First Report - Cost of living: impact on rural communities in Scotland

The term “rural communities” encompasses a broad gradation of populations across Scotland and this results in a varied experience for people living in rural areas. Successful cost of living interventions need to account for and be tailored towards that variable experience.

Whilst accepting the UK Government were keen to get support out to assist people as quickly as possible, the UK Government should carry out a review to assess the effectiveness and value for money of cost-of-living support provided by the UK Government during winter 2022/23. This review should evaluate: a) How effectively this support met the needs of Scottish rural households; b) How the UK Government could have better targeted the support; and c) Whether all levels of Government have sufficient data and administrative systems to deliver more effective, targeted cost of living support in the future, if required The UK Government should write to us with the findings of this review once completed. (Paragraph 15) Rising costs of energy

The unprecedented package of financial support delivered to households across Great Britain by the UK Government last winter was welcome and helped to mitigate the full impact of the dramatic energy price increases experienced during the period. However, the Committee heard that the blanket level of energy support provided was not sufficiently “rural-proofed”–it did not account for additional costs required for many households in rural Scotland. Energy schemes prioritised administrative ease to accelerate funds getting to people over specific targeting. Whilst understandable in the context of the immediate crisis, a system of support more tailored towards the acute pressures faced by rural communities would have been more effective. In addition, many off-grid users reported unacceptably long waits to receive payments. Support measures need to ensure parity between households connected to the grid and those reliant on alternative fuels.

One way to help reduce energy costs in the long-term is to improve the energy efficiency of homes. The challenge of retrofitting and insulating homes, in terms of cost, time and practicality, are particularly acute for rural areas. Rural Scottish households are therefore facing more barriers to accessing home energy efficiency schemes, despite being most in-need of them. Addressing this challenge will be key to reducing the rural premium for these Scottish consumers. (Paragraph 36) 28 Cost of living: impact on rural communities in Scotland

The Scottish Government’s Energy Efficiency (Area-Based) Scheme uses ring-fenced funds which require approval, but which we heard was causing concern. Witnesses were unable to provide reasons for the Scottish Government’s underspend of this scheme.

We hope to hear from the Scottish Government on how they will respond and address these concerns. (Paragraph 38) Food insecurity and food poverty

We are deeply concerned by the real hardship being experienced across many rural communities in Scotland, such as parents having to skip meals in order feed their children. Food banks provide a vital service in remote rural Scotland. There has been a significant increase in demand for their services with a record number of food parcels delivered over the past year.

Although there is no agreed definition of food insecurity, it is clear that the difficulties people experience in providing sufficient food for their families are the result of a range of issues affecting household budgets—there is no lack of available food, but there is often insufficient income to pay for it. This hardship has been exacerbated by covid-19 and other global events such as the war in Ukraine.

By Spring 2024, the UK and Scottish Governments should agree a consistent means of defining food insecurity and food poverty and show how it plans to measure this in the context of remote rural communities in Scotland. In its response to this report, both Governments should also set out what it is doing to address high food prices affecting remote rural communities in Scotland specifically.

The UK Government should work with the Scottish Government and local authorities jointly to investigate further the impact of high food prices as well as the scale and nature of food insecurity and food poverty on communities in remote rural Scotland. They should collate this data to identify parts of society worst affected and what must be done to ensure nobody goes without essential food . (Paragraph 62) Transport

Ferries are existentially important to island communities, but also create knock-on costs for goods and services. The lack of regular, reliable, affordable and integrated transport provision–including adequate and reliable bus services - is one of the main barriers to remote rural communities mitigating the impact of the current cost of living crisis. Service disruption further hinders connectivity, preventing the movement of people and goods, therefore affecting communities’ cost of living in multiple ways. Active travel options provide limited opportunities to ease transport challenges in remote rural locations.

Given the continued problems the Scottish Government have faced progressing improvements to vital roads and ferry infrastructure, the Scottish Government should work together with the UK Government and local authorities to improve the provision of transport across rural Scotland. The Scottish Government should look to coordinate the operators of these services more rigorously to ensure that timetables Cost of living: impact on rural communities in Scotland 29 are more integrated and meet the needs of people in these communities. Transport investment turbocharges the UK’s net zero ambitions and economic growth, and we welcome the action taken by both Governments to tackle this. The Committee shares the anger and frustration of affected communities by the ongoing failure of the Scottish Government to deliver two lifeline ferries which are so far six years late and £250 million over budget. Both Governments should work together to ensure mistakes are not repeated and that timely and cost-effective delivery of vessels happens in the future. (Paragraph 82) 30 Cost of living: impact on rural communities in Scotland