Investment critical for sector's future

As we argued earlier this year, if politicians are serious about rebalancing the economy to give those who "produce" the recognition they deserve, a prerequisite will be the offer of fast and effective business assistance.

Without it - whether tax incentives, funding for R&D, allowances for investing in equipment or other measures - talk of rebalancing the economy will remain an empty sound-bite set against, in horticulture's case, another year of decline in farm and nursery production.

Next Wednesday's budget will provide the Government with a clear opportunity to show how serious it is about achieving this objective, with emergency measures to keep industry on its feet.

Meanwhile, longer-term (but no less urgent) measures must be formulated reflecting the complete rethink required to rescue applied R&D - the lifeblood of all productive industries in the UK, not least production horticulture.

The good news is ministers have already shown that they can sometimes get things right for business - witness the Government's recent pledge to allow firms to defer payment of part of this year's increased business rates. For any business to shell out now on a rates increase based on last September's lofty retail price index would have been damaging - but particularly so for firms where every cost is eating into future investment in critical equipment and technology.

But there is also an urgent need for more effective incentives for such investment at a time when the focus is on short-term survival. Add to that the relatively small scale of most production horticulture businesses and the task of buying into the kinds of technologies that will ensure their future becomes almost Herculean.

The Engineering Employers Federation has called for a temporary increase in the Annual Investment Allowance from £50,000 to £250,000 for one year. This kind of measure could help UK production horticulture too - particularly in the face of competitors who enjoy vastly superior financial support from their governments.

But so much more could be done if Defra could be persuaded to put its responsibility for supporting production horticulture first - rather than focusing on the sector's environmental impact.


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