UK Shared Prosperity Fund: Rural Areas

Alicia Kearns Excerpts

Wednesday 11th May 2022 Commons Chamber

[Alicia Kearns (Rutland and Melton) (Con)]

When people think of levelling up, what often comes to mind is cities that have been left behind, areas of the north whose industries have changed and towns where inequalities are often blatant and impossible to miss, but how often are the needs of rural communities considered within that discussion? I know that they are largely absent from the media debate on this issue and I suspect that they rarely get a look-in in Whitehall. This is the crux of why I stand here this evening: rural communities can be forgotten no more. Too many of them have been left behind, and they deserve to be levelled up too.

One fifth of the UK’s population live in rural areas, so this debate is of great consequence to very many. We too need support to access the opportunities our communities need to succeed. I recognise that this is not straightforward, because in rural areas poverty is often hidden. Barriers to social mobility can be more difficult to observe in rural areas, and it costs more to deliver services in those areas. Another issue is that deprivation is used as a key determinant of funding, but with no recognition of the fact that rural poverty should be considered within this because of the added cost of accessing services in rural areas, which deprives many of access. A focus in policy making on urban and industrial growth has come at the expense of those who do not live in large cities, and this has been made worse by underinvestment in critical infrastructure and local government funding, particularly in areas of the east midlands.

[Jane Hunt (Loughborough) (Con)]

My hon. Friend is making an excellent speech. The national figure for this year’s funding settlement is £128 per person, but Leicestershire County Council gets only £85 per person.

[Alicia Kearns]

My beloved hon. Friend is absolutely right. If Leicestershire were funded the same as Surrey, it would get something like £104 million more, which I will address in more detail shortly.

--- Later in debate ---

Motion made, and Question proposed, That this House do now adjourn.—(David T. C. Davies.)

[Alicia Kearns]

Rural prosperity has been stifled, and the rural powerhouse campaign estimates that closing the rural productivity gap would add £43 billion of gross value added to our economy.

I convey a simple request to the Minister: that the Government make sure they do not leave rural areas behind; that the Government promise to level up rural areas; that he sends a delegation of civil servants to my constituency—they could also pop across the border to his constituency—to see the challenges faced by our rural authorities; that he considers creating a rural capital investment fund; and that he establishes a rural deprivation unit in his Department.

[Jim Shannon (Strangford) (DUP)]

I congratulate the hon. Lady on securing this debate. As the MP for the rural constituency of Strangford, this subject is close to my heart. I look forward to the Minister’s response.

Does the hon. Lady agree that many rural businesses would be successful online if only they had more support specifically designed to help those in rural areas and that some of the shared prosperity fund should be allocated for specialists in rural business to provide training and support?

[Alicia Kearns]

I could not agree more. Rural businesses also require more support to access the broadband they need to establish and grow.

I welcome the UK shared prosperity fund, which is a central pillar of our levelling-up agenda. It rightly focuses on local stakeholders and letting local people have their say, but I would like to raise the concerns expressed to me by Harborough District Council, Melton Borough Council and Rutland County Council.

First, rural districts and local authorities have been prescribed relatively small proportions of funding. That is not a surprise to many of us, but I hope it can be rectified. Secondly, local flexibility risks being constrained by the fund’s pre-specified outcomes. Finally, the yearly spending requirements limit our ability to maximise investment spend over the fund’s duration.

For the shared prosperity fund to be most successful, we have to focus on long-term investments, but a closer inspection of the 2021-22 Red Book shows that there will be no dedicated, ringfenced funding for rural businesses, which will hit communities like the hon. Gentleman’s and mine hardest. Shared prosperity begins with the recognition that different areas have different needs, and my good friend the Minister knows my constituency of Rutland and Melton and the Vale of Harborough villages very well. In many ways, our communities are the same. They are idyllic and have an enormous sense of community. Their big-heartedness and friendliness is heartfelt and deep, and we have the picturesque rolling hills of England. Uppingham, one of my three towns, was voted the best place to live in the east midlands, and Melton was voted sixth.

We have industries that people might not associate with rural areas. Samworth Brothers makes the majority of sandwiches in this country, and Arnold Wills makes the majority of belts. We have the Hanson cement quarry, Mars Petcare, C S Ellis, which is an amazing national haulage company, and Belvoir Fruit Farms, and of course our stilton and pork pies are enjoyed around the world.

We love and want to protect our rural way of life, but we need support. Delivering services in rural areas is more expensive, rural economies are more susceptible to skills shortages, our physical and digital connectivity lag behind other parts of the UK and the geographical spread of our communities can obscure the nature of the issues that people face.

The relative affluence of some parts of Rutland and Melton means that some pockets of deprivation are too often overlooked by Government policy, which is to the detriment of rural communities. Rutland ranks in the bottom 10% of the entire country for social mobility, and I believe rurality plays a large role in that, alongside insufficient Government support. I know that the Secretary of State is especially interested in tackling these pockets of deprivation, and that is where a rural deprivation unit within his Department would make a fundamental difference. Such a unit would help it consider and understand the complex nature of rural inequalities and make sure that local investment plans take it into account. It would provide a renaissance for our rural communities.

I come to local government funding, an issue that my hon. Friend the Member for Loughborough (Jane Hunt) rightly raised. For too long, communities in Leicestershire and in Rutland and Melton have been coming second. Despairingly, Leicestershire is the lowest-funded county council per head in England, while Rutland County Council is expected to raise significantly more revenue through local taxation than other local authorities in England. The east midlands has the lowest level of public investment of any region in England. How can we have shared prosperity when long-term funding settlements are so unfavourable to rural areas? This is a bold and ambitious agenda, but how can our councils do more with less? We desperately deserve the funding we need.

Rutland County Council has been an effective unitary authority for many years and we are proud of our independence. We ranked No. 1 on the Impower index as the highest performing council on adult social care in the country, but we have forecast a budget gap for 2023-24 onwards. We are required to raise a shocking 80% of our revenue through taxation, whereas the national average for councils is just 60%. That means that the council tax for a band D property in Rutland is £2,200 a year, and we are talking about a council in the worst 10% for social mobility in our country. We receive £331 less Government funding per household than other councils and we have the highest council tax in the country. That is not good enough and it is not fair.

Let us then look at the position for Leicestershire County Council, in which the Melton, Vale and Harborough parts of my constituency sit. As I mentioned, if LCC was funded at the same level as Surrey, it would have £104 million more to support people across Leicestershire. This situation cannot be right, and we need fair funding. I am pleased to have secured productive meetings between Rutland County Council and the relevant Minister. I hear and hope that future funding settlements will be provided earlier to allow for better local planning, but they also need to be richer. My Leicestershire colleagues and I have worked tirelessly since our elections to try to get the Department to pay heed to this unfair imbalance. I know that it is not easy or straightforward, and that budget would be required, but we must rectify these injustices. I have raised the issue of them time and again, and I hope the Department will pay attention to them.

Let me move on to the issue of rural transport. Strong transport links are all the more crucial in rural settings, and it is fantastic that the shared prosperity fund is taking transport into account. After 40 years of promises, hope and let-down dreams, and through working with the Minister’s Department, the Melton Mowbray distributor road is finally being built in my constituency. It is going to transform the town centre of Melton and bring £160 million of investment into our amazing town. However, we have wider rural transport concerns that continue.

Community renewal is highly dependent on good transport services, but we have had recent reductions in all of our transport services, which threatens to undermine our rural growth. In Melton, the No. 19 bus between Melton and Nottingham has been cut, not only because it was being under-used, but because it would no longer be financed. Workers and students are no longer able to get from rural Melton to Nottingham for work or for educational opportunities, and businesses are suffering, as, in particular, are those with special educational needs.

In rural areas, those with SEN suffer so often because it is so difficult for them to access the services they need. I am hopeful that I can mitigate some of the loss of that bus service with the reinstatement of the train service from Melton to Nottingham; currently, there is no direct service and we have to go through the constituency of my hon. Friend the Member for Loughborough and through Leicester. The Government kindly provided £50,000 of funding to look at my proposal to reopen it. I politely ask the Minister to remind his colleagues at the Department for Transport that we are waiting to hear back on our bid, having made our business case.

In Rutland, Centrebus is only continuing the Rutland Flyer bus and the 747 routes after demanding additional subsidies from Rutland County Council. Given what I have just said about our funding issues in Rutland, Members can see why having to subsidise a bus route is an additional burden that the council cannot take on. The Government have promised to bring forward new arrangements for rural transport in the summer, and I urge them to act now to support faltering rural transport services, because that will provide a boost.

[Dr Neil Hudson (Penrith and The Border) (Con)]

I congratulate my hon. Friend on securing this important debate on support for rural communities. Levelling up throughout the entire United Kingdom must include rural communities. The Environment, Food and Rural Affairs Committee, on which I serve, is in the midst of a rural mental health inquiry. According to the evidence we have taken, much of the stresses and pressures on rural communities are exacerbated by rural isolation, by the things that happen in rural communities—such as animal disease outbreaks and flooding—and by connectivity issues, with people unable to get from A to B, as my hon. Friend is explaining passionately. Does she agree that central Government should work with local government to mitigate ruralisation by allocating funding for rural bus services and broadband for rural communities, to make sure people can be connected and stay together?

[Alicia Kearns]

My hon. Friend hits the nail on the head. Whether in respect of combatting loneliness, connectivity, business opportunity or the 150 Ukrainians who are to settle in my constituency—they have started over the past few weeks—the 431 square miles of my constituency are difficult to navigate when there are no bus services.

Let me turn to digital connectivity. We have a digital deficit in rural communities. In 2021, Onward and the National Farmers Union highlighted that only 20% of people in rural areas can access broadband speeds above 24 Mbps. That is not good enough. I was pleased to get Rutland into the first tranche of places in the country that will receive full fibre-optic—that is fantastic: we will get gigabit broadband—but we need it for more communities. [Interruption.] Excuse me, Madam Deputy Speaker—I promise I do not have covid.

On job retention in rural areas, if we are to give rural areas the tools they need, we have to make sure that people know they can remain locally for jobs—I touched on some of the amazing employers in my constituency earlier. To tackle the challenges, we need local authorities to be able to think about the long term. I am concerned that unless the shared prosperity fund can be used to address the root causes of rural inequality, it will have a limited impact on our communities. That is why the Country Land and Business Association has called for the creation of a separate fund for rural capital investment. I urge the Minister to consider that. Rutland and Melton are currently developing a joint levelling-up fund bid that reflects the varied nature of our communities and business interests. I look forward to championing it in Parliament.

Let me turn to health and emergency services—[Interruption.] And I thank the very good friends one can make in this place. The Government have rightly identified health as one of the key pillars of levelling up. A 2019 report found that although older people in rural areas experienced reduced rates of mortality, poor access to services was driving health inequality. People who live in the countryside can have the most incredible, healthy and happy lifestyle, but poor access to services is a meaningful challenge.

Since being elected, I have campaigned for a second GP practice in the town of Melton Mowbray, because I believe Latham House Medical Practice is the most over-subscribed surgery in the country. If nothing changes, 45,000 people will be served by one practice. That cannot be right. When I was elected, I was told that it would take me more than a decade to get us another GP practice; that is not good enough for me and it is not good enough for the people of Melton. I have been working hard with Melton Borough Council, especially its leader Councillor Joe Orson and chief executive Edd de Coverly, as well as with clinical commissioning group chair Andy Williamson, to make sure that we get another practice and do not wait 10 years for it.

There are wider health challenges in Rutland. I promised to save Rutland Memorial Hospital and now have a commitment from the CCG that it will be saved, but we need investment so that those in my local elderly community do not have to go to Leicester—which takes at least an hour—to get ongoing care for chronic conditions. We need new funds and we need to invest in community hospitals. Indeed, yesterday at the Dispatch Box the Prime Minister championed the fact that he fought for community hospitals when he first came to this place, so I hope he will listen and take heed of the fact that we need to invest in them now.

In Rutland, we also face challenges in respect of cross-border working. Constituents of mine access services in Peterborough, Lincolnshire, Kettering, Northamptonshire and Leicester. People in the vale access services in Leicestershire, Nottinghamshire and Lincolnshire. We now finally have a requirement that information has to be shared across borders, but there is more to be done.

I wholeheartedly welcome the shared prosperity fund’s emphasis on community and place. As the Minister knows, our motto in Rutland is multum in parvo—much in little—and we have an abundance of pride in our county. I invite every Member of this House to visit Rutland water. Indeed, a colleague grabbed me earlier and said, “Is Stoke Dry in your constituency?” I said, “Yes, it is. Did you know that’s where they launched the gunpowder plot?” He said, “No, I didn’t, but I did once I had been there. Aren’t you lucky to have that in your constituency?” I said, “Yes, I am.” He then went on to list a number of other villages and towns in my constituency and say how lucky I was.

Rutland is an amazing place to be. The Rutland showground does events such as Birdfair, and we have recently had two incredible archaeological discoveries. The first was the amazing Roman mosaic, found in a farmer’s field just 15 minutes from my own home, which tells the story of Achilles and Hector. It has changed our understanding of Roman Britain. In so many movies, Britain is depicted as having hordes of barbarians, but we now know that there were these amazing mosaics. The Roman mosaic is described as one of the most significant discoveries ever made in the UK.

Only a couple of weeks later, there was the discovery of a 180 million-year-old ichthyosaur, the UK’s largest and most complete record of the marine reptile, which I had the privilege of touching while it was being dug up. Surely funding from the shared prosperity fund could go towards the promotion of these discoveries. I have no doubt that the scale of them means that we deserve a heritage museum and a heritage trail. We need major investment in our tourism industry that would help counteract the fact that we do not get enough local government funding. It would allow us to stand on our feet, which is all that we are asking for, but we need investment from the Department for Digital, Culture, Media and Sport, and I hope that we can make it a reality.

Melton too has much to celebrate in pride of place. We all know that it is the rural capital of food. We have some of the best farmers in the country who produce world renowned goods such as Melton Mowbray pork pies—yes, I promised in my maiden speech that Members would hear much of those pies and I have clearly not failed to deliver on that. We also have stilton—Tuxford and Tebbutt is the oldest producer in the world, and there is also Long Clawson Dairy. The world’s best ale is produced by Round Corner Brewing in Melton. We also have the award-winning Brentingby Gin—it did not win the international award—and Cidentro Cider, which, again, has won awards. We make amazing samosas at Samosa Wallah, and we are also the leading producers of paneer cheese, and of tofu for the Japanese restaurant market. We are the world’s capital of food, and food heritage is in our blood. We could be the home of food tourism with help from the Government.

I wish to pay tribute to Melton Borough Council and Leicestershire Enterprise Partnership, which set up the new Food Enterprise Centre last year. The new Stockyard was launched only two or three weeks ago, which will provide a new opportunity and a haven of food and drink in my constituency.

I previously stated that the shared prosperity fund can deliver outcomes greater than the sum of its parts, but can the Minister elaborate on ways in which we as MPs can access this fund? I was recently contacted by the trustees of Barrowden village hall, who have, over the past six years, been working on a plan to replace their ageing village facilities. The grants that they had hoped to apply for have been wiped out by covid. We recognise that we are asking for more in a time of less, but they are looking into applying to the community ownership fund to help restore their village hall. The next bidding round is in May, and the project would be a fantastic candidate for the community and place investment priority, so I hope that I have put that on the Minister’s radar.

I would also point out that I have been fighting for at least 18 months for the Department for Environment, Food and Rural Affairs to open its office outside of London in Melton. It is not just that Melton needs DEFRA, but that DEFRA needs Melton. It should not be that our policy officials are reliant on field visits to meet farmers and to understand the rural way of life. We are in the final three to home DEFRA. It is Melton Mowbray, Peterborough and York. What do we notice about that? There are two cities and one rural town in the shortlist. Only one is the rural capital of food. DEFRA should come to Melton and it would get a wonderful home and wonderful support from my colleagues.

In conclusion, for far too long, rural areas have been left behind to the detriment of our society. That is grossly unfair to the Minister’s constituents and to mine. We have a levelling-up agenda that allows us to find and tackle these inequalities, but we have to be honest about the scale of the challenges. We need: a fair funding settlement for rural local authorities; investment in rural transport and digital infrastructure; improved rural health services; improved rural mental health services; and a long-term plan for rural culture. If we do this, all the communities of Rutland, Melton and the Vale and Harborough villages will have the chance to succeed. Rutland and Melton are currently tier 2 priority areas in the levelling-up fund, so give us that chance to succeed and support us.

In February, the Secretary of State offered to come to Rutland to see at first hand the opportunities that we have and the challenges that our local authorities face. I ask him to come. My colleagues are always welcome to pop across the border and join me. I hope that we can recognise that when rural communities prosper, so does the rest of the UK. I hope that we will not have to have a debate such as this again during my time as the proud Member for Rutland and Melton.

[The Parliamentary Under-Secretary of State for Levelling Up, Housing and Communities (Neil O'Brien)]

I congratulate my hon. Friend the Member for Rutland and Melton (Alicia Kearns) on securing a debate on this important topic and on her superb speech. I also acknowledge the important contributions from the hon. Member for Strangford (Jim Shannon) and my hon. Friends the Members for Loughborough (Jane Hunt) and for Penrith and The Border (Dr Hudson), who were making some similar and important points in a debate just a couple of weeks ago.

We should start by recognising that many positive things are happening in Rutland, Melton and the parts of the Harborough district that my hon. Friend the Member for Rutland and Melton represents, and many of them are happening because of my hon. Friend. She has been a relentless champion for fairer funding for Rutland and Leicestershire. She has secured the Melton Mowbray distributor road, which is key to levelling up Melton; after 40 years of discussions, she and local colleagues have finally made it happen. Rutland Memorial Hospital has been saved after the commitment she secured from the clinical commissioning group. She raised broadband, and I am pleased her efforts paid off and put Rutland in the very first tranche of the gigabit upgrades in the country. She also helped secure £150,000 for a community hub in Thurnby and £150,000 for a pub in Frisby from our community ownership funds, and I look forward to drinking in them at some point. Of course, her local authorities have also benefited from funding from the UK shared prosperity fund: Rutland, Melton and Leicestershire are receiving over £5 million of UK SPF funding, with Rutland getting over £1 million, Harborough over £2.1 million and Melton just shy of £1.2 million. On top of that, Leicestershire is receiving nearly £3 million in multiply funding.

On the SPF, my hon. Friend raised a series of important questions about flexibility and rurality which I want to address directly. Even the last Labour Government acknowledged that spending on regional economic policies should have been brought back from Brussels and decided here, but they never managed to bring it back or get the EU to agree to that. Now that we do have control back, we can do things differently. The SPF fund will be radically more flexible than previous EU funding, and also much more locally led. Under the last Labour Government, funding was given to remote and unelected regional development agencies based far from Rutland and Melton; under the SPF, it will be given to individual districts and elected local leaders so it is much more local. In addition, bureaucracy will be slashed and there will be far more discretion over what money is spent on. EU requirements for match funding, which impacted on poorer places in particular, will be abolished. The EU system—with payment in arrears, multiple rounds of auditing and multiple rules, and lengthy application documents that all made it difficult for small local voluntary groups in particular—will be swept away. Under the EU funding, only a narrowly defined set of things could be funded, but under the SPF the investment priorities deliberately cover a very wide range of possible interventions because that is what local leaders said they wanted from us. Whether digital connectivity, buses, skills, improvements to high streets, community events, or sports and festivals, the choice for the first time will belong to local leaders and local communities. Rural communities will be empowered to set and deliver against their own priorities through the fund, shaping things locally and not having to apply to a remote RDA based in a city far away.

In terms of allocations, the SPF matches in real terms the previous spend in each local enterprise partnership area because we were conscious of the need for continuity for ongoing programmes. Within those LEP areas we have used the same index of community renewal that we developed for the community renewal fund. One reason why we used that is precisely because, unlike previous funding formulas, it explicitly recognises the challenges of rurality and sparsity to tackle the very unfairness my hon. Friend raised.

The SPF is only one of the funds we are using to give financial firepower to places. The £4.8 billion levelling-up fund, which recently opened for its second round, could be used to boost some of the fantastic rural food businesses that she mentioned, or to make the most of the incredible cultural discoveries that she also mentioned. She noted that Rutland and Melton were in tier 2; again, that is because the index for the levelling-up fund recognises the challenges of rural and poorly connected areas in a way that previous Governments have not. We have also created new funds such as the community ownership fund, which particularly helps rural communities where hub assets are so important to villages and smaller places. The £3.6 billion towns fund is regenerating communities throughout the country, and there is more to come, with the £1.8 billion brownfield fund mainly still to be allocated, which will help drive regeneration and save valued green spaces.

[Alicia Kearns]

The Minister mentioned community ownership funds. There is a pub in Stathern in my constituency which, having seen the success of the Bell in Frisby, would like to do the same with the Red Lion. When will the next funding round be opening—I know the Department is keen to learn from previous rounds and help people apply for the next round of the community ownership fund?

[Neil O'Brien]

It will be opening extremely shortly. I will take that offline with my hon. Friend, and we have indeed tried to learn lessons to improve that aspect of the fund from the first round.

My hon. Friend raised a number of other critical issues. She talked about the need for more GPs surgeries. I wholly agree, and the Levelling Up and Regeneration Bill published today responds to exactly that issue and to the campaigning by her and other hon. Members here.

We must ensure that development always comes with the infrastructure that is needed. Section 106 has seen money handed back to developers, which is intensely frustrating for local communities: projects become outdated by the time money is available, money cannot be adequately pooled to add up to major projects, it is not a transparent system and it does not reflect the cumulative effect of development because funds cannot be pooled properly.

The new infrastructure levy that we propose through that Bill will change all that. It means more money for local communities, more of the benefits of development for the local community and not just developers, more local control over what it is spent on and matching of new housing to the infrastructure that is needed.

My hon. Friend also talked about the challenges of digital connectivity in rural areas and her success in the early roll-out. We are investing £5 billion so that hard-to-reach areas can get gigabit speeds. More than 67% of UK premises can now access gigabit-capable broadband, an enormous leap forward from July 2019, when coverage was just 8%. That is a spectacular transformation. The £1 billion that we are investing in the shared rural network will particularly help to improve mobile signal in rural areas such as Rutland and Melton, so that she can spend even more time when she is on the A47 lobbying Ministers with brutal effectiveness.

My hon. Friend talked about the critical issue of local government finance. The overriding ambition of the Government is to keep bills low by giving councils the tools and firepower to keep taxes low while offering first-rate services to their residents. The Russian invasion of Ukraine has an impact on that and makes the cost of living even more important. Our local government finance settlement for 2022-23 meets that ambition by providing an additional £3.7 billion of funding to local authorities, including support for adult social care reform, which is critical for rural areas with older populations.

In my hon. Friend’s constituency, that funding translates to a cash-terms increase in core spending power for Harborough council of 6% compared with last year; for Melton it is a 9.3% increase and for Rutland a 7.4% increase. For Leicestershire County Council it translates to a 6.9% increase compared with the previous year. The new funding we have made available is the largest cash-terms increase in grant funding provided through the settlement in the past 10 years and is testament to the support we are affording councils in every corner of the country, especially those outside our major towns and cities.

My hon. Friend is quite right to say that these things can always be improved, and I am sure she will continue to power forward on this agenda.

[Alicia Kearns]

The Minister is a neighbour of mine, and I just want to point out that without him I do not believe we would have made such progress on fair funding for this country and the improved settlements. While he cannot publicly lobby for his own Market Harborough constituency, I know that all Leicestershire MPs wish to put on record their gratitude to him. Since I cannot ask him to agree with that, I will instead ask him to confirm that he will continue to keep his eye on funding for Leicestershire and Rutland.

[Neil O'Brien]

I am not entirely sure what I should say in answer to that question. Instead, I will finish by thanking my hon. Friend for bringing this very important issue to the House today. In the past, the rural economy has not always had the attention or the credit it deserves, but Governments who undervalue rural communities do so at their peril, and we will never do that.

When I was in Uppingham just the other day on market day, I saw all the attractions and the wonderful things that my hon. Friend’s constituency offers in the incredible, vibrant town centre. It is a wonderful place. However, we as a Government also see the challenges of maintaining those rural bus routes and the challenges of an older population. It is wonderful that Rutland has the highest male life expectancy in the entire country, but that brings with it the higher cost of looking after a group of older people well.

Rural places do not have the momentum that larger cities have had, because of the changes to a services-based economy over the past 20 years that have helped capital cities and large cities particularly at the expense of rural areas. We are conscious of those challenges. We have made unprecedented changes to the funding formula to recognise the challenges that for too long, as my hon. Friend said, have been neglected. Under this Government we are addressing those things. I will disagree with one thing she said: she was worried that sometimes these things are forgotten in Government, but I can promise her they will never be forgotten in this Government.

Question put and agreed to.