In the Budget in March this year, the Chancellor of the Exchequer announced a £300 million relief fund for Business Rates. The reason was that while the rates revaluation was revenue neutral, some firms were being hit by sharp increases. This scheme is to ease some of that burden. Most welcome. Straight away the figures were published as to how much funding was available to each local authority to pass on. All the local authorities had to do was to decide on the details for their discretionary scheme, adopt it and ask central government for the money. But many have been slow to get on with it.
Marcus Jones, the Minister for Local Government, told Parliament in September:
“At the spring Budget, my Rt Hon Friend the Chancellor announced a £435 million package of support for ratepayers over the next four years following the 2017 business rate revaluation. Overall, the revaluation was revenue neutral with the majority of businesses seeing a fall in their rates.
“The package of support announced at the Budget comprised three schemes: one that caps the annual bill increase for any ratepayer losing Small Business Rate Relief or Rural Rate Relief as a result of the revaluation to £600; a second that provides a £300 million fund for local authorities to distribute over four years to help hard-pressed businesses facing higher rates bills; and a third that gives a £1,000 discount to all pubs with a rateable value of less than £100,000. On top of this, from April 2017, the Government permanently doubled the rate of small business rate relief and increased the threshold for eligibility, meaning that 600,000 small businesses now pay no business rates at all.”
He gave some examples of good progress. Westminster Council had “already rebilled eligible businesses under the pubs and supporting small business schemes. The consultation on Westminster’s discretionary scheme which will provide over £11 million in the first year alone has now closed. Formal approval to the scheme is due this week, with applications invited from this Friday.” Leeds “has provided over £1.5 million in relief to over 3,600 ratepayers, including 50 per cent discounts on bill increases to 3,300 small and medium sized ratepayers under their discretionary scheme.” Rutland County Council “has provided almost £250,000 in relief to over 100 ratepayers to offset average rateable value increases of 13.5 per cent, and is awarding a discount of 26 per cent to eligible businesses.”
But then Jones added:
“The Government has been consistently clear that it expects local authorities to make rapid progress in helping business by implementing these relief schemes. Overall, however, despite various examples of good practice, the pace of providing relief to ratepayers has not been acceptable. I have written today to those authorities that have not fully implemented all three schemes asking them to rebill businesses that are set to benefit from relief as soon as possible.”
It would seem that some councils still have not got round to it. The Department for Communiities and Local Government publishes a list of “billing authorities that have confirmed to the Department for Communities & Local Government that they have begun rebilling for the three business rates relief schemes announced at spring Budget 2017.” There were 46 eligible councils that had not yet confirmed they had started rebilling for the discretionary scheme.
- Adur & Worthing,
- Barking & Dagenham,
- Hammersmith & Fulham,
- High Peak,
- Isles of Scilly,
- North East Derbyshire,
- Reigate & Banstead,
- Southend on Sea,
- Staffordshire, Moorlands,
- Tower Hamlets,
- Waltham Forest,
- West Berkshire,
The Federation of Small Businesses is understandably exasperated:
It’s now nine months on from the announcement of emergency relief for those most harmed by April’s business rates revaluation. While some councils got on and distributed that help, others have been slower to take action.
“We are now down to the rump of 46 councils who have yet to lift a finger to help their local businesses. Among them are authorities with some of the largest fund allocations, including Hammersmith & Fulham, Nottingham and Northumberland, who have collectively been guaranteed £7.5 million in urgent support for the five years ahead.
“It’s completely unacceptable that small firms in these areas are being put in jeopardy by this lethargic attitude.
“FSB research shows that one in five small business owners were considering closing or selling their firm as a result of bill hikes. The support promised by the hardship fund could make the difference between business life and death for many in these 46 areas this Christmas.
“Before council offices have their parties and close for the festive break, we call on these 46 local councils to do the right thing and help businesses that are struggling this Christmas. Let’s get the 46 down to zero.”
In the case of my own Council, Hammersmith and Fulham, the Council’s Cabinet did finally agree to adopt a scheme for this on November 6th. I suppose it will write to let the Government know in its own sweet time. I asked why it took us so long, given that the neighbouring borough or Kensington and Chelsea had sorted it out months ago. I was told it was because differences in the “decision making process” meant that K&C did not need Cabinet approval. Nonsense, of course. K&C also gave Cabinet approval – the difference was they approved it on April 27th. Hammersmith and Fulham Council, having been asleep at the wheel for eight months, then had the nerve to boast it had “secured” £4 million “to help local businesses”.
Councils will routinely issue virtue signalling proclamations about how they are “open for business” and all the rest of it. Yet many small firms have faced an extra strain on their cash flow due to needless delay in this relief being provided. It makes sense for some flexibility to be allowed – that is in the spirit of localism. But that is no excuse for the long delays seen in some areas. At least the transparency shown by the DCLG means we know who the culprits are.