Chancellor Rachel Reeves’s 2024 Autumn Budget introduces wide-reaching reforms aimed at promoting investment and economic stability while addressing social inequality. While many provisions have been broadly welcomed, their implications for small businesses, particularly in the gardening and horticulture sectors, present a mixed picture. Here's how the key changes may affect the industry.  

 

 

Positive Moves for Employees and Wage Growth

The Budget’s increase in the National Living Wage is a significant development. From April 2025, workers aged 21 and over will earn at least £12.21 per hour, a 6.7% rise from £11.44. Younger workers and apprentices will also benefit, with their minimum rates increasing substantially.  

This increase is a welcomed boost for employees in labour-intensive sectors like landscaping and horticulture. It raises the living standards of those at the lower rungs of the wage ladder, potentially improving worker satisfaction and retention.  

However, this also adds financial strain to small businesses, which make up 98% of the UK horticulture sector. Labour costs are a substantial portion of operating expenses, and businesses will need to find efficiencies or adjust pricing to absorb these increases.  

 

 

National Insurance Changes: A Double-Edged Sword

From April 2025, employer National Insurance Contributions (NICs) will rise from 13.8% to 15%, and the threshold for contributions will drop from £9,100 to £5,000. These changes, though offset somewhat by the doubling of the Employment Allowance to £10,500, increase costs for businesses employing staff.  

The increased Employment Allowance is a relief for smaller firms, particularly those operating within tight margins. Gardening businesses should ensure they take advantage of this benefit to mitigate rising NICs. However, for larger horticulture enterprises exceeding the eligibility limits for the allowance, the impact will be more pronounced.  

 

 

Investments in Housing: Opportunities for Horticulture 

The Budget allocates £5 billion to deliver a national housing plan and raises the Affordable Homes Programme’s funding to £3.1 billion. This commitment to housebuilding could create significant opportunities for the gardening and landscaping industry.  

New housing developments often require landscaping services, green spaces and sustainable outdoor designs. There is a strong call for these projects to incorporate green infrastructure maintained by UK horticulture businesses.  

This focus aligns with growing consumer demand for eco-friendly spaces and could provide a significant boost to UK businesses involved in garden design, maintenance and supply chains for landscaping materials.  

 

 

 

 

Tax Adjustments: Challenges for Landowners and Farmers 

Farmers and horticultural landowners face challenges from the reforms to Agricultural Property Relief (APR) and Business Property Relief (BPR). Starting in April 2026, the full 100% inheritance tax relief will only apply to the first £1 million of combined APR and BPR, with the remainder taxed at 20%.  

The government argues these changes make the tax system fairer, as currently, much of the relief benefits the wealthiest estates. However, farming groups, including the National Farmers’ Union (NFU), have expressed concerns. They argue that many farms, especially commercial ones exceeding 50 acres, could be adversely affected.  

For horticultural businesses, these changes could impact generational succession planning. However, provisions such as the ability to pay the tax in interest-free instalments over ten years may alleviate immediate financial strain.  

 

 

Fuel Duty Freeze: A Welcome Relief 

The Chancellor’s decision to freeze fuel duty for another year and maintain the temporary 5p cut is a welcomed measure for horticulture businesses reliant on vehicles for transporting tools, plants and supplies.  

Fuel remains a significant operational cost for many small gardening firms. This measure provides stability and cost predictability, particularly as energy prices remain volatile.  

 

 

A Push Towards Sustainability

The Budget includes significant green investment initiatives, including funding for 11 green hydrogen projects and a £3.4 billion Warm Homes Plan to support heat decarbonisation.  

For the gardening industry, these green initiatives signal a broader push towards sustainability. Businesses offering eco-friendly products or services, such as sustainable garden designs, drought-resistant plants, or energy-efficient lighting for outdoor spaces, may benefit indirectly as demand for sustainable solutions grows.  

 

 

Mixed Signals on Business Rates 

The continuation of business rates relief for retail, hospitality and leisure properties at 40% in 2025/26 offers some relief for garden centres and nurseries. However, the gardening sector’s repeated calls for a full reform of the business rates system remain unaddressed.  

Horticulture businesses in Scotland, where rates relief differs, may face additional challenges compared to their English counterparts.  

 

 

The Cost of Flexibility

The horticulture industry’s seasonal and physical nature means flexibility in job structures, such as shorter work weeks or job sharing, could make positions more attractive. However, rising wage and tax costs may discourage businesses from adopting these measures in the short term.  

 

 

Inheritance Tax Changes: Implications for Farms and Estates 

The changes to inheritance tax relief on agricultural and business property are another contentious point. While the government highlights that most estates will remain unaffected, the NFU argues that up to 75% of commercial farms could feel the impact.  

For smaller horticulture businesses, these reforms may lead to reconsiderations of ownership structures. However, the ability to pass on assets tax-free up to £3 million for couples may still provide a viable route for intergenerational transfer in many cases.  

 

 

Strategic Responses for Gardening Businesses 

To adapt to these Budget changes, gardening businesses should:  

• Reassess Budgets: Factor in rising NICs and wages to align cash flow with higher costs.  

• Claim Reliefs: Ensure eligibility for Employment Allowance and business rates relief to mitigate financial strain.  

• Leverage Green Opportunities: Align services with sustainability trends to tap into growing demand for eco-friendly solutions.  

• Plan for Tax Changes: Consider the timing of property sales or inheritance tax planning to minimise future liabilities.  

• Engage in Local Housing Projects: Seek contracts linked to government-backed housing developments. 

 

 

 

The 2024 Autumn Budget presents a mixed bag for the gardening and horticulture sector. While higher costs loom large, opportunities abound in housing, sustainability, and infrastructure investments. For small businesses, strategic planning and adaptability will be essential to navigating these changes and thriving in the evolving economic landscape.