A landmark review for the UK Government has declared the farming sector to be "bewildered and frightened", with profound concerns over changes to inheritance tax and agricultural payments threatening business viability.
Key Findings of the Batters Review
The report, authored by former National Farmers’ Union president Baroness Minette Batters and published on Thursday 18 December 2025, paints a stark picture of an industry under severe strain. It highlights that alongside a sharp rise in costs and increasingly extreme weather, including severe drought in 2025, policy uncertainty is crippling confidence.
Although the review's formal terms excluded the controversial inheritance tax changes—set to apply to farm businesses worth over £1 million—Baroness Batters stated it was raised as the single biggest threat to farm viability by almost all respondents. Combined with uncertainty around the Sustainable Farming Incentive (SFI), the main post-Brexit payment scheme, this has created "significant" ongoing concern.
The report notes that farming costs are projected to be 30% higher in 2026 than in 2020, while the £2.4 billion farming budget for England has remained largely static since 2007. This comes as farmers are asked to meet higher environmental standards with less funding and no long-term certainty.
A Call for a 'New Deal' and Key Recommendations
In response, Baroness Batters' farm profitability report urges the Government to broker a "new deal for profitable farming". This deal must recognise the true cost of food production and environmental delivery. "Farmers don't want handouts from the state," she emphasised, "they want nothing more than to run thriving, profitable farming businesses, by earning a fair return for what they produce."
The review outlines 57 detailed recommendations to achieve this, including:
- Simplifying the Sustainable Farming Incentive (SFI) to ensure all farmers can access it, with a focus on options that build resilience and support upland farmers.
- Establishing a Great British farming advisory board to boost the market share of British ingredients in retail and public procurement.
- Creating a "Food and Drink England" body to champion English producers, seasonality, and reduced food miles.
- Mandating nature reporting for companies to stimulate private green finance and placing greater economic value on environmental outcomes like healthy soils and hedgerows.
- Reforming planning rules to speed up approvals for on-farm reservoirs, polytunnels, and farm shops.
Government Response and New Partnership Board
Following the review's publication, which was delayed by Government, Environment Secretary Emma Reynolds announced the creation of a new Farming and Food Partnership Board. This board will bring together senior leaders from farming, food production, retail, finance, and government to strengthen the food system.
Ms Reynolds stated: "British farmers are central to our food security, our rural economy and the stewardship of our countryside... This is about serious action to remove barriers, unlock investment and make the food system work better, so farm businesses can grow, invest and plan for the future with confidence."
The Department for Environment, Food and Rural Affairs (Defra) added that the Government is stepping up action on supply chain fairness, tackling barriers to private finance, and supporting exports alongside the planned planning reforms.
