More support needed for rural businesses in 2017, says CLA branch chair

CLA Suffolk branch committee chairman Paul Rous.

CLA Suffolk branch committee chairman Paul Rous. - Credit: Archant

Failure to map out a clear future, planning frustrations and the digital divide are holding back rural businesses, an East Anglian business leader has warned.

Paul Rous, chairman of the Country Land and Business Association (CLA) Suffolk branch, said rural businesses could provide a big boost to the economy at large in 2017, but they needed the right economic and political environment in which to thrive.

Mr Rous, of Bruisyard Hall, near Framlingham, said businesses had an appetite to invest, but needed more support from local authorities and from Whitehall.

“An estimated £1.8bn was invested by rural businesses in the east of England in 2015, a significant sum that has done much to boost our national economy. The contribution of Suffolk’s rural business to this figure cannot be underestimated,” he said.

“There is the potential for further investment across a wide range of areas, such as the diversification of rural businesses into residential and commercial property, tourism, renewable energy, and so on.

“However, many are left frustrated by the planning system, which is often unnecessarily costly, time consuming and bureaucratic. The refusal rate for converting old farm buildings to residential units is almost three times higher than approvals to convert offices to homes, which indicates policy is not working.”

Farmers and landowners also needed certainty on where they stand in the longer term as Brexit looms, he said, but government instability and ever-shifting policy was also a problem.

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“Farmers will also be looking for news on changes to regulation that can be made on our exit from the EU that could have an immediate and positive impact – such as a replacement for CAP and a new process for licensing crop protection products,” he said.

“We also need certainty on reform of water abstraction regulation because there are major concerns regarding what it means for farmers and landowners.

“Radical reform of such a complex system needs careful planning, but the time taken to advance plans has caused uncertainty. This ultimately leads to a lack of confidence in making long-term capital investments.

“Economic policy, especially taxation, is also a major consideration when it comes to businesses progressing with investment plans. The 2017 Business Rates revaluation has suddenly increased the rate liability for many rural businesses, leaving many very concerned about the future viability of their enterprises.”

Mr Rous said farmers and landowners could give themselves stability and an increased chance of profitability by creating long-term business and succession plans.

“Informality and a lack of business planning contribute in no small part to holding businesses back from fulfilling their potential,” he said. “Four in five rural businesses are planning to make investments, but only 13% have a formal business plan in place. While over a quarter of those not planning to invest are not doing so because there is no one to take over the business.

“We need to continue to promote the benefits of farmers and landowners sitting down and mapping out the future with their families and business partners, and ensuring they all have a clear idea of the direction of travel their businesses are taking – and knowing who will be at the helm.”

Mr Rous also said the potential of digital connectivity had only been partially fulfilled and more needed to be done to help rural businesses grasp the opportunity to trade goods and services.

“Despite a major programme of public investment, all too often rural business owners have had to make their own investments in order to get connected,” he said.

“A digital divide still remains between rural and urban areas, and there is a need for real focus to ensure universal service is achieved.”