Rural areas ‘missing out on enterprise plans’

Ministers have been told they risk “missing a trick” if they do not offer incentives to help boost the £200bn-a-year rural economy when George Osborne unleashes a fresh package of measures designed to stimulate growth later this month.

Barry Dodd, chairman of the York, North Yorkshire and East Riding Local Enterprise Partnership, has held discussions with officials at the Department for Environment, Food and Rural Affairs (Defra) proposing the setting up of a series of small zones – offering tax incentives and superfast broadband – in rural areas and has also won support from MPs.

The Government is now being urged to adopt the proposals as part of the growth review which the Chancellor Mr Osborne will unveil in three weeks’ time.

“While the Government pays lip service to the idea of rebalancing the economy there’s hardly any sign of it happening,” said Mr Dodd.

“Without this, I think they’d be losing a vast amount of potential growth by ignoring businesses in rural areas who have real potential to grow. They’d be missing a trick and disadvantaging rural communities.”

The Government has already approved 23 Enterprise Zones around the country, offering businesses in them discounts on business rates, tax incentives, superfast broadband and fast-track planning.

Ministers hope they will attract thousands of new jobs, with the Aire Valley zone alone claiming it could bring in £550m to the economy and create over 9,500 new jobs by 2025.

But the zones are overwhelmingly in urban areas such as the Aire Valley or along major transport routes, such as the M1 corridor in South Yorkshire.

A report by the Government’s countryside adviser as long ago as 2008 warned of an untapped potential from rural businesses to be up to £347bn a year and Mr Dodd said rural growth is in “danger of being overlooked”.

He has proposed allowing the creation of Enterprise Networks which could see smaller sites sharing benefits such as tax incentives and superfast broadband.

“All the Enterprise Zones are in urban areas but we have these huge rural hinterlands in the UK and it’s important that rural businesses have opportunity to grow,” said Mr Dodd. “We can’t just do this in the cities.

“I accept the fact cities are important in their own right but we need to do something with the vast number of opportunities in the countryside.

A lot of hi-tech small businesses can operate in more remote areas, particularly as the Government is keen on rural high speed broadband.

“What we need to look at is an idea of distributed Enterprise Networks in rural areas where we could tie together a number of business policies – for example in market towns around North Yorkshire – and tie them together with fast broadband and some tax incentives to get businesses growing.”

The proposal has been made as part of a Rural Growth Review being carried out by Defra which will form part of a package of measures designed to stimulate growth to be announced by the Chancellor on November.

Skipton and Ripon MP Julian Smith said: “We must ensure Enterprise Zones are not restricted to urban areas and it’s really important Barry gets support from councils, from business groups and our local communities.”