Businesses in Rural Areas

Jess Brown-Fuller Excerpts

Wednesday 18th June 2025 Westminster Hall

[Sarah Olney (Richmond Park) (LD)]

It is a pleasure to serve under your chairmanship, Mr Western. I thank my hon. Friend the Member for North Norfolk (Steff Aquarone) for securing this debate and his excellent opening speech, which touched on Liberal Democrat enthusiasms such as buses and microbreweries, but also his characteristic interest and enthusiasm for the opportunities created by science and tech in rural areas as much as across the rest of the country. Small businesses have had a tough time for years. I thank my hon. Friend for his eloquent speech, particularly outlining the challenges that businesses in his constituency face and touching on the broader challenges facing rural businesses in all corners of the country.

When I speak to businesses, their owners repeatedly tell me that their bills are too high, and that causes them to question their future, as they see their neighbouring shops and businesses close down. As we have seen, soaring energy costs over the past few years and costs related to transport, energy and supply chains can disadvantage rural businesses, and many of the Government relief schemes that exist do not sufficiently account for unique rural pressures.

Nowhere is that clearer than in the changes to national insurance contributions announced by this Government. The changes are an unfair jobs tax that will hit small businesses, social care providers and GPs. The NICs changes present an additional challenge to businesses already struggling with rising energy prices, interest rates and input costs. These businesses were hammered by the previous Conservative Government, who broke their promise to reform business rates, and instead trapped businesses under mountains of red tape, stopping them trading internationally. Making things even harder for small businesses and their workers will not grow the economy. Raising the employment allowance will shield only the very smallest employers, but thousands of small businesses will be seriously affected.

A significant amount of the income of many businesses goes straight out the door via our outdated businesses rates system. Business rates are harmful for the economy, because they directly tax capital investment in structures and equipment, rather than taxing profits or the fixed stock of land. I am sure the Government would agree with that assessment, given their pre-election promise to overhaul our business rates system. Nearly a year into this Government’s time in power, however, and this commitment seems to have been forgotten. Meanwhile, businesses across the UK are continuing to struggle with a system that is unfit for a modern economy. The Liberal Democrats are committed to replacing business rates in England with a commercial landowner levy based solely on the land value of commercial sites, rather than their entire capital value, thereby stimulating investment and shifting the burden of taxation from tenants to landowners. I urge the Government to consider this change.

The decline of high street services in rural areas has been an ongoing issue in the UK, with banks, post offices and other essential services disappearing at an increasing rate. This has significant consequences for residents, particularly older people, those without digital access and small businesses—not least the confusion it appears to be causing in Wellington. In the past three years, nearly 2,000 banks have closed across the UK, including hundreds of rural branches, due to declining in-person transactions and the rise of online banking. Many villages and small towns now lack a single bank, forcing residents to travel long distances for financial services.

The challenges are often compounded by limited broadband or access to the internet, leading to swathes of people in rural communities being excluded from online services and digital banking. The Liberal Democrats are concerned about the inequality of provision as the 5G network is rolled out, and we believe it is wrong that people should be disadvantaged simply because of where they live. I urge the Government to prioritise major investment in broadband for underserved communities. Alternative solutions such as banking hubs are being developed, but there are not enough of them, and the Government should be facilitating more to ensure that people across the country can access vital services when they need them, and prevent the digital exclusion of people in rural areas.

As high street services close, rural public transport has also been cut, making it even harder for residents to reach alternative services.

[Jess Brown-Fuller (Chichester) (LD)]

Does my hon. Friend recognise that rural communities always seem to carry the burden of losing out on everything? They have the businesses struggling to get people through the door, they lose their public transport and they lose their health provision. I am seeing that in my constituency, where a rural village is losing its GP surgery, but there is no bus to take people to the proposed GP surgery in the nearby town. We need to support our rural businesses because they are the backbone of these rural communities, and they are keeping these rural communities alive.

[Sarah Olney]

My hon. Friend is absolutely right. There is always the danger that we get into a vicious circle of declining transport provision leading to declining demand for services, which then lose viability and are withdrawn. The point about investment in public transport that my hon. Friend the Member for North Norfolk made so eloquently at the start of this debate would go a long way to managing some of those issues.

Bus route reductions leave some villages with little to no public transport, which worsens isolation. Bus services are the backbone of economic activity in communities across our country, but they are particularly crucial in rural areas, where accessible local amenities and services are greater distances apart.