The Chancellor has been keen to support the regions in his budget. In his words,
“If we are truly to build an economy that is fit for the future, then we have got to get all parts of the UK firing on all cylinders”.
Overall, the budget represented a fiscal loosening with considerable support for the economy in 2018/19, 2019/20 and 2020/21 in particular. This is presumably designed to help support the economy post-Brexit and Philip Hammond is focusing on capital expenditure which should have a greater multiplier effect so that he gets as much bang for his buck as possible.
Housing was a big story for the South West where lack of affordable housing is a huge problem. The Chancellor unveiled a series of measures designed support the construction of 300,000 new homes a year and bring about the biggest increase in supply since the 1970s.
The Chancellor wants to unlock housing development sites and to increase the supply of houses both for sale and social housing in the South West, where there are a number of prospective development sites, creating not only houses but also building industry jobs to benefit the local economy.
First time buyers in the South West, have cause to celebrate with stamp duty land tax on purchases up to £300,000 being abolished and with relief on the first £300,000 of the purchase price of properties up to £500,000.
Phillip Hammond’s other focus is on innovation and skills to boost productivity. There was recognition of the importance of new tech businesses, a big growth area in the South West, with the announcement of over £500m in a range of initiatives from Artificial Intelligence, to 5G and full fibre broadband. He also announced the allocation of a further £2.3 billion for investment in Research and Development (R&D) and increasing the main R&D Tax credit to 12%. As well as boosting investment in science education and skills.
There was good news for the region’s drink manufacturers with the Chancellor pledging to increase duties on so-called white ciders, but freeze charges on other ciders, wine and beer. There was more good news for the hospitality industry with an extension of the £1,000 discount for pubs with a rateable value of less than £100,000 for one more year to March 2019.
The public sector in the South West looks set to benefit with an additional commitment of resource funding of £2.8 billion to the NHS in England. This included £350 million immediately to allow trusts to plan for this winter and £1.6 billion in 2018-19, with the balance in 2020. He also announced plans to make over £1 billion of discounted lending available to local authorities across the country to support high-value infrastructure projects.
Other than the infrastructure announcement, there was nothing for roads and rail in the South West, there was some limited respite for travel costs with the fuel duty freeze and the extension of rail cards for everyone aged up to 30.