Budget 2023: Rural communities being held back by government apathy says CLA

The key points that could affect businesses and residents in the countryside are that pension lifetime allowance is abolished, pension annual allowance is increased from £40,000 to £60,000 from April and there are no changes to frozen income tax thresholds.

Other aspects are that fuel duty is frozen at reduced rate for a further year, the Energy Price Guarantee is extended until June, childcare support could help farming families and there is a freeze on draught beer duty in pubs,.

Sean McCann, Chartered Financial Planner at NFU Mutual, said: “We welcome the Chancellor’s decision to abolish the limit to how much you can accumulate in your pension over your lifetime, as it will help farming families plan for succession.

“Pensions provide an independent source of income in later life separate from the farm, which makes it easier for farmers to gradually step away and hand over more of the day to day management to the next generation."

Chris Walsh, Farm Specialist at NFU Mutual, said the freeze on fuel duty would be welcomed as farmers and rural communities rely more heavily on fuel than their urban counterparts, whether that is using red diesel for agricultural work, or white diesel and petrol for transporting produce around the countryside.

The energy price guarantee was also welcomed as rural areas had a higher fuel poverty rate (15.9%) last year than those in towns and cities and rural households are usually less energy efficient.

However, CLA President Mark Tufnell said it was “difficult to see what – if any – ambition the government has for the rural economy”.

He said: “The rural economy is 19 per cent less productive than the national average. Closing this gap would add £43bn to the national economy. Nothing in this budget will unlock that vast potential.

"The government needs to show it is on the side of hard-working rural families and business owners, that it matches their ambition and is serious about growing the economy. They need urgently to come forward with a robust plan that will remove the considerable barriers rural businesses, and communities, face to their future success.”

The definition of agriculture to include environmental delivery for Inheritance Tax purposes is under consideration to change and would benefit farmers in line with the need for more environmentally friendly farming.

Mr Tufnell added: “The CLA has campaigned extensively to change the definition of agriculture in the tax system to include ecosystem services.

"It is vital to give farmers and landowners the confidence they need to engage with environmental delivery, improving biodiversity and carbon sequestration. Without this change, we will see a perverse outcome whereby forward thinking, nature friendly farming will be punished by the tax system.”