Public Toilets and how they are liable for Business Rates

It might seem daft, but public toilets are liable for business rates (officially called Non-domestic Rates NDR), even though they are not something I would call a businesses, more of a service. Cornwall Council has previously lobbied Central Government over the unfair burden of charging business rates on public toilets. No matter if they are run by a Town and Parish Council, a community group, or Cornwall Council.

The good news is the Government has tweaked the legislation and will give local council’s the powers to award discretionary relief from April 2018 under the Local Government Finance Bill. I welcome this.

However, there is a sting in tail. On one hand the Government allows Cornwall Council not to levy this charge, but it will be the local authority who have to pick up funding shortfall in funding.

Applying these powers to the public toilets that are the responsibility of Town and Parish Councils in Cornwall would create a £156,000 funding shortfall for the Council.  If the powers were applied to all public toilets in Cornwall, the shortfall would increase to around £250,000. That’s a lot of money to lose.  I believe the Government should compensate local authorities for any such funding shortfall. It has done previously with other business rate relief measures.

In the past, Cornwall Council collected business rates  and sent them to the Government, who in turn gave the Council a percentage back. Then, we collected and kept part of the NDR with the rest going to the Government. Now the Council keeps all, but gets no grant from the Government.

 

Local Authorities Keeping Business Rates – Will There Be a Catch?

The Local Government Secretary, Eric Pickles announced yesterday that local authorities will soon be able to keep (there is a catch) Non-Domestic Rates (NDR), otherwise known as business rates.  Currently, local councils receive their funding from three main sources: grants from central government; council tax; and other locally generated income (such as fees and charges for services).
The catch is the government is not going to allow the local authority to keep all of the NDR.  The government wants to make sure there is a fair starting position by taking business rates away from those with too large an amount in comparison to their current spending, and then top up those authorities with too little, again in comparison to their current spending.
Yes, on one hand it looks like the government will give greater flexibility to local authorities on keeping and spending NDR, but it won’t let local authorities  set NDR, as this power will remain with the government (at the moment).
To be honest, I doubt it will mean extra money, as if you gain from the NDR, you will have a reduced amount in the formula grants handed out by the government. Still, I do believe this could work positively for Cornwall, but we won’t know for sure until the number crunchers get out their calculators to make sure.
The Communities and Local Government Department has released a ‘Plain English Guide’ to the proposals. They explain without government speak the proposals.