FSB report calls for urgent help for village shops and pubs at risk of closure

As the UK’s leading agricultural show welcomes visitors for the final time this week after 160 years, a new Federation of Small Businesses (FSB) report warns that our village shops and pubs could go the same way as the Royal Show unless urgent action is taken.

Single shops, pubs, post offices and petrol stations in small rural settlements are eligible for vital funds from the Local Authorities which could help them through the recession, but according to the FSB, 47 per cent are currently missing out.

Village businesses, such as shops and pubs, are entitled to 50 per cent relief on their business rates under a Rural Rate Relief scheme, which also gives local authorities discretionary powers to grant up to 100 per cent business rate relief.

However, many local authorities fail to offer significant relief above the mandatory 50 per cent to half of all small village firms, which could mean the difference to those firms between survival and closure.

The village shop network is losing between 300 and 500 shops each year, and 13 rural pubs close each week, yet the existing Rural Rate Relief scheme is not being fully used to help save these businesses, which form the heart of village life.

In a poll of FSB members, 44 per cent said they relied on a sole pub, shop, post office or petrol station in their area. They cannot afford for these small businesses to fail.

The FSB’s report, A new approach to the rural economy, calls for the Treasury to make more funds available to local authorities so they can grant 100 per cent rate relief for a fixed period of just 12 months to help these vital village business weather the downturn.

The report outlines a mixture of short term and long term actions the Government must take to relieve the problems of the rural business owner and plan for a successful rural economy of the future. These include:

-A planning system that encourages the development of a vibrant and diverse business community in the countryside
-Incentivising local authorities to encourage tourism
-Greater fiscal help for our rural small businesses

Linda Walton, Rural Affairs and Tourism Chairman, Federation of Small Businesses, said:

“Every week we hear of the death of village shops and pubs yet the Rural Rate Relief scheme, which was specifically set up to help these rural businesses, is being chronically underused. Village shops and pubs are at the heart of village life and the failure of such a business can devastate local communities, the Treasury must ensure our village shops and pubs do not go the same way as the Royal Show by enabling our local authorities to give 100 per cent rate relief during this downturn.”