The Scottish Government

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Annual Rural Report 2004

Supporting rural economic development

Economic development is our top priority. Improving the prosperity of the people of rural Scotland requires providing them with the opportunity to seek high quality employment. We are continuing to make use of our natural assets to secure sustainable employment in green jobs, renewable energy, the traditional land-based sector, modern marketing and processing of natural products, and, of course, tourism. But we have also worked hard to provide businesses with the incentives to locate and grow in rural Scotland - through targeted business support, broadband and ICT advice. We are also assisting with skills development and support for research and development.
We also recognise the contribution of the social economy to Scotland's rural economy.

What we have achieved:

• Around 80 million of the Scottish Enterprise budget is spent on projects in rural areas. The Scottish Enterprise Rural Group in 2004 published a website outlining its activities and highlighting case studies across the network.
• Ten new communities have joined Initiative at the Edge (Iomairt aig an Oir), a scheme to support remote rural communities in the Highlands and Islands to develop local plans for rural development. New communities include Northmavine in Shetland, Eday and Stronsay in Orkney, and Glenelg and Arnisdale in the Highlands. The initial eight pilot areas will now enter a 2-year transitional exit period.
• A new 2 million recycling facility is being created in Sutherland with funding support from Highlands & Islands Enterprise. The project will create 30 high quality jobs in the area and develop world-leading technology for the recycling of lithium-ion batteries.
• The Forum for Renewable Energy Development in Scotland (FREDS) has been established to consider how best to exploit Scotland's renewable energy potential.
• Fisheries and aquaculture projects across Scotland received funding totalling 6.18 million to improve and modernise their businesses. Many projects are located in remote communities with a high dependence on the fisheries and aquaculture economy.
• The Executive has funded research that indicates that Scotland's angling industry is worth 113 million a year and supports almost 3,000 jobs.
• From May 2003 to April 2004, some 6.5 million will have been delivered through the Processing and Marketing Grant Schemes to businesses the length and breadth of the country. The schemes ensure that assistance is available to food-processing businesses in rural areas which are seeking to develop their enterprises.
• We have awarded grants of 650,000 under the Marketing Development Scheme to help small businesses develop efficient marketing structures and target new markets. Many of these grants have gone to small rural companies who take their primary product from local farmers so the benefit of the award can spread beyond the applicant themselves.
• We have continued to provide grants to a large number of farming families thereby allowing farm businesses to restructure, re-orientate or diversify in the Highlands & Islands Special Transitional Programme
  (H & ISTP) area under the Agricultural Business Development Scheme (ABDS). Farming families in the rest of Scotland can prosper under the Farm Business Development Scheme (FBDS) which offers new income generating opportunities through diversified activities. To date, around 720 projects in the H & ISTP area and a further 540 projects in the rest of rural Scotland have benefited from awards of around 18 million.
• Progress with implementing
  A National Strategy for Farm Business Advice and Skills has continued, with an extensive
  6-month pilot from October 2003. A roll-out of the scheme is planned for summer 2004.
• We have consulted on reform of the Common Agricultural Policy and announced our intention to move our total rate of modulation, EU compulsory and national combined, to at least 10% by 2007, subject to review. This is with a view to supporting wider rural development objectives so that we can target resources to provide the benefits that society wants.
• Additional funding of 20 million for marketing and quality assurance is helping VisitScotland to promote Scotland as an all-year round destination.
• The Scotland's Adventure Pass has been developed and launched by Perthshire activity operators, Perthshire Tourist Board and VisitScotland to make it easier for visitors to access different adventure experiences in Perthshire. The pass has also been developed to encourage better packaging and linkages between sectors.
• Green Tourism Business Scheme set up and run by VisitScotland, is one of Europe's most successful green tourism schemes. There are over 450 members in the Scheme, a large proportion of these in the Highlands. The Scheme requires members to sign up to a range of environmental criteria including waste management, energy reduction and public transport use. As the Scheme grows it is making an increasing contribution towards the sustainability of Scottish tourism, and promoting green tourism.
• Working together, Scottish Enterprise, Highlands & Islands Enterprise, tourism businesses and VisitScotland developed a Whisky Tourism Initiative with the whisky industry. It was launched in 2003, led by a dedicated development manager. Work is well underway to develop whisky ambassadors and centres of excellence.
• In a drive to boost fragile rural economies and increase the benefits woodland brings to local communities, Forestry Commission Scotland launched the Woods Works project in 2003. The pilot project focuses on helping people develop ideas and skills to maximise the benefits reaped from the woodland resources surrounding their communities. The Scheme focuses on three contrasting areas of rural Scotland. Balloch Community Woodland Project and the Minard Community Woodland Trust have concentrated on developing the recreation and tourism potential of the woodland. North Sutherland Community Forest Trust has focused on developing a community tree nursery to complement existing economic development activities including berry growing and wood energy projects.
• Land ownership offers an opportunity for communities in rural Scotland to purchase land to further sustainable development in their area.
  We have expanded the scope of the new Community Right to Buy so that an additional 117 communities within Scotland will be able to benefit. We have also prepared the way for a new Crofting Community Right to Buy.
• Scottish Enterprise and Highlands & Islands Enterprise have provided support to small and medium-sized enterprises on all aspects of e-business, through seminars, practical workshops, and one-to-one consultancy. The annual e-business survey undertaken by Scottish Enterprise helps support to be better tailored for the sectors, business sizes and areas in greatest need of assistance. The high-profile annual Winners at the Web competition, which rewards best practice in e-business adoption, also helps to motivate organisations to reassess their use of ICT.
• We achieved the broadband target we set ourselves in December 2002 of 70% population coverage in January 2004, 2 months ahead of target. Our approach, using a combination of marketing, demonstration facilities, impartial advice and financial incentives for businesses, has not only helped to increase coverage through demand stimulation, but also helped to increase the rate of take-up across Scotland. As a result of our efforts, BT have announced that all telephone exchanges which had been set a trigger level will now be enabled by summer 2005, providing coverage to 95% of households in Scotland. We have now announced a new broadband coverage target of access in every community in Scotland by the end of 2005, and measures to meet it. This will benefit up to 100,000 households and businesses in rural and remote areas across Scotland which would otherwise not have access.
• We are improving the planning system in rural areas through our publication in April 2004 of the National Planning Framework. The framework includes a section on rural Scotland which recognises the promotion of diversification of the economy in combination with a commitment to environmental stewardship.
  We have consulted on a draft Scottish Planning Policy for Rural Development. This promotes a planning vision for rural Scotland, emphasising a more welcoming stance to development in sustainable locations.
• We are working with Post Office Ltd and the DTI to ensure that Scotland received its fair share of support funding to the rural Post Office network.

CASE STUDIES

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