Promises promises – party conferences address business rates
It was good to see business rates bumped back up the agenda at The Labour Party conference this week in Rebecca Long-Bailey’s speech.
The Shadow Business, Energy and Industrial Strategy Secretary launched in to the woes of the High Street pretty early on and unveiled a 5-point plan to reinvigorate.
This included eye catching plans to offer free bus travel to the under-25s (but no details on who will pay for it) along with the idea to stop Post Office and bank branch closures in town centres (even enforceable?).
Her final fifth point focused on business rates with the pledge that Labour will introduce annual revaluations of rates and exempt new plant and machinery from revaluations.
She went on to say they will “ensure a fair appeals system and fundamentally review the business rates system” but, to be honest, my 14-year-old daughter could have written that line in her latest business studies’ essay and only got a C+ for originality.
But whilst the conferences season steals the headlines, most businesses are more interested in seeing what the September Consumer Price Index (CPI) comes out at. Various sectors are queuing up to claim the crown of being hardest hit.
September’s CPI measure of inflation determines the annual level of rate rises for the coming financial year. Overall, experts predict the total business rates bill for 2019/20 will increase by £758.6m in England, if the headline rate of inflation remains unchanged at 2.5%.
The retail sector would face a £194.2m increase, industry £159.3m and the office sector £181.7m. The remaining sectors, classified by government data as “others”, would pay the balance of £223.4m – included here, for example, the hospitality sector which argues it faces a collective £50m rises on these figures.
Helen Dickinson, Chief Executive of the British Retail Consortium (BRC), is still calling on the Government to support retailers. In light of the collapse of House of Fraser and Debenham’s difficulties she recently suggested a two-year rates’ freeze as a good starting point.
Whilst employment figures are looking strong and the economy is outperforming the gloomy forecasts for this year we still have a looming Brexit and I don’t see how Hammond will have the political will or support to give away a healthy £758m without something tangible in return. Voters are not going to get excited over a business rates’ freeze and, who knows, another snap General Election could be just around the corner.
There wasn’t much pre-Christmas cheer on the business rates front from the Chancellor’s Spending Review, unless you count a miniscule concession.
UK airports are to receive new financial support after ministers finally succumbed to months of pleading from the sector.
Calls are mounting for the supermarket giants to hand back their business rates windfall after seeing profits leap during lockdown.