Following the announcement of today’s budget Cumbria Tourism, the county’s official Local Visitor Economy Partnership, and its members have reacted to Labour’s plans for the future of the British economy.
Cumbria Tourism members were watching the budget carefully as Chancellor of the Exchequer, Rachel Reeves delivered her October statement to the nation, where a number of financial changes will have immediate impact on the tourism and hospitality sector.
According to Cumbria Tourism’s most recent business tracker survey, sponsored by strategic partner, Lamont Pridmore, over 71% of businesses in the county were facing on-going challenges due to a number of factors, amongst these being staffing and operating costs.
Gill Haigh, managing director of Cumbria Tourism said: “Cumbria’s visitor economy is a priority sector within the county. It generated £4.6 billion to the economy in 2023 and supports around 45,000 jobs. As well as providing employment and being of economic importance, the visitor economy has a wider and significant role to play in supporting Cumbria as a place to live, work, study and invest. 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.
“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.”
Haigh continues: “The government also plans to deliver more affordable housing and more planning officers which is vital to our industry, as 72% of our businesses have reported lack of housing and affordable accommodation is issue in recruiting and retaining staff. Overall though, business has been hit hardest by the budget and this will cause significant concern. We look forward to receiving further detail on these announcements in the coming days.”
Cumbria is one of the UK’s leading tourism destinations with businesses in every area set to feel the pinch. Amongst those commenting on today’s budget implications on their business are:
Graham Lamont, CEO at leading Cumbrian accounting firm Lamont Pridmore, who said: “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. 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.”