Foot-and-mouth harmed quarter of businesses

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The Independent Online

A quarter of all British businesses have been damaged by foot-and-mouth, and rural communities will suffer bankruptcies and job losses for years to come, the Government's rural advisers said on Wednesday.

A quarter of all British businesses have been damaged by foot-and-mouth, and rural communities will suffer bankruptcies and job losses for years to come, the Government's rural advisers said on Wednesday.

The Countryside Agency called for a wide-ranging package of economic support in a report that revealed for the first time the depth of the crisis. It suggested the total cost of the outbreak to the British economy would reach £4.1bn.

Opposition MPs condemned the Government's handling of the affair, urging extra support for rural businesses and tourism. Business leaders predicted that industry would take years to recover.

Ewen Cameron, the agency chairman, said: "Government and many others acted quickly to provide some immediate relief but the full effect will not be known for some time. There will be more bankruptcies, fewer jobs and rural communities will suffer for years to come."

He said that Devon, Cumbria and other hard-hit areas faced a "double blow" because the disease affected a farming industry already in severe recession. "Foot-and-mouth has had a profound impact on rural areas, threatening livelihoods and the very fabric of rural life."

The Confederation of British Industry said it had cut its economic growth forecast by 0.5 percentage points because of the outbreak and economic conditions in America. A spokesman said: "Foot-and-mouth is a pretty substantial part of that forecast and that there is going to be an effect on the wider economy."

The Institute of Directors warned that many businesses were being hit by the knock-on effects of the outbreak. Geraint Day, a policy specialist, said: "For some people this will have meant the difference between staying in business and not being in business at all."

The new report reopened the debate about whether the Government had acted swiftly enough to save businesses.

John Greenway, the Tory spokesman on tourism, said: "This report proves that the Government has not done nearly enough for rural tourism. This industry is facing a dire crisis."

The Liberal Democrats called for interest-free loans and rate relief for rural businesses. Vincent Cable, the party's trade and industry spokesman, said: "The fact that one in four businesses has been hit by foot-and-mouth shows this crisis goes beyond farming. More help is desperately needed for tourism and small businesses, already suffering from a quiet summer. The Government has failed to provide adequate support."

But Lord Whitty, an Environment minister, said the Government had already offered £300m in aid. He said: "It was due to the wide-ranging impact that the Prime Minister set up the Rural Task Force to look at easing the immediate problems faced by rural business and communities."

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