Rural communities in Scotland will be severely affected by Brexit. We are asking for MP candidates and political parties to agree to continue rural funding as it is currently allocated by the EU, until a full review has been conducted, and to continue to support funding for rural enterprise, development, communities and services in the long-term.
We believe that:
· Rural communities are likely to be amongst the hardest affected by Brexit because of the protected funding they receive from the European Union and the impact of reduced trading with the EU. The future is uncertain and there are deep and pervasive concerns about the deal rural Scotland will get post-2020, as well as the impact on investment in Scotland, workforce, tourism, agriculture and trade.
· Exiting the EU is likely to have a long-term impact on trade2, with estimates indicating there will be a long-term reduction in exports of 25%. This would be mitigated by remaining in the EEA or EFTA, but even then, we still face a 12 – 18% reduction in exports. Relying on the World Trade Organisation is in the long-term predicted to result in a change to GDP of -5.3%, real wages of -7.2% and employment of -3.2%3
· The provision of services which are not provided in rural areas by the markets – such as broadband – have been supported by EU funding and this must continue. The loss of EU funding allocated for rural development, transport, broadband and other essential services and infrastructure would be devastating.
· The loss of migrant labour will impact on the ability of the public sector to provide care services, the tourism industry which many communities are reliant on and the provision of GP and other health services. There are currently 180,000 EU Nationals living in Scotland and EU firms employ 115,000 people in Scotland3.
· Analysis indicates that 40-60% of farms will close without EU farming subsidies1 and this will have a serious impact on communities and businesses, leading to unemployment and population decline, as well as reducing our nation’s ability to feed itself. This will be compounded by the reliance of many farms on migrant labour and challenges in trading with the EU.
· Excellent progress has been made to bring broadband and superfast broadband to rural communities and we strongly support the Scottish Governments commitment to 100% superfast (30Mbps+) broadband provision in Scotland by 2021. However, more needs to be done to improve mobile phone signal across the country, with some areas receiving no coverage and others receiving unreliable and patchy coverage, and impacting negatively on communication, social inclusion, economic activity and productivity4.
· Scottish Rural Development Programme funding, whilst not perfect, is relatively predictable and supports many different elements of the rural economy and communities. It is important that the funding for this programme continues and that Government commits to doing so as soon as possible to reduce uncertainty.
1. Steven Thomson, SRuC, May 2017.
2. The economic implications of Brexit for jobs, investment and growth, Dr Katerina Lisenkova Head of Economic Modelling, Fraser of Allander Institute, based on Ebel & Warren 2016.
3. The economic implications of Brexit for jobs, investment and growth, Dr Katerina Lisenkova Head of Economic Modelling, Fraser of Allander Institute.
4. What is the impact of mobile telephony on economic growth? A Report for the GSM Association. Deloitte LLP, November 2012.