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Council lobbies for increased share of business rates

By Lisa Reeves - Thursday, 16th February, 2012 - 1 comment

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Cheshire East Council is lobbying the Government for a fairer slice of business rates.

At the moment, the authority receives in the formula grant only 44 per cent of the rates it collects, the rest remains with the Government.

Cabinet member with responsibility for resources Councillor Michael Jones said: "Cheshire East is fortunate in that it has, compared with many areas, a strong business community. As a result, the total amount of business rates we collect, on behalf on the Government, is very high.

"Unfortunately, the current method of calculating what authorities should keep means that Cheshire East receives only 44 per cent – one of the lowest proportions in the whole of the country.

"The remainder is used by the Government, among other things, to bolster authorities with less-thriving business communities."

New methods of calculation around how much money a council can keep are not set to help either. The Government wants to see local authorities have greater control over their money, enabling them to plan better for the future. It also wants to see a stronger link between councils and their local businesses to create conditions that generate growth.

Councillor Jones continued: "I applaud fully and support entirely what the Government is trying to achieve. It is right that we should a greater say over our finance. We already have a strong productive relationship with our business communities and continually strive to create conditions for growth. However that takes money and that is something that this Council has not got.

"The amount of business rates collected by Cheshire East Council is sufficient to fund Formula Grant for the Council, Cheshire Police Authority and Cheshire Fire Authority as well as all Department of Work and Pensions and Department for Education grants to the Council. And this is still likely to leave a surplus in the region of £9m.

"Unfortunately, unless something is done, the money will continue to go to those authorities who are seen as needing it and the money will continue to come from authorities like Cheshire East."

1 Comment

Here's what readers have had to say so far. Why not add your thoughts below.

Andrew Malloy Friday, 17th Feb, 2012 4:51 pm
Town and Parish Councils should also be able to claim a share of Business Rates. Currently, Town/Parish Precepts are funded by households, with no tax levied on to businesses. It is very important that the Town Council supports local business, in order to provide jobs, attract visitors, and keep the town vibrant.
CEC should also be demonstrating to tax payers how they will be reducing costs in light of Town Councils taking on the running of local assets and services. This was originally proposed as an efficiency initiative when talks began about cutting bureaucracy by introducing a single level of primary local government. In actual fact, it has been swallowed up by CEC as a cost saving exercise. The risk being that if Town Councils do not take on assets, the future of those assets and services is put at risk.
It is not right that Town/Parish Councils should take the flack for CEC cost cuts, when all they are trying to do is preserve facilities locals hold dear (Public Toilets, Markets, Community Centres, Allotments), but we also cannot lose these facilities. Meanwhile, what will happen to towns without Town Councils or those who choose not to take on assets? Will they pay more? Will they lose their facilities?
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