Rural Proofing

It is not possible to carry out ‘rural proofing’ at any level unless it is clearly understood why rural proofing is needed.  This is as true of rural GP provision as any other essential service. Unfortunately a good deal of the rural proofing initiatives of the last twenty years have been carried out in the absence of understanding this fundamental point.

Rural proofing is not needed as a result of public policy makers, managers of services or commercial organisations wilfully failing to understand either the needs of rural people or their particular circumstances.  Many people in positions of power and influence live some or part of their lives in rural areas and may well believe they are very well informed about them.

Rural proofing is required because it costs more to deliver the same service to a dispersed population than to a geographically compact one.  Rural GPs, the post office, the Royal Mail, broadband providers, people reliant on village shops all understand this very well.  For many services there is also insufficient profit to be made from serving rural areas to enable more than one commercial provider to compete.  Taken together these effects define an imperfect market where market forces do not operate to drive up quality or volume of provision.  In short, the dominant feature of rural areas is market failure.  With increasing numbers of public sector services being delivered through competitive tendering or competitive ‘commissioning’ processes the same effect is becoming more overt in public services as well.

Why is rural proofing needed?  Because commercial and public sector service organisations know that it costs proportionately more to deliver to rural communities and this means spending more either to achieve the same profit per customer or to deliver a similar service per user.  The ‘why’ is, therefore, straightforward.  The necessary next question is: what do you do about it?

There are four fundamental ways in which to tackle this market failure:

  1. Ongoing extra public subsidy.  Eg, the addition to the local government revue support grant formula that takes account of rural sparsity.  This is a rare device, and getting more so.
  2. Cross subsidy through regulation.  In other words use regulation to make urban customer subsidise rural one. Eg, The universal service commitment requirement of the Royal Mail.  Not always popular and being nibbled away at by competitive forces.
  3. Subsidy of rural provision through voluntarism or community action.  Eg Community shops, Community transport, Village Halls, voluntary lunch clubs for the elderly etc..
  4. Economies of scope as an alternative to urban economies of scale.  Eg the pub is also a shop, post office, taxi office, café, older persons drop-in centre and advice centre.

Government has become less keen to pay for the first (but must face up to doing so in some areas such as health care) and has become much less keen to regulate to create the second.  Rural Community Councils, such as AirS, can, if supported by DEFRA, make the third and fourth happen.

Jeremy Leggett,  July 2014

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