Local Government Finance Bill

Iain Stewart Excerpts

Tuesday 10th January 2012 Commons Chamber

[Iain Stewart (Milton Keynes South) (Con)]

I shall focus my comments on the business rate proposals, and I should like to share with the House the example of my local authority, Milton Keynes council, to show how the Bill will benefit growth and help deliver better infrastructure in the local area.

At present, Milton Keynes loses out pretty badly under the current system. According to figures that I got from the Library this morning, in the current financial year businesses in Milton Keynes are due to contribute £132.5 million in business rates, yet Milton Keynes authority will get back about half of that—just under £70 million. Opposition Members may think that Milton Keynes is a very affluent place, part of the golden south-east, but there is fairly significant deprivation and very often we lose out in our share of the funding formula, be it for local authorities or for the health service. What we want is our fair share. I quite accept the principle of fiscal sharing of revenues across a country; any western country has that. The more affluent areas will contribute more to help those that are less so. I am not saying that we should move away from that principle, but the history of Milton Keynes shows that we have not had our fair share over the years, and I very much welcome the proposals that will give us that fair share.

Milton Keynes is a fast-growing area; it has developed enormously in recent decades, but I do not believe that in terms of business growth we have realised our full potential. Certainly there has been huge housing growth in recent years, but that has not necessarily been underpinned by the necessary business growth and the necessary infrastructure to support those new houses. The measures in the Bill, coupled with those that have been introduced by the Localism Act 2011, will make us more masters of our own destiny, and I think in my local area we will seize that opportunity, and help develop Milton Keynes and grow it into what we want it to be.

The measures on business rates are warmly welcomed by the local business community. This morning I was in contact with Colin Fox, the new chief executive of the local chambers of commerce. He endorsed the view that local businesses very much support them, and that they want business to be a genuine partner of the local authority in boosting growth and developing the infrastructure that underpins that business growth in the future. I believe that, whatever mechanism the local authority has to work with business, that should be decided by the local authority. There is potential for a very good partnership to develop our local place.

I finish by giving just one example of how I believe the Bill’s measures can work, particularly the power that it will give to borrow against future revenue streams, which is not currently permitted. Just before Christmas, the Chancellor announced the building of the east-west railway line, which will go through my constituency—a very welcome announcement. One addition to that which is not currently part of the scheme but which some people locally have promoted is the building of a rail freight terminal in Milton Keynes to encourage more transport of freight by rail rather than road. If the local authority could borrow against its projected business rate revenue, it would help develop that project and enhance the scope of the scheme that is already in place and is already worth while. I offer that up as one example of how the measures could really drive the local economic growth that we all want to see, and I am very happy heartily to endorse the Bill.