Speech

A government that supports rural business

Andrea Leadsom addresses the CLA's inaugural Rural Business 2030 Conference

Thank you, it’s fantastic to see so many of the key people here today, who make our rural areas such a success for our economy.

Around 70% of all land in the UK is agricultural, providing food, farming and agri-tech industries a huge opportunity to harness that natural capital – and unlock the economic potential of rural Britain.

Not only that, but a quarter of our businesses are based in rural areas, too.

Now, I’m really proud to serve the constituency of South Northamptonshire, where home is in a hamlet; with more sheep than people; and green fields surround us –

It means that on a day to day basis I experience the many wonderful things the countryside has to offer.

Millions of people flock to our shores every year to enjoy our ‘green and pleasant land’ -

But as we know, that’s only half of the story.

Because for centuries, the UK economy has been powered by the ideas and innovations of rural Britain.

A government that supports rural business

Whether through food, farming, tourism or technology - Rural businesses add £229 billion a year of GVA to the English economy, employing 3.8 million people in England.

That’s an enormous contribution, and if rural businesses can go even further, the potential economic prize is very clear.

Even a small increase in productivity has the potential to add billions to rural GVA.

That’s why the government wants to provide the right conditions to enable you to grow your businesses even further, and plan and prepare for the future with confidence.

So in the Autumn Statement the Chancellor announced a whole suite of support that will help rural areas, along with the rest of the economy.

The £23 billion of funding for innovation and infrastructure over the next five years will help us discover the next big digital and technological breakthroughs.

But it will also support the building of new houses and the accompanying transport networks, cutting down on congestion and opening up new roads and train links.

Take the funding for a Cambridge to Oxford expressway, which will encourage the development of a ‘Silicon Valley of the South’.

Or the 100% rural rate relief we are introducing, which means small businesses working hard in their communities no longer have to pay business rates at all.

We’re also going further than ever before to improve our resilience to flooding, which as we saw this time last year is a significant threat to your livelihoods.

We are spending a record £2.5 billion on flood defences, funding at least 1,500 new schemes, and we have announced an additional £15 million of funding for Natural Flood Management. This is so important to rural areas.

And not forgetting the vital importance of food production, we are also making sure that over one million acres of prime farmland will be better protected from the risk of flooding by 2021.

Support from Defra

So, the government is providing the right foundations to support the ambitions of your businesses.

But now turning to Defra, my department. I made it clear when I joined the Department in July that it’s vital we provide as much certainty as we can for the rural sector as we leave the EU.

I believe we have been handed a huge opportunity, with great products to introduce to new markets, and relationships to cultivate right across the globe.

But I recognise that business confidence and certainty is crucial to fulfilling the opportunity.

You need a stable landscape to move forward with your growth and investment plans.

So, we have already been able to reassure the farming sector that it will receive the same level of agricultural support until 2020 – and Pillar 2 payments that are signed before we leave the EU will be guaranteed for their lifetime.

The Chancellor has also been able to confirm our commitment to funding the Rural Development Programme.

Funding from this programme has already produced some great outcomes for food and farming, as well as the environment.

Take for example Poplar Farm in Spalding, which used Rural Development Programme funding to purchase cutting edge flower bunching machinery.

They’ve been able to match the huge and growing demand from high street stores as well as take on new members of staff.

And the Dovecote Farm project, that I visited recently, which is restoring flood-plain meadows and grassland along the Nene Valley, as well as supporting species like otters.

And in the coming months and years, as we demonstrate to the rest of the world that we are open for business

I want to make sure that all businesses, big or small, but especially those in rural areas, are able to play their part in the opportunities that lie ahead.

Now is the time to think about how you can find new trading relationships, draw up a formal investment plan, or improve the local environment.

Addressing the specific challenges of rural business

I know that there are certain challenges that really do impact your ability to plan for the future, so I’d like to use this opportunity today to outline the progress we are making.

Firstly, on the issue of planning.

The CLA report identifies planning as one of the biggest barriers to investment.

In fact, 50% of you said it was the single biggest issue.

That is far too high - We need a planning system that matches the ambition of rural businesses, and I can assure you this is something I take really seriously.

The rural productivity plan committed the government to review planning constraints - And we will be announcing some very positive next steps in the housing white paper which will include details relevant to rural businesses.

Secondly, the very knotty issue of connectivity.

This is one of the critical ways to strengthen rural business, and it really can expand your horizons.

Take the example of 22 businesses based in Cornwall, whose productivity increased by an average of 30% when they connected to high-powered broadband – an excellent result and something we want to see more of.

The government has, as you will know, committed to providing superfast broadband to 95% of the country’s premises by the end of 2017, and announced funding for 5G mobile network trials.

Since 2010 we have made excellent progress – but if you are in the last 5%, which let’s face it, many of us are, me included, or based in a so-called ‘not-spot’ area, you will need extra support to stay connected.

So, we are going to be implementing a new Universal Service Obligation, giving you a legal right to request affordable, fast broadband on demand, at 10 megabits per second.

That goes further than any country in Europe.

And following planning reforms that came into effect two weeks ago, businesses are now incentivised to share mobile infrastructure and upgrade networks and masts – all really critical for those with businesses in the countryside.

And thirdly, I want to mention jobs and skills.

The future of a thriving food and farming industry relies on attracting a strong workforce.

There is a huge and ongoing need for rural workforce skills; in fact, it’s the only industry with a specific target to treble the number of apprenticeships by 2020.

During the summer, I attended the Approved Apprenticeships launch – ten new food and drink industry programs that will attract more young people into the industry.

There’s a wide selection on offer, from entry level to advanced, offering real opportunities for career progression.

Real opportunities for young people who want to live and start a career in the countryside.

And lastly, I would like to mention innovation. I have seen so many impressive developments in agri-tech – and I really believe that our talent for innovation will determine the future of the food and farming industry.

That’s why the government has invested £160 million in an agri-tech strategy.

The funding supports agri-tech catalysts, helping businesses test creative new approaches and design solutions for food and farming.

The funding also backs a number of Centres for Agricultural Innovation, which will stimulate investment in crop management, livestock productivity and precision agriculture to name but a few.

To encourage more great ideas and milestone innovations, the government has made an additional £4.7 billion of funding available by 2020 – 2021 for research and development.

Looking ahead to the future

As your report recognises, if we are going to tackle these challenges and emerge with a stronger, more prosperous rural economy – We have got to adopt a strategy for your investments, which stretch across a longer-term business cycle.

I’m therefore delighted to be part of the government team that is developing a comprehensive industrial strategy.

We will look to rural businesses, and particularly the agri-tech sector, to help close the productivity gap and increase economic activity in all corners of the country.

And in-keeping with this long-term view, my Department will soon be consulting on our frameworks for our two 25-year plans – one on food, farming and fisheries, and one for the environment.

Working to a timeframe much longer than the normal political cycle, these plans can chart a course for our future, outlining the challenges and the opportunities facing these important areas.

I know that the CLA has already done a lot of thinking these areas and many of your businesses demonstrate exactly how a thriving economy can go hand in hand with environmental improvement and investment.

And I would really encourage all of you here to contribute and make your views heard.

Concluding remarks

So, in conclusion, there is no doubt that without a strong and successful rural economy, there can be no such thing as a thriving British economy.

I will do all I can to make sure that success continues and grows - And I applause your conference agenda today, looking at how your work can help us deliver better connectivity, improve and harness our natural capital, and make the most of the opportunities for renewable energy.

In addition to your economic clout, rural businesses are some of our prime custodians of the environment; they protect our wildlife, and are a crucial partner in preserving our rural heritage.

For that, I want to say a huge thank you.

I wish you great success for the rest of the day, and I hope this will be the first of many Rural Business conferences to come.