Calls to Chancellor not to forget vulnerable in bid for economic growth

With the pain of recession still affecting consumers and businesses, all eyes will be on the Chancellor on Wednesday as he delivers his Budget. The WMN asked a cross section of Westcountry residents what measures they would like to see included.

The Bishop of Exeter, the Rt Rev Michael Langrish said: "The welfare reforms will have difficult, if not destructive, effects on many people in the UK, especially those who are already vulnerable because of age, income or ability. It is essential that the Budget includes a systematic review of both the intentional and unintentional consequences of these changes for Devon's communities. It is important to point out that welfare spending as a proportion of taxation has actually remained stable not increased, for the last 20 years.

"Our Diocese, as part of the Church of England, is increasingly supportive of 'The Living Wage' campaign, and the Budget should acknowledge that for many people the incomes they receive are not realistic, especially in traditional low-wage counties such as Devon.

"The economy of Devon is already marked by a large number of small and microbusinesses. Improving opportunities and mechanisms for start up loans and investment would be particularly helpful to rural communities.

"High house prices, the lack of affordable housing and access to mortgages for first time buyers remain challenges for a county like ours.

"The overseas aid budget should not be cut. Along with others supporters of the 'IF' campaign, I would call on the UK Government to deliver on its commitment to spend 0.7% of gross national income on aid from 2013."

Jim French, chairman and chief executive of Exeter-based airline Flybe, said: "The UK economy desperately needs to start growing again and all serious commentators agree that the regions, like ourselves in the South West, can be engines of that growth. That's why I'd like to see the Chancellor reform Air Passenger Duty to benefit the hard-pressed regions. He can do this in two ways; firstly by drastically reducing the amount paid outside London or secondly by addressing the scandal of the 'domestic double-hit' where passengers pay tax both ways on flights within the UK, while those travelling abroad only pay tax in one direction."

Sally Hurst is the founder of the Kingsbridge-based Old Bag Company which has won numerous industry awards for its colourful holdalls since its launch in 2005.

She said: "Life as a small business is tough so I hope the Budget is going to encourage entrepreneurship and stimulate economic growth in the UK. I would like to see increased access to funding for small businesses and business taxes cut. Also, I have been hearing about "crowd funding" recently. I think there should be more opportunities and tax incentives for ordinary people to be able to make modest investments in small businesses and this should be encouraged by the Chancellor.

"VAT is too much! For years, VAT stayed at the same rate until recently. The current rate of 20% is too high and should be reduced. Consumers are struggling enough without having to pay 20% more.

"Making it easier and cheaper to employ staff in small businesses by giving tax relief on national insurance when there are fewer than 10 employees for the first three years of a business would encourage employment.

"On a lighter note, there is no VAT on "essential" items such as bread and milk – well I think the Chancellor should recognise handbags in the same way, after all they are "essential" to all us women."

Exeter-based pensioners' campaigner Bob Turner said: "1.7 million pensioners already live in poverty. This Budget provides a valuable opportunity for the Chancellor to address this scandalous situation and avoid the inevitable increase if he continues his current fiscal path. George Osborne should, as a minimum requirement: reduce fuel duty; scrap the withdrawal of extra personal allowance for those turning 65 after April 5 and the so-called Granny Tax, which will deprive pensioners of £3.5 billion of income over the next five years.

"The Chancellor should introduce greater controls on rocketing utility prices and force utility providers to offer their 'cheapest' tariff offers as all options are increasingly unaffordable. Never has the expression 'eat or heat' been more appropriate."

Claire Wright, independent East Devon District Councillor for Ottery St Mary, said: "Tax should be much higher on second homes. You wonder why the Government wants to build so many more new homes when there are so many second homes that are empty. It makes no sense. On the one hand the Government says it has no money, and on the other it seems to have a bottomless pit when it comes to building homes.

Also I would ask why the Government is spending more than £30 billion on the environment-destructing HS2 (High Speed 2 railway) when they are simultaneously taking away £30,000 from local councils' funding."

Will Ashworth, managing director of the Watergate Bay Hotel, said: "He should tell everyone that VAT on hotels will be cut in half – but I anticipate he won't say that. I would like to see the Government continue to see SMEs as the key area for growth. He should do more to assist SMEs who, in this country, employ the vast majority of people. We want to continue to invest but we want to do so in an environment that is friendly to us."

Peter Symons, partner of Stags, Westcountry estate agents, said: "I'd like to see the Government beef up its schemes to encourage first-time buyers and help them financially. This would have a knock-on effect all the way up the property ladder and boost the whole property market. Stamp Duty currently rises at £250,000, £500,000 and £1 million. I'd like to see this rise on a sliding scale instead of making such marked jumps, as the current arrangement has a choking effect on the market around these price points. Finally, the current legislation making estate agents do all sorts of ID checks on vendors to prevent money laundering is doing nothing to stop criminals, so I'd like them to get rid of this unnecessary and pointlessly expensive red tape."

John Endacott, partner at Francis Clark, said: "Falling real living standards is both a big political issue and a reason why consumer spending remains depressed. I think the Chancellor will be determined not to add to inflationary pressures and may try to counteract the impact of the falling pound. I expect to see further action to limit fuel duty increases, lower alcohol duty and other more minor indirect tax changes to try and get inflation down. I also expect measures to try and increase housebuilding especially affordable housing. Such measures are probably more medium term so I think George Osborne will have some more short term announcements – maybe through grants or soft loans to housing associations."

James Staughton, managing director of St Austell Brewery, said: "I would like to see the Chancellor lower taxes in order to create more jobs and help lead the county out of recession.

There are three taxes which he should target. First to freeze duty on beer and scrap the beer duty escalator which is an unfair tax that isn't increasing revenue for the Treasury.

"Second, to increase the rateable value on which small business rate relief is applicable in order to help a number of hard pressed licensees.

"And finally he needs to do something radical such as reduce VAT on alcohol, food and accommodation to 5%. The licensed trade is arguably the best placed industry to employ people at short notice and a reduction in VAT would encourage people to eat out more often thereby creating more employment."

Jilly Greed, founder of the Ladies in Beef marketing group, farms at Thorverton, near Exeter. She said: "Rural and farm businesses seeking to up-scale to achieve economies of size and overheads, need policies which generate confidence and stability, not short-term quick fixes to much bigger economic problems.

"While the two-year extension of Capital Allowance Tax relief is encouraging investment in machinery, it does not necessarily mean a boost to British manufacturing, as many market-leading tractors and other farm equipment are produced outside the UK and imported.

"Where the Government could make a difference is by reinstating Agricultural Buildings Allowance with a 10% annual tax relief written off over a ten-year period.

"This would enable farms to scale up, create infrastructure and increase food production on a sustainable basis. This would boost local rural businesses, as most farmers use local construction companies and local labour forces.

"Furthermore, by widening tax allowance to other classes of assets, such as fences, concrete yards and cow tracks, there would be investment in long-term permanent assets which are excluded at present."

Clive Scott, chief executive of Barnstaple-based manufacturer Aero Stanrew, said: "I think the Government has done quite a good job in changing the rules to support research and development but I don't think they have gone as far as they could do. The (R&D) benefits are sufficient that it has changed our behaviour. If there were more grants and incentives there, we would do far more. We don't want to have our hands out, per say, but there are projects that are marginal it does make a difference if you think you're going to get support for it."

Clive Woodward, managing director of Bude-based manufacturer Bott, said: "There has been a swing in terms of how we are doing on state expenditure. The focus needs to switch toward capital projects and away from employing people to do nothing. Overall, the size of the state has to be cut and, at the same time, it would be good to have a drop in taxes to push the economy along. There is too much state and it needs a (political) party to be big enough to stand up and say 'that needs to change'."

Matthew Lee, managing partner at Bishop Fleming, called for measures including: exemption from National Insurance in the first year of trading; tax relief on private medical insurance; fuel-duty stabiliser; scrapping universal benefits for the elderly and boost basic state pensions instead; the removal of stamp duty on all property purchases for a year; Exempt all building work from VAT for a year and committing to spending on infrastructure investment. He said: "George Osborne is in a cleft-stick: he has nailed his colours to an austerity mast, but he still has the scope to make a real difference for South West businesses in his March Budget. I accept that George Osborne is faced with a massive political challenge. He will be reluctant to accept that his policy is failing, so he will look for every reason to make no change: but the reality is that he must make some changes if he has any hope of re-invigorating the economy."

Valerie O'Neill established her Tavistock-based 'around a pound' shop with husband Piers two years ago, in a business volte-face, after recession hit the luxury skincare outlet she launched in 2010.

Mrs O'Neill, who also co-ordinates the town's food bank, which launched a year ago would like to see red tape simplified for small business along with further pressure on the banks, saying: "We're VAT registered and paying VAT is incredibly difficult when you are new to running a business. Also, the banks are still not willing to lend. They are very cautious and while we have very good accounts to show them, they are still reluctant.

"In terms of needs in the community, the biggest percentage in demand for our food bank is not from people out of work, but those on low incomes.

"Many people working and earning are falling through the net.They are not entitled to free school meals or transport. They need to use the food bank in order to feed their families.

"In order to help the 'working needy', I'd like to see the rules and the processes on benefits reviewed in the Budget. I'm no benefits expert, so solutions may be in place already in the complex world of benefits, but all too often we see a sector of the community who go out to work, but earn just over the threshold for any benefit assistance and can't meet their daily living costs on their wages. This seems grossly unfair. If I was being radical, I'd like to see free school meals/transport for all children."