Challenges post 2013:Rural Communities

Dr Deborah Roberts

Presentation to Scottish Government ConferenceFuture Common Agricultural Policy for Scotland

HolyroodHotel, Edinburgh, 16 March 2011

Overview of presentation1. Current and future issues facing rural Scotland

2. Agriculture’s contribution to rural Scotland• Farming

– Production-related linkages– Local public goods

• Farmers (and farm households) – Social contributions– Non-farm business activities and off farm work

3. Policy implications

CAP post 2013: •Support for local public good provision from farming•Support for re-linking farming and farmers to local economies

Trends and challenges: Rural People• Steady population growth, particularly strong in accessible rural areas (but spatially variable)• Population projections spatially variable Pressure on housing, infrastructure and service delivery

• Older demographic profile than rest of Scotland • Increased social costs associated with aging population

• Difficulties in accessing services• May worsen with cuts in public finance

• Higher levels of fuel poverty • Likely to worsen with increasing energy costs

• Industrial structure masks key differences in types of businesses

• Micro, self employed, lower growth ambitions

• Reduction in public sector jobs may not be matched by growth in private sector employment

Trends and challenges: Rural Businesses

Agriculture’s contribution : Farming (1)

Policy emphasis given to importance of production-related linkages but capitalisation and specialisation plus changes in up/downstream industries

Farming has become “delinked” from local economies

•Contribution to GVA fallen from 4% 1973 to 0.8% 2009.

•Number of employees fallen by 31% since 1982

No. of Agricultural employees

Findings from the CAP-IRE project

Location of farms in North East Scotland sample by postcode sector

Extent of local transactions, NE Scotland

% of transactionswithin reach of nearest

town

% of transactionswithin reach of nearest

City

Local Non-Local Local Non-Local

Fertilizer 19.3 80.7 71.8 28.2

Chemicals 30.1 69.9 80.1 19.9

Seed 35.5 64.5 78.7 21.3Feed 30.5 69.5 73.5 26.5

Machinery 56.1 43.9 90.0 10.0

Fuel 43.2 56.8 91.0 9.0Services 53.9 46.1 95.5 4.5Destination of main output

25.9 74.1 77.7 22.3

Both demand-side (age of farmer; attachment to local area) and supply-side factors (spatial concentration of agri-businesses) found to influence local transactions

Fertiliser purchases-Turriff

Fertiliser purchases-Main locations

Cattle Sales -Inverurie

Cattle Sales -Main destinations

Agriculture’s contribution: Farming (2)• As dominant land use, farming provides local public goods

(landscape amenities and access)• Key driver of counter-urbanisation trends and increased

demand for rural tourism and recreation.

•“Scenery” cited as top reason for choosing Scotland as a holiday destination (66%)

(Harris Interactive, 2008)

Aspects of neighbourhood particularly liked

Dumfries and Galloway Tourist Board

Images of Rural Scotland

Orkney Tourist Board

Visit Scotland: Highlands

Agriculture’s contribution : Farmers Farmer contributions to social and cultural capital in rural communities weakening

- threatens cooperative practices (Burton et al., 2005; IEEP, 2004)

-Reduced farmers’ participation in village and community life (Lobely et al., 2005)

•Transition towards part-time suggests skills (and social capital) remaining in rural communities

No. of occupiers

Re-linking: Diversification and off farm workProvides:• a mechanism for re-linking farming and farmers with

local economy (local farmer markets, local food networks, renewables)

• a means by which farmers can benefit from the positive externalities from farming activity

(farm tourism, recreation) 55% Scottish farms have income from off farm work, Approx 40% have at least one diversification activity.

SRDP committed funds to end March 2010: “Diversification Outwith Agriculture “ (Axis 3) £16.8m, 6%“Development/Creation Of Micro-Enterprises” (Axis 3) £7.7, 3%Source: http://www.scotland.gov.uk/Topics/farmingrural/SRDP/RuralPriorities/RuralPrioritiesStats/DataOption

Off farm workOff farm work

Percentage of farms selling output/ having off farm work within different market areas

Town City

LocalNon-Local

LocalNon-Local

Place of off farm work

53.2 46.8 88.1 11.9

Policy implications

To support rural communities, CAP post 2013 should• Ensure local public goods associated with farming are

maintained and/or enhanced

• Encourage re-linking of farming through– value added activities in food chain – Support farmer cooperative groups

• Encourage re-linking of farmers– on-farm diversification– Off farm activities with non-farm businesses

Greening Pillar 1

Strengthen Axis 3 Pillar 2