Why Labour rebels could yet force U-turn on family farm tax

When I was deputy chief whip in the Liberal Democrat-Conservative coalition, I often told my colleagues “backbenchers are the most powerful people in government”.

Perhaps it is dangerous to tell MPs who are “outside” government just how powerful they are but it’s true all the same. Being on the government “team”, even without being a minister, means you have a lot of leverage when you want to extract concessions on behalf of your constituents. A government only holds a majority in the House of Commons courtesy of its backbenchers – they hold the balance of power.

That is something on which Labour MPs should reflect as they consider the backlash against the Chancellor’s tax on family farms. The opportunity to force a U-turn and protect rural communities is in their hands – if they are willing to grasp it.

Hitherto they have played the game and kept their disagreement private. Now, as the Chancellor doubles down and the protests continue – or, if anything, get louder – that may be starting to change.

Farmers protested in Whitehall on Monday against changes to inheritance tax rules for farmers (Picture: Henry Nicholls) | AFP via Getty Images

Anger and betrayal

Backbenchers know what ministers want to ignore. We still have at least another eight months before the decisive votes to enact the new tax, so this issue is not going to go away. Monday saw the latest in a series of debates on farming issues inside Parliament, and another raucous protest by farmers outside on Parliament Square.

The one-track mind of Treasury ministers has come to be expected in these debates. This week, however, other Labour voices were heard. Quoting constituents’ words of bitter anger and betrayal and then saying something to the effect of “they are not entirely wrong” does not quite meet the level of rhetorical flourish that might be hoped for – but it is progress nonetheless.

Labour MPs elected for the first time in rural areas are an interesting bunch. They are almost uniformly smart, diligent and conscious of the needs of their communities. Unlike many of their cousins in “safe” urban seats, they have got there on their own efforts and not because of the party machine.

Wise ministers would listen

Having got there, they do not want to lose next time around. Having played the game and kept their disagreement “in the family”, they are now becoming restive as a result of the lack of movement or even signs they’re being listened to.

Wise ministers would start to listen now. Farmers and other rural advocates have been clear from the start that they are ready and willing to find compromise proposals which would raise revenue and tackle tax avoidance by the super-rich. The signs are there that backbench Labour MPs are looking for an off-ramp and a compromise policy as well.

Government whips must be despairing. Come the day, they may win their vote by driving reluctant backbenchers through the lobbies but that costs political capital. Political capital can only be spent once.

For a tax that earns so little money for the Treasury, is it really worth it? Wiser heads on the Labour backbenches know the answer. How many tractor horns have to blow before Treasury ministers hear the message?

We may yet find out. The time is coming for Labour MPs to look around, recognise their own power – and secure the U-turn that farming communities need.

Alistair Carmichael is the Scottish Liberal Democrat MP for Orkney and Shetland.