Seòmar agus comataidhean

I beg your pardon; I got carried away.

The Labour Party should be taxing the rich, not farmers who are struggling as it is. The failures of Labour members to speak up on the levy on family farms, on the impact of the hike in employer national insurance that also affects farmers, on the means testing of the winter fuel payment, on the two-child benefit cap or on the rural visa to alleviate the loss of a labour force following Brexit are all testament to those members’ status.

If that were not bad enough, it is compounded by the promise before the election from the then shadow and now Government Secretary of State for Environment, Food and Rural Affairs, Steve Reed, who said that the Labour Party had no plans to change inheritance tax or agricultural property relief. That is a betrayal and it is endorsed by Labour members here.

Many family farms across Midlothian South, Tweeddale and Lauderdale will be affected, because it does not take much for assets to be worth more than £1 million. We might take the UK Labour Government at its best by believing that various reliefs for spouses and so on will mean that the impact will mostly be on assets worth more than £3 million. That looks like a lot on paper, but when we look in farm sheds at the combine harvesters, tractors, quad bikes, milking parlours and feed for stock, let alone the farmhouse and the land, we can see that even £3 million is an easy figure to reach. A new high-end combine harvester can cost at least £750,000. Farmers might look rich in assets, or even be so, but they are poor in revenue.

We must remember that, for many, farming is a family matter. It is a generational and intergenerational vocation 24 hours a day, seven days a week, from dawn to dusk and in all kinds of weathers. Farming is literally—to abuse that word—under farmers’ fingernails as they provide not only the quality food on our tables, high standards of animal welfare and exports but the very landscape that we take for granted. Ironically, family farms might be forced to sell up and become the property of the commercial investors that this policy is meant to target. There are levies with no impact assessment or engagement with farmers, which also completely fail to respect devolution because of a lack of engagement with the Scottish Government.

What more does the Labour UK Government intend to do to undermine our farming and rural communities, many of which are reliant on the trade of local farms? As I understand it, according to the UK Government, all of this is to raise £240 million in the first year, but how many millions of pounds will be lost to the rural economy and how much will be lost in the heartache and concern of farming families? It is time for Labour members, at least in the Scottish Parliament, to speak up, for once, or are they going to remain twigs?

You are taxing the wrong people, Mr Smyth. You have taken the winter fuel payment away and you are taxing farmers.

I hope that you have not just said something that you will regret, Presiding Officer—that happens in here.

I initially had 12 years in this Parliament representing the rural South of Scotland region and, for the past 13 years, I have represented Midlothian South, Tweeddale and Lauderdale, a constituency that has many farms and which runs from the Eildon hills to the Pentland hills. As I have said previously, during those 25 years, I have visited many estates, such as Burncastle in the Borders and Arniston in Midlothian, as well as farms, such as Baddinsgill in the Borders and Moorfoot and Eastside in Midlothian.

Although this debate is about the appalling impact on family farming of the Labour Government’s changes to inheritance tax, which, when combined with changes to agricultural property relief, are bad enough, there is also an impact on local businesses, suppliers, hauliers and so on. All that, combined with increases to employer national insurance contributions, will have a devastating impact on the rural economy.

The Labour Party appears to have little concept of rurality or of Scotland’s farming landscape. Of the 37 Labour members who were privileged to be elected at the recent general election, I have yet to find one who has broken ranks to criticise those policies. I have written to Kirsty McNeill, the newly elected member for Midlothian, who has rural and island issues as part of her ministerial brief, to see what she has to say about the changes both to agricultural property relief and to national insurance.

What do Labour members here say? Their silence speaks louder than words. During the debate on this issue last week, I felt heart sorry for Rhoda Grant, a decent colleague who, in some discomfort, had to defend the UK Labour position. I see that she has escaped having to reprise that defence here today. Colin Smyth spoke about practically anything but the injustice of inheritance tax changes for Scotland’s farmers. I have a health warning for Labour: if you are merely a megaphone for the UK Labour Party and if you speak and behave like a branch of UK Labour, perhaps you are merely a branch of UK Labour, as Johann Lamont foretold. Perhaps I am being too generous to Labour members, who may be less of a branch and more of a twig.

I will take an intervention from Colin Smyth.

I shall try hard to temper my words in order to obey that instruction, Deputy Presiding Officer.

I thank the Conservatives for bringing this debate to the chamber. I want to lay to rest the notion that the Scottish Parliament and the Scottish Government do not understand rural communities and, at worst, do not represent them. I represented the South of Scotland region for 12 years and I have represented Midlothian South, Tweeddale and Lauderdale for the past 13 years. Indeed, I lived in rural Galloway for more than a decade. Therefore, like many people here—because, across the chamber, many of us represent wholly or largely rural communities—I hope that I am sufficiently appraised of the varying requirements of rural areas. During those 25 years, I have visited many estates, such as Burncastle and Arniston, and farms in the Borders, such as Baddinsgill, Moorfoot and Eastside. Although I cannot begin to approach the knowledge of Tim Eagle, I am not completely a townie.

The party that appears to have little concept of rurality and, in particular, rural farming communities and landscapes in Scotland is the Labour Party. I do not think that I am being unfair when I say that, because the recent actions of Sir Keir Starmer in respect of inheritance tax and changes to agricultural property relief, on top of changes to farming payments following Brexit, are evidence of it. I add to those actions the additional national insurance obligations, which will also fall on those farmers who are employers, and the pressure on farmers from supermarkets to always keep prices down.

In December 2023, Steve Reed MP—who is now the Secretary of State for Environment, Food and Rural Affairs and was then the shadow secretary for the department—stated that Labour had no plans to change inheritance tax, including APR. Well, we know what happened there, and what happened with regard to the national insurance contributions of employers, including farmers, who are apparently not “working people.”

There are many farms across Midlothian South, Tweeddale and Lauderdale that will be affected, because it does not take much for a farm’s assets to cross the £1 million barrier when a high-end combine harvester can cost nearly £750,000. I am therefore grateful to the NFUS for its briefing, which includes working examples of the impact of inheritance tax and APR. It says:

“an IHT qualifying farm with a value of £4 million would mean £1 million will have 100 per cent relief. The remaining £3 million will receive 50 per cent relief, seeing £1.5 million subject to IHT at a 40 per cent rate. That would equate to a £600,000 IHT bill in this example. Although the payments can be spread over 10 years, the first £60,000 will require to be paid within six months. Many farm businesses would not have this amount available which will mean some land would need to be sold thereby bringing into question the future viability of the farm.”

Farming is a family matter for many, as others have said. It is personal, intergenerational and a vocation. It is literally—not to abuse that much-used word—under farmers’ fingernails. Farmers provide not only the quality food on our tables, high animal welfare standards and quality exports, but the landscape that we take for granted. I add in passing that there may well also be an additional punitive levy on exports to the USA.

The levies have been set with no impact assessment or engagement with the sector, and the UK Government has completely failed to respect devolution by engaging with the Scottish Government. There is no rural visa on the horizon, either. What more does the Labour UK Government intend to do to undermine our farming and rural communities, many of which, as Beatrice Wishart said, are reliant on local farms? Those things will affect not just the farms, but all the local businesses.

It will be.

Does the member share my view that we should look at some of the vehicle excise duty going towards the upkeep of roads? Given that lorries and commercial vehicles pay more, perhaps they would not feel so bad about it if that money was being apportioned to the roads network.

Will the member give way?

Are we not seeing abject hypocrisy from the Conservatives, who, during decades in power, failed to provide pensioners with a decent state pension, requiring pensioners instead to rely on pension credit, even though we know that 40 per cent of eligible pensioners do not claim it because the form has 26 pages to read before they get to the end of it?

I thank the member for bringing the debate to the chamber, as I have four major north-to-south roads in my rural constituency of Midlothian South, Tweeddale and Lauderdale: the A68, the A7, the A701 and the A702. If I may, Deputy Presiding Officer, I will confine myself to speaking about those roads. As members can imagine, over my many years in Parliament, I have become very familiar with them, as I am with lesser highways and byways, too.

I say to Douglas Lumsden that there is no war on the rural Borders and Midlothian—it was the Scottish Government that built the Borders railway, but I digress.

First, I will deal with the ubiquitous potholes. My experience of those is probably more frequent as the roads that I have mentioned approach Edinburgh, although there is a particularly bad stretch on the Auchendinny road that avoids Penicuik, which is a bit of a rat run. Potholes are not only down to the use of private vehicles; they are undoubtedly caused by heavy commercial vehicles. Those vehicles knock the stuffing out of our narrow rural roads, and not simply the surface, but often more so the road edges, because those roads came about to serve horses and carts and were not built for loaded articulated lorries.

I have spoken before about vehicle excise duty, which was once called road tax, but which has long since simply gone into the United Kingdom tax pot. In the budget of 1909, the then Chancellor of the Exchequer announced that the roads system would be self-financing, and so from 1910, the proceeds from road vehicle excise duties were dedicated to funding the building and maintenance of the roads system. Even during that period, however, the majority of the cost of road building and improvement came from general and local taxation, owing to the tax take being too low for the upkeep of the roads.

Hypothecation came to an end in 1937, and the proceeds of the vehicle road taxes were subsequently paid directly into the Exchequer. The road fund itself, which was then funded by Government grants, was not abolished until 1955. The fund has long since gone, but my question is, should it be resurrected?

A recent RAC survey of potholes across the UK estimated that there are at least 1 million potholes UK-wide, yet in 2022-23, the UK Government collected £7.3 billion in vehicle excise duty. As I said, that money is simply swallowed up by the Treasury.

Would it not be fairer if Scotland, and indeed England, collected its own road tax and then used it appropriately by ring fencing it? Some of the money could provide Scotland with £700 million per annum, not simply to plug potholes but to assist in maintaining and modernising the network. That is just a thought.

With regard to road improvements, I appreciate that there are pressures on budgets at both governmental and council level, but what would certainly help on rural roads in my constituency, especially on dark mornings and evenings, would be better road markings. We need central reflectors and white lines not just down the centre of the roads but at the edges, because some of the roads in my constituency outwith the towns and villages can be a very tough drive on a dark night, especially when it is raining.

I am also pleased that staggered speed limits have been introduced, for example when entering and leaving Stow. Extending the 20mph limit, before raising the limit to 40mph to a place called Galabank, and then to 60mph, has helped a great deal with safety on the roads. That has now been extended to Eddleston. I am now campaigning to have the same approach on the A702, which would be to extend the 40mph limit northwards from Dolphinton, at least to what is known as the Garvald junction, because that is a particularly fast and dangerous stretch.

I note the dreadful statistics on road deaths, but roads are not the real culprit. Just because the speed limit is 60mph, it does not mean that you do that speed while going around sharp bends when, in any event, you might come across some of the many cyclists on the Borders roads. There are other issues with city drivers, who may be unaware of the specific challenges of such roads, such as stray farm animals, wildlife and slow-moving farm vehicles, for starters.

Those are just some of my observations on the problems and challenges of rural roads, but I would like us to look again at whether at least some of the vehicle excise duty could be apportioned to Scotland’s roads, and indeed to England’s roads.

Will the cabinet secretary take an intervention?

I shall try hard to temper my words in order to obey that instruction, Deputy Presiding Officer.

I thank the Conservatives for bringing this debate to the chamber. I want to lay to rest the notion that the Scottish Parliament and the Scottish Government do not understand rural communities and, at worst, do not represent them. I represented the South of Scotland region for 12 years and I have represented Midlothian South, Tweeddale and Lauderdale for the past 13 years. Indeed, I lived in rural Galloway for more than a decade. Therefore, like many people here—because, across the chamber, many of us represent wholly or largely rural communities—I hope that I am sufficiently appraised of the varying requirements of rural areas. During those 25 years, I have visited many estates, such as Burncastle and Arniston, and farms in the Borders, such as Baddinsgill, Moorfoot and Eastside. Although I cannot begin to approach the knowledge of Tim Eagle, I am not completely a townie.

The party that appears to have little concept of rurality and, in particular, rural farming communities and landscapes in Scotland is the Labour Party. I do not think that I am being unfair when I say that, because the recent actions of Sir Keir Starmer in respect of inheritance tax and changes to agricultural property relief, on top of changes to farming payments following Brexit, are evidence of it. I add to those actions the additional national insurance obligations, which will also fall on those farmers who are employers, and the pressure on farmers from supermarkets to always keep prices down.

In December 2023, Steve Reed MP—who is now the Secretary of State for Environment, Food and Rural Affairs and was then the shadow secretary for the department—stated that Labour had no plans to change inheritance tax, including APR. Well, we know what happened there, and what happened with regard to the national insurance contributions of employers, including farmers, who are apparently not “working people.”

There are many farms across Midlothian South, Tweeddale and Lauderdale that will be affected, because it does not take much for a farm’s assets to cross the £1 million barrier when a high-end combine harvester can cost nearly £750,000. I am therefore grateful to the NFUS for its briefing, which includes working examples of the impact of inheritance tax and APR. It says:

“an IHT qualifying farm with a value of £4 million would mean £1 million will have 100 per cent relief. The remaining £3 million will receive 50 per cent relief, seeing £1.5 million subject to IHT at a 40 per cent rate. That would equate to a £600,000 IHT bill in this example. Although the payments can be spread over 10 years, the first £60,000 will require to be paid within six months. Many farm businesses would not have this amount available which will mean some land would need to be sold thereby bringing into question the future viability of the farm.”

Farming is a family matter for many, as others have said. It is personal, intergenerational and a vocation. It is literally—not to abuse that much-used word—under farmers’ fingernails. Farmers provide not only the quality food on our tables, high animal welfare standards and quality exports, but the landscape that we take for granted. I add in passing that there may well also be an additional punitive levy on exports to the USA.

The levies have been set with no impact assessment or engagement with the sector, and the UK Government has completely failed to respect devolution by engaging with the Scottish Government. There is no rural visa on the horizon, either. What more does the Labour UK Government intend to do to undermine our farming and rural communities, many of which, as Beatrice Wishart said, are reliant on local farms? Those things will affect not just the farms, but all the local businesses.