Business Rates Relief: High-street Businesses

Steve Darling Excerpts

Wednesday 4th June 2025 Westminster Hall

[Steve Darling (Torbay) (LD)]

It is a pleasure to serve under your chairmanship, Ms Jardine. I congratulate the right hon. Member for Stone, Great Wyrley and Penkridge (Sir Gavin Williamson)—that’s the hardest bit of the speech out of the way now—on securing this important debate.

When we reflect on our communities, it is often our town centres that we think about. Whether it is our own communities, which many hon. Members have spoken about with great love, or others that we enjoy visiting, it is often the town centre at the heart of it that we truly love. However, the challenge that we have faced over recent years is the strange death of our town centres, whether that is a result of out-of-town shopping, online shopping or, more recently, the failure under the Conservatives to reform the business rates system. We now need the new Labour Government to step up to the mark and ensure that reform happens.

As many hon. Members have noted, it is clearly not just about business rates. The problem has been exacerbated by the national insurance hike, which has had a massive impact. Many businesses tell me that they are comfortable with the increase in the minimum wage, but the double whammy of national insurance hikes and the lowering of the levy has had a major impact on them. The worry for many Opposition Members, I am sure, is that the current Government see business as a cash cow. If they bleed the cow too much, it will die. That is a real challenge. I ask the Government to reflect on that.

[Gideon Amos (Taunton and Wellington) (LD)]

Does my hon. Friend share my concern about Hatchers department store in Taunton? It was founded in 1775, but because of the combined effects of the change in business rates and the revaluation, it has seen its business rates go up by 144% in one year.

[Steve Darling]

My hon. Friend makes a very good point. I congratulate him on coming from the glorious county of Somerset, where our Liberal Democrat colleagues have had to pick up the pieces after the disastrous Conservative-run council effectively ran it into the ground for many years.

[Sarah Dyke]

As my hon. Friend alluded to, the previous Conservative administration in Somerset was a disaster; indeed, it oversaw an irresponsible record six-year freeze on council tax. Does he agree that the Liberal Democrats in Somerset are now delivering a successfully run administration after a very difficult run of Conservative irresponsibility?

[Steve Darling]

My hon. Friend makes some very powerful points. In my experience, the Conservatives in county councils are more interested in painting the grass greener than in actually getting on and sorting out people’s services.

Back to the main point, we need to be reimagining our town centres. In my constituency of Torbay, a Merlin cinema has appeared where there used to be a department store, and there is an NHS diagnostic offer in our town centre. That reimagining of what the town centre should be about is essential. We have also seen a really popular new pool hall appear in the last few weeks. That is what we need to do to our town centres. Will the Minister do the right thing and undertake a root-and-branch reform of the system to drive the positive change that we want to see?

A couple of businesses have told me about their challenges. A photographer says that he sees no benefit in the doubling of the rates and has had to let a member of staff go due to the national insurance hike. Another business—a gaming café particularly for the LGBTQ community—told me that it is really challenged and is on a knife edge due to the business rates increase; it remains extremely worried.

The Liberal Democrats would like to see a commercial land value levy, which would ensure that we look at the value of the land rather than what is developed on the site. That would lead to a major rebalancing across the United Kingdom and significantly reduce land values in some of our more deprived communities, such as mine in Torbay, driving the productivity and regeneration in our town centres that we desperately need. The only saviour for the Labour Government would be growth in the economy, because that would get us out of the rut that we are in.

I would welcome any assurances the Minister can give us that we will have a root-and-branch reform of the system, rather than tinkering. An element of the Government’s scheme is a cap of £100,000 on what chains pay, and I fear that the books will be balanced on the backs of the poorer independents in our town centres.