Autumn Statement: What might the Chancellor do for the rural economy?
The chancellor Philip Hammond will deliver his maiden autumn statement tomorrow against a backdrop of weaker growth prospects and a large deficit.
It will be his first opportunity to outline his priorities for taxes and spending in the wake of the Brexit vote.
If there is one message Mr Hammond wants to put across, it is that the government is committed to making Britain an attractive place to run a business, even as it negotiates the UK’s exit from the EU. He will not elaborate on the timetable or strategy of the UK’s Brexit negotiations, but will signal how Britain seeks to remain competitive.
Howard Archer, chief UK and European economist at IHS Markit, said Mr Hammond has hinted that he will prioritise infrastructure and housing measures to help support the economy.
“The chancellor has already indicated that an additional £2 billion will be earmarked to tackle the housing shortage on top of a £3 billion house-building fund that has already been targeted at small- and medium-sized developers, offering cheap loans or financial guarantees,” he said. “There are also plans to cut red tape.”
Mr Hammond will also announce a £1bn investment fund for fast broadband and mobile phone connectivity. The pledge means at least two million more homes and businesses will get access to full-fibre broadband services, which offers download speeds of 1Gbps. Farmers and rural businesses have been coping with less than adequate internet speeds for years.
Mr Hammond has already guaranteed billions of pounds of UK government investment after Brexit for projects currently funded by the EU, including agricultural subsidies.
The National Farmers Union said it’s good to hear that other rural development grants, such as Leader, offered before the Autumn Statement will also be honoured.
'Difficult for farmers to make ends meet'
Rural insurer NFU Mutual says as low commodity prices across all sectors continue to make it difficult for farmers to make ends meet, measures to help struggling farm businesses need to be put in place.
"Measures to help their businesses through these times would help boost the rural economy and help young people get into agriculture," Tim Price, NFU Mutual rural affairs specialist, told the Plymouth Herald.
Mr Price also made a plea for the Chancellor to consider the effects for the countryside of any measures designed to curb the use of diesel-powered vehicles.
"While diesels are being blamed for pollution in city centres, calls for extra tax on these vehicles or a rise in duty on diesel fuel could unfairly hit country people who use diesel powered 4 x 4s and pickup trucks to farm and keep the rural economy going," added Mr Price.
'Rural economy is critical'
Rural property consultancy Carter Jonas has outlined some of the steps it hopes the Treasury will address, specifically in issues affecting the rural economy.
Tim Jones, Head of Rural, Carter Jonas said: “Whilst the strength of our economy is frequently assessed by the health of our large towns and cities, I would urge the Chancellor to turn his attention to the rural economy, which is critical in maintaining our country’s food supply, landscape and wildlife.
“The government has already honoured its commitment to continue the level of subsidy payments, currently received through the EU Common Agricultural Policy up until 2020 in the wake of Brexit, which is welcome. We would, however, like to see the Government take this one step further and work collaboratively with the rural industry on the best long-term workable solutions for the sector through favourable policy initiatives, subsidies and support to maintain a vibrant rural economy.
“Infrastructure plays an insurmountable role in the rural economy’s success. This is not just about transport networks, but connecting people, communities and businesses to enable the construction of much needed homes, energy grids and inward business investment.
“As part of measures announced, we would like to see an equal weight placed on local infrastructure projects to that of large-scale national ones, bringing the decentralisation agenda to life by connecting and improving UK regions up and down the country where investment is long overdue,” Mr Jones concluded.
