Business Rates and the Recession

It is a pleasure to follow the hon. Member for Mid-Worcestershire (Peter Luff). I am only sorry that I was not here on the Friday when his private Member's Bill was debated. He put forward an excellent idea, about which I shall say more in a moment. Today's debate had not been proceeding for long before the first hon. Member mentioned that today was a quarter day. Businesses large and small in high streets up and down the country are being asked for three months' rent, which for some is the last straw that will break the camel's back. It was reassuring to hear the trade body for British property managers say today that it recommends its members to do all that they can to help people to pay their rent, which includes accepting payments monthly even if they are legally entitled to payment for the full three months. I hope that we shall all watch property managers assiduously to ensure that they are being as reasonable as they can be to businesses that might otherwise be struggling. As the hon. Member for Bromley and Chislehurst (Robert Neill) pointed out, if that does not happen we shall see more and more gaps opening up in our high streets, which would be very damaging to local businesses as a whole. Last Friday, when I met members of my local chamber of commerce for one of our regular discussions, the issues that they raised with me were the continuing difficulty of obtaining credit from banks and a reasonable performance by Her Majesty's Customs and Excise, in most cases, in allowing time for taxes to be paid. They also made a point that has been made today about prompt payment of bills. They said, "If only people would adhere to the terms and conditions and pay within 30 days as they are supposed to, that would benefit us greatly." They drew attention to the huge purchasing power of the public sector in procurement contracts, and pointed out that much more could be done locally in terms of goods and services, food, and printing and advertising. Stafford contains the local councils' administrative headquarters, a prison, a university, a police headquarters and several hospitals. All those are huge players in their procurement power. Of course the members of the chamber of commerce mentioned rates. They were still very annoyed about the business rates on empty properties. I was nervous, even in a rising market, about the implications of those. I saw the argument—in a rising market—in favour of trying to put pressure on people not to leave properties standing empty, but to reduce their rents if necessary in order to obtain tenants. It was a reasonable argument in a rising market, but the market in property prices has now collapsed. The least that the Government can do is provide what they have announced so far—a temporary relief that will benefit around 70 per cent. of properties—but my first Budget representation in this debate is that we need to go further. I think that we should preferably provide a complete temporary relaxation of the tax, but, if we cannot do that, we should certainly do something that will benefit more than 70 per cent. I appreciate how difficult the Government's finances will be when it comes to the Budget. If anyone was in any doubt about that, their doubts will have been dispelled by the Governor of the Bank of England yesterday. However, this is an important issue, which is why I have made my representation.