Plunkett’s response to the APPG for Rural Business and the Rural Powerhouse

Georgina Edwards, Policy and Research Manager

What is the impact of the cost of living crisis on rural businesses and consumers?

Georgina Edwards, Plunkett’s Policy and Research Manager has submitted evidence to the APPG (All Party Parliamentary Group) for Rural Business and the Rural Powerhouse on behalf of our members for their inquiry into this question.

Our response to the cross-parliamentary group’s call for evidence represented the interests of the 700 rural community businesses operating across the UK. Our answers to the APPG’s questions were based on a survey of Plunkett Foundation community business members, as well as anecdotal evidence from community businesses we have supported. They represented a variety of enterprise types and UK regions.

Prior to developing our APPG response, the Plunkett team had reviewed the data compiled for our recent Better form of Business research which includes the most recent annual accounts submitted by community businesses. When we scrutined the most recent surplus and deficit averages, along with the levels of reserves held by community businesses we estimate that as many as 1 in 5 community businesses are currently vulnerable as a result of the financial pressures they face.

In support of our submission we then completed a survey of our members, which showed:

  • 95% of community businesses have been affected by the cost of living crisis.
  • The most common effect reported is that customers are spending less (affecting 58% of community businesses).
  • Over half are struggling to cover their day-to-day costs (53%).
  • 37% of businesses may have to delay improvements and investments.
  • Around 1 in 10 community businesses are reducing their services or hours to manage costs.
  • An estimated 70,000 people in rural areas could be affected by these reductions in services, with decreased access to essential groceries, post offices, and warm spaces.
  • A loss of local services and jobs will further increase the cost of living for rural residents

We also wanted to know whether community businesses felt disproportionately disadvantaged:

  • 63% said that being a rural business meant they were more badly affected by the crisis
  • 73% said that as a small business, they were more badly affected

As examples of this, members cited a number of difficulties, such as being financially squeezed by the price marking of wholesalers, having difficulty upgrading old or listed buildings to become more energy efficient, and lack of connectivity limiting the use of smart meters.

The upshot of the survey was simple: 83% of members felt that the UK Government needed to do more to support small, rural businesses.

Our asks of Government

In our recommendations to the APPG, we called on MPs to push for the following:

  • An extension of the energy price cap beyond March 2023
  • Grant scheme to improve the energy efficiency of rural business premises
  • Additional support to ease immediate financial pressures, such as VAT reduction
  • Tackling other longer-term issues in rural areas that pre-date the current crisis, such as poor connectivity, hospitality recruitment and supply issues
  • Support must be rural-proofed, bearing in mind the age and variety of rural buildings and additional costs of running a business in a rural location
  • Support must also be tailored with small businesses in mind, which make up most of the rural economy
  • Continuation of the Community Ownership Fund, to help developing businesses, with active support to apply for rural energy efficiency grants

Although 53% of community businesses we surveyed felt that COVID-style emergency grants were needed to tackle the crisis, 79% wanted to see grant funding to make premises more energy efficient. Community businesses are forward-thinking when it comes to this crisis, so UK Government investment to improve rural energy independence and efficiency will not only provide short-term relief but also long-term economic benefits.

The most useful short-term financial support measures for businesses would be an extension of the energy price cap beyond 6 months and other measures to ease financial pressures such as VAT reductions. As one Plunkett member responding to the survey put it, without an extension of the energy price cap, all that is offered to rural businesses is a “deferred car crash”.

Please keep in touch.

If you have any questions or comments about our policy and advocacy work, please contact Georgina Edwards, Policy and Research Manager (

In this together!

No community-owned business or project should feel alone at this time we are here to help, in whatever way we can. The whole Plunkett team want you to feel supported at this time so if you want to access our advice services, please get in touch via

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