Local Government Finance Act 1988 (Prescription of Non-Domestic Rating Multipliers) (England) Regulations 2026

Lord Parkinson of Whitley Bay Excerpts

Tuesday 10th February 2026 Grand Committee

[Lord Fuller (Con)]

My Lords, having heard from the Deputy Chairman of Committees that we were going to the first Motion first, we have the second Motion first. I want to go back. I do not want to talk about studios. It is not that I do not know anything about recording studios; it is that I have nothing to add to what noble Lords have said.

I want to raise a wider point about what happens when you make changes in the business rates system. It is important that the business rates system has the right incentives and is fair to small businesses, particularly those on the high street that make such a cultural contribution to our nation. We have seen in the newspapers as well as in these regulations what happens when you make alterations to the business rates that pertain to pubs, hotels, restaurants, between retail and industrial, and to large businesses versus small. It is one of those truths that the winners tend to keep quiet, but it can be existential for losers. That is partly because the amount of money that is raised by business rates is fixed and, as you give a relief in one place, it pops up as additional burdens elsewhere. That is just the way the system works.

However, for local government, stability and buoyancy in the system are important. When you change the system, there are downstream consequences, because business rates very largely pay for the delivery of local government services. Yes, there is redistribution within the nation of the money that is raised. For example, we are in Westminster, which raises nearly £1 in every £12 raised in business rates in our nation, and that £2 billion or so is redistributed to Redcar, Redruth, Wroxham and all around the country with a complicated process of ceilings and floors. There are also systems within county areas, as they tend to be, so that all the councils can pool together to grow the economy. That is important, because the system is designed with powerful incentives for councils to grow the economy on the simple truth that the more you grow the economy, the more you keep. Of course, resets happen every now and again and they are a disincentive to grow. All that effort is wasted as the business rates baseline is washed away. That is the context within which I wish to make my subsequent remarks.

In the past few weeks, there have been technical changes in the way that baselines and pooling are done that would have had material effects on district councils. For most councils, about 10% of their net budget would have been swept away, badly impacting on homelessness, recycling, building and all the things that we need to get the economy going. That is especially germane because district councils outside the M25 and the urban metropolitan centres tend to be the planning authorities that get growth going.

I know that the District Councils’ Network and, more widely, the local government family are grateful that the technical changes that could have caused that 10% disaster have been fixed for the coming year, but for one year only. As we look at business rates more generally and at altering the application of business rates, we need to make sure that the Treasury and the local government department are better aligned in future years so that we avoid the perverse outcomes that we might have seen.

It is not fair on councils to have the uncertainty. It is certainly not the right thing for the economy, because confidence and long-term stability provide that central alignment between central and local government to generate wealth in these islands. It is incumbent on the national Government to ensure that they do not accidentally damage that delicate balance that keeps the economy growing, people in work and taxes paid.

[Lord Parkinson of Whitley Bay (Con)]

My Lords, I add my name in support of all the noble Lords who have spoken in favour of the take-note Motion of the noble Lord, Lord Clement-Jones. I am grateful to him and to the members of the Secondary Legislation Scrutiny Committee for drawing our particular attention to the regulations before the Grand Committee.

--- Later in debate ---

[Lord Parkinson of Whitley Bay (Con)]

My Lords, we had to hit pause, but I shall resist the temptation to hit rewind and repeat what I said. I was echoing the points that have been made: a lot of the problems here are with the way the Valuation Office Agency tries to understand the particular nature of these important businesses. At the very helpful meeting with the noble Baroness, Lady Twycross—which the noble Lord, Lord Freyberg, alluded to—we heard from a lot of people across the sector. They are frustrated that they have one conversation with the Government but hear something different from the Valuation Office Agency. If there is a way to short-circuit that, I know that they would appreciate it.

There is also the broader question of how the Government value and account for things. Can the Minister say whether, in bringing these measures forward in the discussions that His Majesty’s Treasury had with the Department for Culture, Media and Sport, he was able to talk to the team there that works on the culture and heritage capital programme? That team is working to arrive at a Green Book-compliant way of valuing the wider benefits that we have heard about. That includes the social benefits of our cultural infrastructure in terms of not just our physical and mental health and well-being or tackling isolation and loneliness, particularly in rural areas or areas of deprivation, but trying to put a value on inspiring the future generations of musicians, artists and others.

It seems that the decision here runs counter to the Government’s noble aims in their creative industries sector plan to grow what are already world-leading sectors for the United Kingdom. Nevertheless, they are precarious and challenged by a number of global competitors, which are breathing very heavily down our necks. As the noble Lord, Lord Watson of Wyre Forest, said, we have a very delicate ecology and ecosystem in these sectors, and it is very important that we all do everything we can to maintain that.

[Lord Clement-Jones (LD)]

My Lords, I am not quite sure, as the procedure is rather arcane, but I think I manage to get a very quick wind-up. The positive thing today is that we have heard so much about our music ecosystem, and people have been celebrating that. The noble Lord, Lord Parkinson, was absolutely right when he talked about the impact of Covid—the perfect storm, in a sense, of inflation, national insurance and so on—but that ecosystem is hanging on. It is still there, and it is absolutely fundamental to the music industry. In a sense, that is the good news; the bad news is that some of the issues we have been talking about today on business rates are going to kill what the noble Earl, Lord Clancarty, called the critical creative infrastructure.

Grass-roots Music Venues

Lord Parkinson of Whitley Bay Excerpts

Monday 26th January 2026 Lords Chamber

[Lord Livermore (Lab)]

I will absolutely do what the noble Baroness asks. The Government have heard exactly what she said: that the existing policy to mitigate the impact of development on existing activities, including live music, is not always applied effectively. The creative industries sector plan committed to improving the implementation of the agent of change principle. MHCLG’s current consultation on the National Planning Policy Framework proposes that the policy be more explicit about the matters to be considered, such as both the current and permitted levels of activity within existing uses, which includes licensing for music and cultural venues. This will enable decision-makers to consider the right information early on, addressing the conflict between new and existing development.

[Lord Parkinson of Whitley Bay (Con)]

My Lords, live music venues are the R&D incubators for our creative industries. Some 53% of venues made no profit last year, and the Government’s choices on national insurance contributions and business rates have given them an additional tax bill of £7 million. At a recent helpful meeting with the noble Baroness, Lady Twycross, a number of noble Lords met representatives of music venues who said that one of the difficulties is hearing different things from the Treasury and from the Valuation Office Agency. So regarding the meeting the Minister’s kindly agreed to on behalf of the noble Lord, Lord Bassam, may I encourage him to bring along somebody from the Valuation Office Agency to help clarify the situation for these vital parts of our grass-roots music sector?

[Lord Livermore (Lab)]

I am not in a position to promise who specifically will attend the meeting, but I will absolutely take that representation back to the department to see if it is possible. I agree with the noble Lord on the importance of music venues; as he says, they are the R&D incubator for the rest of the sector. As part of the industrial strategy, the Government have recognised music and performing and visual arts as a priority sub-sector, and we have recognised the potential for growth. The UK is the third biggest music market globally. As you all know, as part of the music growth package, we are backing the next generation of British talent by doubling funding to support independent artists and grass-root music venues.

Tax Reliefs: Theatre, Orchestra and Museums and Galleries Exhibition

Lord Parkinson of Whitley Bay Excerpts

Tuesday 15th October 2024 Lords Chamber

Asked by

[Lord Parkinson of Whitley Bay]

To ask His Majesty’s Government whether they plan to maintain the current rates of Theatre Tax Relief, Orchestra Tax Relief, and Museums and Galleries Exhibition Tax Relief, as announced in the Budget on 6 March, beyond the current Spending Review period.

[The Financial Secretary to the Treasury (Lord Livermore) (Lab)]

My Lords, the Government are committed to supporting the creative industries, which play a key role in driving economic growth. As part of the Government’s industrial strategy, a creative industries sector plan will be developed, working with business, local leaders and sector experts. I am unable to comment on any specific taxes ahead of the Budget; any tax changes will be confirmed in the Budget on 30 October.

[Lord Parkinson of Whitley Bay (Con)]

My Lords, I understand that the Minister is limited in what he can say ahead of the Budget later this month, but the Government were willing last week to provide certainty for one part of our brilliant creative industries by confirming that they would continue the support we announced in March for independent film production. Does he acknowledge that brilliant organisations in theatres, orchestras, museums and galleries are already planning their programmes for 2026 and beyond, and need certainty too? If the Minister cannot give them that today, will he press that point on his colleagues at the Treasury and urge them to confirm the permanent uplift of the tax reliefs we announced in March, particularly in a week when the Government are enlisting the help of cultural icons to promote investment in the UK?

[Lord Livermore (Lab)]

I know that the noble Lord has genuine concern for, and a great deal of expertise and experience in, the arts and culture sector. As I said, the Government are committed to supporting the creative industries, and to creating good jobs and accelerating growth in film, music, gaming and the other creative sectors that the noble Lord mentioned. That is why we have ensured that the creative sector is a key part of our industrial strategy. As the noble Lord said, I cannot comment on any specific taxes, but he will know that the Government face a very challenging fiscal situation. He will know that the previous Government left a £22 billion black hole in the public finances, which they concealed from the public, Parliament and the OBR. Addressing that will involve very difficult decisions on spending, welfare and tax.