Rural Economy

Lord Fuller Excerpts

Thursday 11th June 2026 Lords Chamber

Moved by

[Lord Fuller]

That this House takes note of the Government’s record on the rural economy.

[Lord Fuller (Con)]

My Lords, I spent yesterday standing in a field in that new spiritual home of British agriculture, Diddly Squat Farm in Oxfordshire, for the cereals trade show. Nearly 20,000 farmers, growers, advisers, machinery dealers, drone flyers and, yes—by way of declaration of interest—fertiliser suppliers such as myself, huddled under umbrellas, wearing wellingtons, talking trade. The host, Jeremy Clarkson, has said that there cannot be a single farmer left who supports this Government. I can tell noble Lords that my experience yesterday proves him correct.

Indifference from a north London-based Labour Party sadly has morphed into a hatred of those who live in the shires—those who put bread on the table and sustain our nation—with no signs of contrition in the gracious Speech. You know the malevolence has reached an apogee when even the former Secretary of State for Health and the current Mayor of Manchester have realised that this ritual rural abuse must stop. It has taken a while, but those two honourable gentlemen have worked out for themselves that Labour’s war on the countryside has gone too far and must be halted.

It is because the food, drink and agriculture business is big. Agriculture’s annual contribution to the UK economy is £13.9 billion. But this is not a debate about farming alone; the debate is wider than that. This debate seeks to hold the Government to account for the damage they have wrought on those who live in the sticks: the places where the Uber cannot come and collect you from the pub at 11 pm, because either the pub has closed down as a result of Labour’s war on the high street in our market towns, villages and coastal communities, or because there is not an Uber in the countryside anyway. You see, we do different out in the sticks.

It is not just rural pubs. It has been terminal for country house hotels and other hospitality businesses, filleted by extra rates, hobbled by new employment taxes and made unviable with other levies, fees and charges such as the tax on glass bottles.

It is not just hotels; it is also private schools. Many custodians of wonderful grade 1 heritage buildings are the last employers where they have made country towns factory towns: places such as Holt, Marlborough, Oakham and Uppingham. Mostly charities, they are significant contributors to the UK exports for services, but the Government are deaf to that reality. In these places, they are the factories employing hundreds. The people who work there—cooks, cleaners, groundsmen and, yes, teachers—are not rich, but they have been the collateral damage in a class war that has seen them lose their jobs in areas with so few other opportunities. So much for the party supporting the workers.

We have seen £110 million slashed from rural councils with the abolition of the rural services delivery grant. Devon lost £10 million out of £100 million. Norfolk is not far behind and North Yorkshire, our largest rural county, has lost over £12 million, with the countryside being short-changed.

Support for off-grid home owners, people off the beaten track who heat their homes with oil, has been nothing but an inadequate afterthought. Now we see a fresh war on country pursuits, which employ thousands, enhance conservation and dispose of fallen stock while keeping the country pub going in the winter—not with fallen stock, I hasten to add.

On Tuesday, the noble Lord, Lord Deben, raised the inexplicable behaviour of His Majesty’s Revenue and Customs, which refused to refund millions in VAT incorrectly levied on county show societies that could force their insolvency. We see that political indifference is now infecting the behaviours of the departments of state, damaging the cultural life of the countryside.

Now let us dwell on the harm inflicted on farmers, which structurally undermines our food security as the result of the sustained attack on those who feed us. Last summer there was a ham-fisted cessation of SFI, which could have helped the natural world. What an irony that it has led to farmers intensifying production instead. We saw the cancellation of slurry lagoon grants that, more than anything, could have helped reduce river pollution. We have empowered private equity and sovereign wealth funds to compulsorily purchase land for other purposes. All these have shot the environment in the foot—an activity that will be possible only until shooting itself is sidelined.

Thinking of the rural economy more widely, let us consider the inheritance taxes levied on farmers and other family businesses, which are disproportionately clustered around our market towns in modest trading estates. Together, they employ millions in firms handed down in trust for the next generation. However, they are being systematically filleted and starved of working capital in a way that foreign owners, private equity or publicly traded shares held by pension funds are excused from. This spiteful apartheid disproportionately affects firms in the provinces, especially the large number of rural trades involved in food processing, machinery dealing, fencing, ditch digging, plant hire, and any other ancillary trades, such as timber and buildings merchants, and the haulage contractors that fetch and carry supplies.

We see that Labour’s economic illiteracy is chilling the private investment that drives growth, reducing profits today and damaging the corporation tax revenues of tomorrow—all of which pay for schools and hospitals. We have a Chancellor boasting about free bus travel for youngsters in August. If only there were buses in the countryside for them to ride. Instead, those who drive those twin-cab trucks, who know how to get up in the morning, are to be taxed more heavily. All these people need to move about anyway because of poor digital connectivity in our villages. The Treasury boasts that it has taken about threepence off the price of a litre of red diesel, but only until Christmas. This is a Government reduced to gimmickry. All these active harms visited on the rural economy are the result of the smug city dweller, for whom the countryside is somewhere to look down on and patronise: it is all rather provincial, you see. That is part of the problem. This Government misunderstand, underappreciate and malign the countryside; they should stop treating us as second-class citizens.

Like the hopeless apprentice, Labour is not learning on the job, as there are other insults in the pipeline. To mask the manifest failure of housebuilding in the cities, Labour has increased housebuilding targets in rural districts by over 50% to unachievable levels—levels that have never been achieved before. The Social Housing Bill does nothing to promote social housing in rural areas of the sort championed by the noble Lord, Lord Cameron of Dillington. Under the land use framework, 1.7 million hectares of productive farmland—about 20%—will be removed from agriculture. At a typical £2,000 gross income per hectare, that represents a £3.4 billion annual hit to the rural economy—a sector that lost an estimated £800 million last year. The countryside is being made poorer and, if things carry on at this rate, there will be no money left to make it more attractive to the birds and the bees and the other species.

The new SFI is meant to be more environmentally beneficial, with fewer actions, but with a paltry £240 million budget announced today, and capping, it prevents those with the most land from making the greatest environmental impact. Worse, at a time when there is hunger and a need for food security, there is a plan to introduce insane carbon taxes on fertiliser—the farmer’s largest expense. That will do nothing to reduce emissions yet will turbocharge food price inflation at a moment when the EU is racing to reduce the impact. Why are we running towards this danger with a scheme that is architecturally incompatible with that of the EU, and which has additional complications—free allowances, default values, and so forth?

For a country that no longer produces ammonia, the raw ingredient for fertiliser, foreign suppliers are already concluding—I know this from personal experience—that we are becoming far too difficult to deal with. That imperils our food security, because fertiliser forms the foundation of our food chain. Then there is the problematic SPS deal, which will turn back the clock on precision breeding—which drives sustainability and productivity—and ban advances and innovations in black grass chemistry. Here is the rub: Labour is trying to have it both ways on the SPS. It wants dynamic alignment with the EU, without the agricultural support that EU policies require. That leaves British farmers in a worst-of-all-worlds situation: all the costs and none of the revenue.

The EU has seen us coming, something the Government cannot see for themselves, and it will not rest until our best land is given up for solar schemes that destabilise the grid and generate no real income at all. There is no need for the little doers that keep the village stalls going—and to prove this point, yesterday we learned that Clarkson’s farm employs 150 people; converted to solar, it would employ nobody. Labour’s vandalism even goes as far as imposing metropolitan patterns on local councils, extending regional city councils to milk the surrounding parishes to pay off their historic debts. It is all quite a list.

Today I can reveal for the first time another example of this Government’s indifference to the rural economy: in reopening the Ensus plant to produce CO² for our nation at a subsidy cost of £1 million a day, the first cargos of feedstock to power it were from France. The Government could not bring themselves to require that the wheat for that plant come from British farmers, who are on their knees. Given a free choice, this Government have subsidised French farmers to the extent of £1 million a day over our own. The irony is that none of this would have been necessary, had an unthinking Government not signed away our 1.4 billion litre a year bioethanol business in a trade deal with the US that collapsed grain prices on our shores.

This debate reveals a landscape where there is no one in government who understands or is prepared to stand up and speak for those who can see green outside their windows; just chaotic departments all pulling in different directions. We have a Government who prefer dogma to delivery and are ignorant of the millions who live and work in the sticks, working long hours out in the rain and cold, boosting nature, cherishing our countryside, tending to our herds and crops and making Britain a green and pleasant land. Labour has simply abandoned the countryside, providing nothing in the gracious Speech. It is an omission that will come back to bite it.

--- Later in debate ---

[Lord Fuller (Con)]

My Lords, it has been an interesting debate and I am grateful to all noble Lords who have contributed. It was a good job that the speaking allocation was increased by 25%, because so many noble Lords had so much to say. It was a pleasure to see my noble friend Lord Roborough back in his seat—back in harness, so to speak—and fighting the good fight.

The Government have painted themselves into a corner on the countryside, but I congratulate the noble Baroness, Lady Royall, on her spirited defence. However, she invites me to make a further declaration of interest, because I am a long-standing, and lately long-suffering, shareholder of Adnams, the brewery at Southwold. Its beers are as good as ever, even though its shares are not quite as plump.

There were so many contributions in the debate, including seasonal agricultural workers, education and rural crime, raised by my noble friend Lord Howard of Rising. We had the tension between alignment and mutual recognition, which is something we will return to in future weeks, with tourism and hospitality. The greatest pleasure I took from the debate was that the noble Baroness, Lady Pitkeathley, raised flooding before my noble friend Lady McIntosh, and then the greatest surprise was that the noble Baroness, Lady McIntosh, did not mention it although it is a hobby horse of hers. We covered housing and transport, from potholes to mopeds.

I was very taken by the comments from my noble friend Lady Coffey, who echoed a previous Secretary of State for Agriculture—it was probably MAFF at that time of day—when she made the important contribution that people in the countryside are not rich. There is poverty, but because it is diffuse it cannot obviously be seen. However, that does not hide the fact that there is poverty none the less. It is harder to see but more difficult to deal with, and I do not think that has always been grasped by urban politicians who can see it right before their eyes.

We have seen the interplay between business, councils, investment and the APR point. Let us not relitigate that, save to say that it particularly benights agricultural businesses because it includes the value of machinery, livestock and cultivations that are a work in progress, in a way that does not otherwise happen.

To summarise, I think we have shown today that the countryside has an empathy, and a love of landscape. There is the commitment to service that the noble Baroness, Lady Pitkeathley, raised, and the importance of hard work. The people in the countryside do not want to be classed as second-class citizens because they love our green and pleasant land. I beg to move.

Motion agreed.