Farming "can and will play its part in leading the country back to sustainable economic growth", the NFU has said in response to chancellor George Osborne’s Autumn Statement.
NFU President Peter Kendall acknowledged that while the chancellor’s statement laid bare the stark reality of the economic crisis, he agreed with the overall thrust of the speech.
He approved of the message that businesses and industry must be freed from the stifling grasp of red tape and regulation if they are to achieve their potential.
“Despite the gloomy economic outlook, there are some good signals in the announcement that government recognises the role the farming and food sectors can play towards stimulating economic recovery and rebalancing the economy,” Kendall said.
“We will need to look at the details of the chancellor’s plans for growth but I detect some positive announcements such as a consultation on proposals to allow existing agricultural buildings to be used for other business purposes and acknowledgement of the positive impact of the farming regulation task force will have, if implemented properly.
“We await with interest the details of the government’s food and drink export action plan in January 2012, the summit in March 2012 aimed at boosting innovation in small agri-food businesses, and the appointment of a food and drink business ambassador.
“However, the government can and must do more for the farming sector if we are to meet our potential. I have called on the Treasury repeatedly to review its decision to reduce the Annual Investment Allowance from next year from £100,000 to £25,000 but it appears again not to have listened.
"As a capital-intensive industry, which will rely on investment in plant and machinery in the coming years to meet the challenge of global food security, this move sends out entirely the wrong message, especially as many farm businesses are unincorporated and will not benefit from any offset in the reduction of the rate of Corporation Tax. We see that 100 per cent Capital Allowances are being introduced in the largely urban enterprise zones championed by the chancellor - it is a serious omission that rural areas are being denied similar fiscal incentives."
“I’m more convinced than ever that farming can and will face up to the contribution it can make in stimulating economic recovery and rebalancing the economy. The exact measures needed to meet these challenges are many and complex and it remains to be seen whether the chancellor’s proposals will provide the right medicine.”
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