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Dairy and rural broadband funding boost

   

NEWS RELEASE

Ref: 163/09
Date: 15 July 2009

The dairy industry and rural broadband in England will benefit from £5.2 million of new European funding, Food, Farming and Environment Minister Jim Fitzpatrick announced today.

The funding, agreed in Europe as part of the European Economic Recovery Plan (EERP), will be split between the dairy industry and rural broadband infrastructure, and will be delivered through the Regional Development Agencies under the Rural Development Programme for England (RDPE).

Mr Fitzpatrick said:

“England’s dairy sector has responded with strength and resilience to big challenges over the past decade and, despite current difficulties, the sector is well positioned for the future. 

“However, weak global markets hit by the economic downturn and the recent collapse of Dairy Farmers of Britain mean that confidence in the industry has been hit, and we want to address that.

“That’s why we’re allocating half of the new European funding, an extra £2.6 million, as additional support for the dairy industry to improve its competitiveness, providing an important additional boost to the support for the livestock sector already being provided through the RDPE.”

The rest of the EERP funding will be allocated to the provision of rural broadband infrastructure, with a particular focus on support for community broadband projects.  Access to high speed high quality broadband services is an important tool in supporting rural businesses to maintain their competitiveness and develop new market opportunities. 

Accessible rural broadband is also increasingly important as a means of ensuring access to services and social inclusion for those living in rural or remote areas.  Delivery of this additional funding through the RDAs will help contribute to achieving in rural areas the goals the Government set out in Digital Britain. 

In addition, the priority placed on rural broadband within the Rural Development Programme for England will be strengthened in order to enable the Regional Development Agencies to utilise existing funding under the Programme to support rural broadband, alongside other public and private sector funding available.

Mr Fitzpatrick said:

“Broadband can transform jobs, communities and lives in rural areas, helping rural entrepreneurship to grow, supporting businesses, and bringing investment to rural England.

“We need to overcome the barriers some rural communities face in accessing broadband to deliver the true promise of Digital Britain throughout the country and to ensure our rural economy is able to thrive in the years ahead.

“We are working closely with the Regional Development Agencies to ensure that these new funds, and the existing priorities for RDPE, are delivered as effectively as possible to help farmers and rural communities respond to the challenges they face.”

The new priorities are subject to the agreement of the RDPE Programme Monitoring Committee and must be approved by the European Commission.  Changes to the programme document will be submitted formally to the Commission for approval along with other changes implementing the CAP Health Check in the next few days.

Notes for Editors

1.   The European Economic Recovery Plan (EERP) was agreed by the European Council in March 2009 and consists of €5 bn of European funding which is being made available to member states to stimulate the economy during the economic downturn. Of this €1.02bn is available across the EU, allocated through rural development programmes, for investment in rural broadband and the ‘new challenges’ arising from the CAP Health-Check (climate change, renewable energy, water management, biodiversity and dairy sector restructuring).

2.   The UK share of the rural development element is €12.5m over two years.  Of that, England’s share is €6.6m (£5.2m). For planning purposes, an exchange rate of $1= £0.80 has been assumed for this funding. Under European rules, additional national co-financing is required at a rate of 25%.  The additional funds must be added to programmes in 2009 and 2010 but can be spent across the rest of the programme period.

3.   The RDPE is a seven-year programme of investment in the rural environment and in rural businesses and communities.  The additional funds available from the EERP for the dairy sector and broadband will be available under Axis 1 (Improving the competitiveness of the farming and forestry sectors) and Axis 3 (Rural quality of life and diversification of the rural economy). The Regional Development Agencies will be responsible for the managing the delivery of the EERP support.  The funding will not be ring-fenced at the regional level in order to recognise the different needs and priorities across the regions.

4.   EERP funds for the dairy sector will provide targeted support for the modernisation of holdings, adding value to products and cooperation for the development of new products, processes and technologies.  It will be available alongside the £107 million which is available over the 7-year programme period to address a range of challenges facing the livestock sector, including competitiveness, animal health and welfare and nutrient management.

5.   Rural broadband has been recognised as an enhanced priority within the Rural Development Programme for England providing greater flexibility to Regional Development Agencies in supporting rural broadband infrastructure needs using other measures and axes in the Programme.

6 .  In June 2009, the UK Government published its report Digital Britain (www.culture.gov.uk/what_we_do/broadcasting/6216.aspx), which sets out priority objectives for the future of Digital Technology.  This includes a Universal Service Commitment for broadband at a basic speed of 2Mbps by 2012, enhanced by the rollout of next generation networks to the majority of the country by 2017

7.   The RDPE Programme Monitoring Committee is currently being consulted on  these and number of other changes to the RDPE, after which they will be submitted to the European Commission for their approval. .  The approval process is expected to take several months.  The key changes being made are:

  • The implementation of the November 2008 CAP Health Check agreement for the RDPE.  This gives effect fto a change from voluntary modulation to compulsory modulation and introduces some increased aid intensities;
  • The implementation of the EERP
  • Further changes to the Environmental Stewardship Scheme to implement the third tranche of changes arising from the Environmental Stewardship Review of Progress.

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Page published: 15 July 2009