All-Party Parliamentary Group (APPG) Report sets out £43bn Economic Blueprint to Revitalise Rural Economy
|
Report concludes that no government in recent memory has had a
program to unlock the economic and social potential of the
countryside. Sets out how to improve productivity in rural
businesses, adding £43bn to the UK economy. Evidence from
over 50 bodies found that planning, tax, connectivity, skills,
agricultural policy, and lack of ministerial direction is holding
the rural economy back. CLA President, Mark Tufnell: ‘For
too long, successive...Request free
trial
The All-Party Parliamentary Group (APPG) on the Rural Powerhouse has published a report on how to level up the rural economy. It follows one of the most comprehensive inquiries ever to be conducted by a parliamentary body into the health of the rural economy. The APPG took evidence from over 50 industry bodies, charities, campaign groups, companies, academics, and business leaders. The report concluded that no government in recent memory has had a program to unlock the economic and social potential of the countryside. This has resulted in the fact that the rural economy is 18% less productive than the national average. A gap that, if reduced, could add £43bn to the UK economy. Findings from the report included: (1) a broken planning system has failed those who live and work in rural areas, (2) Defra lacks the policy levers necessary to make a significant change to the rural economy, (3) lack of skills provision is causing rapid ‘brain drain’ in rural areas, (4) urgent action is required to address labour shortages and supermarkets’ price-setting powers, (5) government is backing away from commitments to provide everyone with full-fibre and 4G and (6) the tax system disincentivises business investment and diversification. Co-Chair of the APPG on Rural Business and the Rural Powerhouse and MP for York Outer (CON), Julian Sturdy stated: “This report sets out a comprehensive growth plan, one that will create jobs, spread opportunity and strengthen small towns and villages across the country. We recognise the unique set of challenges that the Government is facing at the moment, but this makes the need to grow and strengthen the rural economy more, not less important.” Co-Chair of the APPG on Rural Business and the Rural Powerhouse, Lord Cameron of Dillington (Crossbench) stated: “It is vital that government understands that rural Britain is not a museum, but instead is an important part of the national economy that deserves the chance to succeed. “The report provides an economic blueprint that will help any Government seize the capabilities of the countryside and create the long-term economic growth necessary to boost/enrich/enhance our rural communities – in a cost-effective and timely manner.” Mark Tufnell, President of the Country Land and Business Association, stated: “The country can no longer afford to ignore the potential of the rural economy and the prospects of the millions of people who live within it. Rural businesses are ready to expand, creating good jobs and opportunities for people from all walks of life – but a lack of interest from government is holding them back.” “Homes are often unaffordable for local families. Well-paid jobs can be scarce. And broadband can be painfully slow. All this means leads to an exodus of talented people who are too often forced to move to more urban areas.” The report findings were further compounded by the launch of the Government’s Levelling Up white paper, which made no mention of creating prosperity and economic growth in rural communities and did not include any specific policies to create it. The lack of ambition from the UK Government is leaving them facing political consequences. A recent poll of the UK’s five most rural counties commissioned by the CLA highlighted changing political voting patterns in rural areas. In the previous general election, 46% of correspondents voted Conservative. Voter intention is now 36% Labour and 38% Conservative, representing a 7.5% swing. The two parties are now neck and neck ahead of the local elections. The poll also found that 66% of people did not believe that the government was doing enough to create prosperity in rural communities. 80% said that a lack of affordable housing was driving young people out of the countryside, with almost half (42%) agreeing that their community was worse off economically, compared to five years ago. With no concrete plan to support rural communities, the APPG report is intended to serve as an economic blueprint for the countryside. Recognising the impact of the pandemic on the nation’s finances, most of the recommendations are low-cost, requiring only a change in policy – and, in many cases, a change in how the government thinks about the countryside. Rural Britain is not a museum. It is an important part of the national economy that deserves the chance to succeed. Key policy reforms to boost rural productivity include:
On average rural jobs pay less than urban jobs, rural homes are less affordable than urban homes, and poverty is more dispersed in rural areas. While the depth of rural fuel poverty is more extreme than those facing similar circumstances in towns and cities. Skills training and public services are harder to access – as is good internet connectivity. -- Ends -- NOTES TO EDITORS:
APPG Report Summary Planning The planning system is failing those living and working in the countryside, harming productivity. Applications for small-scale housing developments designed to sustain local communities and economies are routinely rejected. Those seeking to support local economic activity by converting disused old buildings into modern workspaces often face excessive bureaucracy and delay. The poor planning system means businesses are unable to move to a better location or expand, and farmers are unable to diversify their businesses – despite this being a government objective. Housing is particularly critical to solving the productivity gap. The more affordable houses in rural areas, the more likely that people can afford to live where they work, which keeps money in the community. The report found four causes of the rural housing crisis:
The report points to five main solutions:
Skills The inherent isolation of rural communities can make it difficult to access new skills and training opportunities. This is more concerning given the potential that emerging environmental markets have in transforming the rural economy – a lack of skills provision could mean the country is not able to capitalise on such opportunities. The report found the main challenges for skills in the UK were:
The report recommends that the Government:
For decision-makers, recognising the diversity of the rural economy and the wide range of business activities is vital. In Cumbria for example, 23% of GVA is in advanced manufacturing (much of it in rural areas), compared to 11% in tourism, which would not be expected given the perception of the LEP area and Lake District National Park as being primarily dependent on agriculture and the visitor economy. This is a common myth the inquiry has identified, and changing this perception is critical to increasing rural productivity. Farming Farming in the UK is going through the biggest change in agricultural policy in over sixty years, moving away from the EU to a new Environmental Land Management (ELM) scheme. During this seismic shift in the sector, the government has left farmers stranded as trade deals and policy decisions fail to support agricultural businesses. As the sector adjusts to these changes, the report targets key challenges that the Government must solve:
To improve productivity across the rural economy through agriculture, the report urges the Government to:
Connectivity There has been significant progress has been made in recent years in digital connectivity in rural communities. But its findings suggest there is cause for concern that the Government is now rowing back on promises to deliver full-fibre broadband and 4G for all. For rural communities to attract workers, support entrepreneurs and encourage economic growth, urgent action is needed. Connectivity issues that hold back productivity include:
To improve connectivity and productivity, the report urges the Government to:
Tax Like with planning policy, the Government’s one-size-fits-all approach to tax policy means rural communities are missing out on new economic opportunities. The inquiry heard repeated calls for simplification of tax policy specifically for those running multiple businesses and targeted support for businesses that could benefit from additional research and development (R&D). Key issues with the tax system for the rural economy include:
To improve the tax system and productivity, the report recommends:
Processes The evidence received by the inquiry pointed toward systemic failings in the Government’s rural policy development. There is no doubt of Defra’s ministerial team’s commitment to the countryside, but also that it did not have the policy levers at its disposal to make a meaningful difference in economic and social policies beyond farming and forestry. The APPG heard evidence that many of those other government departments that did have the powers necessary to generate economic growth in the countryside had a laissez-faire attitude towards rural policy-making. Efforts to rural proof policy-making are widely believed to have failed. As a result, a more targeted, cross-departmental, ministerial-led approach is necessary. Effective rural policy decision making is being held back because of:
Recommendations from the inquiry to improve rural processes include:
|