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Mar 2024

Last Updated: 06/03/2024

Local politicians and businesses react to Budget

by Flora Grafton

| 06 Mar, 2024

Chancellor Jeremy Hunt's Budget prompted a mixed response among local politicians and businesses today.

Mr Hunt's announcements included a 2p cut to National Insurance contributions, increasing the child benefit threshold from £50,000 to £60,000, raising the VAT registration threshold for small businesses to £90,000 and £3.4 billion for the NHS.

We asked local politicians and businesses to respond to give their verdicts.

Andrew Jones: Budget will drive 'economic growth for years ahead'

Andrew Jones, Conservative MP for Harrogate and Knaresborough, praised today's Budget.

He said the fall in inflation from 10% to 4% had allowed Mr Hunt to "further ease the tax burden for thousands of working people in Harrogate and Knaresborough".

He also welcomed the extension of the Household Support Fund for a further six months, which he said has "helped many households in my constituency who have struggled with the higher cost of living".

Mr Jones said:

"It is good to see that the representations North Yorkshire Council made to the Chancellor highlighting the scheme's positive impact have been heard.

"Following the cut already announced in last year's Autumn Statement, today's news of a further cut for National Insurance contributions means a saving of £900 for the average worker earning £35,400. There have been other measures to reduce the cost of living which include maintaining the cut in fuel duty and the freeze of alcohol duty which will also help the hospitality sector."

Mr Jones also said he "strongly supports" the additional NHS funding, which will go towards improving technology and IT systems.

He added:

"I have heard first-hand from many clinicians and those working in the NHS about how their IT systems are slow and out-of-date. This investment will free up clinicians to carry out more procedures and for different parts of the NHS, such as hospitals and GP practices, to better communicate with each other.

"The economic forecasts have been upgraded and there was some very positive news on investment from businesses, plus measures to boost business investment further. This was a budget which will drive economic growth and strengthen resilience for the years ahead."

Lib Dem labels Budget a 'desperate deception'

But Tom Gordon, the Liberal Democrat parliamentary candidate for the Harrogate and Knaresborough Liberal Democrats, criticised the Tory government's financial plans.

Mr Gordon said the Budget will "barely touch the sides" for local families and pensioners who face "soaring mortgage bills while the cost of the weekly shop goes through the roof".

He added:

“People in Harrogate and Knaresborough know that their tax bills will remain sky high after this Budget, and the Chancellor is attempting a desperate deception after years of income tax hikes.

“People don’t want more Conservative empty promises while our local health services are left on their knees. They want proper change through a general election so we can kick this Conservative government out of office.

“It’s clear the choice locally at the next election will be between the out-of-touch Conservatives or a fresh start with the Liberal Democrats.”

Budget shows 'little to directly benefit' Knaresborough businesses

Knaresborough and District Chamber of Trade said it sees "little to directly benefit our businesses" in the town.

A spokesperson for the group said:

“Perhaps the headline for the sector is the increase in the VAT threshold from £85,000 to £90,000, but this increase falls well below increases in inflation over several years since the current level was set.”

The chamber acknowledged the town had “recently benefitted” from levelling up money, delivered through the Shared Prosperity Fund, and said the viability projects funded by this money could “significantly increase future footfall” in the town, adding:

“It would therefore increase economic prosperity, so perhaps there is something in the small print that commits to continued support to such projects, but the underlying trading conditions for many of our town businesses will see little short term benefit from this Budget.”

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Local brewery welcomes alcohol duty freeze

A Masham brewery praised the extension of the alcohol duty freeze.

Mr Hunt had planned to end the alcohol duty freeze in August, but today announced it would continue until February 25 in a bid to support hospitality venues.

Richard Bradbury, managing director of Theakston's Brewery, welcomed the Chancellor's decision against a backdrop of "continually rising running costs for pubs".

He added:

"From increases to the national minimum wage, rising energy costs and reduced spending due to the cost-of-living crisis, the pressures pubs face continue to mount so it is a comfort to know that at least one cost is held.

"According to the Campaign for Real Ale, more than 1,200 pubs have closed in the past year alone so measures which give pubs a fighting chance to survive should be welcomed.

Ripon BID feels alcohol freeze 'does not go far enough'

But Ripon Business Improvement District felt the extension was not sufficient.

It told the Stray Ferret the pause “does not go far enough for the hospitality industry”, and said it “echoes” the concerns of The Campaign for Pubs, which aims to protect and support local pubs.

The BID added:

“The campaign called on the government to introduce a VAT cut to at least 10% on all hospitality sales for a year to benefit all pubs, rather than only those offering food and accommodation.

“It also proposed to extend zero business rate relief to small brewers and producers, as well as to take further and “more meaningful action” on reducing energy bills for businesses."

However, Ripon BID felt “none of this appears to have been addressed in the Budget”.

It concluded:

“The raising of the VAT threshold to £90,000 from April 1 is welcomed, but with a previous seven-year freeze perhaps it will not have the impact first perceived.”

Other key changes in the Budget included a new excise duty on vapes to discourage young people from vaping, as well the abolition of multiple dwellings relief in June and a 40% relief on business rates for the film industry.