Conclusions and recommendations
Rural funding
LOCAL GOVERNMENT FINANCE SETTLEMENT
1. Sparsity of population makes
it more expensive to provide services in rural areas than urban
areas. Yet, despite this, urban areas—as defined by the
Government—receive 50% more funding per head than rural
areas. Part of this disparity of funding results from the process
of 'damping' in the spending settlement.
The Government needs to recognise that the current system of calculating
the local government finance settlement is unfair to rural areas
and that the disparity must be reduced. The Rural Fair Share Campaign
calls for the disparity to be reduced to 40% by 2020. We agree
and recommend the Government factors this target into future spending
settlements.
(Paragraph 8)
2. Defra needs to
work closely with the Department for Communities and Local Government
to ensure future local government finance settlements reduce the
rural penalty. They must use an agreed definition of rurality
to achieve this goal. (Paragraph 10)
3. While the £8.5
million 'efficiency support' payment is welcome, such a payment
does not address the underlying problems in the current system
for allocating funds through the local government finance settlement.
(Paragraph 12)
RETENTION OF BUSINESS RATES
4. The
Rural Communities Policy Unit must monitor the impact of the business
rates retention policy on rural local authorities and raise any
adverse consequences with Ministers in both Defra and DCLG.
(Paragraph 15)
SCHOOL FUNDING
5. Local
authorities are better placed than central government to judge
the support rural schools require yet the changes for 2014-15
prevent local authorities from having the flexibility to do this.
This is a backward step and we recommend the Government reverts
to its previous position of allowing local authorities to vary
funding according to need rather than using a centrally derived
formula. The change we recommend is cost-neutral and in line with
the Government's agenda of localism.
We welcome sparsity funding in principle, but introducing 'as
the crow flies' distances adds unnecessary complexity. The option
of sparsity funding should be retained but local authorities must
be given more flexibility to decide the criteria used to apply
to it. (Paragraph 23)
6. The scope of the
pupil premium entitlement should be extended to target more children
who live in poverty than are included in the current measures
that determine eligibility for free school meals. (Paragraph 25)
HEALTHCARE FUNDING
7. Given
the difference in experience of health services between urban
and rural areas, the unequal funding allocation and the increasing
age of rural populations, we believe rural healthcare should be
a top priority for Defra Ministers. (Paragraph 30)
Broadband and mobile
RURAL BROADBAND PROGRAMME
8. The
Universal Service Commitment (USC) of 2Mbps is a big step forward
for households and businesses currently with no or slow broadband.
This part of the rural broadband programme is crucial and it should
not be undermined by the ambition to roll out superfast broadband
to those who already enjoy an adequate service. It must be the
priority, particularly if there is a risk of funding not stretching
as far as originally hoped. However,
given the delays to the Rural Broadband Programme, the Committee
is unclear when those currently without any access may benefit.
2Mbps must also be the minimum speed that users receive during
periods of peak demand, not a headline 'up to' figure that is
rarely achievable. (Paragraph
40)
9. As part of the
2Mbps roll out, if communities wish to put in place an alternative
scheme that offers better broadband than the USC would offer then
they should receive every encouragement and support from Government
to do this—including any funding originally intended to
help those communities meet the
USC. (Paragraph 41)
10. The USC should
include a minimum upload speed target set at a level that meets
the needs of SMEs and consumers. The Government-funded infrastructure
must also have the capacity to allow such a speed to be achievable
at times of peak demand. (Paragraph 43)
11. In response to
this Report the Government should set out how many households
and businesses are not going to be covered by the roll-out of
2Mbps broadband under the Rural Broadband Programme, and the reasons
for this. (Paragraph 44)
12. BDUK and Ofcom
should consider requiring BT, where it is in receipt of state
aid, to disclose its costs in a way that permits comparison across
contracts. Without such transparency it is difficult to see how
value for money can be guaranteed, particularly now that the only
competitor to BT has effectively ruled itself out of the bidding
process.
(Paragraph 52)
RURAL COMMUNITY BROADBAND FUND
13. It
remains disappointing that payment under the Rural Community Broadband
Fund is available solely on evidence of past expenditure. The
grant should be there to help communities to roll out broadband
infrastructure, not just a means of recovering some of the costs
afterwards. (Paragraph
55)
14. The Rural Community
Broadband Fund is an important lever in the roll-out of superfast
broadband to the hardest to reach 10%. It is therefore disappointing
that so little money, less than 2% of government's overall funding
for broadband, has been made available to encourage and support
innovative community-led solutions in these rural areas. Defra
should expand the scope of the RCBF when the next round of RDPE
funding is available. (Paragraph 59)
BEYOND 2015
15. The
Government should draw on lessons from the Rural Community Broadband
Fund and use the funding from the BBC as a lever to encourage
private and community sector capital and expertise. As a pre-requisite,
the Government must publish details showing precisely what areas
will be covered by BT and when, in order to encourage alternative
providers to fill in the gaps and prevent bodies in receipt of
public money competing with each other. We have already stated
our belief that the RCBF should provide up-front support to projects
and this should also be the case in the application of the funding
from the BBC. (Paragraph 65)
MOBILE INFRASTRUCTURE PROJECT
16. The
lack of mobile coverage in large parts of rural Britain is unacceptable
and we welcome the Government's commitment to go some way to addressing
this problem through the Mobile Infrastructure Project, although
it is disappointing that the ambition of the scheme has been scaled
back from that originally announced. We are concerned that in
focusing on reducing the number of premises in 'not-spots', which
may already have landline access, large parts of the countryside
and those who work in it may still be left without access to mobile
technology. The Government must set out what improvement in geographical
coverage the Government foresees as a result of the £150
million initiative. (Paragraph 70)
The rural economy
PLANNING AND RATES
17. The
measure to exempt new-built commercial property from empty property
rates is currently out to consultation but it has our full support
and we hope to see it implemented in October 2013 as envisaged
by the Chancellor. (Paragraph 79)
18. To promote rural
economic growth, we urge local authorities to take action to reassure
themselves that businesses in their area are in receipt of all
of the business rate reliefs for which they are eligible. We accept
that there is a squeeze on local authorities' finances but we
urge them to make as much use of the discretionary element of
rural rate relief as possible to support those rural businesses
critical to the vibrancy of rural life. (Paragraph 81)
19. We welcome the
Government's ambition to create a simpler planning system that
will support sustainable rural economic development. For it to
be effective local councils must work pro-actively with local
businesses that wish to expand or diversify. Councils must move
away from the tick box system of the past to one where the planning
officer is an adviser helping a business build its confidence
and prospects. The free planning advice service that has been
made available to businesses in Rural Growth Networks is an excellent
example of the Government listening to the concerns of business
and putting policy in practice. (Paragraph 86)
LACK OF FINANCE
20. The
Government must ensure that provision of banking services to rural
communities is included in any programme to increase competition
in the banking sector.
(Paragraph 94)
21. We welcome the
Government's proposal to create a business bank to increase access
to finance for small and medium sized businesses. Small businesses
are the lifeblood of the countryside. In developing the business
bank we urge the Government to ensure that businesses from rural
areas will be able to benefit just as much from its creation as
their urban counterparts. (Paragraph 96)
RURAL ECONOMY GROWTH REVIEW
22. The
Rural Economy Growth Review should not be seen in Government as
purely a Defra initiative. Lessons learnt from the Review must
be translated into policy influence across government. (Paragraph
98)
23. When more money
becomes available through the next round of Rural Development
Programme the RCPU should extend the current scheme and explore
whether there is a need to create an additional scheme aimed at
supporting businesses that require grants of less than £25,000.
(Paragraph 101)
24. The Government
should consider creating a Rural Growth Network that has supporting
young people who face specific barriers to employment, education
and training, as its focus. (Paragraph 105)
25. In response to
this report Defra must set out what steps it is taking under the
measures set out in the Rural Economy Growth Review to increase
the number of people from under-represented groups who access
the natural environment. (Paragraph 109)
LOCAL ENTERPRISE PARTNERSHIPS
26. It
is important that the Government puts in place safeguards to ensure
that LEPs' focus and funding is of benefit to all parts of the
country, not just urban areas. Their performance must be measurable
and clear to the communities they serve. The RCPU should lead
on this work and in response to this Report set out how it will
make sure that the work of LEPs is robustly rural proofed.
(Paragraph 115)
27. We are concerned
that micro- and small businesses characteristic of rural areas
might be overlooked by the LEP structure, Defra
must work with BIS to ensure this is not the case by advocating
a closer working relationship between LEPs and their local rural
and farming network. Defra also need to
ensure that there is no disconnect between the work of LEPs and
other rural bodies that have a role in economic development such
as AONBs, local action groups, community councils and Local Nature
Partnerships. Finally, the RCPU, through its LEP roundtables,
must be a strong advocate not just for the rural economy but for
the social and environmental needs of rural communities as well.
(Paragraph 116)
Housing
28. We
urge the Government to consider whether local authorities should
be allowed to invest in housing under normal borrowing guidelines.
If the Government opposes this suggestion it must set out why.
(Paragraph 121)
AFFORDABLE HOMES PROGRAMME
29. The
problem of lack of affordable housing in some rural areas is so
acute that we do not believe that the Affordable Homes Programme
up to 2015, which aims to develop 8,000 homes among 16,000 rural
communities, will be sufficient in scope to make a meaningful
impact, particularly in those areas with the highest numbers of
households in temporary accommodation such as the southwest of
England. The Government has allocated a further £3.3 billion
to the Affordable Homes Programme from 2015 onwards—we expect
a larger proportion of this money to be spent in rural areas than
has happened in the current spending round.
(Paragraph 127)
30. We expect the
Rural Communities Policy Unit to monitor the progress of the Affordable
Homes Programme and work with the Homes and Communities Agency
to ensure a minimum of 10% of homes built under this Programme
are in those rural settlements identified in the Taylor Review
as most in need. We expect to hold Defra to account should the
proportion fall below the 10% threshold. (Paragraph 128)
AFFORDABLE RENT MODEL
31. The
Affordable Rent policy which increases rents on the least well
off in society in order to compensate for a marked reduction in
funding from central government is one which gives us concern,
particularly for rural areas where the cost of living is already
high. Affordable rents, tagged at up to 80% of market rent, means
homes will remain unaffordable to many rural workers. The RCPU
has a crucial role in monitoring the outcome of the affordable
rent model in rural areas and must seek amendment to the policy
if it is found to be failing to assist those in rural housing
need. (Paragraph 130)
RIGHT TO BUY
32. The
RCPU must monitor the impact of Right to Buy on rural areas, particularly
National Parks, and if necessary put the case for them to be exempt
from this scheme.
(Paragraph 134)
UNDER-OCCUPANCY
33. It
is difficult to see how the under-occupancy policy, which might
cause key workers to leave areas where they perform a vital role,
and force children to move schools, is of benefit to rural communities.
Settlements of fewer than 3,000 people, the same threshold as
the Right to Acquire scheme, should be excluded from the under-occupancy
policy.
(Paragraph 137)
RURAL EXCEPTION SITES
34. The
importance of rural exception sites to rural areas should be reflected
in national housing policy. They are not going to solve the problem
of lack of housing in rural areas on their own, but we wish to
see the RCPU work with Department for Communities and Local Government
and local councils to explore whether more homes might be made
available under such schemes. (Paragraph 145)
NEIGHBOURHOOD PLANNING
35. Ongoing
support for communities developing neighbourhood plans, particularly
those that lack the capacity, expertise and finance to undertake
this work, is crucial if the process is going to deliver the benefits
communities have been led to expect. Through its rural networks
Defra has a role to ensure that this vital support is available.
Defra must also set out how it intends to monitor the neighbourhood
planning process to ensure it does not have the unintended consequence
of increasing inequality both within and between rural communities.
(Paragraph 153)
36. Despite its benefits,
neighbourhood planning will not always be the most effective option
for communities to choose to achieve the desired result. Where
the community and the local planning authority are in agreement,
there are better approaches which avoid the cost of neighbourhood
planning and are less onerous. Defra must ensure that communities
receive unbiased advice and only choose the neighbourhood planning
option where it is in their interest to do so. (Paragraph 154)
SECOND HOMES
37. People
should not be prevented from buying second homes but we believe
there is merit in the RCPU exploring options that may make the
process either less attractive for the second home owner or more
beneficial for the rural community or both. To reflect local circumstances
implementing such options must be at the discretion of the local
authority.
(Paragraph 159)
NEW HOMES BONUS
38. Urban
areas already receive 50% more in local government funding than
rural areas. We have made it clear that we wish the Government
to reduce this gap but the New Homes Bonus has the potential to
widen it further. The RCPU should monitor the impact of the New
Homes Bonus on rural areas and seek urgent amendment if it is
found to be putting rural areas at a disadvantage. (Paragraph
161)
HELP TO BUY
39. Assuming
uptake from lenders, the Help to Buy scheme will offer some help
to those wishing to purchase a home. However, it may also cause
house prices to rise further. Unaffordability of housing is an
acute problem in rural areas and we question the merit of a scheme
that has the potential to make the situation worse. The Government's
focus must be on measures to increase supply. (Paragraph 163)
Fuel poverty
40. It
is disappointing that off-grid households are being prevented
from accessing the same incentives and finance to improve their
properties as on-grid households. We look to the RCPU to rural
proof energy efficiency policies and see that the bias against
rural communities is removed. (Paragraph 174)
41. Collective buying
groups have the potential to reduce energy bills for our rural
communities. We are encouraged by the steps Defra has taken to
support those communities wishing make use of the benefits of
collective buying power. In order to be able to judge the effectiveness
of this approach, Defra should set out how many communities have
set up oil-buying groups since 2011-12 in its response to this
Report. (Paragraph 177)
Rural Transport
A STRATEGIC POLICY
42. The
Government must develop a strategic policy aimed at reversing
the trend of declining accessibility to key services for people
living in rural areas. As the Department responsible for rural
affairs, Defra has a key role in developing this policy. The policy
should be an expansive vision that includes multimode approaches
to regional rural transport. As part of this work, Defra should
liaise with bodies such as the Association of Train Operating
Companies, Network Rail, Local Enterprise Partnerships and the
Department for Transport to explore improving rail connectivity
within rural areas. (Paragraph 181)
43. Defra should work
with local authorities and LEPs to support actively those rural
communities wishing to maintain or improve their rail access.
As part of this, Defra should consider whether RDPE funding might
be made available to support rural communities that are successful
in the existing round of the New Station Fund (and future rounds
should the Fund be extended), in order to help create successful
local transport hubs. Such work should be incorporated in a nationwide
strategy for rural transport. (Paragraph 182)
COMMUNITY TRANSPORT
44. When
the next update of the Rural Statement is published we expect
it to include the steps the Government is taking to follow up
on the concerns and opportunities identified during the production
of the 2012 CTA State of the Sector Report. This work must include
an evaluation of the outcome of cuts in the Bus Service Operators
Grant on community transport as well as consideration of how changes
to the bus subsidy system will impact on that sector. (Paragraph
191)
45. We also expect
Defra to work with rural and transport practitioners within local
authorities to ensure that where a rural bus service is targeted
for closure, alternative community-led schemes are actively pursued
and supported where demand is demonstrated. Such community-led
schemes, as well as other transport services, should not ignore
the needs of the labour market in favour of other requirements.
(Paragraph 192)
CONCESSIONARY FARES
46. We
believe there is a need for the Government to review the current
mandatory nationwide concessionary fare system. In line with the
Government's decentralising agenda the review should consider
whether locally led solutions offer a better means of safeguarding
services and generating growth. Protecting the vulnerable should
be at the heart of any proposed reform to the system and allowing
elderly and disabled people to gain concessions on services provided
by the community transport sector must be considered. (Paragraph
194)
WHEELS TO WORK
47. Defra
should work with the DfT and DWP as well as local authorities
and civil society groups to ensure that schemes—such as
Wheels to Work—that enable young people to get to work,
training and education do not falter through lack of funding.
Where necessary, alternative sources of funding should be explored
including loan finance from Big Society Capital and other social
investment bodies for the third sector.
(Paragraph 195)
FUEL PRICES
48. In
addition to maintaining the freeze on duty the Government should
continue to explore other options to address the high cost of
fuel in rural areas. This should include continuing work on the
possibility of introducing fuel duty discounts in the more remote
parts of the United Kingdom that do not have easy access to the
cheaper fuel available at supermarket-tied filling stations. The
Government should report back on this issue no later than next
year's Budget.
(Paragraph 201)
REDUCING CAR DEPENDENCY
49. As
part of a strategy on rural transport the Government, and its
delivery bodies such as Local Enterprise Partnerships, must consider
measures that reduce car dependency. More needs to be done to
create rural transport hubs. Buses that link up with rail services
to enable people to get to work and education should be the norm
not the exception. Encouraging increased take-up of cycling must
also form part of a rural transport strategy. This should include
the provision of safe, dedicated cycle paths along key commuter
routes and secure storage facilities at bus and railway stations.
(Paragraph 203)
Empowering communities
COMMUNITY RIGHTS
50. The
new Community Rights are welcome additional tools to allow communities
to shape their future development. However, giving communities
these rights does not mean that it will be appropriate in all
cases for communities to exercise them to achieve the desired
outcome. The Government should promote the new powers it has created
but it must not push communities into using them unnecessarily,
particularly if the outcomes can be better achieved using existing
tools. Some of the new rights are costly to implement and are
not without risks. It is crucial that communities receive impartial
advice and the Government must do better to ensure this is the
case. (Paragraph 211)
RETAINING SERVICES
51. The
Government is not doing enough to promote the benefits of community
ownership and the role community-owned enterprises, social enterprises
and co-operatives can have in growing the rural economy—especially
in our more isolated communities. A firm endorsement of this type
of enterprise in policy and planning guidance will have a positive
impact on the attitudes of public bodies, particularly local planning
authorities and LEPs. Such an approach is consistent with the
Government's stated objectives of promoting action driven by civil
society rather than reliant on the public sector.
As part of an increased emphasis on the benefits of community
ownership, the Government must do more to promote the Community
Right to Build scheme as a means to help communities build or
retain amenities such as village shops.
(Paragraph 214)
52. During development
of the new Rural Development Programme Defra should explore how
Leader can be used better to help those communities looking to
retain services that are under threat. However, no amount of support
will make a local shop, pub or other service viable if communities
do not use them.
(Paragraph 217)
COLLECTIVE ACTION
53. We
recommend the RCPU put in place a programme to support communities
wishing to come together to realise the benefits that collective
action can bring.
(Paragraph 218)
UNEQUAL CAPACITY
54. As
take-up of neighbourhood plans demonstrates there is a risk that
if the state passes power and responsibility to local communities
some will rise to the challenge but some will not. Inequality
within rural areas may increase as a result. We welcome funding
from Government to help communities get initiatives off the ground
but funding must also be directed at professional community support
organisations. Without the encouragement, hands-on support and
resources of such organisations, many communities may miss out
on the opportunity to have a say in their future. (Paragraph 222)
Rural Communities Policy Unit
RURAL PROOFING
55. We
recommend that all policies be subject to rural proofing, unless
a case can be made that it does not apply. Action taken to ensure
fair rural outcomes must be reflected in a policy's Impact Assessment
so that rural stake-holders can see that their needs have been
accounted for. Where applicable, the impact assessment process
must include consideration of the rural premium that exists in
delivering services in rural areas. (Paragraph 227)
56. We agree that
Defra should review rural proofing annually. The review must acknowledge
where it has failed to secure rural fairness as well as the successes
it has achieved. It seems
sensible to us for that review to be included in Defra's Annual
Report and Accounts in line with the guidance for other government
departments. (Paragraph 229)
ENGAGEMENT
57. While
we consider that the network of bodies with which the RCPU maintains
a structured relationship constitutes a comprehensive engagement
framework, we believe that including rural practitioners in local
authorities in that structure would be mutually beneficial.
(Paragraph 233)
RCPU'S PRIORITIES
58. While
deprivation may be more directly aligned with other Departments
such as DWP we believe that because of the different rural experience
of deprivation and disadvantage, which Defra is most likely to
better understand, rural deprivation should be a policy focus
for the RCPU. In addition, the implications of an ageing rural
population mean that if healthcare is not already included within
the services priority then the RCPU should add it as an additional
policy focus.
(Paragraph 236)
59. When it is next
updated we expect to see a more ambitious Rural Statement that
includes reference to the RCPU's policy plans for the future.
The Statement must also include some key performance outcomes
so that rural areas can hold the Government to account. Such indicators
might include figures on rural GVA, rural deprivation, the numbers
of rural pubs and shops, and feedback from rural stakeholders.
(Paragraph 244)
Conclusion
60. In
response to this Report Defra must set out what steps it is taking
to combat poverty and deprivation in rural areas and how it is
ensuring that pockets of rural deprivation that might otherwise
be overlooked in official statistics are being recognised across
government. (Paragraph 249)
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