Spring statement: What co-ops need to know

Chancellor Philip Hammond announced new policies around housing and digital businesses which could impact some co-ops

Chancellor Philip Hammond presented his spring statement to MPs yesterday, updating the house on the state of the economy.

While there were no significant announcements on tax and spending, he pledged £26.6bn to boost the economy should MPs vote to leave the EU with a deal. He warned that the country would face significant disruption in the short and medium term if it left without a deal.

The chancellor is also going ahead with his push for a digital service tax to pool money from online retailers and relieve pressure on high street retailers. A consultation on the levy will open on 1 April.

Ed Mayo, secretary general of Co-operatives UK, said: “Despite the headlines of mass spending if crisis hits, the spring statement is an ordinary budget in extraordinary times.

“It is as if to reassure us that government goes on while parliament is in confusion and our relationship with trading partners is in tatters. There is an economic cost to pay for all this, because businesses tend to benefit from stability and lose out when there is volatility.

“Co-operatives are no different, even if we are here to meet needs rather than benefit investors. Working with our partners, we will be calling for action by the chancellor to invest in communities, urban and rural, that are losing out, with the release of funds that used to be spent though EU programmes into more local community control.”

Mr Hammond made a number of announcements around the government’s housing policy, including a new £3bn scheme of borrowing by housing associations in England to support delivery of around 30,000 affordable homes.

Nic Bliss, head of policy at the Confederation of Co-operative Housing, said: “Generally, anything that leads to more homes being built or brought back into use has to be a good thing. So funding for affordable housing is a good thing. It may also be welcomed that the housing association Right to Buy is parked due to lack of funding although some housing association tenants would not agree with that.

“But for us in the community led housing sector – the boost that the government’s Community Housing Fund has already given us is the major issue and we continue to work with government and others to ensure that it leads to the several thousand community homes that it could deliver.”