Non-Domestic Rating (Nursery Grounds) Bill

Marcus Jones Excerpts

2nd reading: House of Commons
Tuesday 5th June 2018 Commons Chamber

[Rebecca Pow]

A reluctant gardener? That’s okay. You can garden from your chair, or in a window box, but you can get your fingers into the soil. My hon. Friend the Member for Solihull (Julian Knight) is absolutely right to say that we could increase our home growing, but we could also increase the health and wellbeing that people get from being engaged in the soil and growing things. Horticulture is such an exciting area to be in, and it is also very good for mental health. My hon. Friend makes an excellent point.

The industry itself believes that if we had the statistics that I was talking about, it would be possible to grow the industry by £18 billion. I am pleased to say that the ornamental horticultural roundtable group, in which I have been much involved, has commissioned Oxford Economics—at the vast expense of £50,000—to look into the value and economics of the ornamental horticultural sector. That is just one section of the horticultural industry, but it is pertinent to what we are talking about today. I urge all my colleagues to join the all-party parliamentary group on gardening and horticulture if they are not already members of it, because we have interesting trips to places such as Chelsea and glean a lot of excellent information. The group is also looking into the issue of growing the horticultural industry in the context of Brexit.

The ornamental plant industry supplies our landscaping industry and our popular gardening sector with wonderful bedding plants and perennials, and it is thought that that sector was worth £1.4 billion in 2017, which represents an increase of 4.8% compared with 2016. So the sector is on the up, and it could increase more. It could be a much more viable industry with this essential business rates exemption, and the more we can grow the industry, the more it will benefit the economy, particularly in the south-west.

[Mr Marcus Jones (Nuneaton) (Con)]

It has been great to hear about the all-party parliamentary group—perhaps I should dig out the details. Coming back to the exemption that the Bill is likely to provide, my hon. Friend has talked at some length about the fact that the industry is now able to grow. Is it not also the case, however, that the tax that was imposed by the Court of Appeal could well have had a significantly detrimental effect on many growers, particularly the smaller businesses that would have been most affected?

Non-Domestic Rating (Nursery Grounds) Bill

Marcus Jones Excerpts

3rd reading: House of Commons & Committee: 1st sitting: House of Commons & Legislative Grand Committee: House of Commons
Tuesday 10th July 2018 Commons Chamber

[Steve Double]

I am grateful to my hon. Friend for that good point. We should do all that we can to support our farmers who want to diversify and expand their operations to include growing plants in greenhouses and so on, and they should be able to do so with confidence and in the knowledge that they will not suddenly incur a business rates bill. It is therefore correct that we introduce clarity and put right the wrong that the court case created. As I said, I do not believe that that wrong was ever the intention of Parliament or the Government, and we should provide the sector with confidence that horticultural buildings and nurseries will continue to attract the agricultural exemption that they should rightly have.

I acknowledge the role played by the National Farmers Union in bringing the matter to my attention and lobbying on this issue. It has spoken up for its members, ensuring that their voices have been heard. I thank the Minister and the former Local Government Minister, my hon. Friend the Member for Nuneaton (Mr Jones), for listening carefully to the arguments, agreeing to take this measure and ensuring that the matter is corrected. I welcome the Bill and trust that it will pass unopposed with wholehearted support from across the House so that it can reach the statute book as quickly as possible to support this sector.

[Mr Marcus Jones (Nuneaton) (Con)]

I rise to support clause 1. As ever, it is a pleasure to follow my hon. Friend the Member for St Austell and Newquay (Steve Double), although he has just reminded me of the Local Government Finance Bill and the many interesting and fun hours that we spent on it, particularly in Committee. Unfortunately, however, those hours were subsequently lost when the Bill fell, so it is good to see this measure coming to the House, as have several other provisions that were in the previous Bill.

The agricultural exemption for nursery grounds has been in place for a significant period, dating back to 1929. Indeed, this issue was raised during the passage of the Local Government Finance Act 1988, when Ministers gave a steer that there was a clear intention that nursery grounds should be subject to the same sort of exemption as other agricultural uses. The Court of Appeal case—the Tunnel Tech case—seems to have driven a coach and horses through the custom and practice since 1929 and the intimation given by the then Government during the passage of the 1988 Act that the status quo would prevail. To put it mildly, suddenly receiving a significant rates bill as the result of a Valuation Office Agency investigation and the subsequent Court of Appeal case has challenged a number of growers in the running of their businesses.

I am pleased in many ways to have played a small part in the Bill. My hon. Friend the Member for St Austell and Newquay apprehended me in the Division Lobby one evening to explain the challenge he was seeing in his area as a result of this Court of Appeal ruling and the problems it was likely to cause growers. We subsequently had meetings with the National Farmers Union, which put a coherent and collegiate case for restoring the status quo.

I am glad that, when I approached the then Secretary of State for Communities and Local Government and the matter was put before Ministers—we do not always receive this type of response—the unanimous verdict was that the Court of Appeal decision was not the right thing for growers and other such businesses and was not consistent with the Government’s intention. I was delighted to publish a written ministerial statement confirming the Government’s intention to restore the position as it was before the Court of Appeal ruling and to allow the agricultural exemption in this regard, as was clearly intended.

[Ben Bradley (Mansfield) (Con)]

My hon. Friend mentions the NFU’s contribution. Will he join me in showing appreciation for its work in representing our farming and agricultural industries, particularly when we are deciding on the future of those industries? Does he agree it is important that the Department for Environment, Food and Rural Affairs, in particular, continues working with the NFU to make sure we get the policy right?

[Mr Jones]

My hon. Friend makes an extremely important and pertinent point. The agricultural industry is very different from many other industries in this country. This country needs to be as self-sufficient as possible in food production, and we also need to consider that it is often difficult for producers in the industry to recover their costs. For example, there has been a perennial challenge for milk producers, which have not been able to realise even the cost of production. That is why organisations such as the NFU are extremely important in bringing such issues to the fore so that we maintain our food security.

--- Later in debate ---

[Mr Jones]

I completely agree with my hon. Friend. Again he is absolutely right that, wherever we can, we should be producing food in this country for those reasons.

Importantly, clause 1 is a retrospective measure. Such measures are often not retrospective, but it is important that the Bill is being implemented retrospectively, because a number of growers have already been caught by the provisions of the Court of Appeal decision and, as a consequence, have seen their business costs rise significantly. I have mentioned the challenges that agricultural producers often face, and those challenges are compounded when growers are retrospectively asked for an amount of money that they did not anticipate they would need to build into their business costs.

In this case, a number of growers will have already sold their produce and therefore will not have factored this into their price, if they were able to do so. The decision will put a significant strain on the businesses in question, so I am pleased the Bill is being applied retrospectively and that businesses that have already been caught by the Court of Appeal decision will be refunded any business rates they have paid.

[Steve Double]

Does my hon. Friend share my view that another reason why we need to keep costs down is to allow the industry to invest as much as possible in emerging new techniques and technologies for developing and growing food and increasing yield? An additional tax burden would reduce the amount of money the industry can invest for the future.

[Mr Jones]

My hon. Friend is right. There is huge potential for such industries to grow—pardon the pun—but investment in technology is needed for them to do that. If the Government or, in this case, the Court of Appeal decide to levy an additional cost on such businesses, bearing in mind many of them are small and medium-sized businesses, the chances of their being able to continue investment will be diminished. The Bill will therefore help us to facilitate businesses in taking advantage of new technological advances. By being more likely to invest than they otherwise would have been, they will be able to further themselves, and hopefully not only will their prospects improve but they will add to UK GDP and add jobs in their local area.

I am grateful to my hon. Friend the Minister, who is now taking the Bill forward. The Bill is a positive step to put right a Court of Appeal decision that most rational people consider to be wrong. I am extremely glad that the Bill is being applied retrospectively. As colleagues have said today, not only will it enable growers to continue growing produce to sell on to other growers, who can then provide the produce we all buy in the shops and subsequently eat, but it will enable growers to invest for the future. The Bill will make sure this country continues to be a leading player in advancing how we grow our food and sustain our population.