing this important debate.

I welcome the Minister to his place. His natural passion and enthusiasm for this vital sector is evident in the zero parliamentary mentions he made of farming prior to his appointment, despite his having been elected in 2017. Nevertheless, I wish him all the best. For the good of the sector, I hope that he gets out and engages with the farming community more than his predecessor, the hon. Member for Wallasey (Dame Angela Eagle).

This debate is about financial sustainability for the farming sector. Over the past two years, this Labour Government have continually pulled the rug out from under our farmers. We have had the sudden and unannounced closure of the SFI scheme, the rapid acceleration of delinked payments, the introduction of the family farm and family business tax, the jobs tax and, soon, the fertiliser tax. The result? Record farm closures under this Labour Government, and greater food insecurity than we have seen before.

Our farmers are fed up, worried and increasingly concerned about the future of their farming businesses and their livelihoods. I know that because, unlike the Government, the shadow DEFRA team and I have been out and about, travelling up and down the country, attending agricultural shows and speaking to farmers across the United Kingdom. We have been to the Royal Highland Show, the Royal Cornwall Show, the Royal Cheshire Show, the Lincolnshire Show, the Essex Country Show, the Balmoral Show in Belfast, and Cereals—just to name a few. The locations may vary, but the same theme comes out again and again: devastating cash flow challenges as a result of the fiscal decisions made by this Labour Government.

Unlike in other professions, income from agriculture can be volatile. Farm businesses are price takers, and the determinants of the prices they receive are out of their control. By the time the crops or livestock reach the market, prices may have dropped, but goods must be sold anyway. Income schemes such as the SFI are so important—but not in the Government’s eyes, with their chop and change approach. Under this Government, the schemes are not providing any reassurance or support to the majority of farmers. Last year, the Government closed applications for the SFI scheme with no warning, and yet again they have announced a budget that does not meet farmers’ requirements.

Would my hon. Friend agree that another uncertainty is coming down the path? The Climate Change Committee is asking farmers to reduce livestock numbers by up to 40%. That would devastate and make unviable so many farms—complete madness.

My hon. Friend makes an excellent point. On the day when the farming roadmap has been announced, this just shows the direction that the Government want to take: to destock and produce food less. The key question from the shadow Secretary of State for Environment, Food and Rural Affairs that the Secretary of State did not answer in the Chamber was: if that is the ambition of the Government, where is our food coming from?

The £100,000 cap for the SFI will be a disaster, resulting in lower environmental roll outs. The changes to delinked payments that went through as a statutory instrument just a couple of weeks ago had no costed impact assessment associated with them. It is an absolute disgrace that Labour MPs all voted to drastically reduce the payments despite no impact assessment having been done.

The Conservative party has been clear that we will reverse the family farm and family business taxes. We will reinstall the 100% relief on agricultural and business property because we know the huge negative implications that is having on family businesses needing to mitigate any inheritance tax liability and on the investment they are able to put into their businesses. That is impacting not only our primary producers but the wider supply chain. I say to those Labour MPs that they should be ashamed of themselves for continuously voting that through.

Then we come to the challenges associated with input costs, including the fertiliser tax. If we want to increase or stabilise domestic self sufficiency at 63%, why on earth are the Government coming through with the fertiliser tax? It has been raised as a concern, but the Government seem unwilling to tackle the challenge. The Conservatives will scrap that tax. [Interruption.]

Order. There has been a lot of chuntering while the shadow Minister has been on his feet. If you wish to try to intervene on the shadow Minister, please do—he may give way. However, do not chunter constantly when people are trying to make a speech.

I thank you, Mr Turner, for your advice to colleagues. If they wish to intervene, they are more than welcome to do so.

Red diesel has been a huge challenge: its price rose dramatically from 67p a litre to about £1.35p a litre at its peak. However, the Government’s rebate or reduction applies only to this year. If someone is growing crops or producing livestock, they need greater certainty beyond this calendar year. I call on the Minister to reinstate a level of reassurance that goes beyond the end of this calendar year.

We then have the EU reset. Pushed by EU members, the Government have put back the date beyond 22 July. However, CropLife UK has rightly estimated that the EU reset deal, as it is being promoted at the moment, could drain £810 million from UK farmers and sacrifice almost 9,000 jobs. What reassurance can the Minister provide to our arable sectors, which are suffering and struggling right now?

Today we had the announcement about the farming roadmap for the next 25 years. Where is the reassurance that cross sector Government Departments have bought into that? Labour’s record on this is not good. It does not matter what food strategy the Secretary of State for DEFRA comes out with: if a Chancellor comes out with fiscal decisions like those under the last two years of this Labour Government, that will blow any food strategy out of the water.

Order. I suspect that the shadow Minister is going to bring his remarks to an end very soon.

Absolutely, Mr Turner.

The financial sustainability and profitability of the farming sector is vital. Through the choices that the Government have made and voted on, they have demonstrated that when the revolving door of farming Ministers say that food security is national security, that is just warm words.

It is a pleasure to serve with you in the Chair, Mr Turner. I congratulate my hon. Friend the Member for North Northumberland (David Smith) on securing this important debate and thank all those who have made contributions this afternoon.

I am delighted to see the excellent Labour rural research group here in force. Their speaking with such insight and passion is a reminder to me of the real champions for rural affairs issues who we have on our Benches. What a shame that so few Conservatives are here! Maybe that is a reminder of their disastrous election result in 2024.

I want to pay tribute to my predecessor, my hon. Friend the Member for Wallasey (Dame Angela Eagle), for her hard work and dedication to the role. Her ambition for farming and food security will make her a tough act to follow. I have already had the opportunity to meet a range of stakeholders from across the sector and visit a range of farms and farmers across the country, which has reinforced to me the importance of farming. It matters to our country, supports rural jobs and communities, provides the food we rely on and underpins our national resilience.

As I mentioned earlier, today we published our farming road map, which sets out our plan for farming up to 2050. The road map sets out a clear direction towards a future for farming. It will give businesses in the sector confidence to invest, grow, plan for the future and secure farms for the next generation. The road map will help our food and farming system to become more resilient to global crises, adopt nature friendly methods that support profitable food production in the long term and shore up food supplies. It sets a direction for agriculture that involves clearer, fairer routes to market, with better access to the tools, technology, skills and supply chains that farmers need to run sustainable businesses.

Alongside the road map, today we published our full response to Baroness Minette Batters’s independent farming profitability review. The vast majority of her recommendations are either already under way or are being implemented soon, including the formulation of the farming and food partnership board, which has already met twice. Today, we announced that we will be taking a number of additional actions to create an environment for profitable farm businesses to thrive. That includes an additional £53 million investment for the farming innovation programme to help farmers to harness new technology that improves productivity, reduces reliance on inputs and improves long term resilience. It also includes investment in the skills and people that the sector needs. By supporting training and new entrants, farmers’ hard earned knowledge will be passed down to the next generation.

I also want to recognise the pressures that many farm businesses face—a theme that has come out very clearly in the debate. Input costs rise quickly, and global markets can shift overnight; that uncertainty makes it harder to plan, invest and employ. That is why I want to reiterate this Government’s long term and practical approach to farming, our commitment to stable funding, and our simpler and fairer funding schemes, which are designed to make farming more resilient and sustainable for the future.

The Minister may well know that it was only a few years ago that the UK met 40% of its own nitrogen and fertiliser needs. Would he commit to working with the Minister for Industry to look at how we can get our domestic production to grow once again, given that under the Conservative party it disappeared altogether?

I thank my hon. Friend for his reminder of the Conservative party’s record of failing rural Britain. I am very happy to take away the action he suggested. If we are to deliver our road map successfully, it will require lots of cross Government working, and I am very committed to making that happen.

Let me address the fertiliser issue; I appreciate that major input costs are real source of worry for farmers. We are very conscious of the increases in fertiliser prices that have occurred because of the middle east conflict, and we are working actively to monitor the impacts on the agricultural supply chains. We have regular communication with domestic fertiliser suppliers, commodity traders and farming stakeholders, including the National Farmers Union, and we have been clear that we are committed to ensuring that markets function fairly.

We continue actively to monitor developments in the middle east, as well as other impacts on our food and farming sectors, including through ongoing engagement with industry leaders. My Department is aware that there are signs of some pressures easing but that prices still are above pre conflict levels.

We recognise that these costs continue to be a significant issue for farmers; that issue was raised with me on my first day in this role, when I met with the NFU. The pressures that it is imposing are absolutely worth considering further. Whether through more effective use of technology or the adoption of more sustainable farming practices, we can better equip our farmers and growers to produce good food in a more resilient way, and this Government stand ready to help farmers to do that.

Does the Minister accept that it is a choice made by this Government—maybe not by DEFRA, but by the Treasury—to bring in the carbon tax from 1 January? The Government cannot change events in the middle east, but they could choose to delay or scrap that tax.

I remind Members that we currently have a good supply of fertiliser and are keen to support domestic production. The Government are live to the other issues that the hon. Gentleman raises; I will take them back to the Department, and am happy to write to him on his concerns.

The Government are also sharing information and guidance to support farmers to diversify sources of nutrients to reduce reliance on artificial fertilisers and strengthen long term resilience by managing more effectively. DEFRA’s new nutrient management planning tool is already supporting our farmers by matching nutrients to crop and soil needs. That enables farmers to make the most of nutrient sources and to reduce their reliance on artificial fertilisers. More than 500 farms have used the tool since it was launched.

DEFRA has launched a consultation and call for evidence to inform how the Government modernise fertiliser production and the regulations around it, which will further improve future fertiliser supply options. We will continue to work with farmers to ensure that they become more resilient, through our innovation funds and equipment grants or our continued shift from area based subsidy to environmental land management schemes.

Another issue raised in today’s debate was about fuel. Farmers have told the Government how important manageable fuel prices are to the financial sustainability of the farming sector and food security, and we have listened. While the shadow Minister, the hon. Member for Keighley and Ilkley (Robbie Moore), worries about his selfies for social media, we are focused on taking decisive action to support farmers by slashing the fuel duty rate on red diesel from 10.18p to 6.48p per litre—its lowest rate in 20 years. That means that red diesel now benefits from an 88% tax discount, saving farmers more than £300 million a year.

We have also extended the 5p fuel duty cut until the end of this year, keeping taxes at a 16-year low and saving the average driver £120. My Department will continue to work actively with others to monitor developments in the middle east, including their impact on the supply and price of red diesel. We are committed to ensuring that the market functions fairly, and will continue our discussions with industry leaders, including the NFU and farming stakeholders.

There are real, recent issues that need to be addressed; I have heard from the stakeholders I have already met that additional pressures are affecting farmers. The Government are well aware of the impact of climate change -related extreme weather on the financial sustainability of farms in recent years—this week’s heatwave is a reminder of that. We are committed to working with farmers to deliver long term solutions to the risks associated with extreme wet or dry weather, and to increase profitability, because farmers being able to run profitable businesses is good for the whole economy and vital for food security. That is why we are investing in farming schemes and grants to make farming more resilient to economic and environmental shocks, and to safeguard our long term food security.

We have allocated a record £11.8 billion over this Parliament to sustainable farming and food production. Overall, farmers and land managers will benefit from an average of £2.3 billion a year through our farming and countryside programme.

On that point specifically, I raised Dartmoor and invited the Minister to visit my constituency. He has about 30 seconds left to speak, but could he respond to that point?

I am happy to write formally to the hon. Lady to respond to her questions.

The message I leave with Members is simple: this Government believe that food security is national security. We are standing alongside farmers through global uncertainty, and supporting them by equipping them to manage volatility more effectively. We have already responded to the real pressures around fertilisers and fuel that farmers face and are backing British farming with record investment, improving schemes to make them simpler and fairer and supporting productivity and innovation. We are proud to work with British farmers as we grow the future of farming together.

I thank the Minister for his comprehensive speech, and especially for touching on the issue of fertiliser. That issue is significant for all hon. Members here, and we will follow up on it.

The discussion has, for the most part, been cross party. If the shadow Minister, the hon. Member for Keighley and Ilkley (Robbie Moore), would like to see the level of conversation and the in depth relationships that Labour MPs have with our farmers, I encourage him to go on social media to look at all our different listening exercises. He should also look at just how many—there are more than 100—rural Labour MPs sit in this House.

I could say many things, as some fantastic points were raised, but I finish with the idea of identity in our countryside and way of life. We need to secure that, and we will not do so unless we make farming financially sustainable.

Motion lapsed, and sitting adjourned without Question put (Standing Order No. 10(14)).