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6.6 pm
Mr. David Curry (Skipton and Ripon): I shall begin by pretending for a moment that there has been no outbreak of foot and mouth disease, and sketching the situation in agriculture and the rural economy that obtained before the outbreak began.
It is worth remembering that agriculture was already experiencing the worst economic crisis for a generation, and 24,000 jobs had been lost in the sector. The total income from farming in 2000 was at its lowest for 25 years. According to Countryside Agency figures, per capita income declined from £10,600 in 1998 to £7,800 in 2000. Significantly, agriculture's contribution to the national economy is now below 1 per cent. That puts the cost of dealing with the crisis in context.
The value of tourism to the English countryside is estimated at £12 billion, £9 billion of which derives from day trippers. Tourism supports 380,000 jobs, and in Yorkshire alone, 135,000 people--7 per cent. of the work force--earn their livelihood from tourism. The total revenue generated from tourism is £3.34 billion, and rural tourism generates £1.7 billion. Those figures also put the matter in perspective.
Before the foot and mouth crisis began, the tourist industry was already suffering from the high pound and poor weather. In addition, the fuel crisis and flooding problems had already made this a very difficult year for the industry.
One third of all England's businesses--just under 600,000 enterprises--are in rural areas. They are often very small, offering part-time or casual employment on a seasonal basis. Such businesses are now subject to a new set of impositions that have nothing to do with foot and mouth disease. In my constituency, for example, the aggregates tax will hit the quarrying industry, and the climate change levy will also have an effect.
The hon. Member for Workington (Mr. Campbell- Savours) set out the circumstances encountered by people in his constituency, and the situation in my area is similar. Employers who must pay additional fuel costs will not get them rebated through national insurance contributions because they do not pay such contributions in respect of a significant number of their part-time work force. In addition, local employers are having to deal with the red tape of administering tax credit, and there is a new threat that fuel prices will rise again. The cost of car use to rural households is estimated to be 25 per cent. higher than it is to urban households.
In addition, access to technological infrastructure is often difficult in rural areas. A constituent of mine in Malhamdale wanted to have an integrated services data network line installed to help him pursue his business, but he has been told that the cost would be in excess of £300,000.
In many rural areas, the quality of secondary education is extremely high--that is especially true in North Yorkshire--but the further education structure is often less good and requires real work.
There are also the particular problems of what I call the countryside's great hidden industry--the residential home and nursing home sector. Those problems arise from the inadequacy of funding for local authorities, which determine the level of fees payable to such homes. In North Yorkshire last year, 500 beds were lost. There has been an 11 per cent. increase in the national minimum wage. One can argue that such an increase is justified, but it cannot be passed on by a sector that greatly depends on fees paid by a public authority.
That sector is crucial in offering employment. It often buttresses employment in agriculture. The farmer's wife, for example, might work part-time in a care home, because care homes are the largest employers in some of the villages in my constituency. This is a crucial sector upon which the health service depends enormously to provide "seamless" treatment for people from hospital back in the community, and it is seriously under threat.
All that happened before the outbreak of foot and mouth disease. There is not a single case of foot and mouth in my constituency, but it is under siege because
until very recently, every square inch of it was a restricted area, so no normal activity could take place. I have spent a lot of time recently going to Wharfedale, Grassington and Ingleton--the villages that depend on tourism. With due respect to the Prime Minister, York is not the gateway to the countryside. My constituency, like that of the hon. Member for Workington, is much more dependent on rural pursuits such as walking and access to the countryside.The level of cancellation is over 80 per cent., and the results of that spin down to the local pub and the local restaurant. The patterns of delivery for the Theakston and Black Sheep breweries show that there is the opposite of an accelerator right through the rural economy. This is the deceleration effect that comes from the crisis in the tourist industry.
Sir Patrick Cormack: Will that not persist right through the summer? The agricultural shows will have been cancelled in my right hon. Friend's constituency, as they have been in mine. People who depend on those for revival will not have them this year.
Mr. Curry: My hon. Friend is absolutely right. The royal show is being cancelled, as are all my little shows in individual dales. They are a great focus of local activity.
It is important that the Minister for the Environment realises that the summer has already been shot to pieces for many of those businesses. The clients who would have booked for their summer holidays have already booked elsewhere. Businesses may be able to hang on over the summer, but come the back end of the summer and next winter, many will be in serious difficulties. Any help may almost be more relevant six or nine months from now than it is at the moment.
As for the Government's help, the suggestions on my list are very close to those made by the hon. Member for Workington. Although my constituency was a zone excluded from the list of benefits that he hopes to see introduced, our economic circumstances must be very similar. The £12,000 ceiling on the rateable value for businesses does not make sense. Indeed, it excludes some properties such as the larger pubs, which employ more people. They are having to lay off staff, but they want to hold on to their work force.
Many businesses are paying council tax and not business rates, and that needs equivalent relief. The Government aid to local authorities in respect of business rate relief for businesses with a rateable value of more than £12,000 is 75 per cent; for values below £12,000, it is 95 per cent. As for the wonderful principle that because businesses must pay 5 per cent. when the relief is 95 per cent., that means ownership of the scheme, my businesses would happily dispense with that particular proprietorial notion.
Craven is a tiny local authority, one of the smallest in the country, with a budget of between £5 million and £6 million. Without advertising the rate relief scheme yet, it has had 388 applications, 65 of which relate to properties with a rateable value of more than £12,000. If it were to grant them all, that would cost the authority £52,500. That may seem small beer, but against a total budget of less than £6 million, it is a significant sum. The resentment caused by the levels of relief offered in Wales and Scotland is intense--and I say that as someone who,
as the hon. Member for Workington knows, is not inclined to play a particularly English nationalistic card in this matter.
Mr. Geoffrey Clifton-Brown (Cotswold): My right hon. Friend has raised an important point. I wrote to the Minister for the Environment a fortnight ago on behalf of Stroud district council, which is very similar to the authority that my right hon. Friend has mentioned. A fortnight ago, Stroud council reckoned that it would be unable to reclaim £250,000 from the non-district rating pool. This is a very serious problem, and if the Government do not remedy it, the council tax payers in those small rural areas will have yet another year or two of council tax increases way in excess of inflation.
Mr. Curry: My hon. Friend is absolutely right. We have the identical situation in my constituency.
The Government must realise that devolution is not just about Scotland, Wales and Northern Ireland, but about England as well. There is real concern at their apparent unwillingness to match the English interest with what is being offered elsewhere.
The eleemosynary instincts of the Inland Revenue are extremely welcome and very rare. However, for many of my businesses, going to the Inland Revenue and being charged for the privilege is not particularly relevant to their circumstances.
The Bellwin relief scheme ought to apply to local authorities, because this is an emergency. It cuts in when more than 2 per cent. of the budget has been spent. In North Yorkshire, in view of the money needed for flood relief and the effects of the Selby rail disaster, local authority expenditure is extensive. However, a local authority's normal expenditure depends largely on the number of teachers that it employs. It is curious that the Government's aid in connection with foot and mouth disease depends on the number of teachers on a local authority's books.
The climate change levy should be deferred. It is a pure imposition on small businesses in the tourist sector, because the national insurance rebate does not affect them. I agree with the hon. Member for Workington about support for payroll costs. Businesses want to keep their staff in work and keep them available. Those people often greatly need the extra income that those jobs provide. That would be the single most crucial piece of help that I could identify in my constituency, where businesses are under terrible pressure.
Providing investment grants towards the capital investment required to rebuild businesses would be a helpful contribution. If there are to be loans they will have to be interest-free or subsidised, because there is not the cash flow to service loans raised at the normal rate of interest.
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