The government has accepted that pubs are vital village services and agreed to extend mandatory rate relief to some rural pubs.

The Department for the Environment says it will extend the mandatory relief scheme, which already covers rural post offices and shops, to include pubs in single pub villages with a rateable value of less than £9,000. Councils will also be given the power to raise this 50% relief to 100% at their discretion.

Nick Bish, chief executive of the Association of Licensed Multiple Retailers, said: "This is a very positive step, but we should bear in mind that this will only help a small proportion of rural businesses currently struggling to stay afloat and there is no timetable for introducing legislation to effect this."