Ross Murray Speech
Rural Business 2030 Conference
6 December 2016
Thank you Cathy for that generous introduction. It is great to have you guiding us through the day.
Welcome to RB2030. We have had an outstanding response to this conference from the moment it was announced last year. It has galvanised interest in the membership towards the theme of investment in the rural economy, which I am very pleased about.
I invite you to cast your sights over the horizon. A Year ago a new self confident Government had just laid out its economic plan to fix the foundations of the economy. At the heart of this plan was a wave of new public and private investment targeting greater productivity. They set their vision at the 2030 horizon and therefore so did we.
It's been a year of astonishing change since then. A new PM, a new chancellor and a new future outside the EU. You simply could not make it up.
But as the now Chancellor confirmed two weeks ago the vision and long term objectives remain fundamentally unchanged.
Clarity on the long view is the best way to cope with events. We demand this vision of our Leaders, but we must also demand it of ourselves and today we will reflect on that. To take the long view is after all CLA DNA.
I am really pleased to report that the 2030 challenge has galvanised the staff team at CLA. They have drilled into the fundamental issues that affect all our businesses, organising 3 seminars on subjects that brought together members and other practitioners with a particular expertise.
From these we have drawn together important conclusions to feed into the Rural Business 2030 report you will find in your doggy bags.
The Conference theme of unlocking investment and unlocking potential to 2030 has attracted commercial partners who have supported this conference in both cash and kind. My thanks go to Barclays, Strutt & Parker, BT & EE Group, CLA Insurance and CLA Utilities.
And we have a really interesting group of speakers, from members, to academia, the world of politics and of course business, to whom I am very grateful.
My thanks to all of you, for coming, for taking an interest and I hope learning and taking away inspiration to invest even more in your businesses.
Today is also about something else. The CLA is your voice here in the heart of Westminster. We do that advocacy job day in day out, but we cannot do this without your involvement. There is no more effective lobbyist than an intelligent and engaged member. And that is you! Without exception!
Please ask questions and challenge, but more importantly badger the rural MP’s who will be joining us later this afternoon.
Let them know your own challenges and ambitions so they understand what to keep in mind as legislators.
Relevance of Rural Business
Be in no doubt that we are at a critical moment, with decisions required to shape the future of farming, land use and the wider rural economy
Why a rural business conference? We know that individually our own businesses are economically dominant in a small geographical area, but collectively we play a vital role in the national economic story. I really do believe the rural economy in Britain is the Cinderella of the national economy. Beautiful but often misunderstood, neither fully appreciated nor as productive as we could be.
And it is not just private interest which drives us CLA members. I am very honoured to travel all over the land and meet so many members. They are doing incredible and inspiring things that have profound impacts on their local economy, their landscapes and environment and their communities. That in my book is public interest.
We must take ownership of how rural business is defined, especially here in Westminster, and we must set out what makes us important, relevant and distinct.
As technologies change and the economy diversifies, as we lure modern business into the fabulous but traditional British countryside, so the differentiation between town and country blurs.
This trend for greater convergence of economic opportunity will continue.The barriers of distance and geography will become smaller and smaller. Our challenge is toshape that convergence, embracing change whilst preserving what makes our countryside so distinct.
We are also clear that rural economy will continue to be shaped by US, the land-based businesses that are unique to rural Britain. Our report shows how farming and food production, with all its interdependencies, remains the dominant land-use.
How we manage change in agricultural, its relatively low productivity, and how to ensure other economic and environmental land uses co-exist with farming are the defining questions of our generation of landowners.
This will be the CLA’s major focus throughout 2017, and the theme of next year’s Rural Business 2017 conference.
The CLA itself has a membership of around 32,000, more to the point controlling activity on half the rural land of England and Wales. We are fundamentally a family business industry. Our recent survey suggests 96% of us are family owned, of which 78% are unincorporated. You will all understand the significance of that-no benefit of reducing corporation tax.
Many of you will have been investors for generations and intend to be so for more to come, a timeline which puts 43 years of EU membership into perspective.
On a personal level at home in Wales my wife Elizabeth and I are actively planning the 8th generation to come behind us and run our business, we hope with new ideas, energy and entrepreneurial skills.
And this long view marks us out as different. The CLA has been promoting and defending rural landownership since 1907. I should tell you that the public interest is above private interest as one of our Objects.
The PM has told us she wants to promote investment in patient, or long term capital. Our first message to Mrs May is that rural business can be part of her vision, but only through consistency and certainty. This is especially the case with capital taxes which dominate so much of our thinking when planning investments.
For a Government that takes pride in its so-called business tax roadmap for major corporate taxes, it is now time for an investment tax roadmap that extends the ambition to the private family investor.
I am of course fully aware that we are confronted with the mother of all uncertainty-the fighting withdrawal from the EU-whilst we refer today to creation of certainty.
The rural economy is affected by Brexit more than many other sectors. The way we run our businesses and manage our land has been fundamentally shaped by EU money and regulation for the past 43 years.
The most pressing issue is defining a new trade policy for the UK. The history of securing strong trade deals for agriculture is not good. Too often it gets marginalised, or deemed to be too complicated or controversial to include.
So our overriding responsibility in the unfolding Brexit story is to hold ministers to their commitments to ensure food and agriculture is not marginalised in negotiations with our largest and most immediate market place.- on the continent.
Failure to secure the right deal with the EU, or worse to leave out agriculture whilst unilaterally removing the tariffs and regulations on imports from other parts of the world would have a devastating impact.
Our Brexit ambition should be for a new era of free trade, a framework that genuinely promotes our interests, not a trade free-for-all, which swamps our market with cheap food of doubtful standard.
Establishing a new trade relationship with the EU needs to happen within a realistic timeframe, even through transition.
Our role in this process is to shape the decisions that will be made. The CLA has been a respected and influential voice and will continue to be so. We will reach out to farmers and food industries across Britain and engage with friends in Europe to secure the best possible access to the single market.
There is of course a long way to go.
But oureconomic ambition must go well beyond the immediate challenges of Brexit.
When either the Government, or we in business, plan for strategic change, our enemy is uncertainty. It can never be extinguished but the aim must be to minimise it. THIS is what we want from the Prime Minister’s new industrial strategy.
It can be achieved in many ways:
Through certainty in tax policy (as I set out earlier)
Through lifting the dead weight within 70 years of the Town and Country Planning Acts amongst other regulation
Through support for progressive agriculture and technology
Through trade missions opening new markets
Through skills training and incentives for new entrants
Through creative and positive acts of partnership to plant trees and manage flood risk, and deliver for the environment.
Through vital infrastructure investment in roads mobile and broadband
In return for the right economic framework we can make our OWN commitment– which is to play our part as investors for change. In a world where the rural village is never going to be the main focus of public investment, it is us the rural investors that carry the load.
Being agents for change was the challenge posed in our 3 areas of study. We identified specific themes where CLA members can make investments with wider public significance.
The first is that of connectivity. Waiting for your broadband connection in some parts of the countryside has been like Waiting for Godot.
We will hear today with some optimism how new technologies can deliver big strides in performance of fixed line and mobile technology in rural areas. These will in future be underpinned by a new consumer protection, secured at law by the CLA. The Universal Service Obligation is your legal right to superfast broadband connection.
As the USO rolls out, it is our own capacity to invest well beyond the minimum speeds that will complete the revolution.
Secondly unleashing the potential for an energy market transformation, already underway in Fits and Starts (pardon the pun) but with an unstoppable momentum for many of you investing in new and established technologies on your farms.
The essential point is it falls to us, the landowning rural business sector, to establish a long-term plan for investment in energy generation. I commend to you the work of the Rhug Estate in North Wales, one of our case studies later this morning, a business making plans to be a local energy supplier.
And thirdly, natural capital, where delivering environmental outcomes is a commercial opportunity, because ultimately only the landowner can deliver. For this potentially marketable and profitable activity, educating ourselves and then selling the opportunity has to be the priority.
You will hear more on all three of these themes later this morning.
But I would like to conclude by suggesting that there is so much more that the rural economy can do to fulfil its potential. Patient capital is a concept where longer-term returns are deemed acceptable. But only because of our won sense of stewardship that underlies so much of what we do.
You in this room are the cohort that gets the need for drive and ambition. We should evangelise far and wide to encourage long term planning, greater acceptance of risk, embracing change and innovation in all we do, whether through new land use, management style, business skills or use of technology.
And then of course there is succession, by definition a requirement for family owned businesses. Training, ambition, appropriate reward and the ability to hand on assets without capital dilution are all themes we must always confront.
Throughout the discussions we have today, and in our messages to Government, the media and to our wider membership, it is primarily that we are the investors for the future. We will deliver on the Governments 2030 vision, if we are ambitious and achieve our full potential.
I know my friend William Kendall will exhort us to do that and I look forward to his take on how to make the entrepreneurial juices flow. And before that, we hear from Mark Suthern, a highly experienced financier of the rural sector. Mark will remind us of the importance of business planning and the use of capital, patient and otherwise.