Rates (Temporary Rebate) (Amendment) 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 (Temporary Rebate) (Amendment) Order (Northern Ireland) 2016 be affirmed.

Before dealing with the statutory rule, I will set out some background to the measure. The purpose of the legislation is to extend the empty shops rates concession. It was introduced in April 2012 and subsequently extended for a further two years in April 2013 and again for a further year in April 2015. The concession was first introduced as an amendment to the Rates (Amendment) Bill of 2012. At that time, a package of measures was introduced to help rebalance the rating system, assist ailing businesses and improve the appearance of our town and city centres. The empty shops rates concession provides a one-year subsidy for new ventures occupying properties that have been vacant for a year or more.

The current legislative provision under article 31D of the Rates (Northern Ireland) Order 1977 as inserted by the Rates (Amendment) Act (Northern Ireland) 2012 permits applications for the concession until 31 March 2016. The window for applications will close soon, and, following the success of this scheme, I have decided to extend the application period for a further 12 months to 31 March 2017. Unfortunately, there remains a need to provide whatever assistance we can to counteract the many shop closures and the effect that then has on the viability of our towns and cities. The extension of the concession will allow Land and Property Services (LPS) to continue to receive applications for the scheme until the end of the forthcoming financial year.

Where outcomes are concerned, I have to say that my assessment is that the scheme is a good scheme. So far, it has seen over 530 new ventures get up and running across Northern Ireland, and that is to be welcomed by all Members. A recent survey by Springboard Services on behalf of the Northern Ireland Retail Consortium shows that vacancy rates in Northern Ireland are at a four-year low. However, we cannot be complacent about the issue; I know all too well from my constituency and my home town of the difficulties and challenges that are caused by the issue of vacancies.

This is a good news story, although I am not claiming that the scheme is the reason that things have improved. That needs a stronger economy and action by many parts of the Executive. There is still a need for a scheme of this type, and I say that informed by responses to the recent consultation on the review of the rating system; indeed, some have asked for it to be enhanced by relaxing the rules. My Department will consider that in due course. In doing so, we must balance the interests of established businesses in an area and avoid this becoming a rates avoidance mechanism.

In the coming weeks, my Department will do what it can to publicise the current scheme with those involved in letting or moving into property. The scheme is open to all commercial uses and has, as a result, provided new jobs for local people in a wide range of businesses. This is a policy that makes a real difference to new business start-ups, particularly in our town centres and on our arterial routes. Furthermore, it is a sensible measure in terms of cost. In all likelihood, the Executive would not have been getting any more revenue from these units through rates if they had continued to be empty, so this is, effectively, a cost-neutral policy.

Beyond that, after an initial period of reduced liability, these businesses will end up paying full rates after the difficult first year of trading is over. In the longer term, it is likely to bring in more money than it costs. This policy was made and developed in Northern Ireland through engagement with business and was deemed effective enough to be adopted in every other part of the United Kingdom. That in itself is a testament to the strengths behind the policy logic for such a scheme at this time.

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 applications to be received for the empty shops rates concession until 31 March 2017. Article 1 of the order sets out the citation and commencement. Article 2 provides for the amendment of article 31D of the Rates (Northern Ireland) Order 1977, substituting the new end date of 31 March 2017.

I look forward to Members' comments and I commend the Rates (Temporary Rebate) (Amendment) Order (Northern Ireland) 2016 to the House.

Photo of Daithí McKay Daithí McKay Sinn Féin 11:00 pm, 22nd February 2016

Go raibh maith agat, a Cheann Comhairle. The Committee was mindful that the current legislation came about in 2012 as a result of proposals by respondents to a consultation on rebalancing the rating system during the economic downturn. In response, legislation was introduced for one year with the aim of reducing unwanted displacement, minimising any advantage over established traders and creating a time frame to allow the Department to review the success of the initiative.

The Committee noted that the review of the scheme in 2013 highlighted the number of successful applicants throughout the North. The Department has also advised that there has been no evidence to suggest any significant displacement caused by people moving premises in order to avail themselves of the scheme. The scheme does not come with any significant cost, as the Department has pointed out that many of the properties involved would have remained empty in the absence of the policy. Revenue lost, then, could be measured only against a proven case of displacement from a previously occupied property. As has been indicated, there is no tangible evidence at this stage that that is occurring.

Following evidence, the Committee agreed to support the extension of the empty properties rates concession for a further period and agreed that it had no objection to the policy proposals. The Committee formally considered the statutory rule at its meeting on 10 February, along with the report from the Examiner of Statutory Rules, who had no points to raise. The Committee agreed to recommend that the order be affirmed by the Assembly. I support the motion.

Photo of Mervyn Storey Mervyn Storey DUP

I thank the Committee Chair and members for their help on the order. I ask Members to support the measure, and I commend the order to the Assembly.

Question put and agreed to. Resolved:

That the Rates (Temporary Rebate) (Amendment) Order (Northern Ireland) 2016 be affirmed.