Environmental Schemes and Biodiversity Net Gain

All three key parties have made promises about driving forward with development and house building, which is likely to have big impact on Biodiversity Net Gain (BNG) delivery and need.  These could be great opportunities for farmers.

Labour- show commitment towards promoting Nationally Significant Infrastructure Projects (NSIPs) making these “faster and cheaper” so when NSIPs have to meet with BNG in 2025, this is likely to drive demand.

Very keen to make Environmental Land Management schemes (ELMS) work with the introduction of a “Land Use Framework” to ensure this is delivered.  No mention of additional funding.

Lib-Dem- Talk about 100% BNG improvement on large projects rather than our current 10% which seems ambitious.

An additional £1Bn to be spent on farming per annum, with the speeding up of Environmental Schemes high on the agenda and supporting farmers with species recovery and restoring woodland.

Conservative– £2m a year more for ELMS and other grants.

Planning and Rural Development

Labour- review of green belt land to meet ambitious housebuilding pledges.

Lib-Dem- encouraging the use of Rural Exception sites to enable rural housing development.

Conservative- fast-track planning applications for on-farm infrastructure such as slurry and grain stores.  Rural Exception sites to support affordable housing for rural communities.

Food Production

Labour- no mention

Lib-Dem- ensuring high welfare/environmental standards and ensuring all future food deals meet with these standards.  Also, an R&D Fund to support innovation.

Conservative- aiming for 50% public sector food to be local and high environmental standard.  Also, investment in R&D particularly in fertilisers and vertical farming.  Pledge to “stand up for farmers” in trade deals.

Tax

With Agricultural Property Relief (APR) for Inheritance Tax (IHT) on land within an Environmental Scheme to be adopted from April 2025, it is possible that a new government may do a U-turn on this decision.

Labour- very little mentioned in the manifesto however we can assume that as they are eager for Environmental Schemes to work and be widely adopted, it would be at odds to withdraw APR.

Lib-Dem- neither APR not BPR (Business Property Relief) mentioned but like Labour they also pledge commitment to making Environmental Schemes work.

We could expect Capital Gains Tax (CGT) “loopholes” to be reformed to end exploitation by “the super wealthy” however, including the introduction of a three-tiered CGT (much like income tax banding) as well as increasing the CGT tax- free allowance to allow for gains resulting from inflation.

Conservative- pledge to continue as planned in the Spring 2024 budget and “retain key tax incentives” including APR and BPR, and not to increase CGT.

It is a pivotal moment after a long Tory government and at a time of huge pressure on the agricultural and rural sector.  So good luck to my fellow Great Britons – may the odds be ever in your favour! 

To discuss the above points in more detail and how they could affect your business, contact Holly at hollygreenman@fcgagric.com or your local FCG Office.