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From the editor: Farm businesses facing up to a raft of operational changes

If you believe Chancellor Philip Hammond’s Budget speech this week, the age of austerity is finally at an end.


Ben   Briggs

Ben   Briggs

With cash windfalls for the NHS, pledges on house building and tax cuts for millions of voters, it seems he has been able to cast off some of his fiscal caution.

 

For farmers, however, the outlook is not so clear. The rise in the National Living Wage from £7.83/hour to £8.21/hour from next April will put extra pressure on employers as they look to hire workers in an increasingly squeezed labour market, not to mention the ongoing issues around access to migrant labour.

 

Next April, in fact, is set to be a time of transition for farm businesses and the way they interact with the state.

 

Not only will the minimum wage requirements rise, but tax is set to ’go digital’ from then as well, meaning VAT-registered farmers with a turnover in excess of £85,000 will be mandated to do their returns online.

 

Given the difficulty many have doing their Basic Payment Scheme applications online, a smooth transition is by no means a given.


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There are also concerns from some industry leaders about Universal Credit changes, which is a move by Government to draw together six benefit payments in to one scheme.

 

Already a source of anger in some sections of society – food bank use sometimes spikes in regions where Universal Credit is adopted – there are concerns the long hours of agriculture will exempt a proportion of farmers who previously drew down some of the existing benefits.

 

It is one thing for a swaggering Mr Hammond to proclaim that the Government is ready to throw off the shackles of financial prudence, yet it will take time to see what these changes mean for agriculture, particularly in the short-term.

 

It is clear the Government, with wage increases, tax reform and previous enforcement of mandatory adoption of pension schemes for employees, wants to place more emphasis on businesses rather than the state.

 

The age of austerity might be over for the Chancellor, yet many farm businesses could inadvertently face having to tighten their belts.

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