Agenda item

To submit a report by the Head of Function (Resources)/Section 151 Officer.

The report of the Head of Function (Resources)/Section 151 Officer seeking the Executive’s approval to extend the current Discretionary Business Rates Relief Framework for Charities and Non-Profit Making Organisations to 2019/20 was presented for consideration.

The Portfolio Member for Finance reported that non-domestic properties (apart from certain exemptions, such as agriculture, places of worship, property used by the disabled etc.) are liable to payment of non-domestic rates. These are commonly termed business rates although not all ratepayers are businesses in the ordinary sense. Local Authorities in Wales must grant mandatory rate relief to charities provided for within the Local Government Finance Act 1998 as amended by the Local Government Act 2003. The report sets out Council’s proposed framework arrangements for 2019/20.

The Head of Function (Resources)/Section 151 Officer said that on 19 February, 2018 the Executive extended its Discretionary Business Rates Relief Framework for Charities and Non-Profit Making Organisations, with a view to undertaking a consultation on the framework during the first half of 2018/19 with a revised framework coming into effect on 1 April, 2019. Even though the a consultation document has been approved, no consultation has been carried out as the Service was aware of possible significant announcements from either the central Westminster or devolved Cardiff administrations with regard to possible further business rates relief for businesses. Such announcements could have had an impact on the consultation to be undertaken. The Officer said the substance of the announcements actually made in 2018/19 is detailed in the report; the consultation document in respect of the Council’s discretionary business rate relief framework has been amended to take account of the changes announced by the Welsh Government in December, 2018. As there was a possibility of budgetary implications following such a consultation and with the final financial settlement for 2019/20 not received until 19 December, 2018 which included an additional £2.4m (unhypothocated) support for small businesses nationally in Wales, the timetable does not allow sufficient time to consult and for any revisions to the framework, with possible costings to be discussed and reflected in the proposed budget for 2019/20. Consequently, it is recommended that the current policy is adopted for a further year with the consultation to be undertaken in the first half of 2019/20 allowing sufficient time for response and budgetary implications, if any, to be considered before the new framework is implemented from 1 April, 2020.

In noting the report the Executive also noted that business rates in their entirety need to be reformed on a national basis because at their current levels they are having an adverse impact on high street businesses. The discrepancy between the rates paid by high street retail businesses and online retail businesses also needs to be addressed. The Head of Function (Resources)/ Section 151 Officer said that local councils’ capacity to make a difference in respect of  high street business rates is limited as most of the rules and regulations affecting business rates reside with the Welsh Government.

It was resolved –

•           To adopt the current Discretionary Business Rates Relief Framework – Charities and Non-Profit Making Organisations as detailed in Appendix A to the report for the financial year 2019/20 only and to instruct the Head of Function (Resources) and Section 151 Officer to ensure that administrative procedures before 31 March, 2019 advise relevant charities and non-profit making organisations that the policy will apply for 2019/20 only and will cease on 31 March, 2020.

•           That the public consultation on the framework be carried out by the Head of Function (Resources) and Section 151 Officer during the first half of 2019/20 with a revised framework coming into effect on 1 April, 2020.