Rates (Exemption for Automatic Telling Machines in Rural Areas) Order (Northern Ireland) 2016

Executive Committee Business – in the Northern Ireland Assembly at 10:30 pm on 22nd February 2016.

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Photo of Mervyn Storey Mervyn Storey DUP 10:30 pm, 22nd February 2016

I beg to move

That the Rates (Exemption for Automatic Telling Machines in Rural Areas) Order (Northern Ireland) 2016 be affirmed.

The scheme was initially introduced in 2007 for a fixed period of three years with the objective of encouraging and sustaining the provision of ATMs in rural areas. It has been extended three times following evaluation. The latest order provides for a further one-year extension for the 2016-17 Budget period until the end of March 2017. It is not a big policy, but, next year, it is expected to provide rates exemption to 82 ATMs that would otherwise be liable for a separate rates bill of slightly less than £2,000 a year.

Although it is hard to assess its effectiveness as a measure, there are three good policy reasons for its continuation. First, evaluations have shown that, whilst the scheme is not a factor that encourages financial institutions to invest in new stand-alone ATMs, it is a factor in retaining existing ones, particularly those that are borderline viable. Secondly, despite the first assertion, the number of ATMs in rural areas has more than doubled in the eight years since the scheme started. Thirdly, in the context of the loss of many of our rural bank branches, the ATMs become even more of a lifeline for our rural communities, an issue that I know was raised during last week's Finance Committee session.

It will be helpful to Members if I provide them with a brief outline of what the scheme does. The exemption is provided for stand-alone ATMs in designated rural areas that are individually valued in the valuation list; for example, those located outside petrol stations or on high streets. It does not apply to those located in banks or building societies, which tend to be valued as part of that property. The current financial cost of the scheme is around £150,000 in revenue forgone in 2016-17, which I consider to be an affordable and modest sum given the benefits that it can bring. ATMs play an important role in the sustainability of rural economies; indeed, previous evaluations of the scheme have demonstrated that almost two thirds of every £10 withdrawn from one of the cash machines is likely to be spent locally.

The eligible rural wards are currently designated by my Department through the Rates (Automatic Telling Machines) (Designation of Rural Areas) Order (Northern Ireland) 2006. The recent reorganisation of local government that came into operation last year altered both district council and ward boundaries in Northern Ireland, and, as a result of that process, it was necessary for my Department to formally designate new rural wards for use in the scheme. New multipurpose and cross-departmental rural, urban and mixed wards have not yet been centrally redesignated by DARD or by any interdepartmental working group. It was, therefore, necessary for my Department to ask the Northern Ireland Statistics and Research Agency (NISRA) to conduct specific analysis to meet our specifications to determine wards as rural. The list of the new rural wards for the purposes of the scheme was arrived at by NISRA on the basis of the specifications given by the rating policy division and through analysis of the 2011 census, the 2015 settlement definition and the 2014 ward boundary files. The rural wards are designated through subordinate legislation that is subject to the negative resolution procedure, and the Committee cleared that policy.

My Executive colleagues and members of the Finance and Personnel Committee have already been advised on the detail of the statutory rule. The Committee indicated that it was content for individual separately valued ATMs in designated rural areas to continue to be exempt from rates, particularly given the modest cost of the scheme.

Article 1 sets out the citation, commencement and interpretation provisions. Article 2 provides for the extension of the relevant date before which the scheme must end, which is the end of the forthcoming financial year.

I look forward to Members' comments and commend the Rates (Exemption for Automatic Telling Machines in Rural Areas) Order (Northern Ireland) 2016 to the House.

Photo of Daithí McKay Daithí McKay Sinn Féin

Go raibh maith agat, a Cheann Comhairle. On 1 December 2015, the Department wrote to the Committee to highlight its proposal to make this draft rule to help sustain ATMs in rural areas. The Committee was aware that, in 2009, DFP undertook a policy evaluation that noted a 16% increase in the number of ATMs in rural areas. That was very welcome, and the extension of the measure was supported. It has also been noted that recent figures from Land and Property Services (LPS) show that there are now approximately 70 ATMs covered by the scheme. Moreover, the regulatory impact assessment stated that it was unlikely to have any detrimental effect on small businesses but might actually assist small rural businesses.

The Committee considered the proposal to make the order at its meeting on 13 January and had no objection to the policy proposals at that time. The formal SR was considered by the Committee, together with the report from the Assembly's Examiner of Statutory Rules. The Examiner raised no issues by way of technical scrutiny, and the Committee agreed to recommend that the order be affirmed by the Assembly. This is a very good initiative, it has been successful for a number of years now, and, hopefully, it will stay in place for many years to come. I support the motion.

Photo of Leslie Cree Leslie Cree UUP

Thank you very much, Mr Speaker. I was pleased to support this in Committee, and I am pleased to support it in the House this evening.

Photo of Mervyn Storey Mervyn Storey DUP

Thank you Mr Speaker. I thank the Chair of the Committee and the member of the Committee for their comments. In particular, I thank the Committee for its help on the order. I, therefore, ask that Members support the measure and commend the order to the Assembly.

Question put and agreed to. Resolved:

That the Rates (Exemption for Automatic Telling Machines in Rural Areas) Order (Northern Ireland) 2016 be affirmed.