Local Government Finance Bill

One of the key historical points is that local authorities used to set their own business rates, but then pressure from the House changed that situation for the simple reason that large local authorities saw the opportunity to milk businesses and set exorbitant rates, because business did not have a vote. They could then keep local tax low because they had increased business rates to milk businesses. That was why the national business rates were introduced. I do not believe that there is an argument for changing the position so that local authorities determine the level of business rates, but there is a very strong argument, which the Government are advancing, for their retaining the money that is collected locally. I believe that the Government are being a bit timid in their approach, because I would like more money to be retained locally, possibly with a slightly less complex formula to make it more transparent. However, I recognise that the Government are taking the first step along the way.