A new report suggests that with the “right policy framework” in place the rural economy could deliver billions in tax revenues, which could in turn, one day pay the annual salaries of between 250,000 and half a million NHS nurses.
That is according to the findings in a report for The Rural Coalition which outlines the “enormous potential” of the rural economy to deliver an additional “£9 billion to £19 billion per year in tax revenues”.
The report highlights that the rural economy in England has been “underperforming” for decades, and that currently the non-rural economy is around six-times its size.
However it also suggests that the current environment presents an opportunity for change.
“Based on recent trends in economic growth, the non-rural economy will be 6.5 times the size of the rural economy by 2040,” it states.
However, the report also details that with new policies to support growth, rural communities could add £5,000 to £11,000 per worker to current rates of productivity.
It also outlines that the new normal environment of “technological advances, changing preferences, and shifting priorities” offers an opportunity for rural areas to grow at the same rate of non-rural areas.
“The productivity differential between rural and non-rural underscores an existing imbalance in economic output and efficiency.
“This productivity gap signifies both a need and an opportunity for targeted interventions and support mechanisms to unlock the latent potential within rural economies,” the report states.
It highlights that if the underlying factors for this gap were addressed by policymakers then this could potentially create an environment that would support “rural prosperity and sustainable growth”.
Rural economy
Margaret Clark, chair of the Rural Coalition, believes that the report shows that rural areas are “part of the solution” to the growth of the nation.
It makes economic sense to invest in improving rural infrastructure and tackling existing inequalities. But there is no silver bullet.
“It requires concerted action across government and a policy framework that recognises that thinking rural and tailoring policies and programmes to meet rural circumstances will reap positive benefits for us all,” she added.
The coalition is a group of 12 national rural organisations which have come together and all subscribe to a vision of “a living and working countryside” in England.
The new report sets out that growth would “not only benefit” rural communities and the national economy but would have significant tax implications for the UK Treasury.
The report states: “Our estimates suggest that the additional tax raised could pay the annual salaries of between 250,000 and half a million NHS nurses.
“In other words, if the rural productivity ratio in England was equal to that of Scandinavian countries, the additional tax raised could pay the annual salaries of 514,000 nurses.
“Alternatively, under our most conservative scenario, the additional tax revenues could pay the average yearly salaries of 216,000 teachers or 171,000 dentists”.
