Local Government Finance

Part of the debate – in the House of Commons at 5:38 pm on 22nd February 2017.

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Photo of Bob Neill Bob Neill Chair, Justice Committee 5:38 pm, 22nd February 2017

The simple truth is that it cannot, although we have broken down some of the artificial barriers. The idea that there is a major distinction between costs in inner and outer London has gone. Many of the outer London boroughs now have much more in common with the inner London boroughs, socially and economically, than used to be the case.

My second point is about the business rates. I welcome what has been said about the review, and especially what has been said about transitional reliefs. I think that the Secretary of State has hit upon the key issue of businesses in high-cost areas such as mine. May I suggest that he consider putting the multiplier on to the consumer prices index rather than the retail prices index? That would be more logical. In the long term, we need to think about how we can capture businesses that do not have a large physical footfall, such as online competitors. We need to deal with the issue of out-of-town supermarkets being treated much more favourably than shops because of the way in which land values come into the equation. When it comes to transitional relief, perhaps we could move from the current sledging to something akin to the sliding scale that we apply to stamp duty land tax.

I hope that those are constructive suggestions that can be implemented in the future.