Non-Domestic Rating (Lists) Bill (First sitting)

Graham P Jones Excerpts

Committee Debate: 1st sitting: House of Commons
Tuesday 25th June 2019 Public Bill Committees

[Melanie Onn]

Q Do you have any idea of how much is held nationally in reserves for this purpose? Did you mention that?

Councillor Watts: Yes, it is £2.5 billion.

Adrian Blaylock: It was £2.5 billion at the end of March 2017. If you look at the returns that local government is submitting to central Government in terms of their estimates, roughly £1 billion a year is being added to the appeals provision for loss for that particular year. Obviously, as appeals are heard and settled, some of that provision is released, but roughly £1 billion a year is set aside to settle appeals.

In answer to your question, do councils have enough reserves to pay for it? The way it works is that they will reduce their income from non-domestic rates; when they submit that return to central Government, they assume a level of loss and therefore that they will get less income. In effect, it creates its own provision—if that makes sense. That is where the reserve comes from.

[Graham P. Jones (Hyndburn) (Lab)]

Q Do you foresee any problems with the roll-out of the business rate retention scheme and this Bill? Do you think any anomalies or complexities will emerge from those two?

Adrian Blaylock: Nothing obvious occurs. There are a lot of unknowns about rates retention—we are talking about whether we carry on with a similar model to what we use now, just with the 75%, or whether we go for the alternative model, which was favoured in the December consultation—and what local government needs is certainty of funding, and understanding of when and how the money will come. So I do not think that the Bill particularly causes any issues, but it would be nice to get some early indication of where we are going with rates retention and how that will change.

Councillor Watts: I do not think there are any in-principle reasons why the Bill creates problems for business rates retention.

Annie Gascoyne: I agree.

[Jim McMahon]

Q Is there a call from your members for a more fundamental review of business taxation, rather than the silo approach of the review of business rates?

Annie Gascoyne: You mean beyond business rates? We would see a fundamental reform of business rates as being high on our priority list—