Budget ‘fails to meet farmers’ needs’

The Chancellor’s Spring Budget has received a largely negative reaction from farming groups.

NFU president Minette Batters said Jeremy Hunt’s Budget “fails to address the needs of agricultural and horticultural businesses”, and questioned where boosting Britain’s food security fits into the Treasury’s growth plans. 

“Ahead of the Budget, the NFU was clear that greater support is needed for the thousands of farm businesses which are trying, but struggling, to keep our nation fed amidst soaring production costs,” she said. “It’s therefore extremely frustrating that the Energy and Trade Intensive Industries scheme was not extended to include energy-intensive sectors such as horticulture and poultry.”

With the Energy Bill Relief Scheme ending in March, to be replaced by the Energy Bills Discount Scheme, Batters said the new scheme offers “far less protection to businesses with the removal of the price cap replaced with a token discount.” Farm-level sectors are not among those earmarked for further support.

On capital investment, the NFU expressed disappointment that there is limited support for allowances around capital expenditure, and that there is ”again no apparent recognition that businesses need to balance capital investment between equipment and physical infrastructure which is still written off over 33 years for tax purposes.”

However the NFU said it was pleased to see Hunt announce an extension to the cut in the rates of fuel duty for a further 12 months. 

’Lack of ambition’

Mark Tufnell, president of the Country Land and Business Association (CLA), said it was difficult to see what - if any - ambition the government has for the rural economy. Rural businesses, he added, are held back by apathy in public policy, not least in the planning system that actively holds entrepreneurs back.

“The rural economy is 19 per cent less productive than the national average,” he continued. “Closing this gap would add £43bn to the national economy. Nothing in this Budget will unlock that vast potential. The government needs to show it is on the side of hard-working rural families and business owners, that it matches their ambition and is serious about growing the economy.  

”They need urgently to come forward with a robust plan that will remove the considerable barriers rural businesses, and communities, face to their future success.”

Commenting on a potential change, following a consultation, to the definition of agriculture to include environmental delivery for inheritance tax purposes, Tufnell added: “The CLA has campaigned extensively to change the definition of agriculture in the tax system to include ecosystem services. It is vital to give farmers and landowners the confidence they need to engage with environmental delivery, improving biodiversity and carbon sequestration.

“Without this change, we will see a perverse outcome whereby forward thinking, nature-friendly farming will be punished by the tax system.

“This change would also serve to encourage farmers to look afresh at entering into Environmental Land Management schemes (ELM). For all the challenges faced by transitioning away from the old EU schemes, ELM has laid a path that is worth walking, and we encourage farmers to look very carefully at them.”

Concern over Free School Meals

Food Foundation executive director Anna Taylor, meanwhile, said the government has made the right decision in providing extra support for childcare and making changes to the benefit system for parents receiving Universal Credit. 

“However, there remains a big gap in the support provided by government to protect school-age children from the consequences of hunger and poor diet,” she added. “This means 800,000 children living in poverty continue to miss out on Free School Meals. 

“Child food poverty has doubled in the last year – yet calls for government to extend the threshold for Free School Meals is falling on deaf ears. Free School Meals are one of the few existing policy levers available to us that directly and exclusively target vulnerable children.

“We urge the UK government to revise its decision on Free School Meals, and give our children the best chance to learn, be healthy and thrive. Doing so is popular with voters, will help with levelling up and boost our economy while protecting the NHS.”