The Secretary of State for Communities and Local Government, Sajid Javid MP, has named Surrey as one of 10 pilot areas in the country which will be allowed to retain 100% of the business rates raised in the County.

The Government wants to give councils “the levers and the incentives” to grow their own economies.

Crispin Blunt, MP for Reigate, commented:

“The Government is delivering on its commitment to give local government greater control over their income.

“I am pleased that Surrey is among the pilots for 100% retention of business rates from next year.

“I wish Surrey County Council well in implementing the pilot, which will give the Council a direct and strong incentive to promote local growth and economic development across the County”.

Notes

Future of business rates retention

The Communities Secretary confirmed the government’s aim to increase business rates retention for all local authorities in 2020 to 2021 to help meet the commitment to give local authorities more control over the money they raise locally.

The government wants local authorities to retain 75% of business rates from 2020 to 2021. This will be through incorporating existing grants into business rate retention including Revenue Support Grant and the Public Health Grant.

Councils will therefore have the levers and incentives they need to grow their local economies.

Business rates pilots

Ahead of this, to test out aspects of the system in a range of authorities across the country, the Communities Secretary announced 10 new areas that have been selected for business rates retention pilots in the 2018 to 2019 financial year. The 10 pilot areas will be Berkshire, Derbyshire, Devon, Gloucestershire, Kent and Medway, Leeds, Lincolnshire, Solent, Suffolk and Surrey.

This move builds on previous pilots originally launched in Liverpool, Greater Manchester, West Midlands, West of England, Cornwall and Greater London in April 2017, which will also continue into next year.

As announced at the Autumn Budget, the London pilot will also be able to keep 100% of its business rates growth from April 2018. The new areas selected to retain 100% of business rates ensure a good geographic spread with a strong representation of rural areas.

The pilots will provide useful information ahead of bringing in increased business rates retention for all local authorities and future reforms, with piloting confirmed to continue to 2019 to 2020. Further details will be available in due course.

Alongside the 2018 to 2019 pilots, the government will continue to work with local authorities, the Local Government Association, and others on reform options that give local authorities more control over the money they raise and are sustainable in the long term.

Source: DCLG Press release, 19 December 2017: Government sets out further measures to support councils to deliver services