20 December 2017: West Berkshire joins Business Retention Rates Pilot
(I think this should have read ‘…Business Rates Retention…’)
West Berkshire Council is delighted by the recent announcement by the Secretary of State for Communities and Local Government that the whole Berkshire area will be included in the 100% business rates retention pilot.
Allowing West Berkshire to retain the business rates could mean a financial boost to West Berkshire of up to £2 million.
Graham Jones, Leader of West Berkshire Council said: “This decision is most welcome. At a time when all councils are becoming increasing cash strapped, the business rates will provide a much needed boost to West Berkshire’s finances. We are now in a position to firm up budget plans in the New Year and look forward to using this cash injection to support our services and as a solid base on which to build and strengthen economic development in our district.”
20 December 2017: My email to West Berkshire Council
Thanks for the press release above. A few things confuse me.
First, the figure by which West Berkshire will benefit is ‘up to £2m’. I understand that about £85m is currently raised in business rates in the WBC area and about £19m is retained. The difference between these two figures is not £2m; and £2m is far from being the ‘100% retention’ stated in the article.
Second, the scheme is a ‘pilot’ and so I presume temporary. When will this start and for how long will it run? Do you know what other councils are involved? I believe that the plan is for this change of funding to be operating nationally by 2019-20. Is that still the intention, so far as you’re aware?
Third, it seems inconceivable that the government will allocate extra funds without either clawing back others or expecting councils to undertake additional services. Do you have any views on this?
Finally, if the scheme is a ‘pilot’ and thus perhaps temporary and if the benefit involved is going to be only £2m, it’s hard to see how this will lead to the certainty Graham Jones suggests. If an increasing amount of a council’s funding is to come from business rates, as I understand to be the plan, and as these can vary for reasons beyond the council’s control, this would seem to make the long-term outlook less certain rather than more. As for the area’s needs, if there is a relationship between the amount of business rates a council is able to levy and the demand for things such as social care, it’s probably an inverse one. Do you have any idea how these discrepancies will be resolved?
I appreciate that some of these questions involve speculation or concern national issues but I’d appreciate any light you can shed on this. I may have failed to grasp some important and positive point about this scheme. I would love to be able to write something positive about this announcement but at present I can neither understand the figures nor see how this is likely to benefit the people who most need the essential services that you and other councils provide.
April 2018 update: a meeting has been arranged between Penny Post and WBC Council Leader Graham Jones in order for him to explain the pilot scheme in more detail and, in general, his hopes about how the new funding structure for local councils will operate after 2020. This is expected to take place in May 2018 and we’ll provide a report on this as soon as possible thereafter. Penny Post would like to stress that the delay in following this matter up since the above letter to WBC was sent has in no way been due to any reluctance on the part of Graham Jones or WBC to discuss the matter.