The Bishop of St Albans spoke in a debate on the effects of the government’s economic measures on farming and rural communities on 3rd April 2025, raising the potential of the rural economy and the need for strategic policy towards rural affairs:
The Lord Bishop of St Albans: My Lords, I too am grateful to the noble Lord, Lord Roborough, for securing this debate and for his excellent opening speech. I declare my interests as president of the Rural Coalition and a vice-president of the Local Government Association.
I have already spoken in your Lordships’ House on changes to the agricultural property relief and business property relief, so my views are already recorded in Hansard. I lament the sudden closure of the sustainable farming incentive, and the reforms to compulsory purchase in the Planning and Infrastructure Bill.
If your Lordships’ House will indulge me, I want to focus on two associated areas which are pertinent to this whole debate. First, the rural economy has great potential to contribute to the economic growth that is needed. I think we all believe in this; it is just a matter of how we achieve it. Secondly, I will make a few comments about the almost complete lack of strategic rural policy or effective rural-proofing in government decision-making.
It is very easy for us to sit here and talk about the things we do not like—we spend a great deal of time doing that—but I am proud to be president of the Rural Coalition, which has tried to work alongside government over many years to put some positive ideas, initiatives and facts and figures on the table to help us achieve the growth in the rural economy that we believe we need.
I want to mention the Pragmatix report that we commissioned, and which some noble Lords will have read, entitled Reigniting Rural Futures. This report evidences the extraordinarily large productivity gap between rural and urban areas and the billions of pounds that are lost through chronic underinvestment in rural infrastructure and services. We made an economic case that, with the right policies in place, the rural economy could contribute up to an additional £19 billion in tax revenue for the Treasury. That would, of course, mean addressing the digital divide, rural transport, access to banking services, the rural affordable housing crisis and fair funding for rural local authorities. Yet none of His Majesty’s Government’s policies in these areas mentions or accounts for the needs of rural communities.
Despite 1,254 respondents to the question about rural affordable housing in the NPPF consultation, the Government have provided no guidance on the delivery of affordable housing in rural communities. The Planning and Infrastructure Bill also misses the opportunity to implement changes to help deliver small rural housing sites. The Bus Services (No. 2) Bill, which contains many good provisions and for which I am very grateful, needs to implement cross-subsidy between rural and urban areas to account for the additional costs generated by sparsity.
This year’s local government funding settlement once again leaves rural local government underfunded, with urban areas receiving 40% more per head in government funding spending power than their rural counterparts. This comes on top of the additional costs of delivering services due to sparsity. I urge His Majesty’s Government to address these issues in their review of the funding formula, to recognise that density of deprivation is not the only factor that affects the costs of service delivery, and to level per capita spending power across rural and urban authorities.
The word “rural” is not mentioned once in the industrial strategy Green Paper. From a series of Written Answers, I can only conclude that the rural industry is not really being considered in the Government’s drive for growth. What a waste. The Government urgently need—indeed, it is vital—to develop a coherent rural strategy and ensure that all policies across the board account for and involve rural communities. If these communities are left behind again—20% of the population live in rural areas and over 500,000 businesses are registered there—we will all be the poorer for it and the entire nation will lose out.
Baroness Coffey (Con): There is often an assumption that rural communities are wealthy, but that is simply not the case. The right reverend Prelate the Bishop of St Albans talked about rural strategy. A couple of years ago, the previous Government produced something called Unleashing Rural Opportunity. It was the one time I was able to get a map into a particular document showing that contrast and challenging other Ministers at the time but also the country as a whole to see how stark the variation is.
So what can be done? Unfortunately, confidence is now trashed by not only the actions but by the proposals to be made—particularly in the Planning and Infrastructure Bill. I am sure that we will debate it at length when it arrives in this place, but I hope noble Lords understand quite how bad this has got. When we think about the relationship—the unfortunately regrettable relationship—that Natural England has with a lot of our farming community, for it to be given powers to compulsorily purchase land means not only putting it in the wrong hands, because, if anything, it should be done by the Secretary of State, potentially delegating, but it completely destroys the nature markets framework and the approach of bringing private finance into the sector. Just last week, Steve Reed, the Defra Secretary, was right to praise the standard that has come out to open up this market, building on work from two years ago. It is great that we have finally got there, but the Government do not see the irony that giving powers such as this begs the question of why farmers should be bothered to get involved now in the first place.
Lord Teverson (LD): I want first to react and respond to the right reverend Prelate the Bishop of St Albans, who is a true champion of rural affairs, particularly as chair of the Rural Coalition, because the rural economy is often forgotten about. It is important. It is not just farming; it is coastal fisheries, all the SME environment and much more. There are big challenges there, as he said. We can take rural transport, which has declined hugely. It is a real challenge for young people to get to education facilities and for ordinary people to get to work. In the financial area, we have had a huge number of banks closing in urban areas within the countryside, leaving huge areas where people who want to talk to their bank manager find it almost impossible.
Baroness Hayman of Ullock (Lab, DEFRA): The Government are aware of the specific challenges and opportunities that make rural and farming communities and economies distinctive. The right reverend Prelate the Bishop of St Albans particularly asked about the economy, as did the noble Lord, Lord Elliott of Ballinamallard. We recognise that rural areas have significant potential for growth and are central to the economy. We recognise that, in order to develop the full potential of rural businesses, we also need to focus on small businesses, which are an important part of our high streets and of the rural economy, with many more people self-employed or working in small businesses. The Government are actively working on that.
The Government have made a commitment that all policy decision-making should be rural-proofed. Obviously, Defra leads on rural-proofing, but individual departments are responsible for ensuring that their policy decision-making is rural-proofed, and we work with them to consider that. We know that a prosperous rural economy requires effective rural transport, decent digital infrastructure, the availability of affordable housing and energy, and access to a healthy and skilled workforce. We are doing our best to work cross-government to tackle these issues.
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