Rural Economy

Earl of Arran Excerpts

Wednesday 27th April 2016 Grand Committee

[The Earl of Arran (Con)]

In the peninsula economy of south-west England connection is vital to ensuring good-quality local jobs and high levels of productivity and that all our communities, particularly those in the rural economy, can achieve their full potential.

What is taken for granted in most urban centres across England—a good road, a decent local bus service, a reliable train and an airport with a hub link—are scarce resources across large areas of Devon, Somerset and Cornwall. For us, the car is a necessity, not a luxury, yet even here services are contracting, as evidenced by the alarming rate of closure of small rural garages faced with competition from multinational petrol companies and supermarkets in never-ending price wars. However, what can rectify all this at a stroke and place businesses great and small, including the sole trader working from his or her third bedroom, on a national or international trading platform is broadband—I make no apology for returning to this—and a 21st century mobile telephone service rather than a 20th-century one.

The economic evidence is very clear indeed. In 2013, digital businesses grew at 12%, compared with growth of 4% for those not connected. Connected businesses are projecting growth four times faster than those that are not connected. By 2017, a lack of digital knowledge will mean that 25% of businesses will lose their market position. Digital access is drastically changing the knowledge economy to a point where 35% of jobs, many in the white collar sector, will be automated.

This problem has been recognised and is being partly addressed. Cornwall has received a superfast network, which means that it has more fibre per head of population than London. This is powering the economy of the poorest county in England by enabling many small and micro businesses to break into new markets and, importantly, by inspiring a new, young generation of entrepreneurs to enjoy exciting careers with a decent work-life balance. Many lower-cost public sector support services are being developed as a result, with huge potential in areas of remote learning. Cornwall has a realistic opportunity to break out of decades of subsidy as a direct result of this technology.

Would that this investment was reflected across the rest of the peninsula. Cornwall has the benefit of a significant European funding package but this does not apply to all areas. Connecting Devon and Somerset has enabled many areas to enjoy a level of digital access that will deliver a minimum of 2Mbps—which is an internet speed—to 90% of the area by the end of 2016. This programme has been funded through state aid, with up to £1.6 billion allocated to subsidise BT’s introduction of a fixed-line fibre network to a target of 95% of the UK. However, this has not silenced criticism about the rate of the rollout and the speed and extent of the service. A 2Mbps service is regarded as no more than a fig leaf when compared with many parts of mainland Europe, as well as with countries that are less developed than the UK. The Prime Minister, thank goodness, has got it and has now announced that access to the internet should be a right in 21st-century Britain secured by law under a universal service obligation regardless of where you live. We welcome this.