Monmouth and District Chamber of Trade and Commerce

The waiting game

Additional £10m Targeted Business Rates Relief Scheme – Welsh Government

Before Christmas Welsh Government announced that it had allocated £10m for a targeted business rates relief scheme, which would be in addition to the transitional relief that had previously been announced.

It has been stated that the relief will be targeted at high-street ratepayers – shops, pubs, restaurants and cafes, including those which have seen their rates increase significantly as a result of the 2017 revaluation undertaken by the independent Valuation Office Agency.

This announcement is available via the following link:

http://gov.wales/newsroom/localgovernment/2016/161217-business-rates-support/?lang=en

Monmouthshire County Council and other local authorities are working closely with Welsh Government to finalise the scheme.

We understand that Welsh Government are looking to make full details of the scheme available at the end of February.

We shall update you as soon as we have further information.

Chamber raises the profile of the business rates debate at the Welsh Assembly

Chamber raises the profile of the busiess rates debate at the Welsh Assembly

Pictured above are David Cummings, Chairman of Monmouth and District Chamber of Trade and Commerce, AM Andrew RT Davies and local AM Nick Ramsay on 18th January. Also, Sally Stephenson of the Cowbridge Traders is seen presenting to the Welsh Government a petition from 1700 businesses and individuals in the Cowbridge area opposing the huge increases in business rateable value, which will affect business rates payable from April 2017.

Prior to the photo being taken above, Sally and David had an informal meeting with Andrew RT Davies, leader of the Welsh Conservatives, concerning the business rates issue. It is evident that the Conservatives support the stance by Monmouth and Cowbridge for Wales to adopt the new English system of Small Business Rate relief when the Welsh system is revised in 2018/19.

Following the presentation above, there was robust debate on the subject in the Assembly. Despite being pressed on the subject by assembly members Minister Mark Drakeford would not be drawn on exactly how the extra £10 million promised in mid-December would be allocated to unitary authorities (In Monmouthshire’s case MCC). What is evident is that time s short for a decision to be made as unitary authorities must have the detail by the end of the month,  so that they can calculate how to distribute the extra relief and the transitional relief.  

Assembly Minister listens to Chamber’s views

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Business rates – after disappointment comes good news!

17th December 2016

On 11th December (see earlier entry under this section) I wrote on behalf of the Chamber an open letter to Assembly Members seeking their support at the meeting on 13th December in the Senedd to oppose the proposed transitional arrangements in their present form, which would take effect In April 2017 when the new rateable values would be imposed by the Welsh Government.

In that letter I criticised the very short period of consultation, the lack of contact with key stake holders and, when the responses were analysed, the lack of a sufficient sample size to have any definite opinion on the results.

As a result of my open letter I was heartened to receive responses from half a dozen AMs agreeing with the stance taken by Monmouth Chamber of Commerce and Monmouthshire County Council. It was therefore with some disappointment to learn on 14th December that the vote had been 25 in favour of adopting the proposals and 27 abstentions. I asked several AMs to comment as to why they had not opposed the proposals rather than abstaining. Their responses indicated that it was a case of except the flawed proposals or businesses would not get any transitional relief at all; so, they had to abstain.

It was a complete surprise to hear from the media on the afternoon of the 16th December that the Welsh Government had acknowledged the hardship that was being caused, especially to shops, cafés and those in the hospitality sectors in certain parts of Wales. Minister Mark Drakeford had therefore decided to provide “temporary relief and a breathing space so that businesses could accept the changes in their rateable value”. This is extra to £10 million for transitional relief. We do not like the tone of the wording used by the Minister as it is permanent solutions that need to be found, not temporary ones.

The Minister went on to say that "Equally there are many high streets across the country where business rates are falling, but retailers are struggling. We want to be in a position where we can offer these businesses the extra support they need"

Business owners will be pleased to hear that this extra support amounts to £10 million and has been provided to “ease the burden” This will be avalable in April 2017 and the fund will be administered by councils. At the present time we do not know how £10 million will be split. Will it just be for the councils who have protested to distribute, or rural counties or be shared by all? So we welcome the £10 million as a gesture, but at this stage we do not know how much it will benefit the retailers, hotels and pubs of Monmouthshire and other hard hit areas.

We see this as a first step in a long campaign to secure a result for businesses that is at least as good as the new tapering relief and Small Business Rate Relief systems to be applied in England from 2017/18 onwards.

It would be remiss of me to conclude this press statement without mentioning those individuals and organisations who have been pivotal in getting the Welsh Government to ease the burden on hard pressed businesses. Firstly Monmouthshire County Council officers and Cllr Bob Greenland. Secondly, our AM Nick Ramsay and MP David Davies. Thirdly, Sally Stephenson of the Cowbridge traders, who has worked tirelessly to raise the profile of the problem with AMs and the media and lastly, independent businesses of Monmouthshire who have been vocal and found sometimes, sympathetic ears.

Many thanks

Yours sincerely

David Cummings FIAB Chairman

Chairman@mdctc.co.uk

Business rate revaluation – small businesses urgently seek your help

Open letter to all Assembly Members 11th December 2016.

Dear Assembly Member,

There has been a huge amount of press coverage over the last six weeks about the devastating effect the proposed business rate increases will have on small retailers in rural areas, if imposed in April 2017 by the Welsh Government. The small retailers of Monmouthshire are particularly badly hit with proposed rises in rateable value of up to 585%. Outside our county, we have identified rateable value increase hotspots in Cowbridge, Brecon and Ruthin. The hospitality trade generally in Wales has seen hikes of 200% plus with many small businesses being taken out of the Small Business Rate Relief scheme altogether and having to pay rates in full. As an example, we have identified one public house with a current rateable value of £4000 (so no rates to pay) that has a proposed new rateable value of £27,000 meaning rates payable of £13,500 per annum.

We have been working closely with Monmouthshire County Council, have met several times with representatives from the Valuation Office and have made a small amount of progress with less than a handful of revaluations. Now our focus is to try and influence the Welsh government to really support small business with effective measures to curtail, reduce or postpone these business rateable value increases.

Why have we not contacted the Minister Mark Drakeford on this matter? Monmouthshire County Council, Chambers of Commerce, individual business owners and organisations for other areas have made repeated attempts to enter a proper dialogue with him, but as yet to no avail. The Minister has issued standard letters reiterating how the business rateable value system works. The Minister was asked to attend a public meeting in Usk earlier this week by AM Nick Ramsay, but sent his apologies. This is regrettable, some might say unacceptable, as the clock is ticking to make effective changes to the current flawed approach of WG to this issue.

Why did it take so long for the Welsh government to realise there was a huge problem with the result of the business rateable value revaluation, when it was recognised in England and appropriate measures taken to support small businesses with the change in rateable values?

The valuation office published their report on new business rateable values on 30th September 2016. The Welsh Government was supposed to engage with stakeholders on a Transition Relief scheme and the results of this consultation will be discussed in the Assembly on 13th December. We consider the five week period of consultation was ridiculously short, but worse, only the CBI and county councils seem to have been directly consulted. Anyone else responding found out by accident. The organisations representing small businesses are the Chamber of Commerce of Wales and the Federation of Small Business. Why weren’t South Wales, Mid Wales, West Wales, Brecon, Chepstow, Monmouth etc Chambers of Commerce not directly consulted. Monmouth Chamber managed to get a response in just in time for 4th November deadline. If the Welsh government has not consulted with key stakeholders, then the results of the consultation should be deemed invalid and the meeting to discuss them on 13th December postponed.

Why did it take Business Wales, as the voice on business matters of the Welsh Government until 15th November to mention the results in an email to those on their database?

What more can the Welsh government do now to help improve the lot of small retailers, so that our high streets do not become ghost towns? A good first step might be to look across the border to see what England is doing. Our Chamber’s view is that we feel that the fact that 96.4% of businesses in Wales are not just small, but micro businesses (9 employees or less) is lost on the Welsh Government. They are the arteries carrying the life blood of our whole economy.

After undertaking a vast amount of research on the matter and gaining expert advice from chartered surveyors with experience of business rateable value issues, we propose very clear and achievable options for the Welsh Government to resolve this crisis, as follows:

  • That WG should accept their current approach to the revaluation is flawed. They should either postpone implementation of the revaluation until 2018, when a new Small Business Rate Relief (SBRR) system is planned to come in for Wales (details not known) or they should copy and paste the excellent new SBRR proposals for 2017 onwards from England, with the doubling of 100% relief to £12,000 rateable value and more tapering relief up to £15,000 with a lower multiplier up to £51,000 rateable value. And perhaps most importantly, in the English proposals, a proposed maximum 5% increase (favoured option 2) in rateable value for small businesses in year 1, not 25% maximum increase as proposed in the transitional relief proposals for Wales.

  • WG should postpone the meeting in the Senedd on transitional relief The Non-Domestic Rating (Chargeable Amounts) (Wales) Regulations 2016 proposals due on 13th December, until after they have reconsidered their current flawed approach, which is causing great distress in the small business community.

April 2017, when the new rateable values will be imposed by WG may seem a long way off, but it is not, as effectively a month lost for Christmas. We have taken the time to fully understand the valuation and the devastating effect that the WG current flawed approach will have on small businesses.

In England, they forecast the effect the revaluation would have on small business and produced life rafts for those in peril. Please give the small businesses of rural Wales a voice by raising our concerns repeatedly in the Assembly, especially on 13th December.

Many thanks

Yours sincerely

David Cummings FIAB Chairman

chairman@mdctc.co.uk

2017-Draft-Business-Revaluations

2017 Draft Business Revaluations