The ringfenced agricultural budget for Scotland appears to have been amalgamated into the Scottish Government’s block grant, according to information from the Treasury seen by The Scottish Farmer.

This means that, unlike the ringfenced addition to the block grant established in the 2021 Spending Review, the Barnett formula will now apply in the usual way to funding for agriculture and fisheries.

As a result, the ‘strings’ attached to the agricultural budget sent from Westminster will disappear, giving the Scottish Government full freedom to reallocate rural funds with impunity.

We have already suffered two multi-million-pound cuts by the Scottish finance secretary, with a £46.1m obligation to be paid back.

In future, raiding rural payments to plug gaps in public finances will be easier than ever.

For over 50 years, Scottish farmers have had the assurance that national governments were required to support rural spending. CAP money, then the ringfenced agricultural budget, arrived in Scotland with clear instructions on channelling the cash to the countryside.

Now, these strings often felt like ribbons of red tape, yet much of the funding reached family farms—the bedrock of our rural communities.

Going forward, however, there is no guarantee that funding will continue, as we are left to rely on assurances from Scottish politicians.

The farm budget was significantly cut even when it was ringfenced, so how can we trust its safety now that funds can be withdrawn without penalty?

Meanwhile, in London, the Labour Party seems to disregard promises to rural voters.

Only a few months ago, the party committed to maintaining Agricultural Property Relief (APR) as part of its inheritance tax policy, promising to allow agricultural assets, such as farmland, to pass between generations without incurring inheritance tax.

The then shadow Defra secretary, Steve Reed, confirmed that the party has ‘no plans to change inheritance tax including Agricultural Property Relief’ as part of its platform for the 2024 election.

This week the chancellor of the exchequer Rachel Reeves smashed this promise as she announced a 20% tax on inheritable farm property valued at over one million pounds in a budget move likely to send shockwaves across the rural sector.

With rising land prices in recent years, thousands of Scottish family farms are in the Treasury’s crosshairs for this tax hike.

Labour’s assurance that three quarters of farm claimants hold assets below £1m does little to prevent the fraying of traditional farms.

Many excellent farms and crofts do operate at this smaller scale, but the majority of those claimants described by Labour likely own a few fields and would not be classified as active farmers.

Meanwhile, the backbone of the farming sector faces direct tax impacts.

Tenanted farms must also assess how their tenancy value could breach the £1 million threshold.

Tenants investing in agreed property upgrades with their landlords could face inheritance tax liabilities.

Following the recent ability to sell a tenancy, tenancies are now assets, potentially subjecting rented land to death duties.

The sobering news from the autumn budget will leave accountants and solicitors with busy days ahead.

And here I was thinking this autumn had been one of the better ones for farming sector.