To be published as HC 714-v

House of COMMONS



Environment, Food and Rural Affairs Committee

Rural Communities

Wednesday 16 January 2013

Keith Halstead

Mike Perry and Professor Mark Shuckmith OBE

Evidence heard in Public Questions 359 - 406



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Oral Evidence

Taken before the Environment, Food and Rural Affairs Committee

on Wednesday 16 January 2013

Members present:

Miss Anne McIntosh (Chair)

Barry Gardiner

Mrs Mary Glindon

Sheryll Murray

Neil Parish

Ms Margaret Ritchie


Examination of Witness

Witness: Keith Halstead, Chief Executive, Community Transport Association, gave evidence.

Q359 Chair: Good afternoon and welcome. Thank you very much indeed for being with us and contributing to our inquiry into rural communities. May I invite you, just for the record, to give your name and position?

Keith Halstead: Yes. Keith Halstead, Chief Executive, Community Transport Association UK. I am very pleased to be invited and I hope I can help the Committee in its deliberations.

Q360 Chair: I am sure you will. Do you want to just give us an indication of who your members are?

Keith Halstead: Yes. We have nearly 1,600 member organisations. They are all organisations that are civil society bodies. That is, voluntary community groups, charities, mutuals, cooperatives and social enterprises providing local transport services in their communities. Our membership is very mixed: it ranges from a large number of totally voluntary organisations, with no paid staff, often providing community car schemes using their own cars, at one end of the scale, through to much larger social enterprises, one of which delivers red bus routes outside here in London, and with a big contribution to social purposes. It is really like a curve. You have a lot of voluntary and community groups and then some that have paid staff, just a small number, and operate a smaller range of services, going up to larger organisations with quite significant turnovers.

Q361 Chair: What is the opinion of your members of the Rural Statement?

Keith Halstead: Generally, few may have access to it, because of the nature of their work. Overall, while the Rural Statement notes the investment by the Department for Transport in community transport, we were probably a little bit disappointed that it did not go further, particularly as the Rural Statement was launched the day before we launched our State of the Sector report for England on community transport, by the Rural Affairs and Transport Ministers. That probably was a very good example of both Government departments working together and working with a civil society organisation, and embracing some of the new work by the Rural Communities Policy Unit at Defra, which has been very supportive and contributed time and funding to the production of that report. I thought there was a bit of a missed opportunity there.

Perhaps more substantially though, the Rural Statement did not seem to build on some of the content of the Uplands Policy Review, in respect of community transport and access to services. We were very pleased in the Uplands Policy Review that there had been a recognition of the Government’s wider role of working with community organisations, and there had been case studies in the Review. We had seen quite a commitment there around supporting communitybased enterprise. I thought quite a few things had happened since the publication of that report that perhaps could have been built into the Rural Statement.

Q362 Chair: Have you noticed any difference between the passing or the demise of the Commission for Rural Communities and the start of the Rural Communities Policy Unit? Is it better, worse or is there no change?

Keith Halstead: From our position, the CRC had been a somewhat more distant body. It certainly carried out some research on public transport, as did its predecessors. We felt they were somewhat more detached from central Government. Since the advent of the RCPU, we have certainly had stronger engagement with it, and the state of the community transport sector report that we published is a good example of that collaborative working. There seems to be a bit more connection, because it is based within Defra, with other Government departments, such as the Department for Transport, which is obviously a department we work quite closely with too.

Q363 Chair: Do you think there has been an impact from the higher fuel costs on community transport?

Keith Halstead: Inevitably, our members in rural areas would say that not only would fuel costs be at a higher price than you would find in many urban areas-supermarkets would be the obvious example-but they often have to travel to get to those filling stations too, so I think the price of fuel is quite an important factor and how that cost has increased. Clearly, when you look at other forms of income that community transport organisations receive, such as the reduction in the Bus Service Operators Grant, which was reduced by 20%, then that would have a cumulative impact on the income of a community organisation.

Q364 Barry Gardiner: Mr Halstead, could you just perhaps set out for the Committee how it is that rural community transport schemes are funded and also how the £20 million allocated to the Community Transport Fund has actually been used in practice?

Keith Halstead: Yes. We were very pleased to see that the Government made this boost of £20 million. That was to 76 local authorities, based on a formula that had previously been used for the Rural Bus Challenge. 76 authorities received an amount of funding; I think the highest was £500,000 and the lowest was something like £1,300. We worked with as many of those local authorities as we could, and we engaged with 48 of them out of the 76, so that is 63%. The money was unrestricted, so it was entirely up to the local authority, I suppose in the spirit of localism, in terms of how it allocated that funding and even if it allocated it to community transport. One or two did not.

Q365 Barry Gardiner: Can you give the names of those that did not allocate it as it was supposed to be?

Keith Halstead: Cornwall and Somerset are two examples I think I could give of the situation I know, where those authorities did not allocate the funding to community transport. Our members there are taking that issue up with local councillors.

Q366 Barry Gardiner: What was their allocation, if you know?

Keith Halstead: I could certainly provide it to the Committee. I do not have the figure to hand.

Barry Gardiner: That would be very helpful, yes.

Keith Halstead: Generally speaking, we were quite pleased to see how local authorities were working with the community transport sector in their counties and unitary authority areas. They wanted more to see how they could use that as an additional investment to generate some form of legacy, rather than just spending it instantly on perhaps a new vehicle. What we have seen out of it is many examples of stronger collaborative working between community transport organisations in a local authority area and with that local authority itself. For example, in Norfolk, Suffolk and Devon, we have seen the local authority support the formation of a collective organisation for all community transport organisations in that area, and actually passport some of the funding across that they receive from the Department for Transport to those organisations to look to see how they can work together, in a stronger sense, to carry out training and auditing, to look at reducing backoffice costs and to see how they can address gaps that exist within those areas.

Q367 Sheryll Murray: Could I just ask if you have any idea how those authorities spent the money? Was it perhaps in partnerships with rural transport initiatives instead of spending it specifically on community transport?

Keith Halstead: Some looked at it more widely and spent some on community rail linked to community transport. Others were keen to look at broader transport strategies. Some wanted specific strategies on community transport. Others wanted to focus more on training and standing, so there was quite a mix. I suppose that distils down into about, I do not know, half a dozen things.

Q368 Sheryll Murray: I will just press you a little bit further, because your answer to Mr Gardiner led me to draw the conclusion that, because Cornwall and another authority did not spend money on community transport schemes, that was not going to help rural transport initiatives. Could you just expand on that? If they did, could you give us some idea as to the way they did spend it?

Keith Halstead: I can only say that, in both those instances that I referred to, I am aware that community transport organisations did not benefit from that funding and were upset by that. I would not have a view as to whether that benefited rural transport in some other way, because I do not have that detail. I would clarify that point.

Q369 Neil Parish: Good afternoon. What impact will further cuts in the Bus Service Operators Grant have on the community transport sector and are you satisfied by the work the RCPU has done with the DfT to ensure a staged approach to the changes in the grant?

Keith Halstead: First of all, all community transport organisations would have received the 20% reduction that the Government committed to, so in total about £5 million of BSOG goes to community transport organisations. Nearly 1,500 organisations in England claim it, and the average claim is somewhere in the region of about £3,400. We know that because we have interrogated the BSOG data. Instantly, just from that, they will obviously take a cut of £700 each, which may not sound a lot but, if you are a small community organisation, that is £700 you have to find from somewhere else.

We have worked particularly closely with the Department for Transport, and through our discussions with Defra, on the reforms to BSOG. We are pleased so far by the direction those are taking and the protection offered by the Government, particularly to those services that are operated independently of any contract, which often provide transport to people who are older or disabled in society. Clearly, some money will be devolved; some of that funding will be devolved to local authorities, and I suppose there are some issues there around the detail of that devolution, in terms of existing commitments that community transport organisations may have. For example, you could have a community transport organisation that has committed itself to providing a community bus route on a contract basis, assuming BSOG, for a three or fouryear period. Now the devolution is coming halfway through that process, so there are some issues around how some of that funding is protected as it goes across into local authorities.

Q370 Neil Parish: Can I just press you? We all accept that funding is tighter at the moment. Are there ways of bringing in perhaps supermarkets, with a route that brings people in from the countryside to the towns, to get them to help? With a lot of these routes, the trouble is there are not enough people on them, hence they need the subsidy. Have you got any magic solutions to this?

Keith Halstead: What has been interesting and what we have seen is the significant, for us, increase in the community bus routes provided. If you look at the registration of community bus routes by community transport organisations, in 2007 there were about 10 registered whereas, last year, we saw something like 150. Many organisations now are looking more at delivering community bus routes. Those are open to the public; they either run to a fixed timetable, just like a conventional bus service, or on a more flexible basis. I think it is the more flexible basis, where a community bus route could go round a range of villages picking up people and then going into, say, a market town, where there is significant potential for growth. Those services would be eligible to receive both BSOG in its revised form and concessionary fares, so there is scope to grow that section of community transport provision.

Q371 Sheryll Murray: Could I ask you if there are any better, more local means of generating patronage than the national concessionary travel scheme?

Keith Halstead: On the concessionary travel scheme, clearly community transport organisations operating registered bus routes are eligible for that, but a significant number of services operated by community transport are not. As an older person or a person with a disability, I may have a concessionary pass, but I cannot use it on community transport, particularly if that is my only means of transport that is available to me. The CTA feels that is unfair, and there has obviously been a lot of discussion in this place and elsewhere about universal benefits. We would be saying, if there is any reform to concessionary fares and any savings achieved on those reforms, perhaps a small percentage of those should be focussed on older and disabled people who need community transport, so that they should be able to use their bus pass and it should not be a postcode lottery, as it currently is.

Q372 Chair: Could I just pursue that? Does it worry you or are you finding that some rural buses are actually predominantly carrying only concessionary fare passengers? Just in my own area that is increasingly the case, and they are concerned that they might lose the concession. Would it be easy to administer a halfway house, where you kept the concessionary fare but it was still at a lower rate than what the full fare would be, so that local authorities receive the funding, but the more vulnerable, the elderly and the disabled do have access to community transport?

Keith Halstead: Concessionary fares, in terms of the formula that is used for how operators are reimbursed, are quite complex and vary from one local authority to another, so overall the picture is quite challenging. As a principle of the Concessionary Bus Travel Act, an operator should be no better or no worse off by accepting that concessionary pass. That is not always the case. We feel that the overall policy should be reviewed quite significantly. Also, there is a need perhaps for Government to look at the different levels of subsidy that organisations receive. We talked about BSOG; there are concessionary fares too, and also local authorities have been securing funds from the Local Sustainable Transport Fund to support public transport in different ways. There is perhaps a broader strategic need to review how spend is devolved to local authorities.

Q373 Ms Ritchie: Are community transport bus schemes constrained to only provide routes that are not covered by the private-sector providers, and have you seen an improvement in the services offered by private companies where there is competition from a community transport operator?

Keith Halstead: Quite simply, community transport organisations, if they are operating under the permit regime, which is the sort of legislation that governs what organisations can do and cannot do, cannot go into competition on community bus routes if there is a commercial route in existence. Clearly some of our members, and I mentioned these at the start of the session, are larger and more enterprising. They would have operators’ licences like any large bus company would, so clearly they can go into competition with them. I feel that, particularly in rural areas, there is a role for community bus services in drawing people together, meeting the needs of people in small communities and villages, and bringing those into the larger towns, and then you could have the commercial and more profitable routes operating between the market towns. Community transport is all part of that overall mix.

Q374 Mrs Glindon: I do apologise for having missed your earlier evidence. Some independent bus operators have made a state aid complaint to the European Commission about payments by local authorities in England and Wales to community transport operators. Do you have any sympathy for their complaint and what are the implications for community transport schemes if it is upheld?

Keith Halstead: That complaint is currently lying before the European Commission. I have not seen the detail of that complaint, so I am not certain which organisations are involved and clearly what those commercial operators are putting forward as their case. Clearly there are state aid issues, which normally local authorities are aware of when they are allocating funding, particularly to community transport schemes. I suppose there is a need to put it into context. There are something like 22,000 registered bus routes operating in the UK, but currently community transport organisations are probably only providing 250. Most of the effort of community transport is providing services that are not offered by commercial operators. These are social journeys; they are not ones that are going to generate significant profit. They often have to be subsidised. They could be small schemes involving mopeds, as with Wheels to Work. By far the largest range of community transport provision is in that area, so actually community transport as a threat to the commercial sector is not really evident.

Q375 Mrs Glindon: If the Commission did uphold their complaint, do you think this could have a serious effect on community transport, if they were following any commercial route?

Keith Halstead: Obviously it would be more explicit if a community transport organisation was getting into a contractual relationship with a local authority and tendering. Both the local authority and the community transport organisation would need to be clear and understand any implications of a ruling, if it emerged. Certainly we have seen some initiatives where there are blanket exemptions around state aid rules, so I suppose we may want to explore that further. As I said, we would want to look more at the nature of the complaint and the issue to see what the detail of it actually is.

Q376 Chair: Could I just ask about patient transport for nonurgent cases? I know in my own area, in Ryedale, there is Ryecat and there is volunteer transport, but are we coming to rely too heavily on the voluntary sector? In more isolated communities that may not be sufficient. If I could add to the point I made earlier, are you concerned that this voluntary transport may come under increased pressure? For example, in Ryedale we have the highest cost of fuel in the country outside Scotland at the moment. Are you concerned about too much dependence on the voluntary sector?

Keith Halstead: Certainly our members are noticing a significant increase in the demands made of them, particularly for nonemergency patient transport. We are seeing ambulance trusts cutting back on what they provide and, often, our members will provide services and no one is effectively paying for them, certainly not the local NHS trust, but they feel a moral responsibility to provide transport for their neighbours and others most in need in their communities.

I do think it is an issue that it is worth exploring further with the Department of Health. We have tried to do that through two successive Transport Ministers actually. Given where it would figure on the Department of Health’s agenda, it is pretty low down and is seen as more of a local issue. We are trying to work with specific clinical commissioning groups, NHS trusts and others to pilot initiatives to say, "Look, community transport could bring in a group of patients together. We could try to work collaboratively to manage times of appointments, particularly people travelling from rural areas to regional specialist hospitals, to try to reduce costs." We think, as an organisation, and our members do, that there are some significant opportunities, but we are working very locally on this and perhaps that is the way we have to do it. Certainly there are examples. Only the other day I was in Derbyshire, in the Peak District, and GP practice there funds a community transport organisation to bring patients in, rather than send the doctors and nurses out.

Q377 Neil Parish: My question is really on similar lines to the Chairman’s question, and that is how community transport schemes can ensure that they are sufficiently resilient, particularly when they provide essential services such as transport for healthcare. You have been talking about that. It is essential that people get to their healthcare, is it not?

Keith Halstead: That is where you have to make the case, perhaps drawing on some pilot initiatives, that significant cost savings can be made, but for a relatively modest sum. Remember that most community transport organisations are notforprofit. A lot can be achieved. It is a challenge and community transport is not the answer to everything, by any stretch of the imagination, but in many communities that is all there is. You do not have anything else. We are working with our members to ensure they are as resilient as they can be. There is obviously always more that can be done but, if we can work with different agencies, local authorities and Government, then we can achieve more. There are some interesting projects going on in the other nations as well, particularly patient transport in Wales, which I think we could learn from.

Q378 Neil Parish: Even if it is recovering the cost of the fuel alone, is there a mechanism to do that? That is what worries me with some of these schemes; there is not enough money even to give them support on fuel sometimes.

Keith Halstead: There is obviously a mix of funding. Passengers pay a fare, whether that is in community car schemes or wider initiatives. We have noticed, particularly in rural areas, that many parish and town councils make discretionary grants to community transport, and that is significant and it has increased. It is not just county councils that we are talking about here.

Q379 Chair: Have post buses gone?

Keith Halstead: Post buses seem to have died out as an initiative. There were quite a number in Scotland, but there seem very few now.

Q380 Chair: What do you think of Wheels to Work schemes? Are they being adequately supported by the Government? Should they be ringfenced for a longer period than the current timescale?

Keith Halstead: A number of our members operate Wheels to Work schemes. I am very supportive of them, certainly for young people. They are both a route into employment and education, and they also help to build confidence and enable them to access the services they need. The advent of more community bus routes, too, will help young people. There is quite a body of organisations that feel that young people should benefit from concessionary fares too. With the Wheels to Work scheme, we put forward a proposal to the Department for Transport and Defra saying that we would like to look at the financial models of some of those schemes, because there is potential to be quite enterprising to develop more Wheels to Work schemes as social enterprises, perhaps using some of the loan finance from Big Society Capital and other social investment bodies for the third sector. We would like to just look at those more and advocate some different financial models to scale up Wheels to Work schemes. I think it would be good for DWP to take more of an interest in them too.

Q381 Chair: Do you think there is a role for community transport in getting people to work, training and education, for example? We will all have training colleges and outlets with trainees who cannot drive, because they are underage. Do you think there is a role for community transport there?

Keith Halstead: Our members can offer help and support there, both in direct services and in training a number of young people involved in programmes with community transport schemes themselves. We too can work with other bodies, such as colleges, as you mentioned. Often colleges and student unions may have minibuses and vehicles that are not being used at certain times of the week, and community transport organisations can then use that resource to provide transport perhaps for people under 18 who want to go to a market town on a Friday or Saturday evening.

Chair: Thank you very much indeed, Mr Halstead. We are right on time. Thank you very much indeed for participating and being so generous in contributing to our inquiry. We thank you for being with us and I will invite the next group of witnesses to come forward.

Examination of Witnesses

Witnesses: Mike Perry, Head of Communication, Plunkett Foundation, and Professor Mark Shucksmith OBE, Director, Newcastle Institute for Social Renewal, Newcastle University, gave evidence.

Q382 Chair: Can I thank you both most warmly for being here, welcome you both for joining us and thank you for contributing to our inquiry into rural communities? As I mentioned earlier, we will break for a vote at 4, so I apologise in advance for that. Just for the record, would you like to present yourselves and give your positions?

Professor Shucksmith: I am Professor Mark Shucksmith from Newcastle University, Director of the Newcastle Institute for Social Renewal, and I am also, until the end of March, a commissioner with the Commission for Rural Communities.

Mike Perry: I am Mike Perry from the Plunkett Foundation. My role is Head of Communications. I am also a board member at the Community Land Trust Network.

Q383 Chair: Thank you. To start, how would you describe the greatest challenge facing rural communities at this time? It is not an essay answer; it is meant to be a gentle opener, sorry.

Professor Shucksmith: No; it is like being asked your eight desert island discs. The biggest challenge at the moment is how to cope with the current financial and economic circumstances. That is in the short to medium term. In the medium to longer term, the biggest issue is how to connect with the changing technologies, the highspeed broadband, that threaten to leave rural areas behind, in the same way that the railways left parts of the Wild West behind when they were being developed in the railway age.

Mike Perry: I agree with Mark. I would add that affordability of housing is clearly an issue, and the population changes. Mark has outlined most of this in his written evidence, but the outmigration of young people from the countryside is a big issue as well. From our point of view, what we are seeing are challenges to typical models of service delivery-public service delivery and private service delivery-and the need for communities to step in. That is really what our organisation tries to do.

Q384 Chair: The Committee did what I thought was an excellent piece of work on uplands, and it seemed to be quite well received. In your view of the Rural Statement, do you believe it is a coherent strategy? Does it go as far as it might? Does it give an action plan that can be used to hold the Government to account?

Professor Shucksmith: In my view, the Rural Statement did not set out a strategy at all. There were many things that the Rural Statement might have done and that we might have expected. One would have been a statement of a joinedup rural policy across the different departments of Government. Another might have been an analysis of the changes in rural areas, the issues and how to respond to those, or it could have been a detailed outline of the commitment by each Government Department to rural proofing, but actually it was none of those things. It was a welcome reassertion of the Coalition Government’s commitment to rural communities. Many of these initiatives are welcome, like the co-ordinator at a national level for Wheels to Work, which you were just talking about, but essentially it presents a range of ministerial initiatives. It is a list of things that the Government is doing, including a necessary recognition of rural areas’ contribution to economic growth.

In my view, there was a certain air of unreality about it, because it presented all these initiatives without any recognition, any acknowledgement, of the changing context around them. For example, in terms of what you have just been talking about, there was the mention of the extra money for community transport, but no mention of the cuts to the Bus Service Operators Grant. There are mentions of new pots of money for affordable rural housing and no mention of the collapse in house building and in the construction of affordable housing. I was disappointed by it.

The very final thing, the very final sentence of the Rural Statement, was a statement that this was a contract with rural areas "so that they can hold us to account on our promise to grow the rural economy and support thriving rural communities". If that was the intention of the document, it would have been very helpful for the Government to publish some key performance outcomes, so that one could actually hold the Government to account in the way that that last sentence suggests.

Mike Perry: I would agree again. In addition, we welcome the Statement and the fact that it was published. It was long awaited; it was delayed a number of times, so we were pleased to see it published. We were pleased to see an emphasis on rural growth. What we would have liked to have seen is the role of rural services underpinning rural growth. We would have liked to have seen that evidenced. We would also have liked to have seen a greater commitment to capturing data and analysing data around rural growth, the number of enterprises, etc. One example is that there is no current data set on the numbers of pubs and shops in rural areas, which is something we would like to see.

We were pleased that we were recognised and our role was recognised in the Rural Statement, and there was a commitment to partnership and we are exploring that partnership with the RCPU as we speak. I think it is quite clear that, with the resources available to the RCPU, they are going to be heavily reliant on relationships and partnerships in order to deliver their priorities.

Q385 Ms Ritchie: These are questions about the engagement of the Rural Communities Policy Unit. In written evidence to us, the Plunkett Foundation argue that the RCPU currently relies on too small a number of rural stakeholders to influence their policy and practice. Do you agree? That would be to Professor Mark Shucksmith.

Professor Shucksmith: Yes. Actually, I did not know that Plunkett had said that, but it is exactly the point I would make as well. The Rural and Farming Networks and also the contract with ACRE, which RCPU has as their two main ways of engaging with rural communities, are valuable, but inevitably they are the usual suspects. They are the organisations that are there to represent their members’ interests and they are accountable to their own particular members and organisations. The rural community councils are broader than that, of course, but if one is really trying to reach all parts of rural communities, particularly in the way that the Commission for Rural Communities was statutorily obliged to try to reach disadvantaged groups in rural communities, one has to go further. I do not mean that as a criticism of RCPU, because it is extraordinarily difficult for a central Government unit within a ministry to reach out in that sort of way, particularly with the relatively few members of staff that they have.

Q386 Ms Ritchie: How do you ensure that Defra reaches out to a broad enough base that includes the hardesttoreach rural residents? That is to both of you.

Mike Perry: We have to acknowledge that the team is very small within the RCPU, and the expectation that they will be able to reach out to all rural communities, particularly the hardtoreach, is probably unrealistic to be honest. They will be reliant on organisations like the ones we have talked about-ACRE, RCAN, us. There is a range of rural stakeholders; there are the academic institutions that Mark represents. They have to be reaching out in all sorts of different ways and engaging in different ways in order to reach these people. The expectation that that small grouping of people will be able to tap into the views and changing circumstances of all those different communities is pretty unrealistic.

Professor Shucksmith: Yes, I agree; I think it is unrealistic. If you were wishing to do that, you would design the architecture of institutions in a different way, and go back to something more like the Countryside Agency because, after all, in that side of Defra’s responsibilities there is Natural England, which does have a presence throughout the country in offices. On the social and economic, they have lost that with the abolition of the Countryside Agency, as much as with CRC.

I do note that, in the North East, we have a Northern Rural Network, which tries to bring together around about 600 or 800 people active in rural development practice. It is Newcastle University that animates this group. We have fewer meetings now because people do not have the funding to come to them, but, when we do have them, people are really pleased to meet one another, because they have fewer and fewer opportunities to meet one another. They all speak about how distant and remote central Government has become, and how they no longer really have contact with central Government.

Q387 Ms Ritchie: Bearing in mind what you have said, do you think the RCPU and its work has a sufficiently high profile outside of government?

Mike Perry: My personal view is the RCPU is new; it is small with limited resources. Again, the expectation that they will be well known far and wide within the English countryside is just not the case. That is my personal view and I suspect that would be the view of people within the RCPU as well. The Government marketing freeze probably does not help. The CRC was not subject to that, going back a couple of years ago, so it could engage in events, publications and a greater degree of press work, which would mean that people were more aware of the fact that the organisation existed and what its priorities were, but the RCPU is subject to greater restrictions, and so that inevitably is going to lead to fewer people knowing about their work, what they do and the fact that they exist at all.

Professor Shucksmith: I agree. The CRC, which still exists, has been unable to do all those sorts of things for the last couple of years for the same reasons.

Q388 Chair: Do you say the CRC still exists?

Professor Shucksmith: Yes, until the end of March.

Q389 Chair: Obviously you have a vested interest. I am going to ask you both this: do you think it is better or worse since the Rural Communities Policy Unit has been set up? Is it more appropriate to be in-house, if I ask you both? Obviously you have a slight vested interest in this.

Professor Shucksmith: I declare my interest as a Commissioner with CRC. There are positives and negatives. You already heard the positive in the last session, insofar as an organisation like Community Transport can speak now to an organisation that is part of Government and has the ear of ministers-or at least Defra ministers. It is a question as to whether they have the ear of other ministers, but that is a plus. On the negative side, there are far fewer staff now when you look at how many, 60 people, were in CRC plus the two bits of Defra that used to do this work. There has been a big cut in the resource. Because it is within a ministry, the staff are now essentially looking after the Minister’s interests, perhaps more than disadvantaged groups in rural areas, if those are in conflict at all. I think the process is less transparent and independent, so I do think we have lost the independent voice that CRC and the Rural Advocate provided.

Mike Perry: That would be my main point as well. As far as we were concerned, the main role for the CRC was the source of independent expert advice, and that advice, even if it is expert, is internal within Government now, so there is a need to explore different ways of providing that independent expert advice, and again it can come down to relationships, partnerships and networks being able to derive their expertise from those groupings. That has been an issue since the changeover. Again, we have mentioned it a number of times, but the lower staff resource and the lower overall pot of resources available for the RCPU versus the CRC, and what was then the rural policy side of Defra, is quite a significant difference.

Q390 Sheryll Murray: I would like to turn to rural proofing. What is the most effective way of ensuring Government policy is rural proofed? Could I ask you, Professor Shucksmith, to give us an example? You highlighted the example of school funding in your evidence as a policy that had not been rural proof. Taking this as an example, what do you think would have been the best way to ensure that it was rural proofed?

Professor Shucksmith: Rural proofing has been a thorny issue for many years, as civil servants, CRC and others have sought to find the most effective way of doing it. First of all, I would say that nobody has found the perfect method yet. I would add, though, that this was the main subject of the OECD’s review of rural policy in England in 2011, which does not get a mention in the Rural Statement at all, so I do think that there might be some lessons to learn from that OECD report.

The most effective way of rural proofing is to have strong relationships with the relevant civil servants in other Government Departments so that, when they are designing policy, right at the beginning they are attuned and made aware of rural aspects and angles, so they can think about that at that early stage. It is much harder to try to change a policy once it has been drafted and announced, so that is the ideal. Whether that is possible with a very small RCPU is another matter. I think RCPU has established strong working relationships with colleagues in some Government departments, and has been able to provide CRC with access to policy specialists on matters like housing, social care and benefits, but links to other policy areas, like schools and youth unemployment, appear to be much less strong.

In relation to schools, since you asked specifically about that, I do think that, if there had been conversations with Defra staff and if Defra staff had been aware that this was happening-I stand to be corrected, but I do not think they were aware that this was coming in and was going to have an impact on rural schools-it would have been quite easy to have designed a funding formula that did not have these consequences. I can elaborate on what I think the solution is, if that is helpful.

Mike Perry: Rural proofing is not the only issue that people seem to think can be resolved by a toolkit. There have been a number of rural proofing toolkits that have been developed over the years. We think there is one squirrelled away somewhere that may or may not be launched at some point, but having a rural proofing toolkit does not mean that has been implemented at all. Mark summed up exactly what the issue is.

In addition to that, we have found that some Government departments are actually better at rural proofing their policies than Defra has been at times. The two examples we would give are things like post office mutualisation and the community rights legislation. We have been involved in that, and ACRE and other rural stakeholders have been involved in influencing that legislation. They acted as rural proofers. The RCPU has not necessarily done that on those particular bits of legislation. In future that process will have to be used with fewer resources and a smaller team. They are going to be more reliant on partnerships and others to influence policies to ensure that they are suitable for rural communities and rural people.

Q391 Neil Parish: Mr Perry, in your Plunkett Foundation written evidence, you argue that Defra lacks focus on retaining services within rural communities. You say "clear policy interventions are needed and are currently lacking". What support do you currently receive from Government and what policy interventions would you like to see? It is only a small question.

Mike Perry: What support do we receive from Government? We are a strategic partner of the Office for Civil Society within the Cabinet Office. We are a strategic partner with Defra. We lead Defra’s Social Enterprise Strategic Partnership. We are a specialist delivery partner under the Assets of Community Value contract, which Locality leads as part of DCLG. This is not strictly speaking Government funding, but we receive funding from the Big Lottery for various aspects of our activity. In terms of direct support from central Government, it is a fairly small but important part of the resources we receive. We are much more reliant on fantastic funding from institutions like the Esmée Fairbairn Foundation, the Co-operative Enterprise Hub and, as I said, the Big Lottery Fund, versus central Government funding.

Q392 Neil Parish: Also you say in your evidence that "clear policy interventions are needed and are currently lacking", so what are these interventions that you would like to see?

Mike Perry: This is not necessarily just a Defra issue, but we would like to see a commitment to retaining shops, pubs and vital services in rural areas. At the moment, the planning policy is up in the air as to whether it supports it or not. What we have seen is communities being ready, willing and able to take on running a shop or a pub, and they have been prevented from doing so for various reasons. We would like to see the planning system provide greater support for that. Change of use has been an issue. People have applied for and received change of use, despite their community wanting to take over and run a service. That is one example. We would like to see barriers being removed for communities looking to do this. We have mentioned planning; there are significant financial implications.

Chair: The Division bells are clearly not working. We stand adjourned and we will return in 15 minutes. I apologise.

Sitting suspended for a Division in the House.

On resuming-

Chair: Thank you very much indeed for your forbearance. We are not expecting another vote, but one never knows, so if we carry on where we were with Neil Parish.

Q393 Neil Parish: I just wanted one supplementary, Madam Chairman. When you are talking about delivering community shops and pubs, are you finding a difference between different local authorities? In East Devon for instance, my own constituency, we have quite a number of community shops and pubs, which seem to have been quite successful. In midDevon there are not quite so many, and that may be because they did not apply for them. I am just wondering what you think about the local authorities.

Mike Perry: Local authorities have played an important role in communityrun shops and pubs, particularly smallscale grants, anything from £1,000 up to £50,000, which I think is the most I have heard about.

Q394 Neil Parish: You also talked about planning, did you not?

Mike Perry: Yes. I have all the statistics and all the postcodes for where community shops are. As to the issues with local authorities, planning comes into it in part, but with communityrun shops, the majority of the time and effort comes from the community itself, so the local authority is a minority player, albeit an important stakeholder in it. With community shops, it is important to say as well that 60% of community shops exist in new premises or alternative premises; they do not go into what was formerly the shop. The planning issues are not just related to: "Can we can take over that shop or not?" It is: "If we cannot, where else can we put it?" There is a difference in where community shops exist. That is related to patterns around population and settlement sizes. It is related to historical issues as well. We have seen a clustering effect; where one exists, they tend to cluster around it. We have maps; we have postcodes. I have a couple in my bag, if you would like a look.

Q395 Mrs Glindon: Do you predict much takeup of the Community Right to Challenge and what risks do you foresee for communities attempting to do this?

Mike Perry: The main risk to the Community Right to Challenge is if a community challenges a local authority that is providing a service. The challenge leads to a tender process and anyone can bid for it. A community may go for it and end up with a service provider that provides a far worse service. That is the risk. The community initiating it does not mean that the community necessarily gets the opportunity to take it on or not.

In terms of takeup of the Community Right to Challenge, it does not seem to be a big deal for rural areas, to be honest, due to the lack of public services currently being delivered in rural areas. It is too early to say, to be absolutely honest. That is the case for all of the community rights. Most of them have been up and running for a relatively short period. Not everyone knows about them yet. There is still a communications task to be done to help people to understand these. Particularly for the Community Right to Challenge, people would need to go in with open eyes, if they are going to challenge a local authority service deliverer.

Professor Shucksmith: I agree. I think the big danger is that initiating the tender process might lead to privatisation of the service, with it being provided by a distant provider that perhaps is not too interested in the rural communities.

Mike Perry: One additional point very quickly is the interrelated issue with the Public Services (Social Value) Act, meaning that local authorities will need to take into account issues wider than the economic cost of the tender when assessing tenders. That could provide a useful opportunity for communities where they are providing multiple benefits from a contract, not just delivering minimal services for minimal costs. An issue for rural communities is that the level for when that issue is actually applicable is about £150,000, the contract value, so for some smaller contracts, which is probably more applicable to rural communities, that will not apply.

Q396 Chair: On community shops, you mentioned the size of the settlement. You cannot force people to shop there. If the village or the community does not shop there, there is not much to safeguard their future, is there?

Mike Perry: I completely agree. The one statistic we will trot out time and time again is there are 314 communityrun shops in existence. This is slightly updated now from the evidence we submitted. 314 communityrun shops have opened over the last 20 years, and 301 are still open today, so they are very successful and very viable. Where they differ from privately run shops is that the community literally owns it. They have a share; they have the ability to make their voice heard as to what the shop is and what it should be. Therefore, they get a great deal of commitment from their community, so they are extremely resilient forms of business. About 96% of those that have opened are still open, so it compares very favourably with any form of business I have come across.

Q397 Chair: Are you both worried about the loss of business through a number of reasons for rural post offices and pressure on the future of post offices, which in many cases are being replaced by a post van? Are you concerned by those developments, Mr Perry?

Mike Perry: We have had a commitment from Post Office Ltd. What I understand is that the Coalition has committed to not reducing the scale of the post office network during this Parliament.

Q398 Chair: Do you have evidence that councils, particularly district councils and county councils, are pushing business the way of post offices? Is the post office card still working for Work and Pensions, which I think Professor Shucksmith referred to earlier?

Mike Perry: I do not have detailed evidence of that. About 60% of communityrun shops provide post office services. The models that exist for post office service delivery within communityrun shops pretty much cover every single model that exists, apart from the main service delivery model that exists in larger settlements. Often communityrun shops are providing subsidised premises for a post office service. I do not really have evidence as to the types of business going through it from local authorities, but I know that it varies, just because the models are so different.

Q399 Neil Parish: To both of you, the DCLG estimates the average cost of drawing up a Neighbourhood Plan is between £17,000 and £63,000. Do organisations in rural communities, such as those in the voluntary sector and parish councils, have adequate human and financial resources to cope with devolution of responsibility from central Government, particularly given the recent announcement on the spending settlement?

Professor Shucksmith: The capacity to do that sort of thing, both in terms of the financial capacity and in terms of the other skills and qualities that a community would need, varies enormously from one place to another. In the written evidence, I have tried to draw that out a little bit in terms of the different elements of the capacity that a community might need, in terms of knowledge, social networks and the ability to work collectively together, which is quite a task. It seems to me that communities that do have those things will be the ones that are likely to establish Neighbourhood Plans and the others will not. It will be a minority that can, but there is another aspect to it, which is that the local authority has a duty, a requirement and a responsibility to support a group that is trying to draw up their own Neighbourhood Plan. It has certainly been said to me by planning officers that the diversion of their effort away from developing their core strategy and their central planning documents is significant. They are required to help communities work on Neighbourhood Plans and it does represent another call on departments that are losing staff.

Q400 Neil Parish: What should Government do so that the inequalities do not increase in rural areas, between the larger parish councils and the small ones-those that meet perhaps every other month-the different sized parishes, different budgets and all those things? How do we deal with that?

Professor Shucksmith: There are a number of things. First of all, to try to improve the quality of parish councils was something that was addressed a few years ago. The idea of quality parish councils was in the 2000 Rural White Paper. I thought that was a very good proposal, but it did not really get the implementation and the support that it deserved. Secondly, there is a need for community development support-for animation, for handholding and for building the skills but working with those communities. That requires people on the ground who have those community development skills. While that is a cost, and it may seem as if it is something that we cannot afford, it is something that is in the way of an investment, rather than a continuing revenue cost. It is something that is building up capacity, which might then save money in the future.

Q401 Neil Parish: How does the Government directly effect that then?

Professor Shucksmith: By funding those community development professionals, organising them and looking at lessons from other countries. We can look to Scotland, and the work of the Community Land Unit in supporting work in the Highlands and Islands, and many other countries across the world where there is relevant evidence to draw on. I do not think it has to be a high cost, but it is essential if one is trying to transfer responsibility and, at the same time, trying to ensure that that provides a relatively even standard of service, rather than creating greater inequalities.

Q402 Chair: Could I just turn to European funding and a comment that was made by the leader of North Yorkshire County Council? As the national contributions go down, rural areas become more dependent on European programmes by Leader. Are you concerned about scalebacks and uncertainties relating to the next stage of the RDPE and, if you are, have you made representations to the appropriate places in Government?

Professor Shucksmith: Yes, I am concerned about that, and thank you for bringing in the issue of European funding, because it is a major resource for exactly the purpose that we were discussing. That is the sort of thing that Leader has been about, and potentially one could have more of the Pillar 2 RDPE funding allocated towards that purpose. In fact, I have argued to past rural ministers that putting Pillar 2 to that use is more genuinely about sustainability than agrienvironment funding, which is actually revenue funding and does not invest anything for the future, whereas this really is an investment in trying to build something for the future and future generations. My advice would be to put more Pillar 2 funding into that sort of approach, the community development support, and to switch money from Pillar 1 to Pillar 2 to allow a greater pot there.

Q403 Chair: Farmers may not necessarily agree with you. Mr Perry, do you have a view?

Mike Perry: I am also a farmer’s son. There is a concern about the scaleback, but the other concern is making sure that the next generation of Leader actually fits the needs of communities today, as opposed to communities 10 years ago. That is an important issue. In terms of overreliance on European funding, through our work, for example, virtually none of the communities that have saved their shops or pubs have received any European funding through Leader. The majority have either raised the money themselves or got it through alternative sources, so it does not appear to be working from that point of view, and we are making representations in the light of that and the current timing of it, as people are looking at Leader, what it is and what it could be. Alongside the RDPE and CAP, we are making representations. I am sure Mark and others are doing the same.

Professor Shucksmith: Could I just add a point about the uncertainty of future funding and the gap between funding or programme periods? One of the things that has stopped Leader being as effective as it could have been is that, with every new EU funding programming period, there is a hiatus; all the staff are lost; the Local Action Groups are disbanded. There is a tremendous loss of capacity, knowhow, impetus and momentum. My suggestion, which I have made to officials in Defra, comes from a meeting of all the Local Action Groups in the North East that I chaired in the autumn, where this was a major concern. What emerged from that meeting was that, if the Local Action Groups were to be encouraged to continue meeting, even during the period when they are not funded, then they would be able to maintain a lot of that knowhow, impetus and momentum, and Leader would be much more effective in the future. My suggestion would be that ministers say to Local Action Groups that, if they continue meeting and being active, even with no funding-maybe the Government could give them minimal funding to at least attend meetings-the Government would undertake to make that a significant criterion in deciding where to support LAGs next time around. That would be costless and very effective.

Q404 Chair: Directed to you, Professor Shucksmith, the Department obviously is responsible for rural communities. Do you believe that Defra should have a policy on rural deprivation? Do you believe that rural deprivation should be distinguished from urban deprivation, and should be reflected in, for example, health and education funding?

Professor Shucksmith: Yes, I do. One could argue that it is not Defra that should be worrying about deprivation; it is DWP and all the other Government Departments. There is a difference between the rural experience of deprivation and disadvantage and the urban experience of deprivation and disadvantage. That has been established in a major report that the Commission for Rural Communities pulled together a few years ago and then explored further with many of the vulnerable groups in rural areas.

Q405 Chair: To answer the question, do you believe that Defra should have a specific policy on rural deprivation? Should this be reflected in health and education funding?

Professor Shucksmith: Yes. I was just going to argue that the reason for that is that there is this different rural experience, and Defra would be the Government Department that would be most likely to understand that. Their role is to try to influence other Government departments’ policies.

Q406 Chair: Just one last question to you both, if I may: you mentioned sustainability, Professor Shucksmith. What do rural communities need to do to be sustainable and resilient to future challenges?

Mike Perry: I think Mark summed it up quite nicely in his paper. It has moved away from sustainability towards resilience. It is the ability to cope with changing circumstances and changing issues. From our point of view, it is the willingness and ability to act when others are not able to act for them. Again, Mark has said this and other papers have said this, and I think we started the session with this: rural communities are going to face the issue over the next few years, with the financial crisis and everything else, that public service delivery models and private service delivery models will be threatened, and communities will have to look to themselves to a greater extent to do this. There are certain processes that they can go through to be better prepared for it, but really it is about being ready, willing and able to act when called upon. Planning ahead is obviously key to that as well.

Professor Shucksmith: As I mentioned in the written evidence, people are becoming more enamoured of the term "resilience" than "sustainability" now, partly because sustainability means different things to different people and, to some extent, the term has been captured by environmental concerns more than the social and the economic perhaps. Resilience allows you to bring all those back together again. Resilience seems to me to be about adapting to new circumstances, with this idea of bouncing forward, rather than bouncing back to business as usual or the system as it was before.

The essential elements that enable a community to do that are: to have access to assets, both within and outside; to have networks, learning from other communities but also learning from universities, central Government, organisations like Plunkett, ACRE and so on; and the ability to work together. That is probably the hardest thing, because it involves things like leadership, conflict resolution and inclusiveness and all that. As I have argued, in some communities that is there already but, in others, it does need further development. It needs capacitybuilding and animation, and that is where an enabling state is absolutely essential. Passing responsibility to communities to take responsibility is very desirable, but I do not think that can be done in an evenhanded way by an absent state. It needs an enabling state.

Chair: May I thank you both for participating and our earlier witness, Mr Halstead, as well? We have benefited enormously from your expertise and we are very grateful to you.

Prepared 25th January 2013