National Sheep Association (NSA) believes today’s Budget gives the UK’s sheep farmers little to build on. A handful of targeted cost measures will help some businesses. There is nothing to rebuild confidence, reverse the decline in the national flock or secure the future of family farms.
NSA is disappointed the government has not reversed the changes to Agricultural Property Relief (APR) and Business Property Relief (BPR), which took effect in April. They remain a serious concern for farming families planning for succession. NSA is disappointed that the Budget does not go far enough to address the wider financial pressures facing UK agriculture.
Phil Stocker, NSA chief executive, said: “There is little in today’s Budget for the UK’s sheep farmers to get excited about. Life will go on much as it has for some time. Sheep prices are likely to stay strong, but so are costs, and uncertainty about the direction ahead is making farmers nervous about investing. This Budget does little to address the decline in the UK’s food security and self-sufficiency, or the pressures behind food inflation.
“There are a few crumbs. The cuts to fuel duty, red diesel and VAT on household electricity now run to July 2027. Farms in England with tourism and leisure enterprises may benefit from the higher threshold for small business rates relief. These measures will help some individual businesses. They will do nothing for the viability of UK farming and food production.
“The national sheep flock is still shrinking, and nothing here gives farmers the confidence to invest and rebuild. The sheep sector can make a significant contribution to food security, exports and rural jobs, but it needs a clear commitment to its future. Anyone hoping to see inheritance tax on agricultural land scrapped will be disappointed.”
The new cut to tariffs on imported fertiliser, which runs until December 2027, will offer some relief. Extensive sheep systems use less fertiliser, so they will see less benefit.
The UK Carbon Border Adjustment Mechanism (CBAM), a carbon charge on imports including fertiliser, starts in January 2027 and risks cancelling out much of the saving. The Budget also includes a 3.9% increase in the National Living Wage to £13.21/hour from April 1, 2027. While fair pay is important, higher wages will add to the pressure on farm businesses already managing tight margins and rising operating costs.
The Government is also temporarily suspending import tariffs on more than 100 food products to help reduce costs for consumers. While NSA recognises the importance of affordable food, it stresses that measures affecting food imports must be weighed against the need to maintain a viable domestic farming sector.
Mr Stocker added: “UK sheep farmers produce high-quality food while contributing to the management of the countryside and the rural economy. They need policies that recognise the value of domestic food production and give them confidence to continue investing in their businesses.
“NSA will continue to engage with Government and work with industry partners to ensure the practical realities of sheep farming are understood and that the interests of sheep farmers are considered in future policy decisions.”
