Our response to the Chancellor's Spring Budget

15 March 2023

Jeremy Hunt’s first full budget as chancellor aimed to support the public finances during a cost of living crisis while also trying to win over voters before the next general election.


In it he revealed that inflation will fall to 2.9% this year along with a raft of measures, including additional free childcare, tax relief for pubs and a rise in defence spending. For food and drink businesses he announced a replacement to the super deduction as well as extending the climate change agreements.

But Labour's Sir Keir Starmer says the government is offering "classic short term sticking plaster" solutions to the UK's economic problems.

Chief executive of the Food and Drink Federation Karen Betts said: 

“We recognise the very challenging context in which the Chancellor has delivered today’s Budget.  He has delivered important support to consumers through maintaining the energy price guarantee at £2,500 and through his commitment to continue to help bring down inflation.

"From a food and drink business point of view, it’s good to see the announcement of full expensing – this is a welcome boost to businesses investing in technology across our sector, and supports increased productivity. We also welcome the decision to extend the current climate change agreements for two years. This provides certainty for businesses as they invest in energy efficiencies, and time to design a smart replacement scheme.

“Likewise, the measures announced to encourage people back into work are timely, but with vacancies in food and drink manufacturing double the national average, our sector needs more help, for example hands-on apprenticeship support for SMEs, to ensure labour shortages aren’t a drag on growth nor a risk to the resilience of the UK’s food and drink supply chain.  It’s disappointing too that the Chancellor passed up the opportunity to reform the Apprenticeship Levy, which would have enabled companies in our sector to use levy funds in more flexible ways to help ensure they have the right workforce they need to succeed.

“It’s also vital the Chancellor ensures our sector’s future resilience is supported through good regulation, which creates investment opportunities and jobs.  Here we need government to match our industry’s ambition to reform recycling for everyday plastics and packaging. Current government plans for the introduction of Extended Producer Responsibility and a Deposit Return Scheme fall a long way short of international standards, and do not dovetail with the troubled Plastics Packaging Tax. If they are not careful, government action is about to force avoidable additional costs onto consumers right at the time we’re all working to bring down inflation.”

You can read about the FDF's Budget submission here.