Ernie Clark. Hilperton Division, Wiltshire Council.

It's getting harder to survive in our rural areas.
The Commission sought the feedback to feed into the report commissioned by Communities and Local Government on the impacts of the ‘Credit Crunch’ on economic development and regeneration.

Respondents to this call for evidence had varying views on the impacts. The high cost of fuel and lack of affordable housing were widely reported as having a substantial impact on rural communities. Fuel costs disproportionately affect rural households because they travel further for employment, education and services. Many rural homes and business rely on expensive solid fuel and heating oil and are, or are at risk of, falling into fuel poverty.

Rural areas still lack affordable housing even with falling house prices. Many developments are in danger of becoming mothballed. This coupled with expensive mortgages and high deposits mean young people and low paid workers are still unable to buy properties in rural areas. Several changes are taking place in the construction sector affecting the tenure and availability of jobs, purchases of land and completion of building schemes.

Investment and capital finance into rural businesses has been reduced. Bank lending has become tighter and high interest rates have lead to fewer businesses expanding. Start-ups are moving out of incubation units to be home based to reduce costs. Micro businesses are having cash flow problems. Suppliers are expecting payment on delivery, whilst at the same time larger firms seem to be delaying payments to smaller businesses, who in turn appear reluctant to use the measures now available to them to secure swifter payments. People are also unwilling to invest in new businesses with the impending recession.

The feedback did reveal some benefits of the ‘Credit Crunch’ to rural areas. Some areas are witnessing an upturn in residential lettings whilst elsewhere there has been an increase in tourism from more UK-based holidays.