Rural Communities

Simon Hoare Excerpts

Wednesday 7th January 2026 Commons Chamber

[Sarah Dyke]

As my hon. Friend would expect, I totally agree with him.

The Liberal Democrats want to ensure that British farmers operate on a level playing field and can succeed. That is why last year I introduced the Dairy Products and Dairy Farming Bill. Farm-gate milk prices have plummeted over the past few months; now, cereal prices are also under serious pressure. The Liberal Democrats are clear: we need fairness in the supply chain. When farming businesses fail, there is a knock-on impact on local hospitality—pubs, cafés, restaurants and hotels.

Somerset is a tourism region. It supports nearly 10% of all jobs and contributes more than £1 billion to the regional economy. Many of the fantastic hospitality businesses in Glastonbury and Somerton are under immense pressure as they face huge rates increases from April. Miranda contacted me today. She manages the White Hart pub in Castle Cary, and faces her rateable value going from around £19,000 a year to over £30,000 a year. Meanwhile, the British Institute of Innkeeping states that only one in three pubs are profitable, and warns that that could drop to one in 10 by April.

The hospitality sector already faces £4.5 billion in additional taxes due to increased national insurance contributions in the 2024 Budget. The Liberal Democrats have been calling for an emergency 5% VAT cut for hospitality, accommodation and attraction businesses until April 2027, funded by a new windfall tax on big banks. Combined with our policy to reduce people’s energy bills by removing the main renewables levy, we could put £270 back into people’s pockets, making it more affordable for them to heat their home, and allowing them to spend more on occasional extras. That would help to drive economic growth in rural areas, restore our high streets, and give the country a much-needed morale boost. It would also help rural areas to grow the economy.

[Simon Hoare (North Dorset) (Con)]

Will the hon. Lady give way?

[Sarah Dyke]

I will give way to my honourable neighbour.

[Simon Hoare]

I am grateful to my neighbour for giving way. I share her support for a reduction in VAT for our rural hospitality sector, but does she get the irony that such a reduction would be illegal if we were still a member of the European Union?

[Sarah Dyke]

There are many ironies, but the benefit of being in the European Union far outweighs that cost.

Moving on to homes, to help grow the economy we must ensure that rural areas have places for people to live in. In Somerset, newly built homes make up just 3% of all properties recently sold, with an average price 20% more expensive than the UK average. Rural house prices have increased by 57% since 2013, while wages simply stagnate, creating an affordability gap and contributing to a higher need for affordable housing in rural areas than in urban settings. As a result, many first-time buyers and key workers simply cannot afford to live in rural areas, making it increasingly difficult for rural local businesses to retain staff, reducing local spending power, and threatening the viability of our rural communities.

The Liberal Democrats are clear that both the private and social housing markets are too expensive and insecure, with current provision simply not sufficient to meet demand. People in holiday destinations should not have to face higher rents and housing shortages, especially when they are among the hardest hit by the cost of living crisis. The Tories would offer tax cuts on second homes, making it harder for people who want to live in an area where they work, or where their family is from, to own their own home. That evidences their failure to understand what life is really like in rural areas. As part of a fairer housing system, the Liberal Democrats would allow councils to increase council tax on second homes by up to 500% if there are housing shortages in their area.

The Liberal Democrats believe that the Government must recognise the pressure that they have put on rural communities over the past 18 months, whether it is through the family farm tax, the broken agri-environmental schemes, the lack of support for hospitality or the failure to provide affordable rural homes. We must remember, however, that these are not new problems. The Conservatives failed to make improvements for rural communities, and that is why they were kicked out of huge swathes of the rural south-west.

--- Later in debate ---

[Simon Hoare (North Dorset) (Con)]

Given the time available, I want to read into the record, if I may, some key suggestions for the Government on this important issue. I welcome the fact that we have secured a debate on rural communities. In passing, it is interesting that we have been told in the media over the past few days that Reform UK is the party of the farmer. Its Members must be out tilling the fields! As always, they are all noise, no delivery.

I echo the call that many Members have made to reduce business rates for our vital rural pubs through revaluation and to reduce VAT for them.

[Rupert Lowe (Great Yarmouth) (Ind)]

Will the hon. Gentleman give way on that point?

[Simon Hoare]

Go on then.

[Rupert Lowe]

Does the hon. Gentleman agree with me and more than 4,000 business owners, including hundreds of rural companies who signed my open letter to the Chancellor in the last 24 hours, that a root-and-branch review of business rates is now a matter of urgency if bankruptcy and misery is to be avoided? There should be no change to interim covid relief subsidies until that review is complete.

[Simon Hoare]

I agree, but I think those on our Front Bench go one step further, which is to get rid of the whole damn thing in the first instance, as that solves the problem at a stroke.

I urge the Government to do what they did slightly with the family farm tax. There seem to be noises off from the Treasury, the Department for Business and Trade, and others, about potential changes here there and everywhere, and that they are listening. Businesses are at the brink, and they need certainty now. Stop playing cat and mouse with rural businesses on these policies. Take a decision, announce it. If it is a screeching U-turn, perform it. Do it elegantly, but for the love of God, just do it.

[Jim Shannon (Strangford) (DUP)]

Will the hon. Gentleman give way?

[Simon Hoare]

I will not, if the hon. Member will forgive me.

My second point is for the Government to please restore the listed places of worship scheme, which is vital for our rural churches. I echo the point that has been made: it is daft to merge sections 1 and 2 with regards to shotgun licensing—I declare an interest as a holder of one. As we know, a very serious issue happened in Devon a few years ago, but this is a draconian response to that and there are other ways to deal with shotgun licence safety.

Drop the family farm tax. It was the wrong policy. It was suggested by officials to Conservative Treasury Ministers every Budget cycle, and Conservative Treasury Ministers said no. It was never going to raise the amount of money that the Government told us before the changes, and it will now raise even less because of the changes to the threshold. Pull the plaster off that provision—and again, do it quickly. I say to those on the Treasury Bench that it is not worth the pain to continue to torture small family farms. North Dorset is the “Vale of the Little Dairies” to quote Thomas Hardy, and there are lots of family farms. They will go to the wall even with the changes to the threshold that the Government have announced. Everybody within the dairy sector will be aware of the unsustainable fluctuations in milk price, and we need a Government-led dairy strategy to secure that vital part of our agricultural sector.

We need to restore funding for neighbourhood plans, because that will deliver the local vernacular housing that local communities wish to see. Finally, we need a fundamental ruralisation of the formulas that underpin important funding decisions, whether for schools, the police or Environment Agency projects. If they get all that right, the Government might begin to restore their reputation within the rural community; continue as they are, and they are on a hiding to nothing.