Business Rate Supplements Bill

I also speak to Amendments 7, 12 and 65. I thought that Amendment 2 would give rise to a spate of lobbying against me on the part of business organisations. I am not sure that it has but I would like to explain why I am seeking to allow the opportunity to extend the scope of the business rate supplement. The Bill is completely focused on economic development but it will, by definition, have to last longer than some other legislation. Life changes and priorities change. Businesses do not necessarily have more of a stake in economic matters than they do in social or environmental matters in their area. Indeed, social and environmental considerations can affect the way in which business operates. Promoting economic development in area A may not greatly affect a business in that area but economic development in areas B and C outside the immediate local authority might well do so. This could be part of a much bigger picture than the Bill seems to allow for. Amendment 2 seeks to allow regulations, ""to add to or vary the purpose of projects for which money may be raised"" This is an amendment for the long term. I am not seeking an immediate extension of the purposes. I propose that there should be regulations to implement this, and that they would follow consultation of representatives or organisations of business rate payers, local authorities and others. It has occurred to me that by tabling this amendment I may be arguing against my own cause, as it is probably possible to argue that almost any activity promotes economic development if you analyse it down to the last detail. But if that was the case, Clause 3(3) would not be required, so it is not the basis on which the Bill has been drafted. I should also say at this point that later amendments have been tabled regarding ballots. They are not unrelated to this if regulations to extend the purpose are introduced. We believe that there should in any case be a ballot on each project so that businesses have the opportunity to express their opinion. Amendment 7, by taking out the restriction in Clause 3(3)(a), would allow for money to be spent on housing. I am puzzled that this restriction is included because housing so obviously supports economic development. The consultation on the draft guidance published by the Government in January states in the section on the kind of projects it might or might not be appropriate to fund that: ""It may be considered appropriate to levy a BRS to fund a place-marketing programme to attract investment into a local area"." One cannot attract investment into an area if the environment—I use the word in its widest sense—is not in itself attractive. In order to bring business into an area, those who are going to work in it need to have access to decent housing. If an authority proposed to use a BRS to spend on housing, it would have to pass the additionality test, so I do not seek for this to substitute for other sources of funding. The consultation on the draft guidance rightly states that it will be quite complex to deal with the test, although of course at the moment funding for local authority housing is not in great supply in any sense. Amendment 65 is consequential and would provide for the affirmative resolution procedure to be used or the regulations I have already mentioned. Amendment 12 would insert a new clause seeking a periodic review and a report to Parliament on the use of money raised by BRS with the opportunity for representations to be made and a report then produced. The clause has been suggested by the Federation of Small Businesses, which rightly says that business is being asked to contribute and therefore should have some reassurance that it will be heard so that the Government can get the benefit of business experience in delivering projects of this kind. There is no doubt that local businesses, given that they are so strongly engaged with economic activity, should be given the opportunities that the amendment would provide. The federation also points out that the amendment should ensure that the business rate supplement is used for the Government’s intended purpose of promoting economic development. I have to say that that is probably a matter for the auditor and does not need the provision I am suggesting here. However, I have more reasons than the federation in terms of arguing for this amendment. Business rates are national and this local element is only local in some aspects. To my mind, the amendment would not deal with the detailed assessment of individual projects so much as become a general review enabling businesses and business representatives to contribute to a review of the criteria used and the principles behind it. The review should extend to the interests of all those who are involved, not just those who pay. The billing and levying authorities, having operated the system, are likely to have a view either that it is going well or that alterations in the arrangements are desirable. That is of particular concern in London. I shall leave my noble friend to argue for his first amendment, because I can see that he has marked up exactly the same words in the briefing as I have, so I shall not steal his thunder. I think that that exhausts my arguments for the moment. I beg to move.