Technology

Driverless cars in rural areas in the UK

Autonomous driving is here, but what does it mean for rural communities?

The average driver in England spends 235 hours driving every year – equivalent to six working weeks – and must concentrate on driving 100% of the time. Connected and Automated Vehicles (CAVs) are changing this, enabling the driver to choose whether they want to be in control or handover the task of driving to the vehicle itself. While many people take driving for granted, others do not have a driving licence, access to a vehicle or have to give up driving due to ill-health. For these people automated vehicles opens up access to cars. So where do rural dwellers fit in the design, development and deployment of CAVs? Jessica Sellick investigates.

According to the Department for Transport (DfT), a fully autonomous vehicle is ‘capable of completing journeys safely and efficiently, without a driver, in all normally encountered traffic, road and weather conditions’. Connected means the vehicle can link to other devices and while it can operate in driverless mode, there must by a qualified person in the driving seat who is able to take manual control as and when required. Vehicles are being developed with a range of connected capabilities – from technologies that send and receive information vehicle-to-vehicle (V2V), vehicle-to-infrastructure (V2I), vehicle-to-device (V2D), vehicle-to-pedestrian (V2P) and vehicle-to-the-cloud (V2C). Automation ranges from ‘driver assistance’, ‘lane assist’ and ‘park assist’; through to full self-driving automation. Back in January 2014 the Society of Automotive Engineers produced a report which identified six levels of driving automation: from no automation (Level 0) to full automation (Level 5). Some vehicles are autonomous and connected whereas others are connected only or autonomous only.

Government has been supporting the research, development, demonstration and deployment of CAVs for some time. According to Government, the UK is uniquely positioned to bring CAV technologies to the market – having some of the most challenging and diverse road and weather conditions in Europe. Under the Coalition Government (2010-2015)) Robotics and Autonomous Systems (RAS) was identified as one of ‘eight great technologies’. In July 2015 the Government established the Centre for Connected and Autonomous Vehicles (CCAV). A joint unit of the Department for Transport (DfT) and Department for Business, Energy & Industrial Strategy (BEIS), the Centre works across Government to support the early market for CAVs – enabling Government to develop policy at the pace that this rapidly advancing technology requires. CCVA is providing over £250 million in funding, matched by industry, to position the UK at the forefront of CAV research, development and use. The establishment of the CCVA followed the publication of a regulatory review by the DfT (which found existing frameworks did not pose a barrier to testing autonomous vehicles on public roads) and a Code of Practice for AV testing.

In February 2017 the Government published its Vehicle Technology and Aviation Bill – setting out how automated vehicles involved in road traffic accidents would be treated for insurance purposes. Most recently, the Industrial Strategy, released in November 2017, outlines the establishment of a flexible regulatory framework for transportation to boost ride-sharing, autonomous vehicles and the blurring of distinctions between public and private transport. This includes plans for an Automotive Sector Deal.

Since 2015/2016 CCVA, BEIS and Innovate UK have been supporting three CAV trials in the UK: the GATEway Project in Greenwich (London), VENTURER in Bristol and south Gloucestershire and the UK Autodrive Project in Milton Keynes and Coventry.

In September 2016 the House of Lords Science and Technology Committee launched an inquiry into the future uses of driverless vehicles in the UK. Their report (published in March 2017) – while setting out the potential benefits of CAV and recognising the work undertaken on regulation and standards to date – made four main recommendations: (1) Government is too focused on driverless cars when the early benefits of this highly automated technology are more likely to appear in other sectors such as marine and agriculture; (2) the Government needs to establish a Robotics and Autonomous Systems Leadership Council to play a key role in developing a strategy for CAV; (3) there is a clear need for Government to commission research to weigh the potential human and financial implications of CAV; and (4) Government should sit alongside industry and other partners to position the UK so that it can take full advantage of the opportunities that CAV will bring to different sectors. The report sets out the business case for investing in these technologies (and work being undertaken by existing manufacturers and new entrants) to suggest Government should not invest or take the lead in this area rather ensure if makes a ‘comprehensive testing offer for CAV’ to attract manufacturers and academics to the UK. Crucially, the report states ‘this should include one or more large scale testing environments covering real world urban and rural environments’ (page 4).

What are the implications of this policy context for rural areas? I offer three points.

Firstly, what are some of the benefits of CAVs for rural areas? Proponents often identify safety as a key benefit of CAVs: they don’t get drunk, drive whilst talking on the phone or texting, go through red lights, have blind spots, get distracted or wonder who has the right of way. Accident statistics compiled by the DfT shows that in 2016 1,792 people died on Britain’s road, with a further 24,101 seriously injured. Previous data has shown that while rural roads carry 40% of road traffic, they accounted for 62% of road fatalities. Speed limits combined with blind twists and turns, mixed road users and other distractions are often cited as increasing the risk of a driver losing control if they are not driving with due care and attention. Those in favour of CAVs not only point to the possible reduction in fatalities but also to the prevention of collisions – between vehicles and with livestock/large animals.

Proponents also see CAVs as having the potential to overcome some of the mobility related difficulties rural dwellers face. The International Association of Public Transport (UTIP), for example, points towards the affordability, sustainability and convenience that CAVs might bring to rural areas. On the one hand, CAVs may address the reduction of bus/public transport in rural areas; on the other hand, CAVs could be viewed as part of a diversified public transport system (i.e., with car sharing vehicles or autonomous mini-buses feeding into transport hubs). In October 2017 the German transport company Deutsche Bahn began a trial using a self-driving vehicle on the roads of a rural town in Bavaria to residents from the train station to the town centre.

For me, CAVs offer potential to improve people’s quality of life so they can more easily grow up, live, work and age in a rural place.

But for CAVs to be adopted in rural areas, the ‘offer’ and ‘benefits’ need to be made clearer – who will use them and for what purpose?

Secondly, what are some of the barriers to uptake in rural areas? Not everyone finds the prospect of CAVs appealing. For every accident a driver may cause they will have avoided thousands of others. Some worry about separating people from the driving process – while planes fly on autopilot, pilots are trained to take over should the computer fail. While media reports document CAVs involved in crashes or collisions – often the technology on board the self-driving vehicle has responded correctly but the other ‘human’ road user has not stopped or responded: how will CAVs and non-CAVs ‘share’ the roads? Opponents are also concerned that CAVs could bring an end to the jobs of those who drive for a living (e.g. lorry drivers, taxi drivers) and/or those that regulate road users (e.g. traffic police, parking wardens). Indeed some believe the take up of CAVs will mean fewer parking spaces will be needed thus reducing revenue for Local Authorities.

For me, Government policy appears to be focusing on ‘smart vehicles’ and ‘regulation’, and what is missing are more of an emphasis on ‘smart roads’. The RAC Foundation has considered the readiness of the road network for CAVs. Such vehicles are likely to require road surfaces, markings, signs and signals to be well maintained. Some CAVs need sensors to guide them, computers to steer them and digital maps to follow. Indeed, the Select Committee recommended Highways England and Local Transport Authorities engage with motor manufacturers to ‘future proof’ new infrastructure and minimise the likelihood of expensive retrofitting. How are we going to make sure we have the infrastructure to support CAVs in rural areas?

Similarly, much of the existing research focuses on technical aspects of CAVs (vehicles themselves) rather than the human and financial factors which will affect their adoption in rural areas. What will the pattern of uptake be in rural areas? Is rural road infrastructure being taken into account in the design, development and use of CAVs? And will there be a ‘rural premium’ in the development and deployment of CAVs in the countryside?

Thirdly, how then can rural areas capitalise on Government commitment and investments in CAVs? If CAVs are going to be transformational, how can we encourage Government and companies to see rural areas as testbeds for the future of mobility and smarter transport solutions? Rural areas offer a mix of road and driving conditions not experienced in towns and cities. According to engineers at Glyndwr University, driverless vehicles have the potential to be used most effectively on “steep, narrow, slow and sinuous” roads and where there are mixed transport users (cars, agricultural vehicles, livestock, wildlife). For if Government continues to position the UK as an environment to build automotive technologies of the future – and expects driverless vehicles to bring deliver economic, social and environmental benefits – rural areas can and should be at the forefront of this commitment, providing real word testing to bring these vehicles to market. And if the applications are not only in road transport, but also in agriculture, marine and energy sectors, rural can and should be at the forefront of this move towards automation. Will we see driverless cars on the UK’s rural roads in the near-future? Watch this space…

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Jessica is a researcher/project manager at Rose Regeneration; an economic development business working with communities, Government and business to help them achieve their full potential. Her current work includes supporting a Lottery programme to help people into paid work; research for the NHS on rural workforce issues and evaluating a financial capability project. She can be contacted by email jessica.sellick@roseregeneration.co.uk or telephone 01522 521211. Website: http://roseregeneration.co.uk/ Blog: http://ruralwords.co.uk/

Rural Industrial Strategy in the UK

What’s [rural] in the Industrial Strategy?

In her leadership speech Theresa May set out her aspirations “to get the whole economy firing”. One of her first actions as Prime Minister was to begin the development of an Industrial Strategy. In November 2017 the Government published this much awaited document. Heralded as a new approach to how Government and business can work together to shape a stronger, fairer economy – under the strap line “building a Britain fit for the future” – what might it mean for rural communities? Jessica Sellick investigates.

A speech by Greg Clark back in July 2016 suggested the Industrial Strategy should be a number of things: from providing a long term, predictable and sustained approach to policy making, through to creating an environment in which businesses can be founded, expand and prosper; and where connections are made between Government policy and business decisions, industries and places, research and practice.

The resultant Industrial Strategy, published in November 2017, sets out five foundations of economic policy: (1) ideas – research and development, innovation; (2) people – skills and education; (3) infrastructure – broadband, energy and transport; (4) business environment – support for Small and Medium Enterprises and specific sectors; and (5) places – tackling regional disparities. Improving the foundations, the Strategy argues, will help tackle four challenges: (a) how to embed and maximise the advantages of AI and data; (b) the adoption of low carbon technologies across the economy; (c) automation and infrastructure; and (d) healthcare and labour market challenges amid an ageing society.

The Strategy highlights four sectors where Government will agree deals to drive transformation in investment and productivity across the economy: life sciences, construction, artificial intelligence and automotive. The Government has also proposed the creation of an Industrial Strategy Council – formed of businesspeople, economists and academics from across the UK – to assess and evaluate the Strategy and make recommendations to Government.

In a set of rural words back in September 2016 I described what we might learn from previous Industrial Strategies – exploring the meaning of the term, the kind of Strategy that was emerging and what it could mean for rural areas. Writing back then I suggested the Strategy might have three areas of focus for rural communities: sectors, place and governance. With the Industrial Strategy now published, does it cover these three areas of focus and/or what impact might it have on rural areas? I offer three points.

In terms of sectors, Defra published its latest edition of the Statistical Digest of Rural England in November 2017. While ‘agriculture, forestry and fishing’ accounted for 3.9% of local units of registered businesses in England, they are dominant sectors in rural hamlets and rural villages – in a sparse setting more than half the registered businesses are in these industries. This sector accounts for 15.3% of local units of registered businesses in rural areas overall. Other important sectors in rural areas include ‘professional, scientific and technical services’ (14.9% of businesses), ‘wholesale and retail trade, repair of motor vehicles’ (13.2% of businesses) and ‘construction’ (11.3% of businesses). These sectors are taken up in the Industrial Strategy.

Agriculture is referenced in the application of artificial intelligence and data analytics technologies to enable the more efficient use of energy and resources (page 41); as part of a shift to clean growth and fulfilling commitments made during the Paris Agreement (page 42); as part of a need to build on our capability in precision agriculture (pages 43 and 75); and as an attempt to put the UK at the forefront of the global move to high efficiency agriculture (page 47). The Industrial Strategy also references a new Industrial Strategy Programme in agriculture: ‘transforming food production, from farm to fork’ (pages 144 and 148); and, amid Brexit, a commitment to establishing a new partnership between Government and the whole food chain (page 188).

Scientific and technical services are referenced in the application of innovation (page 59); and in the Strategy’s vision “for a knowledge-led economy…underpinned by world-class facilities and international collaborations that push scientific frontiers” (page 67). The Industrial Strategy outlines a number of initiatives including 5G test beds (page 153) and the development of regional Digital Innovation Hubs (page 196). The Strategy specifically focuses on Artificial Intelligence (AI) (pages 32, 33, 36-41) and data (pages 28 -29, 36-41).

The strengths of the motor/automotive industry are referred to i.e., how we’ve successfully rebuilt the UK automotive industry by deliberately attracting investment from abroad (page 20); alongside commitments to increase the automotive share of the global market as it shifts to clean energy sources and efficient new materials (page 43); develop new mobility solutions (page 49); and use leading edge research and development (page 60). The document further highlights the importance of collaboration (page 166) and outlines an ‘Automotive Sector Deal’ (pages 183, 201-202).

References to construction are littered throughout the Strategy: from setting out the UK’s credentials (page 43) to increasing construction’s share of the global market as it shifts to clean energy sources and efficient new materials (page 43). The document sets out a number of initiatives, including (1) The establishment of an ‘Office for AI’ which will work with six priority business sectors including construction (page 40); (2) a Transforming Construction Programme with up to £170 million available to take advantage of new technologies to provide safer, healthier and more affordable places to live and work (pages 45-46, 74); (3) the creation of a new technical education route known as ‘T levels’ (page 102); (4) a National Retraining Scheme to fill skills and shortages in construction and digital (page 117) – including an extra £34 million to expand innovative construction training programmes across the country (page 119); and (5) a ‘Construction Sector Deal’ (pages 197-198).

Compared to other sectors identified by the Statistical Digest the Strategy contains fewer references to retail: although it is identified as a sector the Government wants to work closely with on the foundations of productivity so as to drive up the earnings of people employed and enhance national productivity (page 171). It also contains a case study of the Monster Group, an online retailer (page 185).

Since the Strategy was published further information about the Sector Deals, a Food and Drink Sector Council and Challenge Fund (ISCF) – including calls for Research Hubs and Batteries Research Institute – have been announced.

However interconnected issues such as workforce, how it will lead to jobs being in places where people need them and partnership working with the private sector has not been full taken-up. A report from the Institution of Engineering and Technology (IET) on the Skills and Demand in industry, for example, found nearly two-thirds (61%) of the engineering and technical workforce considers the recruitment of staff with the right skills as a barrier to meeting their business objectives over the next three years. 75% agree that tackling the skills problem is fundamental to making the Government’s Industrial Strategy viable.

While the sectors identified in the Industrial Strategy are aligned with those in rural areas, what this new sectoral approach will mean for rural areas – and how it fits with interconnected issues – remains unclear.

According to the Statistical Digest of Rural England, in 2015-2016 there were 537,000 businesses registered in rural areas, accounting for 24% of all registered businesses in England and employing some 3.5 million people. The Digest reveals how there are proportionately more registered businesses per head of population in predominantly rural areas compared to predominantly urban areas (excluding London). It further highlights the significance of smaller businesses – with 28.6% of people employed in registered businesses with up to 9 employees compared to 18.7% of people in urban areas. In urban areas 28.9% of people are employed in registered businesses of 250 employees or more whereas in rural areas this figure is much lower at 15.8%.

The Industrial Strategy makes sixteen direct references to smaller businesses: from boosting the digital economy by working with Ordnance Survey to open up freely OS MasterMap data (page 159) to giving attention ‘to ambitious, high potential small and medium sized businesses that are critical to jobs and productivity’ (page 172); and the establishment of a Small Business Commissioner to help small businesses on payment issues, dispute resolution and sourcing advice (page 176).

Back in 2003 Professor Michael Winter undertook a literature review of the English rural economy. This examined how rural labour markets functioned, the degree of interaction between different sectors, geographical constraints, linkages to the urban/regional/national economy and the impact of public policy on rural economies. The review took up the notion of ‘embeddedness’ to describe local social relations of production and consumption based on trust relations. In the words of Kippner “congealed into every market exchange is a history of struggle and contestation that has produced actors with certain understandings of themselves and the world that predispose them to exchange under a certain set of social rules and not another” (see page 34).

More recently, Professor Tim Jackson has published work on achieving prosperity not based on growth. He emphasises meaningful work rather than simply making an income; where businesses are not about making more stuff rather delivering services that improve lives; and where taken together work, enterprise, investment and money are not about accumulating wealth for the few at the top of the food chain but in ways that better serves communities and create lasting prosperity.

The Industrial Strategy is high-level in seeking to provide connections between Government and business. How will this translate into effective and targeted policies that recognise the embeddedness of rural businesses and lead to the prosperity of rural communities?

In terms of place, in the speech Greg Clark delivered back in August 2016 he described how “every business is located in a particular place”. During its development, there were calls to make sure the Industrial Strategy made the most of cities and city regions. The resultant Strategy references ‘rural’ fourteen times: around devolution (pages 27 and 219), as part of a recognition that different policies will be needed in different local economies (page 217), as part of a commitment to invest in places across the UK (pages 132 and 216), including in transport (page 132) and 5G (pages 151 and 154). The Strategy also contains a case study of the Smart Islands Programme on the Isles of Scilly (page 146) and the example of the South West Rural Productivity Commission as part of attempts to ensure rural areas are able to contribute to and benefit from economic growth (page 225).

The Strategy is accompanied by a series of spreadsheets containing maps showing the location of industrial clusters for fifteen sectors. Drawing on research that shows businesses in clusters benefit from agglomeration externalities such as knowledge spillovers, better access to relevant skills and reduced costs due to supply chain integration; the spreadsheets and maps seek to provide evidence for the location of sector strengths across the UK. In technical terms, the methodology used combines the Density-Based Spatial Clustering of Applications with Noise (DBSCAN) and Kernel Density Estimation (KDE). For each of the fifteen sectors three maps have been produced showing: (i) the clusters produced by DBSCAN, (ii) overlaying the KDE with the DBSCAN cluster shapes, and (iii) an employment growth map. While the data is listed and mapped, there is not accompanying spatial description of what is presented nor how to interpret what is displayed.

All of this opens up debates around what is the ‘right’ economic geography – what is the most appropriate spatial unit(s) within which the Strategy should sit and how can we ensure the resultant policies consider rural areas?

For me, the Strategy needs to lead to a territorial approach that benefits rural places in ways that help people find a job where they live, improves their access to services and advances mobile and broadband connectivity. In a previous set of rural words I explored how rural England was becoming a white space in the devolution agenda. How can we make sure rural areas are not forgotten in the Industrial Strategy?

In terms of governance, a new Industrial Strategy Council is to be established, comprising representatives from academia, investors and economists. Dr Craig Berry, from the University of Sheffield – who was one of the Commissioners who shaped the Strategy – has described how “the proposed advisory council falls short of the OBR-style monitoring body required to embed industrial strategy into the routine agendas of future Governments.” A further point was made around the need for HM Treasury and the business department (BEIS) to work together in the implementation of the Strategy. How do we know what success looks like and how will its impact be measured? Will the Council include a representative(s) with an interest in rural matters?

The Industrial Strategy has been heralded as a ‘blended approach’; combining horizontal policies (in seeking to address market wide issues), sectoral policies (through the Sector Deals) and being mission based (through the Grand Challenges). IPPR’s discussion paper on the Strategy suggests its scope might also focus on the ‘everyday economy of ordinary firms where most people are employed’ (page 3). If this is to happen we need to ensure rural is on the Government’s radar.

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Jessica is a researcher/project manager at Rose Regeneration; an economic development business working with communities, Government and business to help them achieve their full potential. Her current work includes supporting a Lottery programme to help people into paid work; research for the NHS on rural workforce issues and supporting a community rail partnership. She can be contacted by email jessica.sellick@roseregeneration.co.uk or telephone 01522 521211. Website: http://roseregeneration.co.uk/ Blog: http://ruralwords.co.uk/ Twitter: @RoseRegen

Adult Education

What future for adult education in rural communities?

Back in July 2016, the All-Party Parliamentary Group for Adult Education published a report it had commissioned from the University of Warwick into the needs of adult learners. The research highlighted learning taking place in education and training institutions (online and offline), the workplace (on and off-site) and in community settings; suggesting this diversity plays a significant role in an individual’s personal development and in leading them into employment. From the perspective of providers, the research found Government policy has a ‘lopsided fixation’ on young people and apprenticeships, often at the expense of other forms of adult education. From the perspective of learners, the study found many felt policy-makers did not understand the true benefits of adult education. From a geographical perspective, the research found a lack of access to private transport and/or the cost of public transport in rural areas to be presenting major challenges for low income adults wanting to participate in learning. Where next for rural adult education and learning? Jessica Sellick investigates.

Back in July 2016, the All-Party Parliamentary Group for Adult Education published a report it had commissioned from the University of Warwick into the needs of adult learners. The research highlighted learning taking place in education and training institutions (online and offline), the workplace (on and off-site) and in community settings; suggesting this diversity plays a significant role in an individual’s personal development and in leading them into employment. From the perspective of providers, the research found Government policy has a ‘lopsided fixation’ on young people and apprenticeships, often at the expense of other forms of adult education. From the perspective of learners, the study found many felt policy-makers did not understand the true benefits of adult education. From a geographical perspective, the research found a lack of access to private transport and/or the cost of public transport in rural areas to be presenting major challenges for low income adults wanting to participate in learning.

The report, ‘adult education – too important to be left to chance’, contained five recommendations to secure the future of adult learning: (1) the establishment of a national and regional strategy for adult education. (2) The redistribution of resources to develop a fair and cohesive adult education framework. (3) Improved awareness of adult education through careers information, advice and guidance in local communities. (4) Research into the full impact of adult education. (5) The encouragement of employers to offer more opportunities to adults to keep them in employment. The report also included a warning from the Association of Colleges that national policy for adult education could disappear by 2020 if providers are forgotten in area reviews and skills devolution processes.

Are we making investments in adult education which reach out to people in rural areas or are rural areas being forgotten within current and emerging policy and funding arrangements? I offer three points.

Firstly, what policies and priorities for adult education does the Government have and how is this funded? Adult education usually refers to education for individuals aged 19 years of age and over and takes place outside of school and the higher education sector – this definition also includes apprenticeships. The Government aims to ‘make sure that further education provides the skilled workforce employers need and helps individuals reach their full potential.’ Tagged under further education, skills and vocational training and/or adult and community learning; adult education finds itself within the auspices of the Department for Education (DfE) and its non-ministerial departments of Ofsted and Ofqual; and DfE’s non-executive agency the Education and Skills Funding Agency (EFSA). Adult education and learning can also be found with the Department for Business, Energy & Industrial Strategy (BEIS) and its non-departmental body, the Government Office for Science; and in the Department for Digital, Culture Media & Sport (DCMS) and non-departmental public bodies such as the Big Lottery Fund. It has also been at the core of bodies established by Government such as the UK Commission for Employment and Skills (which closed in March 2017) and Student Finance England and the Student Loans Company.

References to adult education can be found in various Government documents over the last 20 years: from the Skills Investment Strategy 2010-2011 (an investment strategy and funding streams aligned to Government priorities produced by the Labour Government) to the New Horizon report, published by the Coalition Government. The Coalition Government recognised how adult and community learning ‘stimulates progressive learning, often leading to employment…it sustains democratic citizenship.’

In September 2015 an All-Party Parliamentary Group for Adult Education was established by nine Specialist Designated Institutions (SDIs) to raise the profile of adult education and the role high quality provision plays to the most disadvantaged members of society. In January 2017 David Lammy MP led a debate in the Commons Chamber on night schools and adult education. This highlighted: (a) the need to make sure we do not lose the legacy of Samuel Morley, John Ruskin and William Morris and the value of learning for learning’s sake. (b) How since 2010 the Commons had discussed education on 339 occasions but this had not included a single debate on adult education – with the focus instead on primary, secondary and higher education; notwithstanding there had been some debates around apprenticeships. (c) The Government’s national plan for lifelong learning has so far not appeared. (d) Calls for a national strategy led by a Minister working across departments rather than a patchwork of provision across the country as a consequence of devolution. In April 2017 a number of further education providers reinforced this call to appoint a departmental minister for lifelong learning.

Between 2010 and April 2017 funding for adult education was the responsibility of the Skills Funding Agency (SFA). In April 2017 the SFA merged with the Education Funding Agency to form the Education and Skills Funding Agency (ESFA). Each year a Minister, now within DfE, publishes a skills funding statement or letter containing the Government’s priorities along with an annual budget and indicative budgets up to 2020. The latest letter, published in March 2017, confirms that for 2017-2018 the Government will invest £1.9 billion in apprenticeship training for all ages, £1.5 billion into a new Adult Education budget and £325 million for provision at Levels 3 to 6 through Advanced Learner Loans. The funding rules set out the provision provided under the Adult Education Budget (AEB). The AEB will be focused on: (1) engaging adults and providing them with the skills and learning they need to equip them for work, an apprenticeship or other learning [helping those furthest from learning or the workplace]; and/or (2) making available more flexible, tailored programmes which may not require a qualification.

Looking at the funding letters from DfE to the SFA/ESFA over time reveals how the total funding allocated to adult education has fallen from £3.91 billion in 2011-2012 to £3.24 billion in 2015-2016 (when funding for advanced learner loans is omitted) which equates to a 17% cut in cash terms or a 21% cut in real terms. Alongside this, money from the European Social Fund (ESF) is used to put in place learning provision for individuals not supported by the ‘standard funding system.’ The total value of the ESF programme for 2007-2013 was £1.6 billion and the current programme (2014-2020) is expected to total £1 billion. For previous years the Skills Funding Agency annual accounts have allowed for a comparison of what was spent rather than allocated. The 2015-2016 accounts show an under-spend of £120 million (3% of its total budget) against a total income of £4.27 billion. Overall programme expenditure was £3.58 billion, lower than a total of £4.34 billion in 2014-2015 owing to the SFA transferring capital projects to colleges and Local Enterprise Partnerships (LEPs) and because of a reduction in Government funding.

In 2015 DfE worked with HM Treasury and BIS (now BEIS) to build a cost baseline for the FE sector. This identified wide variation in all cost areas (particularly in teaching and administrative costs). They found the ‘more profitable providers’ had a higher average income per learner due to a more diverse funding mix; that cost was not a key driver in learner outcomes and success; and that there were limited incentives for cost-efficiency as providers were not generally profit maximising.

The Government is now seeking to transfer control of the AEB to local areas through devolution agreements, with devolved budgets in place from 2018-2019. The ESFA is working with LEPs to support them in engagement with the skills sector and allocating their skills budgets. This local approach to adult education and skills commissioning is part of Government attempts to match education provision with the needs of local labour markets. At the same time, a number of bodies including the Learning and Work Institute, the Association of Colleges and the Association of Employment and Learning Providers have called for a replacement of ESF funding post Brexit.

In July 2017 the House of Lords Economic Affairs Select Committee announced an inquiry into ‘the economics of higher education, further education and vocational training.’ The Committee is seeking evidence on (1) the current structure of post-school education and training, and whether the way it is financed appropriate for the modern British economy. (2) If not, what changes are required to develop a system that meets the needs of enterprise and the labour market whilst providing value for students and the Government? The deadline for written submissions is 14 September 2017.

Within these policy discussions and funding decisions, emphasis is often placed on targeting resources at skills, training and learning that leads to employment and economic growth. This does not fully attend to the energy, intelligence, passion and aspiration of people who find learning beneficial for many reasons (e.g. reducing isolation and loneliness, confidence building, personal interest). These policy discussions often fail to recognise the community settings and informal learning places where adult education happens (village hall, children’s centre, library). These policy discussions also open up new debates around how much should be invested in adult education, where the money should come from (Government, employers, learners) and how it should be spent. For me, the need to ensure everyone has equitable access to provision (including rural areas) is important.

Secondly, how are providers being affected by the changing landscape of adult education and what are some of the views of learners? Hard data about learner participation, outcomes and highest qualification is published by the DfE and ESFA on a quarterly basis. The latest figures, from July 2017, show participation in Government funded apprenticeships is higher so far in the 2016-2017 academic year compared to the same point at 2015-2016. However, participation in adult further education is less in 2016-2017 than that reported at the same period in 2015-2016. 1,966,500 learners had participated in adult further education by the third quarter of 2016-2017 compared to 2,032,500 reported at that time in 2015-2016 (a decrease of 3.2%). 715,600 adult learners had participated in an English or maths course in 2016-2017 compared to 736,100 at the same time in 2015-2016 (a decrease of 2.8%). 430,500 adult learners had participated in a community learning course so far in 2016-2017 compared to 465,600 at the same time in 2015-2016 (a decrease of 7.5%). Compared to the same period in 2015-2016, for 2016-2017 the number of learners taking a personal and community development course decreased by 5.3%, the numbers taking a neighbourhood learning in deprived communities course decreased by 15.1%, the numbers taking a family English, math or language course fell by 19.7% and the numbers taking a wider family learning course decreased by 15%. Across all adult categories, apart from apprenticeships, the trends in participation show a decline in the number of adult learners since figures peaked in 2011-2012.

In September 2016 Foresight published an evidence review on literacy and numeracy learning. This suggested that initiatives had been shaped by an economic agenda – the perceived need to upskill the population in order to ensure the UK’s ability to compete on the global market; with progress measured by gains in qualifications. However, evidence on learner motivation suggested neither the desire to acquire qualifications nor the desire to improve labour market position as primary motivations to engage in learning. Instead, the evidence found adult motivations to learn are often driven by intrinsic goals (e.g. regaining confidence lost at school; to ‘brush up’ on learning missed out on in the past) or extrinsic goals (e.g. career development). Integrating skills provision into other learning activities made courses attractive – adults were found to be more likely to engage with maths where it was relevant to managing their finances or helping their children with the subject. For me, what this evidence review reinforces is how education is lifelong and for learners is as much about improving aspects of their everyday lives as it is about economic benefits. Particularly for lower level courses, Government policy does not always stress the importance of the wider benefits of learning, focusing instead on qualifications associated with employability which does not appeal to all learners.

According to the OECD, there are an estimated 9 million working age adults in England (more than a quarter of adults aged 16-65 years) with low literacy or numeracy skills or both. Young adults perform no better than those reaching retirement age. From looking at their projections the basic skills of the English labour force could fall further behind those of other countries. Among those aged 16-34 years 20% have not completed upper secondary education (Level 2 and 3) and 50% lack basic skills. The OECD suggests family background has a particularly strong effect on basic skills among young people which is not as prevalent in other countries.

In Scotland, the Community Learning and Development Regulations 2013 place a duty on Local Authorities to secure the delivery of community learning and development (CLD) in their area. This report describes the variety of activities planned by the range of CLD providers in each area. Here CLD covers a variety of adult learning where the core purpose is to empower people (individually and collectively) to make positive changes in their lives and their communities through learning. – mention community learning development plans and other context. In 2012-2013 BIS (now BEIS) ran 15 Community Learning Trust (CLT) pilots to test new ways of planning and delivering provision. CLTs gave residents a stronger voice in deciding the shape of local provision, partnership working was critical to shaping local provision and with some public investment they can provide a community focused learning offer.

Since then, the landscape in which adult education providers in England operate has been changing. Between September 2015 and December 2016, 33 area reviews were undertaken (in five waves). Initiated by Government, these reviews brought together providers, Local Authorities and business representatives to discuss how they could better meet local skills need whilst increasing efficiency and resilience. The intention was that this would lead to ‘fewer, often larger, more resilient and efficient providers’ and ‘greater specialisation, creating institutions that are genuine centres of expertise…and secure operational and financial efficiencies” (page 7).

The Association of Colleges (AoC) has revealed since this stocktake was carried out there have been 33 college mergers and 4 sixth form college academy conversions. The AoC expects to see another 15-20 mergers and 10-15 conversions over the next 18 months. Despite these efficiencies, providers continue to highlight how constant change and shrinking resources are hindering providers and learners. This blog, written by Helen Osborne at The Friends Centre, an adult education provider in Brighton supporting approximately 1,100 learners each year, describes how instability is affecting staff and learners.

The Transforming Lives project aims to provide evidence of how further education is vital in empowering people and communities in 21st century Britain. The research provides learners and teachers with the opportunity to tell their stories. The project highlights research into the way FE is funded (using an annualised formula that includes a proportion linked to qualifications achieved) alongside a requirement to gather extensive amounts of performance data, are often detrimental to learners educational experience.

Going forward, the Social Market Foundation published a report on the further education and skills sector over the next decade. The document explores areas where providers could identify new markers of distinctiveness, collaborate with different partners and pitch to new pools of learners. One possible scenario in a post-Brexit world is where providers become local champions and engines of social mobility – working with the private sector to help push self-employed people and local businesses up the value chain while also becoming a one stop shop for apprenticeship provision. IPPR’s recent report on building a skills system for the economy of the 2030s suggests that in order to have any impact on productivity, pay and progression; improvements in skills levels must be complemented with action to increase employer demand and utilisation of skills in the workplace. In June 2017, the Local Government Association (LGA) published its vision for employment and skills ‘work vision’ which seeks to address have local areas have little ability to influence priorities, funding or delivery by putting in place a ‘one stop service rooted in place.’

How can we ensure (current and future) adult education provision meets the needs of learners, communities and employers at the local level?

Thirdly, how can we meet the learning needs and aspirations of adults in rural areas?

Back in December 2012, the National Institute of Adult Continuing Education (now the Learning and Work Institute) prepared a report for BIS (now BEIS) and the Department for Environment, Food and Rural Affairs (Defra) on community based learning in rural areas. The report examined the wide range of provision in rural areas (from that funded by Government to that provided by voluntary organisations, local authorities and the private sector through to self-organised learning and online learning) and the participation of adults in that learning. The report highlighted the challenges faced by providers in finding the resources to meet the needs of rural learners and set out a number of recommendations around funding, focus, improved mapping of rural provision and the importance of collaboration and partnership working.

Prior to this (in the 1990s) the University of Leeds had research strand on rural adult education. This considered the adequacy of provision, the different types of educational institutions (e.g. agricultural colleges, village colleges, residential colleges) and how any research needed to cover all aspects of the learning process – including the need for new approaches to delivery to enable learners to progress at their own pace.

More recently, research published by Rural England CIC in January 2017 found only half of prospective learners in rural areas have ‘reasonable’ access to a further education college (i.e., they could reach an institution by public transport or on foot in a reasonable travel time) and are losing out on access to education and skills opportunities. The report also found the proportion of the working age population with at least a Level 3 qualification was lower in rural areas compared to urban areas.

The United States Department of Agriculture (USDA) publishes an annual rural education bulletin. The 2017 edition provides data on educational attainment and the relationship between attainment and economic outcomes (e.g. median earnings, unemployment, poverty). While rural Americans are better educated compared to data from 2000; those who are older, male and from an ethnic minority background continue to lag behind their urban counterparts. In rural counties where individuals have the lowest levels of educational attainment communities struggle because of higher levels of overall poverty, unemployment and population loss. Some new approaches to provide rural residents with access to education are emerging. In Pennsylvania, for example, this includes the expansion of community college courses online and the establishment of a new Rural Regional College of Northern Pennsylvania (RRC) which offers affordable post-secondary learning in 17 locations across the region.

Some of this resonates in the UK where institutions such as City Lit and Birkbeck run community outreach and widening access programmes (albeit in urban areas), and more recently Popup College which involves FE providers partnering with coffee shops and using them for adult education classes after they have closed for the evening. Founded by entrepreneur Jason Elsom, he hopes to bring PopUp College to people who live in rural communities and take the number of colleges participating in the initiative from 15 to 30.

RSN members will be familiar with examples of adult education and learning in their own area. Using familiar/local venues, having local contacts/community champions to raise awareness and recruit learners, ensuring content has applicability to everyday life as much as leading to any economic benefits, working in partnership (with Local Authorities and other service providers) and thinking about legacy and sustainability are all key for me. I am evaluating a financial confidence and capability project which is supporting older people in four rural places. From speaking to some of the learners and attending some of the sessions, the course is helping them to both manage their money in retirement [it is not prescriptive, does not lead to a qualification instead using relevant information and practical examples] and reducing isolation and loneliness [local champions are used to advertise the sessions and drive up participation]. More significantly, when the course has finished, some learners continue to meet weekly (paying a small donation to the venue) providing each other with peer-to-peer support as well as broadening financial awareness across the local community.

One of the authors of ‘adult education – too important to be left to chance’ Deirdre Hughes, describes how “over the last decade, we have seen outstanding progress in adult education reaching deep into local communities and improving people’s life chances. Our research highlights the social, economic and cultural benefits of such provision. However, there is a serious danger that this type of provision gets seriously forgotten in national and/or regional policies. This would be to the detriment of millions of adults who simply want to improve their life chances and need some educational support along the way.”

To consider how deeply this reaches into rural communities, do we need to collect data on education attainment and the social and economic outcomes this results in (similar to the USDA’s annual digest) and/or map existing provision (who, when, where and how) and then see where the gaps are? What rural thinking should be in the Government’s plan for lifelong learning (e.g. equitable access and fairer funding)? And how will the plan (and DfE and ESFA more broadly) support some of the 9 million working age adults in England with low literacy or numeracy skills? Watch this space…

Watch this space…

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RSN members may be interested in the ‘Future is Rural’ Conference being hosted by the Rural Cultural Forum and held at Manchester Town Hall on Wednesday 22 November 2017. For more information and to see the event programme please see this leaflet.

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Jessica is a researcher/project manager at Rose Regeneration; an economic development business working with communities, Government and business to help them achieve their full potential. Her current work includes supporting a Lottery programme to help people into paid work; research for the NHS on rural workforce recruitment and retention issues and supporting a community rail partnership. Jessica can be contacted by email jessica.sellick@roseregeneration.co.uk or telephone 01522 521211. Website: http://www.roseregeneration.co.uk/ Twitter: @RoseRegen

Money matters

Money matters: tackling (rural) financial exclusion

Many people in the UK lack access to even the most basic financial services or are forced to rely on high-cost products which can prove damaging to their long term health. The ‘poverty premium’, where the poor pay more, exacerbates financial exclusion and reinforces a vicious circle. With many local bank branches disappearing and a growing emphasis on digital services, what can be done to tackle financial exclusion in rural places? Jessica Sellick investigates.  

In March 2017, the House of Lords Select Committee on Financial Exclusion published its report on ‘tackling financial exclusion: a country that works for everyone?’ This revealed that 1.7 million people in the UK had no access to a bank account, 40% of the working age population had less than £100 in savings, 51% of people aged 18-24 years regularly worried about money, and at least 600,000 older people were financially excluded. The Select Committee has called on Government, the Financial Conduct Authority (FCA) and banks to give greater priority to tackling financial inclusion. The Committee’s recommendations include: (i) a call on Government to appoint a Minister for Financial Inclusion tasked with reporting annually to Parliament on progress made to address financial exclusion; (ii) broadening the remit of the FCA to establish new rules requiring banks to have a duty of care towards their customers; (iii) interventions aimed at improving levels of financial literacy; and (iv) a greater understanding of the relationship between disability, mental health issues and financial exclusion.

In April 2017, ATMIA (a non-profit trade association representing the global ATM industry), published ‘access to cash: the first step towards financial inclusion’. This report provides an international overview of the role of cash and ATMs in reaching financially excluded persons who have no bank account. The report includes case studies from the UK, Brazil and the Philippines. Quillaume Leperq, the report’s author, describes how “a transition away from cash would only serve to isolate the unbanked and the underserved from the rest of the population…Efforts to eliminate financial exclusion must take into consideration the ways in which those who make up the unbanked are already marginalised”. The Digital Money Index which ranks countries’ readiness to migrate from cash to digital payments: with the UK ranked in fourth place in the Index followed by the United States (third place), Singapore (second place) and Finland (first place). In these countries the use of contactless debit and credit cards, smartphone ownership and bank account penetration rates are all high. In the UK transportation has been a key driver of contactless payment adoption by consumers; with Visa Europe predicting by 2020, 25% of UK consumers will be using mobile payments on a daily basis (up from 8% in 2015).

For me, these reports illuminate two issues: firstly, the often uneven and unequitable access to financial product and services. Secondly, the scale, development and adoption of new payment technologies suggesting we are moving from a cash-carrying to a cash-less society. In the words of Ajay Banga, the CEO of MasterCard, is there a risk that we are “creating islands where the unbanked transact [only] with each other.” How we can bring people living outside of the financial system into it – especially in a rural context? I offer three points.

Firstly, what do we mean by financial exclusion and financial inclusion?

The term ‘financial exclusion’ first emerged in the 1990s in academia. Academics researched bank branch closures and people’s physical access to financial services. At this time financial exclusion was regarded as the ‘processes by which individuals and households face difficulties in accessing financial services’. Financial exclusion was therefore seen as a geographical (exclusion) issue in that closures appeared to have disproportionately been concentrated in poorer areas.

Since the 1990s understandings of financial exclusion have evolved to individual, institutional and behavioural forms of exclusion. For example: the failure to qualify for a financial service because of the minimum deposit required or poor credit history (condition exclusion); the cost of financial services such as unauthorised overdrafts (price exclusion); less profitable customers being unaware of the financial services available because they are not targeted by providers (marketing exclusion); and some people view financial services as “not for people like us” (self-exclusion).

The term ‘financial inclusion’ emerged in 1997 as a response to the problem of exclusion and was first seen as ‘securing access to appropriate, affordable products and services.’ Over time, this understanding has evolved from being an access issue to one of financial citizenship where interventions are required to support individual’s to improve their financial literacy and capability so that they can better manage their own finances.

The Financial Inclusion Commission (FIC) is an independent campaigning body made up of parliamentarians and experts, whose aim is to promote financial inclusion on the public policy agenda. Back in 2015, the FIC produced its report ‘financial inclusion: improving the financial health of the nation’. This brought together evidence on financial inclusion, identified gaps and set out some of the challenges ahead. Since then the FCA has published Occasional Papers on access to financial services in the UK. The 2016 paper, considered how access affects not just the vulnerable, but consumers across the spectrum – and how this situation is not static because new access issues are emerging all the time because of social and technological change. Since 2013, the School of Social Policy at Birmingham Business School has published an annual financial inclusion monitoring report. This recognises how achieving financial inclusion means people need: (1) a secure income which meets the Minimum Income Standard; (2) access to appropriate and well-regulated financial services; and (3) access to free and appropriate advice, particularly for those with debt problems.

What emerges from these policy and academic discussions is the need for people to be able to access basic financial services (e.g. bank account, insurance, pensions), access affordable credit and have a minimum budget available to be able to live. While much research has focused on vulnerable groups (i.e., older people, people with mental health problems, people with disabilities), there is an increasing recognition that financial exclusion affects different kinds of people at different points in their lives (i.e., people in the armed forces or people privately renting who move around may find it difficult to access a bank account or mortgage). While there will always be people that do not wish to access financial services, for those that do, they need to be able to access regulated, responsible, affordable, appropriate products and services.

Secondly, how are rural communities affected by financial exclusion?

There is very little current discussion and debate about the impact of financial exclusion on rural communities. Back in 2009, the now defunct Commission for Rural Communities (CRC) published a support guide to rural financial inclusion. The guide highlighted the ways in which living in rural area brings additional challenges – how financial exclusion is less visible in rural areas compared to urban areas making it harder for providers to identify and target support to those who need it most; how poor public transport and long travel times makes physical access to mainstream financial services difficult and costly for rural communities; and how delivering debt advice and credit union outreach services costs more because of the dispersed client base and economies of scale. Since 2009, two trends in financial services have compounded these findings and impacted on rural communities: (1) an ongoing programme of bank branch closures, and (2) an increasing reliance on digital services.

High street banks delivering services through their branch networks have been contracting for many years. According to information published by the FCA, in 1988 there were 20,583 branches but by the end of 2015 there were reported to be only 8,400 branches. This decline is much steeper than in other parts of Europe: with the UK having 180 branches per million inhabitants in 2014 compared to 447 in Italy, 521 in Germany, 589 in France and 718 in Spain. ’Abandoned Communities’ was produced by the campaign group Move Your Money in July 2016 to highlight the impact of bank closures and the people they leave behind. Since 1989 1,500 communities have been left with no bank and another 840 communities with only one bank remaining. The group suggests banks are closing branches in poorer areas while opening or retaining them in more affluent areas. Their research shows of the 600 branch closures between April 2015 and April 2016, the banks have been targeting rural areas for closures. More significantly, the group found that areas losing the last bank in their town received £1.6 million less lending over the course of a year.

In Bricks and Clicks, Deloitte identified seven different types of branch catchment. One of the categories is ‘declining rural communities’ – places where the people are amongst the poorest, unemployment is high and where branches are struggling with shrinking footfall and reduced demand for financial services. This is leading to debates around cost efficiency, co-location and to what extent banks should help rural communities get back on track. Amid reports that 500 branches are set to close in 2017, research by Saga has revealed that 5.5 million people aged over 50 years of age will be forced to switch their account of their local branch disappears – significantly, some 37% of those surveyed said without access to a high street bank they would be prevented from carrying out many financial transactions.

On a more positive note, since 2015 twenty-five banks have had arrangements with the Post Office for their customers to be able to make cash withdrawals and deposit cash and cheques through its 11,500 branches. The minimum network access criteria means 99% of the UK population, including 95% of its rural population, should be within six miles of a post office. However, even six miles may be a difficult, costly or an impossible distance to travel for many rural residents.

While branch closures raise issues about how individuals access existing bank accounts, there is concern that removal of local banking facilities altogether may lead to increased financial exclusion.

An increasing reliance on digital services poses a number of additional challenges for rural residents. Yet digital technologies are increasingly being used to tackle financial exclusion (e.g. through the use of pre-paid cards, budgeting apps, and simplified current accounts designed for lower income and less financially stable households). The Government has also looked at how digitisation of public services can reduce financial exclusion. The issues in rural areas are two-fold: many rural areas do not have a reliable or fast broadband service, and some rural residents do not have the necessary computer skills to be able to manage their money online. The digital exclusion heatmap developed for Go ON UK, for example, found where digital skills were lacking, lack of infrastructure was part of the story.

Thirdly, what, then, can be done to tackle financial exclusion in rural areas?

Previously, the Commission for Rural Communities had called for different parts of the public, private, community and voluntary sectors to come together within a locality to work on financial exclusion issues (e.g. supporting credit unions to increase access to affordable credit); and emphasised the need to rural proof financial services provision and availability.

If the solutions are likely to be local, Local Authorities have a key role to play. The LGA’s review of local welfare schemes in 2014, for example, highlighted how Councils were innovatively administering local welfare assistance (LWA) funding. While many authorities wanted to expand scheme amid rising demand, they were cautious about planning for the future because of Housing Benefit reform, Universal Credit and a backdrop of a further £12 billion reduction in spending on working age welfare benefits.

The Money Advice Service (MAS) provides a range of tools and calculators on money matters. Set up in April 2011, the MAS are funded through a series of levies on the financial services industry and operated by (but independent from) the FCA and Government. Through the What Works Funding Programme, MAS is providing £7 million in 2016/2017 to build the evidence base around what types of interventions can make a measurable impact on people’s financial capability and to share that evidence with stakeholders across Government, financial services and beyond. Some of this pilot activity is taking place in rural areas. Cornwall Rural Community Charity (CRCC), for example, is running Get £ F+IT, a project supporting 80-100 older people to help them manage their money in retirement. This project is providing older people with six half-day digital and financial inclusion sessions in four rural locations. The findings of this work will be available on the Financial Capability Evidence Hub. In October 2016 the Government announced the replacement of the MAS with a new body, publishing a consultation on the work of this new body in December 2016. This new body is intended to bring together pensions guidance, money guidance and debt advice in one place and also required to scale up financial capability projects that have been proven to work.

The Big Lottery Fund is matching funds from the European Social Fund (ESF) 2014-2020 to invest in local projects tackling the root causes of poverty, promoting social inclusion and driving local jobs and growth. Known as Building Better Opportunities (BBO), the amount of funding and type of projects vary according to Local Enterprise Partnership (LEP) area but some include projects that support financial literacy. Another Lottery programme, Improving Financial Confidence (IFC) is aimed at helping people become more confident in, and more aware of, how to take control of their finances. Mainly (although not exclusively) delivered by Citizens Advice Bureaus, IFC is helping rural and urban residents to access and use financial products and services suitable to their needs.

In response to concerns about the damaging effects of payday loans and other forms of high-cost credit, the Archbishop of Canterbury established a Task Group on Responsible Credit and Savings. The Just Finance Foundation was established in 2016 by the Church of England and Church Urban Fund, in order to implement the Archbishop’s vision of a fairer financial system. After 2 successful pilots a Mustard Seed Appeal is underway to help fund 30 dioceses to train 6,000 volunteers to support 2.5 million people across the UK struggling in financial distress.

While these initiatives highlight the role of Government, charities, the voluntary sector and faith groups in tackling financial exclusion; perhaps there now needs to be a renewed focus on identifying financial exclusion specifically in rural areas?

A broad range of support and guidance is required to help everyone get out of, and avoid falling into, financial exclusion – from providing children with lifelong skills in savings, borrowing and debt, through to meeting rising demand for debt advice services. Bank branch closures, broadband availability, digital skills and welfare reforms are all affecting the extent to which rural residents are financially included in rural England. Going forward, will a new Government commit to a Minister for Financial Inclusion (and will he/she rural proof public policy and its implementation) and will the new Money Guidance Body in 2018 commission services in rural places (i.e., of successful interventions funded by the MAS that are ready for replicating, further testing and/or scaling up in other parts of the country)? Above all, how can we ensure rural financial exclusion is not hidden and that people living in rural areas receive the financial access, support and guidance they need?

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Jessica is a researcher/project manager at Rose Regeneration; an economic development business working with communities, Government and business to help them achieve their full potential. Her current work includes supporting a Lottery programme to help people into paid work; research for the NHS on rural workforce recruitment and retention issues and evaluating a financial capability project. Jessica can be contacted by email jessica.sellick@roseregeneration.co.uk or telephone 01522 521211. Website: http://www.roseregeneration.co.uk/ Twitter: @RoseRegen

 

Agricultural Innovation

How (agriculturally) innovative are rural places?

There are now a number of Government and industry initiatives and funding streams to support agricultural innovation in the UK. This is part of a commitment from Government to create more jobs and promote growth through its Industrial Strategy; as well as a commitment from industry to take ideas ‘from the lab to the market place’ to bring commercial rewards for farmers whilst delivering environmental benefits. What is agricultural innovation and what does it mean for rural places? Jessica Sellick investigates.

Back in July 2013, the Government published ‘A UK Strategy for Agricultural Technologies’. It was the first time the Government, scientists and the food and farming industry had come together to identify and develop the opportunities and strengths of the UK agricultural technologies (agri-tech) sector as a whole. Overseen by the Agri-Tech Leadership Council, and with a budget of some £160 million, the this strategy set out a vision for agri-tech, namely: “That the UK becomes a world leader in agricultural technology, innovation and sustainability; exploits opportunities to develop and adopt new and existing technologies, products and services to increase productivity; and thereby contributes to global food security and international development”. The strategy was intended to unlock a new phase of global leadership in agricultural innovation. As its starting point it identified three strengths vital to supporting growth in the sector: (1) institutes and universities at the forefront of research; (2) innovative and dynamic farmers, food manufacturers and retailers; and (3) accessing global markets through exports of products, science and farming practices. The purpose of the strategy was to harness an infrastructure to support agriculture’s growth. Since then, what have Government and industry done to lead, participate and co-invest in agri-tech? And what does it mean for rural economies and places? I offer three points.

Firstly, Government is investing public funding in building the capacity and capability of the UK agri-tech sector. After the Strategy was published Innovate UK was tasked with improving the translation of research into practice. Innovate UK has put £70 million into an Agri-Tech Catalyst – this is a single funding stream for projects (from laboratory to market place). So far, 120 Agri-Tech Catalyst projects have been supported. These have included projects related to (a) primary crop and livestock production, including aquaculture; (b) non-food uses of crops; (c) food security and nutritional challenges in international development; and (d) challenges in downstream food processing linked to primary production. Individual projects range from harnessing friendly fungi to protect grain from insect pests through to ensuring improved animal welfare for chickens. The current – sixth round – of funding is aimed at projects that will increase the pace and scale of uptake of agricultural innovation by farmers in developing countries. The round closed on 1 February 2017 with decisions expected by 31 March.

Innovate UK has also been tasked with an £80 million fund from Government to establish Centres for Agricultural Innovation to test and develop new agricultural technology and products. There are three new centres: (1) the Centre for Crop Health and Protection (CHAP), a £21.3 million investment to revolutionise how farmers manage crop threats and diseases; (2) Centre for Innovation Excellence in Livestock (CIEL), a £29.1 million investment to create new livestock technology and products to boost productivity; and (3) Agricultural Engineering Precision Innovation Centre (Agri-EPI), a £17.7 million investment in precision agriculture. CHAP and CIEL are headquartered in York at the National Agri-food Innovation Campus at Sand Hutton; whereas Agri-EPI has hubs in Edinburgh, Harper Adams University and Cranfield University. These three new centres are intended to work alongside Agrimetrics, the Government’s first centre for agricultural innovation (a not-for-profit centre that gathers ‘big data’) which was launched in October 2015.

From an industry perspective, agri-tech is about more than Government policy or global factors. Consumers are also important – particularly as they expect quality food produced to high social, environmental and ethical standards. At the interface between the food and farming industry and consumers, retailers have a key role to play in connecting scientists, farmers, producers and manufacturers to the markets they serve. Central to this is a discussion around sustainable intensification: how can we manage farmland to increase farm output and competitiveness whilst protecting the countryside?

Over the last 4-5 years, this Government-industry approach to agri-tech has focused on building new networks and collaborations between all supply chain members to find better ways of producing the food we need and exporting expertise, products and services globally. Following Brexit, this policy approach of seeking to enhance the sustainable productivity of UK agriculture and to put UK farming in a strong position to be internationally competitive is gaining renewed prominence.

For me, the gap that now needs to be filled is around how ideas can be taken ‘from the laboratory to the farm’: how can we build a stronger skills base to attract and retain an agricultural workforce that thinks innovation and applies innovative technologies on farm? How can we ensure the adoption of good practice across farming systems and supply chains rather than innovation being adopted in a fragmented way by individual or small groups of farmers who can see how it will benefit the profitability and sustainability of their farm business? How will this policy backdrop and funding translate existing (and future) research and scientific know-how to the farming community? With this in mind there are already examples of groups of farmers coming together to carry out “on-farm” trials and tests – from Innovative Farmers, to the Farmer Scientist Network and monitor farms.

Secondly, is there a (rural) spatial geography to agri-tech? A blog by Innovate UK on a ‘rural powerhouse’ describes how physical geography (land types) fits into specific clusters. For example: there is an abundance of grade A agricultural land in the East of England, an N8 universities agrifood initiative in the North East, a golden research triangle in the East Midlands aligned to Norwich science park, pasture based livestock production in the West of England and the headquarters of large brands and retailers in Greater London. This builds on existing work by the Centre for Cities and McKinsey & Company for The Gatesby Foundation which identified the most economically significant clusters in the United Kingdom. From “cottonopolis” to “motorsport valley”, the report traces the geographical origins of clusters that have long been part of the British industrial landscape. It identified thirty-one economically significant clusters – from financial services in London to the chemicals industry around Hull. From a geographic perspective, the findings reveal how clusters are evenly spread across the country – and how outside of London, the clusters tend to be attributable to production-led clusters. What is the most appropriate spatial unit(s) within which agri-tech should sit and how can we ensure its geographical emphasis considers rural places more broadly?

Defra’s statistical digest of rural England 2016 presents BIS data on businesses engaged in innovation. This reveals 47% of rural businesses and 49% of urban businesses surveyed between 2010 and 2012 had undertaken innovation activities (e.g. they may have introduced or significantly improved a product, good, service or practice; or were engaged in an innovation project; or undertaking research, development and equipment linked to innovation activities). This suggests that being located in a rural or urban area has little effect on the innovation practices of businesses. However, the percentage of ‘broader innovators’ was found to be lower in rural settlements in a sparse setting compared to those not in a sparse setting. Is this attributable to issues such as remoteness, investment and the application of (urban) policies experienced by some RSN members? How can Government and industry take a territorial approach to agri-tech – a more place-based approach?

Thirdly, and finally, there are discussions around how a focus on agri-tech can unlock broader economic growth in rural areas. On the one hand, this relates to calls for CAP funding and powers post-Brexit to be used to support a strategic farming policy that is better connected to the local economy. ‘Forgotten opportunities’, a report by IPPR North, for example, highlights how Britain’s rural economy contributes 16.6% of GVA. While this is derived from traditional sectors such as agriculture and tourism it also encompasses newer and emerging sectors including agri-tech and energy generation. IPPR North recommends ‘rural devolution deals’ in which Government sets ‘minimum obligations’ which local areas with a substantial rural component must meet – with these relating to food production and sustainability, environmental protection, participation in the Government’s Industrial Strategy and capital spending to support infrastructure and economic development. According to the report, Local and Combined Authorities should work with Local Enterprise Partnerships to demonstrate how they will use devolved budgets to meet their obligations and add value. On the other hand, initiatives are already underway to link the benefits of agri-tech to the wider rural economy. Cheshire East Borough Council, for example, has set up The Skills and Growth Company – with the Council seeking to expand on Cheshire East as a hub for agri-tech, supported by a £50 million capital investment in forestry and farming programmes at Reaseheath College; and following a partnership between the Council and College to pilot a new Food Enterprise Zone (FEZ). How can we ensure rural businesses (of all sizes and sectors) are taken into account by the agri-tech investment?

Much of the policy and practice discussions around agri-tech since 2013 have focused on investment, increasing the uptake of innovative practices and clusters. With the EU Energy and Environment Sub-Committee taking evidence from industry representatives, academics and Government as part of an investigation into the implications of Brexit for UK agriculture and food; and the Environment, Food and Rural Affairs Committee accepting written submissions as part of its inquiry into challenges to the food supply chain from shortages of workers; there are new opportunities to think about agri-tech. How successful has the Government- industry approach to co-investing in agri-tech been since the publication of the Strategy in 2013? What steps need to be taken to ensure that UK farmers are competitive in the global market post-Brexit? And how can we link these steps to the wider rural economy?