Thursday, 28 April 2011 19:49

Cuts 'threaten rural economies'

Written by  Ruralcity Media
Cuts 'threaten rural economies'

PUBLIC sector job losses and pay freezes will result in reduced local spending in rural economies, say experts.

The impact of public sector cuts was analysed by the Scottish Agricultural College's Rural Policy Centre (RPC).

Scotland will share the pain of funding cuts with the rest of the country, it concluded. But some rural areas are much more vulnerable than others.

The analysis ranked each of Scotland's local authority areas according to its vulnerability to further economic downturn following reduced public spending.

It prompted the RPC to warn policymakers that that a 'one size fits all' approach to supporting rural Scotland would be ineffective.

The "vulnerability index" ranks the urban areas of Dundee and West Dunbartonshire as most vulnerable.

But it highlights significant variation among rural areas' ability to withstand the pressures from cuts.

The index was produced and analysed in conjunction with Rose Regeneration and the Rural Services Network.

Rural areas most likely to be hardest hit included the Western Isles, Argyll and Bute, Dumfries and Galloway, Moray and the Orkney Islands.

The least vulnerable rural areas were Shetland and Aberdeenshire.

RPC researcher and report author Jane Atterton said each rural area faced its own set of challenges.

"Rural areas face a range of challenges relating to low pay, high proportions of public sector jobs and an imbalanced age structure."

For the Western Isles, vulnerability related to the proportion of workforce in the public sector and the low proportion of the population of working age.

In Dumfries and Galloway, the vulnerability relates to low levels of weekly pay and the low proportion of the population of working age.

Dr Atterton said: This emphasises the importance of shaping local policies to suit local circumstances as far as possible.

"So, as these issues are debated in the run-up to the election, our key message to policymakers is that a 'one size fits all' approach will not work."

The public sector is a key employer in rural Scotland, accounting for approximately one in five jobs.

The report highlights that public sector job losses and pay freezes will result in reduced local spending in rural economies.

It warns that low-income rural households will cuts to benefits at a time when the cost of basic commodities – such as food and fuel – has been rising.

In addition, the report highlights fears of strong pressures to cut service provision in rural areas where the costs of delivery are high.

Dr Atterton said greater demands would be placed on the voluntary sector to help plug the gap created by reductions in public sector spending.

The rural private sector may also come under greater pressure if demand for its products and services dwindled, she added.

Voluntary and community organisations that were expected to take on additional roles must be supported, Dr Atterton said.

Innovative public sector thinking was needed in terms of service co-delivery across local authority boundaries or with the private and third sectors.

"The private sector in rural areas may struggle to take up the slack in terms of the jobs lost in the public sector," warned Dr Atterton.

"It is important that adequate support is in place for existing businesses and for those who may wish to set up new businesses.

"Good infrastructure is also important, not least in terms of high quality, next generation broadband provision."

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