Cost of doing business in environmental horticulture – HTA urges action in Spring Statement

15 February 2024

The Horticultural Trades Association (HTA) has set our clear asks to the Chancellor of the Exchequer ahead of the Spring Statement 2024. The HTA represents approximately 1,400 businesses in the UK's environmental horticulture industry and calls for urgent action to ensure the sector's growth, which makes vital contributions to the economy and environment and delivers on net zero.

Fran Barnes, Chief Executive of the HTA, said:
"The environmental horticulture sector is at a critical crossroads. We urge the Chancellor to secure resources and readiness funding for the impending border and trade changes that are now just ten weeks away at the peak of our trading season, facilitate support and grants to successfully and sustainably support our members to transition to peat-free growing media, reduce financial and regulatory burdens on SMEs, address retail crime, and enhance accessibility to apprenticeship levy funds. 

“Many businesses are grappling with a surge in trade costs, wage increases, and wider inflation, which poses a serious threat to the sector's viability and growth. Our SMEs are pivotal to the country's economic and environmental landscape, as they generate employment, promote health and wellbeing, deliver green spaces, and support environmental sustainability goals. Around 95% of our sector comprises SMEs, so it is imperative for the government to extend its support to overcome challenges and foster growth.

"Whilst the end of 2023 saw inflation rates decrease slightly, we understand the ongoing fiscal constraints and uncertainty in which this Budget statement is set.  As a result, our submission highlights the need for practical and targeted investments and support and the reduction of unnecessary bureaucracy that detracts from sector investment. Tackling just some of these would help eliminate barriers to growth within the industry, ultimately leading to positive outcomes for the UK economy and environment.

"Our members have shown remarkable resilience. We are one of the few sectors where weather and climate impact our entire supply chain, including growers, landscapers, and retailers. Last year delivered the wettest March in 30 years, the warmest June since records began, and a July with very little sunshine. Already this year, in just a matter of days, businesses have dealt with storms, heavy rainfall, and flooding. Additionally, international uncertainty, for example, in the Red Sea, will likely increase costs.

"We look forward to seeing what certainty and confidence the Chancellor will bring. The association is ready to engage further with government officials, facilitating discussions or site visits to highlight the industry's key economic issues."

The HTA's key priorities for government action include:

Resourcing and delivering borders and trade changes: A smooth import process is critical for the industry's operations. The HTA calls for a temporary easement of Place of Destination checks for plant trade until at least the end of January 2025, alongside readiness funding for impacted businesses. Streamlining border processes and ensuring adequate resourcing are essential to prevent disruptions and enable competitiveness.

Supported and sustainable transition to peat-free growing media: Urgent review of the early peat ban policy is necessary to mitigate adverse impacts on plant production and job losses. The HTA advocates for a return to the agreed 2030 date for professional growers and matched support funding for SMEs to transition to peat-free alternatives. Increased R&D support and transition grants are essential to facilitate a successful transition.

Reducing financial and regulatory burdens on SMEs: The HTA seeks urgent action to alleviate financial and regulatory pressures on SMEs. Recommendations include exemptions from Biodiversity Net Gain regulations, longer-term business rates relief, and investment in water resilience and energy efficiency measures. Addressing wage bill increases and freezing the business rates multiplier is also imperative to support SMEs' sustainability.

Continued action on retail crime: The HTA highlights the significant impact of retail crime on the sector and calls for enhanced government action to protect retail businesses. Provisions for police responses to theft incidents, particularly in rural areas, are crucial to safeguarding businesses and ensuring competitiveness.

Increase accessibility to apprenticeship levy funds and action on skills: Wider reform of the Apprenticeship Levy is necessary to make funds more accessible to SMEs and promote apprenticeship uptake. Collaboration between government and industry is essential to identify skill gaps and ensure adequate skills provision within the horticulture sector.

Click on the resource below to read the letter.