Business Rate

Oral Answers to Questions — Environment – in the House of Commons at 12:00 am on 4th February 1987.

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Photo of Mr Michael Colvin Mr Michael Colvin , Romsey and Waterside 12:00 am, 4th February 1987

asked the Secretary of State for the Environment what responses he has received concerning his proposals for a uniform business rate.

Photo of Christopher Chope Christopher Chope Parliamentary Under-Secretary (Department of Environment)

My right hon. Friend placed a summary of responses to the Green Paper in the Library on 15 December.

Photo of Mr Michael Colvin Mr Michael Colvin , Romsey and Waterside

Even if we may accept the principle of a uniform business rate, does my hon. Friend realise that it could cause glaring injustices in certain localities? Is he aware that the village of Fawley in my constituency, living as it is under the shadow of the oil refinery, has for many years been the Cinderella of local government inputs, although paying a very great amount in rates? Is he further aware that it is the local parish council that has taken the initiative in providing services for my constituents in that area? What guarantees can he give that the parish council will not he deprived of the £90,000 of rate income that it receives out of a total rate precept of £123,000 if a uniform business rate is introduced? Otherwise, it will impose an unfair burden on domestic ratepayers in the area.

Photo of Christopher Chope Christopher Chope Parliamentary Under-Secretary (Department of Environment)

I hope that my hon. Friend supports the Green Paper proposals, because domestic ratepayers in Hampshire, including those in Fawley, will benefit significantly from them. However, it is right for my hon. Friend to remind the House of the enormous contribution made by Esso to Hampshire rates. That is particularly apposite at a time when both the Labour party and the alliance parties on the council are vying with each other to propose a far higher rate increase in Hampshire than is necessary.

Photo of Mr David Alton Mr David Alton , Liverpool Mossley Hill

Can the Minister give the House an assurance that before any business rate changes are made that there will be a general rating revaluation? Is he aware that in Liverpool no revaluation has occurred since 1972? We now have the third highest business rate of any of the 36 metropolitan districts, and stores such as the city centre Marks and Spencer are paying the same rate as Marks and Spencer in Marble Arch in London. Does the hon. Gentleman agree that there is a good case for rate relief to he given to businesses in cities such as Liverpool?

Photo of Christopher Chope Christopher Chope Parliamentary Under-Secretary (Department of Environment)

A revaluation is scheduled for 1990. One of the great merits of the national non-domestic rate is that it will help businesses in the north. For example, in Liverpool it will benefit businesses to the extent of reducing their burden by some 31 per cent. on present projections. which shows the advantages of the proposals.

Photo of Mr Kenneth Hind Mr Kenneth Hind , West Lancashire

Following what my hon. Friend has just said, will he keep to the principles that he has put forward by introducing a uniform business rate, and bear in mind that it will bring much-needed relief in the northern inner cities, where they are over-rated by Left-wing Labour councils, which are not responsible in their approach to rates and are driving jobs and enterprise from those cities?

Photo of Christopher Chope Christopher Chope Parliamentary Under-Secretary (Department of Environment)

My hon. Friend has put his finger on the main benefit of the proposals. Businesses in the north will gain over £500 million a year from the national non-domestic rate alone.

Photo of Dr Jack Cunningham Dr Jack Cunningham Shadow Secretary of State, Shadow Secretary of State for Environment

How can these proposals—which, in effect, give the Government control over 80 per cent. of local government income—be consistent with increasing responsibility and accountability at local level? How can the Minister say that they will be beneficial to the north when Manchester would lose about £29 million of income a year, Sheffield £25 million a year and Newcastle upon Tyne £25 million a year and London would suffer a redistribution of income of almost £1 billion as a result of these proposals? How will that help to alleviate inner city problems?

Photo of Christopher Chope Christopher Chope Parliamentary Under-Secretary (Department of Environment)

I do not accept the figures that the hon. Gentleman has quoted. Non-domestic rates conceal the true cost of local services to domestic ratepayers. On average, at present, for every £10 that is raised in rates £6 is paid by non-domestic ratepayers.