The ‘rural premium’ that means the cost of living crisis hits you harder in the countryside

A “rural premium” is forcing countryside residents to pay up to 20 per cent more on the cost of living, a report has found.

Agricultural communities “can suffer the most” as a result of current economic pressures as a result of weaker energy security and worse infrastructure than their urban counterparts.

The All-Party Parliamentary Group on Rural Business took evidence from industry bodies, campaign groups and businesses as part of an inquiry leading up to the publication of its findings.

It found that people in rural areas are typically needing to spend between 10 and 20 per cent more on everyday requirements than those living in cities and built-up towns, despite average wages being some 7.5 per cent lower.

Three-quarters of countryside homes are off the grid, the report stated, compared to less than one in 10 in suburban areas.

This has made these households more vulnerable to soaring prices amid global supply chain shocks and the invasion of Ukraine.

An evidence submission by the charity Action with Communities in Rural England (ACRE) warned one in seven (14 per cent) of village halls are considering closure in the next six months because of their energy bills, noting the closures were “simply because they don’t feel like they are going to be able to afford to heat their buildings”.

The disparity between rural and urban areas also extends to fuel, with rural households spending almost £800 a year more on fuel than those living in urban areas, according to the Countryside Alliance, with an average car trip taking 49 per cent longer for those in villages.

ACRE also told the inquiry that rural areas have “less good access to the lowest cost food”, while there were warnings elsewhere in the report that some communities risk resembling a “food desert”.

Village shops are struggling to compete with larger retailers on the price of their product, the report added, as villagers visit less regularly amid the cost of living crisis and only buying three items on average.

Meanwhile, three in 10 rural businesses are struggling to hire staff because of their remote location and a lack of convenient transport, compared to just four per cent of firms based in cities.

Another difficulty for these businesses came in the finding that less than half receive serviceable 4G network coverage, which was described as “likely to restrict the mitigating responses and options for many firms”.

The report calls for ministers to draw up an economic blueprint for countryside businesses, more ambitious housing plans, funding for warm community centres and an extension of the Rural Fuel Duty Relief scheme.

Vulnerability of the rural economy

Julian Sturdy, the Tory MP for York Outer and the co-chairman of the inquiry, said: “This report shows without question that those living and working in rural areas have been left at a serious disadvantage. This advantage worsens further in difficult economic circumstances.

“Government needs to now show it is ambitious for the rural economy, and work across departments to develop a serious set of policies that will grow the economy, create good jobs and stronger communities in all parts of the country.”

Mark Tufnell, president of the Country Land and Business Association, accused successive Labour and Conservative administrations of having “turned a blind eye” to the vulnerability of the rural economy.

“We desperately need a robust and ambitious plan for the rural economy; not only to protect these communities from economic shocks, but to unlock their enormous potential,” Mr Tufnell said.

“Unless we stop treating the countryside like an afterthought, people will continue to suffer, and so will our economy.”

Less than half of all farmers are planning to vote for the Conservatives at the next general election, polling for Farmers’ Weekly found in December.

Support for Labour has risen significantly in the countryside since 2020, while YouGov analysis earlier this month showed Reform UK is also in the ascendancy and could plunder the ‘Rural Right’ at the next general election.