The Scottish Office (Back)

TOWARDS A DEVELOPMENT STRATEGY FOR RURAL SCOTLAND

 
SECTION 2 - CHALLENGES
26. Through the action already taken on a Scottish Parliament and National Parks, the Government has made a decisive start aimed at changing the fundamental framework within which rural people can achieve their own sustainable development. But other major challenges lie ahead. This section describes some of the key challenges which must be overcome if our vision of sustainable development for the people of rural Scotland is to be achieved, and seeks views on how our overall aim can best be implemented.
27. Rural Scotland is characterised by gross inequalities of wealth and power. To achieve real sustainable development, which ensures proper life chances for all our rural people, we must widen the power base and introduce greater democratisation and local community involvement.
Land Reform
28. A key resource in rural Scotland is the land, and land reform will play a major part in the Government's strategy to achieve sustainable rural development. The Manifesto contained a commitment to "initiate a study into the system of land ownership and management in Scotland which will look, for example, at measures to encourage crofting as well as options for removing the rights of feudal superiority".
29. Land is a defining issue for the people of Scotland. The strength of public response to the efforts of the people of Assynt, and more recently the people of Eigg, illustrates this clearly, and the Government understand the overriding need for Scotland's land to be used in ways which can work for the benefit of the people of Scotland. The focus will therefore be on securing opportunities for revitalising rural communities and promoting rural development.
30. To take this Manifesto commitment forward, the Land Reform Policy Group, to be chaired whenever possible by Lord Sewel himself, will look comprehensively at the range of reform options available. Ministers have agreed that the remit of the Policy Group will be:

"to identify and assess proposals for land reform in rural Scotland, taking account of their cost, legislative and administrative implications and their likely impact on the social and economic development of rural communities and on the natural heritage."

31. Over the coming year, the Policy Group will analyse carefully and systematically the options for change, and their implications. It will be important initially for the Policy Group to focus on identifying precisely what aspects of current land management and ownership are in practice giving rise to problems affecting communities, the public interest or the environment. For example, what changes to current arrangements for the management and use of land are needed to strengthen the opportunities for local development and community enterprise? Is the balance between the rights of landowners and the public interest in need of adjustment? Having identified where the biggest problems lie, the Policy Group will consider the range of possible practical solutions, their costs and their benefits.
32. The Government will want to tap into public opinion on what the problems are, and what action should be taken to tackle them. The Land Reform Policy Group will therefore be issuing a separate consultation paper early in the New Year on the sort of issues set out above. It is intended that the final report from this work will provide a sound basis for legislative action on land reform. The new Scottish Parliament will also inherit two closely related reports by the Scottish Law Commission on the abolition of feudal tenure, and on the reform of the law on real burdens. Taken altogether, these three reports will represent a comprehensive package and give the new Parliament an opportunity to legislate quickly.
Democratisation
33. A further key challenge is to revitalise democracy into institutional processes. The Government wish to introduce greater accountability to the people into all areas of Scottish life through strengthening the role of elected bodies. Our proposals for a Scottish Parliament have already been described. Scotland's local authorities also have a crucial role to play, since they are directly elected by the local people living in their areas. They are unique amongst providers of local services in being both multi-functional and democratically elected. Of the 32 local authorities in Scotland, 3 serve the island groupings of Orkney, Shetland and the Western Isles which are regarded as being entirely rural, while a further 11 Councils are predominantly rural, while containing towns of more than 10,000 people within their areas: Aberdeenshire, Angus, Argyll and Bute, Dumfries and Galloway, East Ayrshire, Highland, Moray, Perth and Kinross, Scottish Borders, South Ayrshire and Stirling. Many of the remaining Councils also have extensive rural areas within their boundaries.
34. These 14 local authorities employed 58,000 staff (full-time equivalents) in 1996, spending £1.8bn on revenue expenditure and £279m on capital expenditure in 1996-97. Many are exploring new ways of strengthening local democracy, and a variety of decentralisation strategies are being followed. The local authorities provide a wide range of essential services, such as primary and secondary schools, social work services, local roads and ferries, refuse collection, street cleaning and lighting, and through planning powers have a significant impact on decisions taken by individuals, commerce and business.
35. The accountability of a Council to its community is basically secured at the ballot box, but is supplemented by statutory requirements to produce schemes for community councils and (since 1994) of decentralisation. In practice, Councils have a good deal of freedom to find methods of bringing decision-making and council services closer to the people; and this is something which a number of rural councils have made a priority. The whole topic of local involvement is to be given special scrutiny by the Commission on Local Government in preparation for the Scottish Parliament.
36. The Government was elected with a Manifesto commitment to give Councils "a new duty to promote the economic, social and environmental well-being of their area. They should work in partnership with local people, local businesses and local voluntary organisations. They will have the powers necessary to develop these partnerships". This commitment is being taken forward in the first instance through a joint Working Group between The Scottish Office and the Convention of Scottish Local Authorities. This will look at how councils might best develop a community planning role with other agencies active at the local level (Local Enterprise Companies, Scottish Homes etc) for the good of the communities they serve. The Joint Working Group has been instructed to deliver a report by Spring 1998.
37. The Government sees no necessary conflict between greater accountability to elected representatives and greater local community involvement. Better arrangements must be introduced so that communities at local level can develop their own ideas on plans and priorities for the future of their areas, and then have the opportunity to discuss these in a single forum with the local authorities and other public sector bodies who have the resources to implement the plans.
38. One approach which merits attention is the use of community development agents, or "animateurs" to help local rural communities draw up their own development strategies. The aim would be to promote a cycle of regeneration led by local communities, who with assistance as necessary from "animateurs" would prepare an agreed vision for the future of their community, develop a strategy and a programme of action, before forming community partnerships to make things happen through accessing capital and revenue funding. The purpose would be to promote the well-being of rural communities by giving local people confidence, resources, skills and support to prepare and implement their own community strategic plans. The community partnership would need to develop close links with the relevant strategic rural partnership on which the local authority and other public sector bodies would be represented. A pilot project on these lines is under way in Dumfries and Galloway based on ideas developed by the Corrom Trust for a Community Futures Scotland programme.
39. There are many ways of enabling local people to achieve their aims. The voluntary sector plays a large part in life in Britain, to a much greater extent than in many of our European counterparts. Sterling work is done by people from many walks of life on a voluntary basis. Many of the organisations running these are household names - SWRI, WRVS, Councils for Voluntary Service, the various churches, not to mention youth activities such as Cubs, Guides and Scouts.
40. The Government would welcome comments on how best to increase local community involvement in rural development, taking account of the role of local authorities, community councils, and voluntary bodies.
Encouraging Entrepreneurship
41. To achieve sustainable development, rural Scotland needs more entrepreneurs, people who are prepared to take risks to create increased economic prosperity for themselves and the communities in which they live. Social inequalities, of the kind which are evident in much of rural Scotland, in particular gross inequalities over the control of the local resource base, tend to foster a culture of dependency which is inimical to leadership and risk-taking. This underlines the important linkages between social, cultural and economic development.
42. The promotion of economic development is undertaken by a range of bodies, including local authorities, but the main responsibility lies in lowland Scotland with Scottish Enterprise and in the Highlands and Islands with Highlands and Islands Enterprise. Both organisations operate through a network of local enterprise companies (LECs) whose boards are representative of local business communities. LECs have wide discretion to establish their own priorities for investment in the light of their own assessment of local needs.
43. Because a substantial part of the enterprise bodies' decision-making capability is devolved to LECs, they are able to respond more efficiently to the needs of rural areas. Indeed, many LECs - not just in the Highlands and Islands but also in areas such as the Borders and Dumfries and Galloway - are wholly concerned with rural areas and they are therefore able to take full account of the particular difficulties of stimulating economic development in rural areas. All LECs recognise the value of a partnership approach to the implementation of their functions and have formed close relationships with other organisations operating in their areas.
44. In addition to support for business development and training, the LEC networks are also engaged in the remediation of derelict and contaminated land and in environmental and amenity improvements, while Highlands and Islands Enterprise and its network of 10 LECs, many of which serve populations of less than 30,000, have a specific responsibility for improvements in the social infrastructure of communities in the Highlands and Islands. Many of the LECs in the Highlands and Islands place a high priority on community development and support community-led projects and initiatives: others have a particular focus on rural development and on bringing in funds for rural development. Overall 400 community-based projects were assisted by Local Enterprise Companies in the Highlands and Islands area in 1996-97, involving support of £1.5m.
45. Cultural issues have an important role to play in achieving sustainable development since a sense of self-confidence at both individual and community level is often inextricably linked with leadership and entrepreneurship. There are encouraging signs of a growing cultural confidence in many parts of rural Scotland. A notable example is the Gaelic revival, for example through the Fèisean movement which now covers some 27 local festivals, using the performing and organisational talent of people from their own areas. These are an important boost to the tourist industry, especially out of the main season. The Gaelic College at Sabhal Mòr Ostaig on Skye is a major partner in the University of the Highlands and Islands, and like the UHI as a whole, is pioneering the use of electronic communications. Gaelic is used as a medium of instruction for such subjects as business administration and, indeed, rural development. These subjects are looked at from a particularly Highland perspective and thus help to provide solutions tailored to local needs. Many other examples of new enterprise based on local cultural resources are developing in other parts of rural Scotland - for example, walking holidays in the South of Scotland, and activities linked to the Doric language in the North-East.
46. An increasingly wide range of small-scale industries is based on the cultural and natural heritage of rural Scotland. Industries relying on the sustainable development of local resources include tourism based on culture and history, and crafts deriving from traditional rural skills and art forms, such as Celtic jewellery. More tangible resources, such as the products of agriculture, forestry and fisheries, provide many opportunities for locally-based industries, using the advantages of a high quality environment to promote a high quality image. We need to build bridges between traditional industries such as farming, forestry and fisheries and support for entrepreneurs and enterprise. There is a need to add more value locally to such products, thereby maximising the economic benefits for people in rural areas. In their different ways, enterprises such as fish and other food processors, craft goods and caterers already do this. The challenge for many rural entrepreneurs is to overcome the handicap of distance and small size by the use of new technology, and build on the advantages which the cultural and natural heritage of rural Scotland offers.
47. There are many entrepreneurial opportunities in rural Scotland linked to tourism. In the Highlands and Islands, for example, the value of tourism per head of population is four times greater than for Scotland as a whole, accounting for roughly 20% of the gross domestic product of the area, and supporting 20,000 jobs, approximately 13% of the workforce of the area.
Nature Conservation and Local Economic Development
48. The Government wish to achieve better integration between nature conservation and other natural heritage policies and the social and economic benefits these could bring to local communities. Development needs to take place in a way which respects our national and international obligations. Equally, nature conservation and the protection of the countryside can be a source of employment and provide economic benefits to local communities. There are many examples across Scotland - salmon fishing on the River Tweed is estimated to add £12.5 million a year to the local economy and to support 388 direct jobs; while nature reserves such as at Loch Garten attract large numbers of visitors who spend substantial amounts in neighbouring towns and villages on local services.
49. There are real opportunities in this field, helping to get away from sterile confrontations between conservation and development by building new mutually-supporting relationships. Designations such as SSSIs, Special Areas of Conservation, and Special Protection Areas should come to be regarded not as constraints but as accolades from which local communities gain real benefit. The Government is undertaking a GB-wide review of SSSIs, which will examine the question of greater local involvement in land use.
50. Much is being done to safeguard, and where possible enhance, Scotland's biodiversity as part of the Government's wider strategy for sustainable development. The Scottish Biodiversity Group, which brings together a wide range of bodies from the public and private sectors, is overseeing the preparation and implementations of action plans for species and habitats of particular importance in Scotland; developing guidance on Local Biodiversity Action Plans; and preparing a strategy to increase public awareness of the importance of an integrated approach to biodiversity. Examples of work being carried forward under the auspices of the Scottish Biodiversity Group include an action plan for the corncrake, one of the few globally-threatened species found in Scotland; and management and restoration of Caledonian pinewood habitats by the Forestry Commission. Initiatives such as these offer great potential for tourism and other local economic development in particular areas of rural Scotland. The Government will be publishing a new report on Biodiversity in Scotland, and also guidance on Local Biodiversity Action Plans, in November.
51. Walking in the countryside is a major activity with potentially big economic benefits for rural areas. The SNH "Paths for All" project aims to develop a much greater network of paths close to our towns and built-up areas. The Forestry Commission is committed to increasing the recreational potential of its forests and woodlands both for local people and for the benefit of the tourist industry. The Government was elected on a Manifesto commitment to greater freedom for people to explore the open countryside. We are asking SNH to consider whether changes are needed in access legislation in Scotland so that the Scottish Parliament will be able to take early action to implement proposals.
Reform of EU Structural Funds
52. Rural Scotland currently benefits from the following arrangements for expenditure under the EU Structural Funds:
  • Objective 1 for regions with less than 75% of European Union average income per head. The Highlands and Islands Enterprise area has Objective 1 status.
  • Objective 2 for declining industrial areas in west-central and east-central Scotland, including some rural areas and projects (though the amounts are small for rural areas);
  • Objective 5a for adapting production, processing and marketing structures in agriculture and forestry in any part of Scotland;
  • Objective 5b for promoting the economic development of specific rural areas: Dumfries and Galloway, North and West Grampian, Borders, and Rural Stirling/Upland Tayside;
  • Community Initiatives, of which the main benefit to rural Scotland comes from the LEADER II programmes of the Highlands and Islands and Objective 5b areas which aim to encourage an innovatory, partnership, bottom-up approach to local rural development. A number of LEADER Local Action Groups have been established to ensure that local communities are fully involved in the development of plans and projects under this programme.
Structural Fund spending under these programmes in Scotland has been, and continues to be, very substantial. Over the period 1994-1999 it is estimated that as much as £300 million of European funding may be spent in rural areas of Scotland, supporting projects worth over £600 million.
53. These programmes are secure until 1999, but will be subject to the review of EU Structural Funds currently under way. The European Commission recently published its proposals for the future of the Structural Funds after 1999 as part of its Agenda 2000 document, the main thrust of which is to reduce the number of Objectives. The proposed three new Objectives are:
  • Objective 1 - the existing eligibility criteria would be applied more rigorously and transitional arrangements would be introduced for those regions losing eligibility;
  • Objective 2 - would concentrate on areas affected by change in the industrial, service or fisheries sectors, rural areas in serious decline and urban areas in difficulty. This would replace existing objectives 2 and 5b and would concentrate on unemployment; and
  • Objective 3 - regions not eligible for the above would be eligible for a general human resource development objective. Assistance would be available to help Member States adapt and modernise their systems of education, training and employment.
54. There are indications that in the future Scotland will not benefit as much from EU Structural Funds as in the past. The challenge will be to ensure that within Scotland we produce rural development support policies which are even more appropriate to meeting Scotland's rural development needs. Views are sought on how the reform of the EU Structural Funds can best contribute to Scotland's rural development needs.
Agriculture
55. Agriculture remains a key industry in rural Scotland though its relative importance has been in long-term decline. It is by far the largest land user and is crucial in shaping much of Scotland's rural landscape. If upstream suppliers and downstream processors are included, some 150,000 people are employed full or part-time in agriculture or related industries. Agriculture on its own contributes 2.2% to Scottish Gross Domestic Product with a far higher share in rural areas. Through agriculture, a considerable amount of public money is channelled into rural areas, some £400 million a year in direct payments alone.
56. Agriculture, albeit heavily supported from the public purse, therefore remains an important factor in the economic structure of rural communities. Without agricultural activity, and the spin-off benefits it creates in ancillary industries, the viability of some rural communities would be threatened, as would be the preservation of landscapes largely shaped by farming practices past and present. Developments in agriculture and agricultural policy have profound implications for rural Scotland.
57. The Government believe that the long-term prospects for agriculture and related industries in Scotland are good. Scotland has an enviable reputation for high quality products which give Scottish agriculture an edge in what is an increasingly competitive market place. However, the Government do not believe that the current system of agricultural support is sustainable in the long term. Much agricultural policy is shaped by the Common Agricultural Policy (CAP). Fundamental reform of the CAP is essential. The system of channelling most support through production-related payments is inefficient and economically wasteful. While the policy has achieved its goal of increased production of basic agricultural commodities in the European Union, it has only done so at huge cost to taxpayer and consumer. Achieving fundamental reorientation of the CAP will not necessarily be easy or quick, but the Government believe that such a change is necessary if the agricultural industry is to have a long-term future as an economically and environmentally sustainable industry which contributes to the prosperity of rural communities. Production-based payments have failed as a means of maintaining the agricultural population. Over the period 1981 to 1991, while the rural population increased by 3.5%, those employed directly in agriculture decreased by 6.5%.
58. The need for further reform of the CAP has been accepted by the European Commission which has set out a number of proposals in the context of the Agenda 2000 initiative. The Commission proposes a further reduction in the prices of key agricultural commodities, in particular cereals and beef. Because this will lead to a reduction in farming incomes, the Commission proposes that direct payments to farmers should be increased. These proposals are a step in the right direction. If agreed, they will reduce the economic distortions of the CAP and the need for export subsidies. But they will not reduce the reliance on production-linked support; indeed, the cost of that support is likely to rise further. On the basis of the Commission's proposals, the balance of CAP support would remain heavily in favour of direct production-linked payments.
59. The extent to which agricultural support can be reorientated to wider objectives may therefore remain limited in the short term. Nevertheless, the Agenda 2000 document does include some interesting proposals on the management of the so-called accompanying measures and the structural support measures currently funded - in whole or in part - by the European Agricultural Guarantee and Guidance Fund (EAGGF). These programmes include:
  • agri-environment programmes;
  • marketing and processing support;
  • Hill Livestock Compensatory allowances;
  • agricultural structural measures in Objective 1 and 5b areas.
Although details remain to be worked up, the key element of the Commission's proposal is that all of these measures should be brought together with other rural development measures into a single legal framework, both within areas which will be designated under the new Objective 1 and 2 and in other rural areas.
60. The Government see merit in this approach. Such a strategy would not prevent a continuing focus on particular measures where they are necessary - for example, agri-environment programmes or support for farmers in the Less Favoured Area. But it could help to ensure that there is greater coherence between measures and that programmes are better able to be adapted to meet the different needs of different parts of the EU. Negotiations on the whole Agenda 2000 package are at an early stage. Discussions are only likely to begin in earnest in 1998 and may not conclude until 1999 or later. The Government intend to play a full part in those negotiations. Views are invited on the needs of Scotland's rural communities in the context of the approach to rural development set out in the Agenda 2000 document. Views are also sought on how the support presently available under the EAGGF can better be focussed to support rural development objectives.
Fisheries
61. One of the major growth sectors in the rural economy is aquaculture and in particular farmed salmon, where production has grown from just over 10,000 tonnes in 1985 to an estimated 90,000 tonnes plus in 1997. At roughly £240 million the value of aquaculture products in Scotland looks set to overhaul that of deep sea landings before too long. Primarily located on the west coast, Western Isles and Northern Isles, aquaculture is making a significant contribution to the economic structure of remote and otherwise fragile communities. The employment provided, direct and through local contractors, though perhaps not massive by urban standards, underpins a number of communities, in some cases contributing that essential core required to ensure the viability of local schools and other services.
62. The Government fully recognises that the industry faces major international competition and, as a relatively new and developing industry, continues to face various challenges. The Government remains committed to ensuring that the industry operates on a level playing-field internationally as our intervention with the European Commission over the Norwegian salmon dispute demonstrated. The Government is, however, aware of concerns surrounding the planning control of fish farming development and the need for greater local involvement in that process. We expect to make an announcement on planning control shortly.
63. The Government is fully aware of the various initiatives being taken by the industry to develop production of other species, eg halibut. We welcome this but we believe there is also scope as in other areas of primary production for securing local added value. A number of production companies already undertake additional processes but at locations far removed from the sites of initial production. The Government would like to see more of this higher value fed back into local communities through a greater proportion of that processing being undertaken in their areas.
64. Adding value in this way is, of course, just as important in the sea fisheries sector. The sea fishing industry provides over 8,000 jobs for Scottish fishermen and Scottish landings are worth over £300m; but the value which we can add through the onshore processing of wild fish is far greater. Our rural communities enjoy the natural advantage of proximity to some of the richest fishing grounds in Europe. We need to capitalise on that natural advantage by maximising the local processing of fish and building on Scotland's reputation for quality produce.
65. Our ability to secure these undoubted benefits for communities with close links with fisheries is crucially dependent on maintaining the health of our wild fish stocks. It is a matter of acute concern that most of these stocks are heavily overexploited. It is vital that we should place the sea fishing industry on a fully sustainable footing, even if that means short term pain around our coasts. There are far too many boats harvesting too many fish, and unless we can end this vicious circle, the prospects for fisheries-dependent communities will be bleak indeed. When the North Sea herring collapsed in the 1970s, the effect was felt not just by the fishing fleet but by our onshore processors. We must do everything possible to arrest the decline in our fish stocks and to enable them to regenerate.
66. We cannot do that on our own. The fish stocks on which we depend are shared with other European countries. That is why the European Union adopted a policy to reduce the size of EU fishing fleets and their activity. Like our European partners, we are now under a legal obligation to reduce our fishing effort, so that fish stocks expand and can sustain a higher level of exploitation in the medium and long term. None of us can get away for long as free riders. Scotland has a great deal at stake in the success of these common efforts.
67. The UK is seeking to restructure its fishing industry. By decommissioning, the Government is helping to scrap some of our fishing vessels so as to reduce the size of the fleet and help create a more efficient offshore industry. The aim is to ensure that the remaining vessels generate sufficient returns from catching their allowed quota to pay for the costs of capital investment and enable the fleet to be renewed without subsidies from the taxpayer. For some sectors of the fleet, we shall need to restrict vessels' fishing time to make sure that our targets are met. It is the larger vessels spending most time at sea which are doing most damage to our fish stocks. A smaller, leaner offshore fleet will mean fewer jobs at sea but will safeguard the jobs on land by guaranteeing continuing supplies of fish.
68. Closer inshore, fishing vessels are used less intensively. They are more dependent on localised stocks, in particular of high value shellfish species. Our more remote communities in the Highlands & Islands are particularly dependent on these smaller vessels engaged in less capital intensive fisheries; and of course within 12 miles of our coastline, these fisheries are largely exclusive to this country rather than being shared with our European partners. There can be no doubt that the husbandry of these resources at a more local level gives the community a real stake in ensuring that they are exploited on a sustainable basis.
69. With a smaller number of large, capital intensive vessels on the one hand and a larger inshore sector populated by the smaller, less efficient and less capital intensive vessels on the other, the development of a two tier sea fishing industry seems set to continue. For both tiers, we need to find ways of giving individual fishermen and their communities a greater stake in the longer term well-being of the fish stocks. For the offshore sector, we are seeking ways of bringing decision-making under the Common Fisheries Policy closer to those most directly involved in particular fisheries and encouraging greater dialogue between those who harvest the fish and the scientists who advise on the state of the stocks. For the inshore sector, we can seek to develop local management regimes, for example through the use of Regulating Orders under the Sea Fisheries (Shellfish) Act 1967, so that those who take responsibility for protecting the stocks are able in due time to reap the undoubted rewards. Views are invited on how best to give rural communities a stake in the long term sustainable use of fishery resources.
70. In the excitement which surrounds the development of aquaculture and the sometimes more sombre environment which surrounds the sea fishing industry, it is often easy to overlook the significant contribution made to rural communities through game fishing, principally salmon and sea trout but also other species. Estimates suggest that the current value of rod fisheries is about £350 million and that in addition anglers are injecting about £50 million into local communities through the purchases of tackle, accommodation, food, drink, etc. The Government is keen to see this continue and expand. However we are aware of concerns about the continuing reduction in salmon and sea trout catches. This issue and how we might best manage this valuable part of Scotland's heritage was recently examined by the Scottish Salmon Strategy Task Force. The Government will be responding to the Report of the Scottish Salmon Strategy Task Force shortly.
Service Provision
71. The basic service needs of rural people are similar to those of their urban counterparts, but sparsity of population and long distances from major centres inevitably create special problems in the delivery of services to rural communities. There are often considerable distances required to travel between different settlements and to reach facilities such as schools, health centres or shopping centres. In much of modern rural life, travelling significant distances is a normal part of every day business. The Government recognise that adequate transport links are necessary for viable rural communities.
72. Ferry and air services provide vital links in many parts of rural Scotland and the Government will continue to support these through subsidies under existing regimes and through its ownership of Caledonian MacBrayne and Highlands and Islands Airports Limited. Overall it will continue to support an appropriate role for these services within the overall transport policy which it is developing. Many parts of rural Scotland have benefited from fundamental improvements in the road network in recent years, both through reducing journey times to major centres and through bypasses around many small towns and villages which have brought great environmental benefits to local residents.
73. The Government published a UK consultation document "Developing an Integrated Transport Policy" in August, and expects to publish a White Paper in Spring 1998 on an integrated transport policy for Scotland. Local communities have the opportunity to make their views clear to Government in the consultation process which is currently taking place. The recently established National Transport Forum for Scotland will also consider how best to take account of local rural views.
74. The motor-car is often a necessity in rural Scotland. The Scottish Office is co-funding a research project to examine the extent of car dependence across five different parts of rural Scotland. The findings should be available in the first half of 1998. The Government is also funding research to examine the role that rural filling stations play in local communities. This will cover rural petrol prices and supplies, issues of fundamental importance to many rural areas. Advice has already been issued on innovative transport schemes for rural Scotland in the "Rural Transport Action Guide", published by The Scottish Office in November 1996.
75. It is essential that good quality housing is provided in the right areas at prices which people can afford. Rural Scotland experiences particular housing problems which need to be addressed. The second Scottish House Condition Survey, published in October 1997, showed that 1.8% of the occupied rural housing stock fell below the tolerable standard, which compares unfavourably with urban areas where only 0.8% of the stock failed to meet the standard. The survey also showed that dampness affected 12% of rural properties compared with 8% in urban areas. Also, the costs in rural areas associated with transporting building materials and labour, and with the provision of services, can be significantly above equivalent costs in towns and cities.
76. There are often pressures on rural housing markets from second home buyers and commuters, restricting the supply of affordable housing for owner occupation. This can have a knock-on effect on the availability of housing for rent. And although applications under the homelessness legislation are generally lower in rural areas than in urban Scotland, rural areas have particular problems, such as the use of residential caravans, and holiday accommodation which is only available to local people for winter lets.
77. The Government is taking action on a number of fronts to tackle rural housing problems. Scottish Homes, which has so far spent some £450 million in rural areas, is currently reviewing its rural policy and has also been asked to review its grant schemes with a view to making them more flexible and more effective in rural as well as urban areas. The Government has made available additional resources for housing in 1997-98 and 1998-99; has launched a new Empty Homes Initiative and a new code of guidance on homelessness; and announced the first successful projects to receive grant under the Rough Sleepers Initiative, including projects in rural areas.
78. Education is the Government's key priority in all parts of the UK. There are many important contributions that education can make to rural development and this applies at all stages, from pre-school through to higher education. Many villages in rural areas have primary schools which provide a community focus in addition to their educational function. Secondary schools in rural areas serve a wider area than primary schools but can also be a valuable resource for community use, especially after school hours. The Government aims to see, by the Winter of 1998-99, an education place in the pre-school year for every child whose parents opt for it. Innovative solutions to the problems of rural pre-school provision are already characterising the energetic response of local authorities to this challenge.
79. In tertiary education the University of the Highlands and Islands is a particularly exciting project. Using modern technology, the opportunity exists to connect a number of sites which are widely separated by land and sea to form a virtual University. Development of the University of the Highlands and Islands is being watched with keen interest in a number of other parts of the world, and it seems likely that the skills learned there will be of wide application in other countries.
80. The Government recognises the importance of high quality primary schools to many rural communities. The Budget made increased resources available for local authorities to spend on schools and many schools in rural communities will stand to benefit from these funds. Rural schools will play their part in the desire to raise standards throughout the education system. The Government recognises that, in a rapidly changing educational world, the position of small schools requires to be considered with particular care. It is therefore conducting a research study into the management of change in small schools. Agreement with British Telecom to wire up schools to the Information Superhighway will enhance schools' importance in communities. They will form part of the delivery of opportunities for lifelong learning, which will improve life chances for all local people.
81. In the health field, the Acute Services Review is addressing the provision of high quality services in isolated or scattered communities. This is part of a wider review which is looking at the changes these services should be making in order to meet the health care needs of the people of Scotland in 5-10 years' time. The Review, chaired by the Chief Medical Officer for Scotland, is expected to complete its report in May 1998. An open meeting on all aspects of the subject will be held in Inverness on 27 February 1998. The Review emphasises that there is no one pattern of service which should be applied rigidly across the whole of Scotland: account will have to be taken of the needs of different areas. The Review is likely to produce a series of general principles which can be applied locally and flexibly to meet local needs. The recommendations of the Scottish Health Service Advisory Council's report "Health Care Services in Remote and Island Areas", published in January 1995, are also relevant.
82. A range of other services are vital to sustainable development in rural Scotland, whether provided by the public or private sectors. The rural shop, for example, is often central to the life of rural communities, but in many areas faces severe cost pressures resulting from the small scale of operations and the long distances to suppliers. Action has been taken to help rural shops: the Village Shops Rate Relief Scheme will give significant relief from the rates burden for general stores and post offices in villages of less than 3,000 population. This comes into effect in April 1998. On rural petrol stations, The Scottish Office has commissioned a study which will research the contribution these make to the local community. The study will also consider petrol prices and security of petrol supplies in rural Scotland.
83. The Government would welcome views on the provision of key services in rural Scotland, and how the special circumstances of rural areas can best be taken into account.