Thursday, 13 December 2012

Autumn Statement

Nine months ago Cornwall’s MPs were thrown into combat with the government after the Budget bowled a few unexpected problems our way, such as VAT on pasties. It took a couple of months to sort things out but we got there. So I was a little bit apprehensive last week as George Osborne got to his feet to deliver his Autumn Statement which is a sort of mini-budget. However, despite having very limited room for manoeuvre, this year’s statement contained some very good news for Cornwall.

Firstly, the planned 3p rise in fuel duty will not just be postponed as before but scrapped altogether. This is vitally important for a county like Cornwall because we are at the end of the line and our businesses have to transport their goods hundreds of miles to market which is a major cost and because many people who work cannot rely on public transport and have no option but to use their car. Filling up the car with petrol is a major cost for many families and I have always argued that fuel tax is a regressive tax that hits remote areas unfairly and we should be aiming to get these costs down.

Secondly, it was decided to accelerate the increase in the new tax threshold meaning that those struggling to get by on low incomes will be taken out of tax altogether. Again, this is really important to places like Cornwall where thousands of families work hard but have to rely on low incomes. It can’t be right to tax people on one hand only to have to give them some money back in benefits on the other. It would be better by far if you didn’t take their money in the first place so that there was more of an incentive to take a job.

There was also some good news when it comes to investment in roads and infrastructure to try to get the economy moving. The lesson from past recessions is that governments should try, as far as is possible, to maintain investment in infrastructure because, it improves future competitiveness and provides immediate short term work in construction. Here in Cornwall, the government has finally come up with the money to start work on dualling the A30 at Temple which will remove a longstanding bottle neck which causes havoc in the summer months. This has been talked about for years and it is a real vote of confidence in Cornwall that this work will now begin.

Finally, there was some good news for businesses as the government increased “capital allowances” substantially to encourage businesses to invest any profits they make into new machinery which will increase their productivity as well as giving a much needed boost to manufacturing.

George Eustice can be contacted at george.eustice.mp@parliament.uk or 1 Trevenson Street, Camborne, Cornwall TR14 8JD or by telephone on 020 72197032.