Rural Communities

Eilidh Whiteford Excerpts

Thursday 9th January 2014 Commons Chamber

[Dr Eilidh Whiteford (Banff and Buchan) (SNP)]

I begin by congratulating the hon. Member for Thirsk and Malton (Miss McIntosh) and her Committee on their report and the issues raised in it.

I believe that all Members taking part in today’s debate represent rural communities, and I am no exception. In fact, Banff and Buchan has one of the highest proportions of any constituency in these islands of people living in the countryside or in very small settlements. Although there are many positive things to be said about rural life, it undoubtedly presents day-to-day challenges and generates a lot of extra costs, not all of which are justifiable. Those costs put huge pressure on the household finances of people on low and middle incomes who live in rural areas.

This is an extremely broad topic to debate in limited time, but I wish to touch on a range of public policy issues where rural communities have distinct needs and where I believe Westminster is currently letting them down. Many of those concerns echo the issues that other Members have raised, and the first is the cost of getting about.

Petrol and diesel prices are significantly higher in my constituency than in urban areas or less remote rural areas. People in areas such as Aberdeenshire and Banffshire are much more dependent on private cars than those in other parts of the country. They have further to travel and very few public transport options—we have no trains at all in my constituency, and as one would expect in a remote and not densely populated area, bus services are not particularly frequent.

I am concerned about the fact that more than 60p in every pound spent at the pump goes straight to the Exchequer. That means that there is a disproportionate, largely invisible and unavoidable extra tax on people who live in rural areas and have to cover long distances to access shops, amenities and public services and often to get to their work. Those people often have no option other than to use a private car. That places an additional tax burden on rural businesses and households alike, which will not be fully mitigated by the Government’s fuel rebate measures.

It is not only the cost of road fuel that adds to household expenses. It is a supreme irony that although North sea gas comes ashore at St Fergus in my constituency, many people living in the surrounding rural area—including, probably, some who work at the gas terminal—are not on the gas grid and have to depend on more expensive forms of domestic heating. My part of the world is one of the colder and more exposed parts of Scotland during the winter months, and everyone, without exception, has taken the hit of soaring energy prices in recent months. The points raised earlier about that issue by the hon. Member for Ynys Môn (Albert Owen) were salient, particularly on the energy market.

People who are off the gas grid tend to spend a higher proportion of their income heating their homes and are more susceptible to fuel poverty. Even those on respectable incomes, who one would think are doing quite well financially, find that they are not because it costs so much to heat their homes through the winter. One simple and cost-neutral way the Government could help low-income households that are off the gas grid to stay warm in winter is by making winter fuel payments to those households in advance.

My hon. Friend the Member for Angus (Mr Weir) recently brought forward the Winter Fuel Allowance Payments (Off Gas Grid Claimants) Bill, which would provide for the early payment of the winter fuel allowance to pensioners whose homes are not connected to the mains gas grid, and whose principal source of fuel is home fuel oil, liquid petroleum gas or propane gas. Bringing forward payment of the winter fuel allowance would allow low-income consumers who have no access to reduced tariffs and no possibility of changing supplier, to fill their tanks prior to the onset of winter, at a time when prices tend to be a little lower. Unlike those of us who get quarterly bills, those with oil tanks have to pay large four figure sums up front to fill them, and it would cost nothing for the Government to simply re-sequence payments for those affected.

Another key issue for our rural communities is postal services. Our post office network has shrunk dramatically over the past 10 years, and it is critical to protect our remaining post offices in rural areas. Often the post office will be the last business in a village, and the last vestige of any accessible financial services. A reliable universal mail service is essential to businesses in rural areas and to efforts that encourage the growth of such businesses, particularly as online retail continues to expand and create new opportunities. If we are to re-energise small businesses in the rural economy, they must have access to a full, reliable and—above all—reasonably priced postal service that will ensure they can send and receive packages quickly and efficiently. We must recognise that post offices are an essential piece of our economic infrastructure in the digital age. Despite all the good intentions and words, however, the reality is that postal services continue to decline. Until we see the establishment of more Government and financial services in post offices, the future does not look all that bright.

Given that the regulator has already removed price caps from every service apart from second-class mail, I have little confidence that it will provide rural consumers and those in remote areas with protection against big price increases in postal services. The record of regulators in other privatised industries has shown how ineffective a protection they can be—we need only look at the energy market to see that in action.

Another aspect of our essential rural infrastructure is broadband and mobile connectivity, and a lot of attention has been paid to that today. Parts of my constituency are still black holes for phone reception, and many households in rural areas have wholly inadequate broadband speeds, if they have it at all. Sizeable areas of my constituency are simply not online. Moreover, in areas where broadband is available, it is comparatively expensive and people will pay around £40 or £50 a month for a service that they would easily get for less than £10 a month in London. As somebody who pays phone bills in both areas, I know that there can sometimes be a £45 difference in the monthly charge. That hidden cost for people in rural and remote areas does not necessarily come to the fore very often, but even when they have access to the internet, they are likely to pay through the nose for it.

To my mind, the underlying problem is the way that spectrum licences have been issued. It is all very well to say that 90% or 95% of the UK will have broadband by a certain date, but if the remaining 5% is mostly in rural Scotland, that is a problem. As Government services increasingly move online, digital exclusion is becoming an ever more pressing problem in rural areas, compounding economic exclusion and the existing challenges of rural life that already create a lot of hurdles for people in our rural communities. Other countries in Europe with similar geographical challenges have done a much better job than the UK of delivering access to mobile and broadband connectivity, and we could—and should—learn a great deal from them.

I will conclude by touching on agriculture. The economic vitality of our rural communities is underpinned by our agricultural industries and the food and drink processing and distribution sectors that derive from them. In many parts of rural Scotland, common agricultural policy support is essential to the viability of primary producers and the sustainable development of our rural areas. CAP rural development funding has played a crucial role in enabling the 52% rise in exports of food and drink since 2007, mainly by investing in the facilities and infrastructure that those businesses need to grow.

However, keeping up with our neighbours in Europe is increasingly difficult. Historically, Scotland has had low levels of CAP support relative to the area of land in agricultural use. Currently, we receive an average of €130 per hectare, compared with an EU average of €196. Within the UK, Scotland’s €130 per hectare compares with an English average of €265 per hectare, a Welsh average of €247 per hectare, and a Northern Irish average of €335 per hectare. Therefore, compared to other parts of the EU and UK, Scotland has been short changed on the CAP for a long time, putting our agricultural sector at a competitive disadvantage. In that respect, moves towards convergence are an important step in the right direction, but Scotland’s rural communities will not benefit from that process because the UK Government have decided to use the £230 million convergence uplift they received because of Scotland’s historically low levels of support to plug gaps in CAP funding elsewhere in the UK, instead of using it as intended.

By 2019, Scotland will have the lowest levels of CAP funding per hectare of any country in the EU—money that could be used to make tremendous investments in our rural communities, improve our rural environment, and support jobs and economic growth in rural areas. Scottish farmers, those living in rural areas and running rural businesses do not want special treatment, but they do want equitable treatment and parity with their neighbours in the UK and the rest of the EU.

Around 30% of Scotland’s economic output is generated by the rural economy, so the issue is critical for our future development. With better support, we could do a whole lot better and on all those issues—rural development funding, fuel costs, heating costs, postal services and broadband—the UK could, and should, be doing a lot more to support rural communities such as the one I represent. I hope Ministers will use their opportunities in the remainder of this Parliament to give the issue the priority it deserves.