House of Commons Environment, Food and Rural Affairs Committee Rural Communities Sixth Report of Session 2013–14 Volume I Volume I: Report, together with formal minutes, oral and written evidence Additional written evidence is contained in Volume II, available on the Committee website at www.parliament.uk/efracom Ordered by the House of Commons to be printed 16 July 2013 HC 602 [Incorporating HC 714-i to vi, Session 2012-13] Published on 24 July 2013 by authority of the House of Commons London: The Stationery Office Limited £0.00 Environment, Food and Rural Affairs Committee The Environment, Food and Rural Affairs Committee is appointed by the House of Commons to examine the expenditure, administration, and policy of the Department for Environment, Food and Rural Affairs and its associated bodies. Current membership Miss Anne McIntosh (Conservative, Thirsk and Malton) (Chair) Richard Drax, (Conservative, South Dorset) George Eustice (Conservative, Camborne and Redruth) Barry Gardiner (Labour, Brent North) Mrs Mary Glindon (Labour, North Tyneside) Mrs Emma Lewell-Buck (Labour, South Shields) Iain McKenzie (Labour, Inverclyde) Sheryll Murray (Conservative, South East Cornwall) Neil Parish (Conservative, Tiverton and Honiton) Ms Margaret Ritchie (Social Democratic and Labour Party, South Down) Dan Rogerson (Liberal Democrat, North Cornwall) The following were also members of the committee during this inquiry. Amber Rudd (Conservative, Hastings and Rye) Thomas Docherty (Labour, Dunfermline and West Fife) Powers The committee is one of the departmental select committees, the powers of which are set out in House of Commons Standing Orders, principally in SO No 152. These are available on the internet via www.parliament.uk. Publication The reports and evidence of the Committee are published by The Stationery Office by Order of the House. All publications of the Committee (including press notices) are on the Internet at www.parliament.uk/efracom Committee staff The current staff of the Committee are David Weir (Clerk), Anna Dickson (Second Clerk), Sarah Coe (Committee Specialist—Environment), Phil Jones (Committee Specialist —Agriculture), Clare Genis (Senior Committee Assistant), Owen James (Committee Assistant) and Hannah Pearce (Media Officer). Contacts All correspondence should be addressed to the Clerk of the Environment, Food and Rural Affairs Committee, House of Commons, 7 Millbank, London SW1P 3JA. The telephone number for general enquiries is 020 7219 5774; the Committee’s e-mail address is: [email protected]. Media inquiries should be addressed to Hannah Pearce on 020 7219 8430. Rural Communities 1 Contents Report Page Summary 3 1 Introduction 5 Background 5 2 Rural funding 7 Local government finance settlement 7 Retention of business rates 9 School funding 10 Healthcare funding 13 3 Broadband and mobile 16 The Government’s proposals 17 Beyond 2015 24 Mobile Infrastructure Project 26 4 The rural economy 29 Background 29 Barriers to growth 30 Rural Economy Growth Review 36 Local Enterprise Partnerships 41 5 Housing 44 Affordability 44 Housing as a ministerial priority 45 Affordable Homes Programme 46 Right to Buy 49 Welfare Reform Act 2012: under-occupancy 51 Planning and development 52 Second homes 57 New Homes Bonus 59 Help to Buy 59 Changing demographics 60 6 Fuel poverty 63 Background 63 Energy Company Obligation and the Green Deal 63 Energy Performance Certificate 65 Bulk-buying initiatives 65 7 Rural transport 67 A strategic policy 67 Bus services and community transport 68 Concessionary fares 71 2 Rural Communities Wheels to Work 72 Fuel prices 73 Reducing car dependency 75 8 Empowering communities 76 Community rights 76 Retaining services 78 Unequal capacity 81 9 Rural Communities Policy Unit 83 Rural proofing 83 Engagement 84 RCPU’s priorities 85 Transparency, accessibility and expertise 86 10 Conclusion 89 Conclusions and recommendations 91 Annex: Defining rural areas 101 Formal Minutes 103 Witnesses 104 List of printed written evidence 106 List of additional written evidence 106 List of Reports from the Committee during the current Parliament 107 Rural Communities 3 Summary In this inquiry we set out to assess how successful Defra and its Rural Communities Policy Unit have been at championing rural issues across Government to achieve the RCPU’s target of “fair, practical and affordable outcomes for rural residents, businesses and communities”. The RCPU faces a difficult task if it is to meet this ambition. Too often Government policy has failed to take account of the challenges that exist in providing services to a rural population that is often sparsely distributed and lacks access to basic infrastructure. Rural communities pay higher council tax bills per dwelling, receive less government grant and have access to fewer public services than their urban counterparts. The Government needs to recognise that the current system of calculating the local government finance settlement is unfair to rural areas in comparison with their urban counterparts and take action to reduce the disparity. This ‘rural penalty’ is not limited to public services, it is also acute in many areas of infrastructure, not least the provision of high-quality broadband. Businesses, schools and households in rural areas have fallen behind urban areas when it comes to broadband access. Through the Rural Broadband Programme the Government is taking steps to improve rural communities’ access to broadband. The focus of the Programme must be on improving access to those communities with no or slow broadband rather than increasing the speed for those who already enjoy an adequate service. The Government has made growing the rural economy its top priority. To achieve this a number of barriers need to be overcome not least improving rural businesses’ access to finance. The Government must ensure that initiatives that offer financial support to the business sector such as the forthcoming Business Bank and the Single Local Growth Fund are as available to rural businesses as they are to their urban counterparts. Lack of affordable housing can be a brake on economic development. On average people working in rural areas earn less than those working in urban areas but rural homes are more expensive than urban ones. Rural England desperately needs more affordable housing yet the Government’s housing policies pay insufficient regard to the needs of rural communities. Failure to provide more of the right housing, at the right price and in the right place will exacerbate the existing problems of unaffordability and inequality in some parts of Rural England. Rural communities should not be seen as helpless victims whose woes can only be solved by others. Some of the most valuable initiatives to rural communities have started within communities themselves rather than as a response to government policy. The Government is devolving more powers to communities to enable them to have greater influence over their future. We support these moves and believe many rural communities are well placed to respond but the Government must also ensure that those communities that may lack the confidence and capacity to help themselves are provided with the support to do so. 4 Rural Communities We welcome the Government’s Rural Statement. Its publication brought much needed attention to rural issues. The final sentence of the Statement described it as a contract with rural areas, so they can hold Government to account - when it is next updated we expect it to contain some key performance measures so that rural communities can do just that. Rural Communities 5 1 Introduction Background 1. A quarter of England’s population, 12.7 million people, live in rural communities.1 Rural areas make up 86% of England; they cover a wide range of geographies and include areas of affluence and poverty, both of which can vary markedly not just within local areas but within individual communities themselves. Rural areas are also home to over half a million businesses, that together contribute more than £200bn to the economy. 2 Responding to the challenge of sustaining and developing rural communities is not only a task for the Department for Environment, Food and Rural Affairs (Defra), but for all of Government, national and local. 2. Our inquiry was prompted by the Government’s decision in June 2010 to abolish the Commission for Rural Communities and increase the rural knowledge base within Government through a strengthened Rural Communities Policy Unit (RCPU). In our Farming in the Uplands Report we expressed concern that, “following the abolition of the CRC, there is a real risk of a diminution in rural expertise within Defra and across Government”.3 In a Ministerial Statement on 1 April 2011 the Government set out how its new centre of rural expertise would work to ensure government policies and programmes properly take account of the needs and the potential of rural residents, businesses and communities: Defra’s ministerial team will act decisively to champion rural issues across Government. We are now supported in this by an enhanced Rural Communities Policy Unit (RCPU) which will operate as a centre of rural expertise, supporting and co-ordinating activity within and beyond Defra. The RCPU will play an important role in helping all Government Departments to ensure that their policies are effectively ‘rural proofed’ before decisions are made. Building upon the Department’s existing rural policy team, we have drawn in staff from the Commission for Rural Communities (CRC) and from other parts of Government to create the new unit. The RCPU’s immediate objectives are: • To identify issues of critical importance to rural communities and then support, inform and influence the development and implementation of relevant Government policy so as to achieve fair, practical and affordable outcomes for rural residents, businesses and communities; • To develop open and collaborative approaches to gathering information, evidence and potential solutions, working closely with the wide range of organisations which support and represent rural communities. 1 Department for Environment, Food and Rural Affairs (Defra), Statistical Digest of Rural England, April 2013 2 Ibid.