Select Committee on Culture, Media and Sport Minutes of Evidence

Memorandum submitted by Cumbria County Council


  1.1  Evidence will be given by Hazel Broatch, Director of Policy and Performance and by Mick Elliot, Director of Safety Services and Chief Fire Officer from Cumbria County Council.

  1.2  Hazel Broatch is part of the Chief Executive's Directorate and is on the Cumbria FMD Task Force, chairs the Regeneration Sub-Group and is a member of the Local Authorities FMD Executive. She is responsible for the Policy and Performance Department in the County Council which covers all aspects of policy development including economic development and regeneration, best value, scrutiny, human resources, community safety and e government.

  1.3  Mick Elliot is a member of the Cumbria FMD Task Force and the Local Authorities FMD Executive and chairs the Sub-Group responsible for local authority services response to FMD. He is Chief Fire Officer for the Council and is also responsible for emergency planning and corporate health and safety.

  1.4  Cumbria County Council set up the Cumbria FMD Task Force. It is chaired by the Leader of the Council. The Officer Steering Group supporting the Task Force is chaired by the Chief Executive of the County Council. The Cumbria FMD Task Force has met twice and brings together the local MPs, MEPs, Local Councils, Key Agencies and Organisations, Voluntary Sector and Private Sector. The Steering Group meets weekly.


  Over one quarter of all Cumbrian jobs are dependent on tourism or agriculture.

    Agriculture accounts for 13,000 direct jobs with a further 3,500 in supporting industries, representing almost 8 per cent of the total Cumbrian workforce.

  2.1  The MAFF Census (1998 and 1999) shows that agriculture accounts for almost 14,000 direct jobs of which 60 per cent are full time (the remainder are part time or casual). These jobs are distributed across 6,344 agricultural holdings—the majority small to medium in size. The dominant farm enterprises are sheep rearing, beef rearing and dairying. A further 3,500 people are employed in closely related industries such as agricultural supply, animal feeds meat processing etc (AES 1998). This means that, in total, the agricultural sector accounts for more than 8 per cent of the Cumbrian workforce, although this concentration is much greater in certain parts of the county.

    Tourism accounts for over 47,000 direct and indirect jobs, representing 20 per cent of the total Cumbrian workforce.

  2.2  Tourism accounts for almost 39,500 direct jobs and 7,500 indirect jobs, representing almost a quarter of all employment in the county. These jobs are spread across a wide range of sectors, including accommodation, food and drink, recreation, shopping and transport. More than half are located within the Lake District National Park. Countywide, the value of tourism to Cumbria is £964 million, a quarter of which is generated through expenditure of the tourism businesses in the local economy. This income is generated throughout the year but rises steeply from April (7 per cent of all income) until July (14 per cent) before dropping back in October (10 per cent). In value terms, £729.2 million of revenue (75 per cent) is generated during this period. (Source: Cumbria Tourist Board, STEAM Model).

  2.3  The Cumbria Household Survey 2000 found that one in six working residents believed their job was dependent on tourism to some degree. This rose to one in four of the self-employed and one in five of those working part time. It is likely that these figures under-estimate dependence as not all workers will recognise the link, particularly those in supporting industries. Not surprisingly, those working in hotels/restaurants (62 per cent) and retail (30 per cent) were the most likely to recognise the dependence of their jobs on tourism. However, more than a quarter (26 per cent) of those working in agriculture also recognised the dependence, demonstrating clearly the close links between the two sectors. This dependence on tourism was most evident among those with low level skills—29 per cent of those with qualifications no higher than NVQ level 1 (or equivalent), compared with just 3 per cent of those qualified to level 5. This is a major concern because those with low level skills are not ideally placed to seek out and take advantage of alternative opportunities if their employment is threatened.

  2.4  The Cumbria Employer Survey 2000 asked employers their opinion of the dependence of their workforce and turnover on tourism. A fifth of firms said that some of their workforce were dependent on tourism and well over a third said some of their turnover was. This reliance goes beyond the obvious sectors, for example a third of manufacturing firms say some of their jobs are reliant on tourism. The reliance on tourism by key sectors is shown in the table below.

Proportion of Firms Reporting that Some of Their Workforce/Turnover is Reliant on Tourism

Community/social/personal services

  Source: Cumbria Employer Survey 2000.


  40 per cent of all FMD cases Nationwide are in Cumbria.

  If the outbreak is over at the end of July:

    —  Tourism Spend will be down by over £400 million.

  3.1  All members of the Tourist Board, (approximately 2,000) together with members of other tourism organisations have received a postal questionnaire in the last three weeks. To date 515 have been returned, with the following results comparing March 2001 with March 2000.

  Average reduction in turnover: 65 per cent.

  Reported financial losses from the sample 515 businesses surveyed: £4,110,187.

  Number of job losses from the sample 515 businesses surveyed:

    —  181 full time;

    —  251 part time;

    —  432 total.

  3.2  The total number of job losses across the industry is probably over 1,000 to date—from the survey data almost 1 per cent business. The true scale of job losses is not reflected in the claimant count statistics as many of the workers will have other part time jobs, or working partners, making them ineligible for job seekers allowance. By 6 April 2001, the Employment Service had recorded 399 new claims as a direct result of foot and mouth.

  3.3  Tourism Information Centre activity in Cumbria showed that total bookings are down by 58.7 per cent in March 2001 compared to March 2000. The worst affected areas are in the Lake District, down by an average of 75 per cent. This trend continued in the first week of April.

  3.4  Over the Easter weekend, the situation improved slightly, with many accommodation providers at full occupancy. However, a CTB survey still found 45 per cent of tourism providers reporting lower occupancy than Easter 2000, compared to 12 per cent reporting higher occupancy. The trend at visitors attractions was more positive—with 56 per cent reporting an increase over last Easter compared to 255 reporting fewer visitors. This would be expected due to the lack of informal recreation opportunities resulting from the access restrictions.

    Lost Agricultural Output will be over £130 million in 2001.

    The County's GDP will be down by around 10 per cent.


  The total number of jobs in Cumbria has fallen by 6 per cent since 1991, against the national trend of an increase of 8 per cent.

  Half of Cumbrian jobs are in two sectors: manufacturing—(23 per cent, compared to 17 per cent nationally); and distribution, hotels and catering—(27 per cent, compared to 22 per cent nationally.)

  4.1  The Cumbrian rural economy is largely dependent for jobs and wealth on a few sectors. The relative over-reliance of rural Cumbria on jobs in manufacturing and in hotels and catering is clearly shown in the table below, as is the significant under-representation in financial services.

Distribution of Firms/Employees by Sector

Rural Cumbria
Great Britain
Public Admin/Education/Health
Other Services

  Source: AES 1998, Crown Copyright (analysis excludes agriculture and the self employed)

  4.2  However, employment in manufacturing has declined steadily over the last 10 years and is forecast to continue to do so. This, together with declining employment in agriculture necessitated major restructuring within the Cumbrian economy even before the current FMD crisis. The shift away from traditional industries towards high value added service sector employment presents a huge challenge given the under-representation of Cumbria in these areas (both in terms of jobs and businesses) and the differing skill needs of these compared with the declining sectors. This restructuring will be made more difficult by the impact of FMD on the tourism sector which had been experiencing steady growth and was providing alternative employment for some—particularly within agricultural tourism.

  Manufacturing employment is declining, and has weak local supply chains, so will not provide the impetus needed to pull the economy through this recession.

  4.3  Employment in manufacturing has declined by 41 per cent since 1990 and is expected to decline by a further 14 per cent over the next 10 years, with 33,200 jobs being lost between 1990 and 2010 (source: Cambridge Econometrics). Coupled with this reducing employment, manufacturing firms in Cumbria are only half as likely to source their supplies locally compared with the county average (22 per cent compared with 53 per cent) and almost half (45 per cent) have their main customer base outside the county (source: Cumbria Employer Survey 2000). Whilst this may make them less vulnerable to the direct impact of FMD, it also means they may not play a significant role in re-building the local economy, particularly given the difficulties facing the sector in other ways.

  Most other businesses have well developed local supply chains and will be directly affected by the economic downturn caused by the crisis. (40 per cent of Cumbrian businesses are at least partially dependent on the tourist industry)—the economic effect of the crisis will be felt throughout the local economy.

  4.4  For almost three quarters of Cumbria's businesses (74 per cent) their main market is within the county and more than half (53 per cent) buy most of their goods/supplies locally too (source: Cumbria Employer Survey 2000). This high level of dependence on local markets by the majority of firms makes them vulnerable to economic downturn (See above for information on the reliance on tourism).

  Service sector employment in Cumbria is disproportionately reliant on small SMEs and micro businesses. Agriculture and tourism are characterised by self-employment and micro businesses. Such businesses are most vulnerable to severe economic shocks as they are reliant on a single market, have very limited opportunity to raise new working capital, and few reserves.

  Per cent of service sector employment is within businesses of less than 25 employees, compared to 41 per cent nationally, 36 per cent is within businesses of 1-10 employees, compared to 27 per cent nationally.

  Cumbria has a higher rate of self-employment at 13.5 per cent of all employment, compared to 11.9 per cent nationally.


  5.1  The community have looked to the County Council for leadership in this time of crisis. The Council was quick to set up the Task Force which met on 19 March and 9 April 2001 to date and meets again on 30 April. The Task Force has developed two communiqués on the issues faced in Cumbria which have been submitted to Central Government and it has given evidence to the Rural Task Force.

  5.2  We are administering Objective 2 funding that was made available by GONW to support immediate needs resulting from FMD. This was matched by funding from the North West Development Agency. A substantial proportion of this has gone to support marketing by Cumbria Tourist Board for Easter and now for May. The balance has gone to support businesses to survive through the Small Business Service.

  5.3  Our Public Relations and Media Team have been diverted to provide support to improving information and communication. The Council is also leading a small cross-sector group of PR and Media specialists and works closely with the Cumbria Tourist Board. This has resulted in a local "Open for Business" campaign heavily supported by the local press and media. The County Council's own website has been substantially amended to provide up-to-date information. We have also, supported by others, opened a telephone information service on local authority services.

  5.4  The Task Force has clearly stated that top priority is the eradication of the disease. To that end the County Council, working with others, has been responsible for decisions regarding closure of footpaths and siting of preventive matting. Two hundred disinfectant mats have to be maintained daily. Guidance has been sought throughout from MAFF and priority given to preventive action. However, much of the decision-making has also involved balancing conflicting interests.

  5.5  This balance has not always been easy to achieve. The County Council is leading a Sub-Group of the Task Force which brings together the key stakeholders and is tasked with reviewing restrictions. It has re-opened 100 footpaths and continues to look at opening others.

  5.6  Cumbria covers an area as large as Greater London, Hertfordshire, Bedfordshire, Buckinghamshire, almost half of Oxfordshire and Berkshire, part of Hampshire and all of Surrey, plus parts of Kent, Essex and Cambridgeshire. It has approximately 5,400 miles of footpaths and 1,800 miles of bridleway. The scale of action in the county has been significant.

  5.7  We have also led a Regeneration Sub-Group who have developed a working document on recovery which proposes that Cumbria become a trailblazer for modernising the rural economy in line with Government and European policies as a Rural Action Zone. This would need the scale of funding to Cumbria to be increased over that proposed before the crisis and would need the funding to flow quicker. The regeneration of tourism is a key programme strand.

April 2001

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