Retail NI: Rates relief needed to regenerate Northern Ireland's city centres
From Retail NI's perspective, last week's NIO-produced Budget was notable for what was not in it, rather than what was.
The Department of Finance produced a paper before Christmas which outlined revenue-raising proposals for hiking car parking charges, increasing business rates by 10% and ending the Small Business Rate Relief Scheme, which Retail NI successfully lobbied to establish several years ago.
These proposals would have disproportionally impacted upon both the hospitality and retail sectors and our town and city centres. Make no mistake, if these revenue raisers had been implemented, a significant amount of our members would be closing their businesses, with unemployment figures increasing.
After extensively lobbying the NIO and MPs, we were pleased that the Secretary of State listened to our concerns in relation to ending the Small Business Rate Relief Scheme and hiking business rates and dropped them from the Budget.
We also welcomed the extra funding for infrastructure and hope that major projects such as York Street, A5, A6 and others are able to move forward.
That being said, the Budget still had an above inflation rise in the domestic regional rate and we have still to await a decision from the Department for Infrastructure in relation to any rise in car parking charges. The devil is always in the detail in any Government Budget. Addressing the problem of high business rates is Retail NI's top concern. Some 71% of our members' rate bills increased after the last revaluation and that is a significant factor as to why Northern Ireland has the highest shop vacancy rate in the UK.
While it is welcomed that the Small Business Rate Relief Scheme has been secured in the short term, we need to see radical improvements to it, making it more effective and getting enhanced and targeted rate relief to the businesses that need it the most.
Retail NI and Hospitality Ulster jointly produced a plan for such a scheme, which targets rate relief toward independent retailers and hospitality businesses. We will be seeking an urgent meeting with the Secretary of State to advance this plan.
Last year the outgoing Finance Minister adopted the majority of our proposals in his Rate Rethink Plan, including a new targeted rate relief scheme for retail and hospitality.
Our proposed scheme of over £22m of rate relief is the highest amount ever, and is around two and a half times the previous relief available. Over 30 business organisations and Chambers of Commerce supported this plan.
These proposals are not just supporting the growth in retail and hospitality but they are also, - given our members' commitment to sourcing local produce - a real boost for the local supply chain and for the agri-food sector among others. In addition, we believe this plan is good for town and city centre regeneration and for growing our tourism potential.
Directly assisting our independent retail and hospitality sectors is in line with existing rate relief for manufacturing and agriculture. Not only will this rate relief scheme be beneficial for many existing independent retail and hospitality businesses, it will potentially assist new-start businesses in our sectors with a substantial rate reduction, helping reduce their start-up costs. Businesses will have the confidence to reinvest the money that they will save on hiring new staff, further skills training and planning for the future.
In 2014 the Northern Ireland Centre for Economic Policy made a key recommendation that the Small Business Rate Relief Scheme needed to be targeted and focus on areas that could readily promote economic growth.
Sadly it does not look like the Executive and Assembly is returning any time soon and the NIO will be making the big decisions. At last week's meeting of NIO special advisers and senior officials, Retail NI recommended that an economic advisory group be set up to ensure the Secretary of State is getting strategic policy advise on the key economic challenges ahead.
By no means is this the best way to set a Budget, nor run a Government in Northern Ireland. We need to see local, accountable and elected Ministers making the key decisions. Northern Ireland deserves more than 'care and maintenance' administration and emergency budgets.
Direct rule is not viable or indeed a welcome Plan B - we need to see the political parties re-engage the talks process and go the extra mile for agreement.