No longer a rates crisis - it's now an emergency
AFTER three long years,we finally have a working Government back at Stormont. But we don't have time for popping champagne corks or for honeymoons, because it's straight down to hard work, addressing huge policy challenges facing our economy.
We need an immediate call to action on business rates, regenerating town centres, infrastructure investment and addressing the high cost of doing business in Northern Ireland.
While all of the new Executive ministers have a huge in-tray, it's safe to say Finance Minister Conor Murphy's it the biggest of all, and at the top of that list is fixing business rates and addressing the huge concerns with the 2020 rates revaluation.
Indeed we no longer have a rates crisis, because now it's an emergency - and Conor Murphy must take immediate action to save jobs and businesses.
In England, independent retailers up to an NAV of £51,000 receive a 50 per cent discount in their rate bills. In Northern Ireland we get a measly 20 per cent discount of an NAV of £15,000.
It's a scandal that Northern Ireland has the highest business rates in the UK, which is restricting the growth of our retail, hospitality and SME sectors. We also have the highest shop vacancy rate in the UK.
If ever there was an example of how dysfunctional, antiquated and broken our system of business rates is, then the Revaluation 2020 ticks all the boxes. Reval 2020 has actively targeted many independent retailers, with increases of between 20 and 40 per cent and actually reduced the rates liability of large out of town multinational supermarkets. This simply beggars belief.
Take for example Tesco Knocknagoney, a huge out-of-town superstore, which already has an unfair competitive advantage with its location over town centre traders, free car parking, no red coats and a public transport link. It has a received a reduction of 15 per cent while many local independent family owned stores received a 40 per cent increase!
Since the Reval 2020 revealed the initial valuation list a week ago, our office has been inundated with calls and emails from Retail NI members telling us of absolute horror stories of over the top increases and the impact this will have on their business, jobs and future investment. Retailer are the mainstays of every village, town and city centre in Northern Ireland. They actively invest not just their businesses, but in local high streets and the economy as a whole.
You have to wonder on what sort of objective basis such a calculation could have been made. Do Land and Property Services (LPS) actually have any idea of the impact this revaluation will have on independent retailers and the thousands of jobs they support?
Unless the Finance Minister takes immediate action to put a halt to Reval 2020, we will see independent retailers close their doors, jobs lost and our already struggling town centres decline even further. Retail NI also wants the newly appointed Finance Committee to launch an immediate investigation into Reval 2020 and its flawed process.
At the very least, Conor Murphy needs to follow through on his ministerial predecessor's proposals for a targeted approach to small business rate relief, Rethinking Rates, which was put forward in 2017. These proposals gave independent retailers and hospitality businesses a 40 per cent relief in rates and could be implemented very quickly and in place by April if the political will is there.
:: To support our members, Retail NI and property specialists Osborne King are jointly hosting an information seminar on Reval 2020 on Monday January 20 at 4.30pm at the Crowne Plaza. To attend, contact email@example.com.
:: Glyn Roberts is chief executive at Retail NI