By Nick Allen, chief executive, British Egg Industry Council
The British Egg Industry Council cautiously welcomes the UK Government’s Spending Review, which did not usher in huge cuts to the Defra budget, that were nervously anticipated.
Despite a designated £2.7bn annual settlement for ‘farming and nature recovery’ for 2026/27 to 2028/29, £2.3bn of which is through Defra’s Farming and Countryside Programme, the settlement will still equate to a 2.7% cut in real terms by the end of this parliament. Further details on how this funding will be allocated and spent are yet to come, but essentially, farmers are being asked to do more with less, just not as ‘less’ as many might have thought.
The Chancellor has not reversed her decision on Inheritance Tax (IHT), despite the overwhelming evidence presented to HM Treasury on the impact it will have on tens of thousands of family farms across the UK. From April 2026 Agricultural Property Relief (APR) which provides IHT relief for agricultural properties will also be limited. The first £1 million of the property’s value will remain exempt but amounts above this threshold will only receive 50% relief, effectively imposing a 20% inheritance tax on the excess value.
The Government have refused to rule out tax rises for the Autumn Budget. Many economists have warned that a failure to grow the UK economy will lead to further tax rises as the government will have to balance the books. The UK economy suffered its worst contraction for a year and a half in April, shrinking by 0.3%. As with other businesses, British farming has felt the impact of the increase in National Insurance Contributions, as well as the significant rise in the minimum wage.
The Spending Review presents a complex landscape for British farming. To overcome the numerous challenges facing farmers today there is a need to be able to strategically plan, and make investments, with confidence that the regulatory and political landscape is stable and supportive. However, there are many reviews and consultations in progress that will all have an impact on our sector to varying degrees in the future. There is a need to build certainty so that we can continue to provide high quality, high welfare, affordable food to consumers, whilst remaining profitable.
This brings me onto Government’s review into profitability of farming. The review launched by Defra Secretary of State Steve Reed, led by Baroness Minette Batters, will look at barriers and opportunities relating to profitability for various farming sectors. There are numerous areas in which policy solutions could help increase confidence among farmers, which is at an all time low, one of which would be to bring about reforms to the planning system to enable farming businesses to expand and grow their operations, as well as diversify. There are countless examples where planning applications across England have been refused, despite having met all the necessary environmental criteria, leading to lengthy and expensive legal battles with local planning authorities. The BEIC anticipates the review will receive responses from all farming sector organisations where planning has posed an obstacle to farmers running their businesses effectively. . Reform of the planning system will therefore be a key component of our sectors’ response to the review..
There has been concern among livestock sectors that some major supermarket retailers are moving away from their British sourcing commitments, in favour of cheaper imports, that are produced to lower standards of animal welfare. This is why we continue to emphasise the strength of public feeling on this issue – with over 50,000 signatures for our petition, calling on supermarkets to stop importing foreign eggs to produce foods made in Britain and sold as British. We are pleased to have the support of Sarah Champion, MP for Rotherham who has said:
“The British Lion eggs scheme is one of the most trusted and rigorous food assurance schemes in the world, making British eggs some of the safest to eat, and much better than imported alternatives. This is just one of the many reasons why retailers, food manufacturers, food service providers and public bodies should be using the best of British when it comes to the food we buy, sell and eat. I am delighted that The British Egg Industry Council (BEIC) are backing my ‘Buy British Bill’”
Public bodies must continue to do their part in backing British farmers over imported low welfare alternatives.
If it’s illegal to produce, it should be illegal to import.