The leader of the body which represents 4,500 tourism businesses across Cumbria has offered a cautious welcome to the Budget.
Cumbria Tourism says the visitor economy across the county generated £4.6 billion in 2023 and supports around 45,000 jobs.
“The industry, which is made up of thousands of small businesses, is still recovering from the pandemic and cost of living crisis, so any increasing costs for businesses or reduced spend is concerning,” Gill Haigh, managing director of Cumbria Tourism, said.
“The increase to National Insurance contributions for employers will undoubtedly have an impact on businesses right across our county.
“As will the reduction in business rate relief alongside the national living wage increases. Meanwhile, there will be some relief for businesses in the shape of a freeze in fuel duty and the bus price cap remaining relatively low, both of which will hopefully keep visitors travelling to Cumbria.”
She added members looked forward to reading more details about government plans to deliver more affordable housing to help recruit and retain staff to tourism roles in Cumbria.
“The hike in the National Living and Minimum Wage has the potential to substantially disrupt the cash flow for Cumbria’s tourism businesses from April next year, which is only compounded by the increases in employers’ National Insurance contributions as well,” Graham Lamont, CEO at accountants Lamont Pridmore, said. “This could hinder the ability to recruit and retain the best talent. The decision to also immediately increase Capital Gains Tax rates, and the plan to reduce the support available via Business Asset Disposal Relief from April next year, means those business owners considering a sale in reaction to these higher costs will be taxed more in future when they come to sell.”
Others sounded a note of optimism.
“On the whole we were expecting the budget to be more unpalatable than it was, it’s good that the working staff will not see their pay packets affected by higher taxation, but the burden on small business is always a juggling act, the National Insurance increase may not be as high as we had expected, but added to higher energy costs, wage increases and inevitable higher commodity prices the squeeze on our margins is already tight,” Maria Whitehead, director of Hawkshead Relish Company, said. “I hope that people will now feel that the budget allows them to spend for Christmas and thus help small businesses like ours to thrive.”
“The promise to increase affordable housing in the budget is hugely welcomed and I hope that even small villages like Hawkshead will see the benefit of this plan in the coming years, there is so much that can be done with conversion of empty properties,” Maria added.
