THE announcement made by the Department of Finance permanent secretary Sue Gray a few weeks ago on the review of business rates was highly significant. You are probably saying ‘not a another review’ but this is different. Past reviews looked solely at the various rates relief schemes for businesses; this one is looking at the entire structure of non-domestic rates.
Retail NI and our Trade NI colleagues Hospitality Ulster and Manufacturing NI have been working with the Department for Finance for some time to ensure this review is comprehensive and that it could deliver the step change needed.
Let’s be very clear - our system of antiquated business rates is broken and not fit for purpose in the 21st century. It is a scandal that Northern Ireland has now the highest business rates in the UK, which is restricting the growth of our retail, hospitality and SME sectors.
At the last UK Budget, the Chancellor gave independent retailers in England a third off their rate bills. In the last Stormont budget Retail NI members didn’t receive a penny of this reduction. Instead they actually received a 2 per cent increase in their rates.
In setting the local budget, the previous secretary of state had the option to lower the regional rate, potentially bringing us into line with the rest of the UK. She chose not to. All of this goes to prove that we need the Executive restored and local ministers making the key budgetary decisions based on sound evidence-based policy. The business community deserves more than a ‘care and maintenance’ administration and badly thought out emergency budgets.
Retail NI wants to see the targeted approach to small business rate relief, which was put forward in 2017, by the last Finance Minister, 'Rethinking Rates' as a vital starting point for this review. These proposals include enhanced and targeted rate relief for the mainstays of the high street-independent retail and hospitality businesses.
We should not forget that the ‘Rethinking Rates’ had very widespread support with over thirty business organisations and Chambers of Commerce giving it their backing.
These proposals did not just support the growth in retail and hospitality, but also, given the independent retail and hospitality sectors’ commitment to sourcing local produce, could be a real boost for the local supply chain and for the agri-food sector among others.
In our joint Trade NI Vision 2030 report published last month we also outlined new ideas for reform to business rates, which includes incentives for business growth. Our proposals included a green rate relief scheme to incentivise businesses to invest in green technology, enhancing the current empty premises rate relief scheme, a capital allowance scheme and making it easier for businesses to access the rates hardship scheme.
Retail NI has never said that fixing business rates is a silver bullet for the many challenges facing our high streets, but it is a very significant part of the solution. We hope this consultation will lead to a publication of an action plan to ensure that the next finance minister has options to hit the ground running.
:: Glyn Roberts is chief executive of Retail NI
