Rural Economy

Part of Opposition Day – in the House of Commons at 6:06 pm on 25th April 2001.

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Photo of David Curry David Curry Conservative, Skipton and Ripon 6:06 pm, 25th April 2001

I shall begin by pretending for a moment that there has been no outbreak of foot and mouth disease, and sketching the situation in agriculture and the rural economy that obtained before the outbreak began.

It is worth remembering that agriculture was already experiencing the worst economic crisis for a generation, and 24,000 jobs had been lost in the sector. The total income from farming in 2000 was at its lowest for 25 years. According to Countryside Agency figures, per capita income declined from £10,600 in 1998 to £7,800 in 2000. Significantly, agriculture's contribution to the national economy is now below 1 per cent. That puts the cost of dealing with the crisis in context.

The value of tourism to the English countryside is estimated at £12 billion, £9 billion of which derives from day trippers. Tourism supports 380,000 jobs, and in Yorkshire alone, 135,000 people—7 per cent. of the work force—earn their livelihood from tourism. The total revenue generated from tourism is £3.34 billion, and rural tourism generates £1.7 billion. Those figures also put the matter in perspective.

Before the foot and mouth crisis began, the tourist industry was already suffering from the high pound and poor weather. In addition, the fuel crisis and flooding problems had already made this a very difficult year for the industry.

One third of all England's businesses—just under 600,000 enterprises—are in rural areas. They are often very small, offering part-time or casual employment on a seasonal basis. Such businesses are now subject to a new set of impositions that have nothing to do with foot and mouth disease. In my constituency, for example, the aggregates tax will hit the quarrying industry, and the climate change levy will also have an effect.

The hon. Member for Workington (Mr. Campbell-Savours) set out the circumstances encountered by people in his constituency, and the situation in my area is similar. Employers who must pay additional fuel costs will not get them rebated through national insurance contributions because they do not pay such contributions in respect of a significant number of their part-time work force. In addition, local employers are having to deal with the red tape of administering tax credit, and there is a new threat that fuel prices will rise again. The cost of car use to rural households is estimated to be 25 per cent. higher than it is to urban households.

In addition, access to technological infrastructure is often difficult in rural areas. A constituent of mine in Malhamdale wanted to have an integrated services data network line installed to help him pursue his business, but he has been told that the cost would be in excess of £300,000.

In many rural areas, the quality of secondary education is extremely high—that is especially true in North Yorkshire—but the further education structure is often less good and requires real work.

There are also the particular problems of what I call the countryside's great hidden industry—the residential home and nursing home sector. Those problems arise from the inadequacy of funding for local authorities, which determine the level of fees payable to such homes. In North Yorkshire last year, 500 beds were lost. There has been an 11 per cent. increase in the national minimum wage. One can argue that such an increase is justified, but it cannot be passed on by a sector that greatly depends on fees paid by a public authority.

That sector is crucial in offering employment. It often buttresses employment in agriculture. The farmer's wife, for example, might work part-time in a care home, because care homes are the largest employers in some of the villages in my constituency. This is a crucial sector upon which the health service depends enormously to provide "seamless" treatment for people from hospital back in the community, and it is seriously under threat.

All that happened before the outbreak of foot and mouth disease. There is not a single case of foot and mouth in my constituency, but it is under siege because until very recently, every square inch of it was a restricted area, so no normal activity could take place. I have spent a lot of time recently going to Wharfedale, Grassington and Ingleton—the villages that depend on tourism. With due respect to the Prime Minister, York is not the gateway to the countryside. My constituency, like that of the hon. Member for Workington, is much more dependent on rural pursuits such as walking and access to the countryside.

The level of cancellation is over 80 per cent., and the results of that spin down to the local pub and the local restaurant. The patterns of delivery for the Theakston and Black Sheep breweries show that there is the opposite of an accelerator right through the rural economy. This is the deceleration effect that comes from the crisis in the tourist industry.