Non-Domestic Rates (Scotland) Bill: Stage 1

Part of the debate – in the Scottish Parliament at on 10 October 2019.

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Photo of Liam McArthur Liam McArthur Liberal Democrat

As you always are, Presiding Officer—thank you very much, indeed.

I, too, thank James Dornan and his colleagues on the Local Government and Communities Committee for their work to date; I also thank those who contributed to the consultation.

I find myself in agreement with Andy Wightman’s analysis and many of his concerns. The bill includes a set of fairly modest proposals stemming from the Barclay review. That, too, was hobbled in terms of its breadth and its scope. We have been left with a bits-and-pieces bill.

I understand that we are dealing with a policy area that is uncomfortable territory for this and previous Governments. I remember well the business rates revaluation in 2010, which left many businesses, particularly in the hospitality sector, facing massive increases of up to, I think, 1,000 per cent in some cases, with no transition. At the time, ministers seemed largely unconcerned, and they were not concerned enough to delay the revaluation until 2016. In the bill, however, we see the imperative for having regular revaluations.

After 2010, we had the business rates incentivisation scheme, which got off to a fairly inglorious start. The Government and the Convention of Scottish Local Authorities were still arguing in 2014 about what the baseline for 2012 should be and about what the outcomes, performance and payments for any year should be.

Eventually, ministers had to fiddle the figures, short-changing Aberdeen to the tune of millions of pounds. Then they cancelled the scheme anyway. The risk in trying to fake localism is that more of a mess is created. I would rather this bill set about giving control of business rates to local authorities, for many of the reasons that Andy Wightman set out, which would give them the opportunity to form meaningful and strong partnerships with businesses in their area.

Linking to the existing roles in economic development and to business support into local colleges, each authority would have the clout to shape a more successful community. I accept that the same economic and taxation blueprint does not necessarily work in every region, and the bill does not provide for that.

The Scottish Government is scrabbling around to work out how to avoid taxing people who improve their properties, invest in machinery and install renewable energy. All those issues are inherent problems in the business rates system, and it is fundamental that the system be based on rental value.