While the economy is recovering, for many small corner shops trading conditions remain challenging. The budget proposals on the Living Wage and the further liberalisation of Sunday trading rules for supermarkets may make them even tougher.
Pubs, corner shops, and the local high street are crucial to a thriving community.
Therefore it is disappointing that few councils have taken advantage of the business rates reoccupation relief.
This scheme aims to help get empty shops back into use:
“The government wants to encourage thriving and diverse town centres and wants to see the number of vacant shops decrease. This relief is intended to encourage reoccupation of shops that have been empty for a long period of time and reward businesses that make this happen.”
Under the scheme there is a 50 per cent discount for businesses moving into a premises that has been empty. This discount applies for 18 months.
Rochdale Council has taken up the opportunity:
A spokesman tells me:
“The Council has budgeted £100,000 over the two years of the local discount pilot scheme in order to reduce the number of vacant units in Rochdale town centre. We expect that this scheme will encourage new investment and jobs, bring new business start-ups and drive entrepreneurship as well as supporting Rochdale town centre, particularly during the period of construction which has accompanied our River Roch reopening scheme.
This discount is over and above Government reliefs (Retail Relief, Reoccupation Relief & Small Business Rate Relief).
The scheme launched in April and has already generated a significant amount of interest with businesses and agents. The scheme has assisted in the re-letting 5 of vacant properties with negotiations currently ongoing on six others.”
The Council funds 49 per cent of local discounts awarded, Central Government 50 per cent and GM Fire Authority one per cent. The total available budget is £204,082 -£100,000 Rochdale Council, £102,041 Central Government and £2,041 GM Fire Authority.”
There are a few other examples of councils using their Localism Act powers to cut business rates. A spokesman for Warrington Council says:
“Initially we amended the council’s business rates relief policies to incorporate the discretionary aspects of the Localism Act.
“Since amending the policy, the council has been able to apply discretion and has reduced business rates to aid businesses affected by the market redevelopment in the town centre.”
Margot James MP has done some research into the matter but found a disappointingly sluggish response.
It’s not all doom and gloom. Some figures earlier this year suggested the vacancy rate among shops has fallen slightly. However it suggests a regional divide – one in five empty in the north, one in ten in the south. There are also 10,000 shops that have been empty for more than three years.
Planning policies should be more realistic. The ratio of retail units in new developments needs to reflect the trend towards internet shopping. Change of use should be allowed to reflect the housing shortage and the difficulty that we have more shops than is viable.
Yet there are also shops that are struggling financially that could be making a profit if it was not for the crippling burden of business rates. Councils should not always be trying to maximise their own revenue. They should reflect on wider community interests.