Economic and Taxation Policies: Jobs, Growth and Prosperity

Baroness Foster of Aghadrumsee Excerpts

Thursday 13th November 2025 Lords Chamber

[Baroness Foster of Aghadrumsee (Non-Afl)]

My Lords, it is a great privilege and pleasure to follow the noble Lord, Lord Howard. I thank the noble Lord, Lord Elliott of Mickle Fell, for bringing this Motion before the House and allowing us time to debate the various issues that have become clearer since the general election last July. The Government have told us that growth is their number one priority. However, the policies and taxes that have been introduced, or are about to be introduced, have made this aspiration harder and harder to achieve.

Many in this debate have spoken to the macroeconomic indicators and prospects, but I want to use the short time available to focus on the plight of rural dwellers. We rural dwellers are known for our laid-back ways, but being sanguine about the current economic prospects is not where we are at present. Sir Keir Starmer told farmers before the election in July that he would not raise taxes, then the Budget of last year revealed the biggest change for farming families for over half a century. The cap on agricultural property relief and business property relief for inheritance tax set at £1 million will have huge consequences for rural communities in terms of investment, succession planning and the continuity of family-owned enterprises. Indeed, the Taxing Futures research conducted by CBI Economics shows that these changes will, instead of growing the economy, put 208,500 jobs at risk, result in a GVA reduction of £14.8 billion and produce a net fiscal loss to the Government of £1.9 billion.

I received an email at the beginning of this week from someone who farms in the north-west of Northern Ireland. This woman, who lives with her family and her farmer husband, was in total despair. She told me that the proposed tax

“will have a devastating impact for each generation as it will stifle any future innovation and investment on farms. The reality for many farms is they will have to sell off fields each generation due to low profits and returns on farms as there will not be the money to pay it. This will result in ever smaller farms”—

farms in Northern Ireland are already small, as we know. She went on:

“There is no point in saying there will be 10 years or pay off the IHT tax—as with low returns from farming there will be nothing left for farm improvements/or future development”.


She continued to say that this proposed tax

“will ultimately change rural farms in NI—as many farms may become unviable and unsustainable—consequently many young families may leave and go to Canada, Australia. As it is at present—we have many part time farmers but their vital off farm income sustains their farms and multi-generations of their family—in addition to supporting many other off-farm employment throughout NI—all contribute to the NI economy”.

She also made a very important point about succession. I know that sometimes we have been told that this will help with farm succession. But she told me she believed that older farming parents are becoming increasingly vulnerable and are often pressurised by their younger family members to sign over their land to their sons and daughters. This can result in elder abuse, something I am very concerned about.

The reality is that the policy change on inheritance tax poses a direct threat to the continuity of family farming across the UK, and in particular in Northern Ireland. The Ulster Farmers Union has said that the absence of a credible evidence base and meaningful consultation or any impact assessment has led this Government, unfortunately, to implement this tax increase—which is effectively what it is—and has meant that many farm families are in a state of uncertainty and panic. I urge the Government to think again.