The Government is proceeding with plans to expand 100% business rates retention pilots and has encouraged councils to join forces and put forward joint proposals.
In this second phase of pilots, ministers want to explore how rates retention can operate 'across more than one authority to promote financial sustainability and to support coherent decision-making across functional economic areas'.
Communities secretary Sajid Javid encourages a more 'strategic view'
'Accordingly, the Government encourages, in particular, areas to apply as pools (either on existing, or revised pool boundaries), which comprise county council(s) and all relevant district councils; groups of unitary authorities; or groups of county councils, all their districts and unitaries. Arrangements would also need to reflect the position of precepting authorities, such as Fire and Rescue authorities,' officials said.
Ministers are particularly interested in exploring 'tier-split' models and other technical aspects of business rates retention.
There was a fear in the local government sector that 100% business rates retention plans, originally intended to provide full devolution by 2019/20, had stalled after the programme was not mentioned in the Queen's Speech.
President of council directors' body ADEPT, Simon Neilson, told Transport Network the apparent hold on the plans meant 'we're driving with handbrake on because we are not sure at what speed we should be going'.
The deadline for fresh proposals is Friday 27 October and successful pilots will be announced in December 2017. The communities department DCLG said it will support authorities in preparing for implementation in April 2018.
Pilot local authorities will retain 100% of the growth in their business rates income in the year of the pilot (2018/19), meaning that the central government share (usually 50% of the growth) will stay in the local area. The pilot programme will not affect funding to other, non-pilot, local authorities.
This move expands on previous pilots launched in April in areas including Liverpool, Greater Manchester, West Midlands, West of England and Cornwall, which will also continue into next year.
Communities Secretary Sajid Javid said: 'By encouraging councils to work together, with the aim of sharing their business rates income, it enables them to take a much more strategic view on decisions that benefit the wider area.
'Expanding the pilot programme is an opportunity to consider how rates retention could operate across the country and we will continue to work closely with local government to agree the best way forward.”
Ministers also aim for wide coverage from the pilots across the country, with a focus on rural areas.
Further details can be found on here
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