I attended a meeting, held on November 1st, by the Federation of Small Businesses, the FSB, to discuss how Government can best help businesses in the South West. This was an opportunity to specifically raise the disastrous increase in small business rates in Dartmouth that are due to come into effect in April 2010.
The situation in Dartmouth, with rateable values due to increase in some cases by as much as 350%, will undoubtedly lead to the closure of many businesses. The situation is unacceptable and I fully support Tessa de Galleani, of the Chamber of Trade and Small Businesses, in her call for all affected business to appeal now to the Valuation Office. The fact is that the valuations are legally bound to reflect the values of the businesses in April 2008, and inevitably rental values have declined since then as a result of the recession. I agree with Tessa that the valuer has to take into account the distorting effect of a few high profile brand stores in the town. It simply defies belief that rental values have genuinely increased to the extent claimed by the valuation officer. At the public meeting in Dartmouth on 17th November, the valuer tried to explain their valuations, which were based on just 6 new rental agreements in the town in 2008. It is time for them to recognise that the scale of increases in Dartmouth is completely out of line with increases in similar towns and to review their valuations.
I call on the Government to reduce the small business rate multiplier, due to be 41.4 when the revaluations take effect next year, and to increase the threshold for small business rate relief. The current increase in valuations risks taking many businesses out of small business rate relief altogether as this will be just £18,000 in April. We need an increase in the threshold to at least £26,000 in order to protect businesses in Dartmouth.
On a more general note, I feel that we must have automatic small business rate relief. It is unacceptable that England is now the only part of the UK that does not have automatic small business rate relief. It adds to the red tape and many businesses in the South West are still unaware that they are eligible to claim. Government knows who these businesses are and should immediately act to help them to survive the recession. 58% of the entire private sector workforce are employed by small businesses, and financial recovery in Devon is absolutely dependent on their survival.
I was delighted to see Dr Sarah Wollaston at our FSB briefing event. The aim of which was to provide Prospective Parliamentary Candidates with the cold hard facts that face small businesses in Devon today. The FSB has over 8,500 members in Devon who employ somewhere in the region of 25,000 staff. Our aim was to give the PPC's as much information as possible about the various problems facing small businesses. The enormous amount of red tape small business owners are expected to work through. 924 changes in employment legislation alone since 1997; health and safety regulations; immigration regulations affecting small businesses, the list goes on and on. Small businesses need a level playing field - we don't want special treatment - just fair treatment and a universal understanding by all politicians that many regulations are just not practical for many small businesses, who employ fewer than 2 people. Large businesses have the manpower to cope with HR, legal, health and safety. Currently there are over 385 government or local counil officials that have the right of access to business premises, and if one called each day, you could spend over an entire year, doing no work at all. No one person is capable of being aware of all the regulations that apply to small businesses, and where this is the case, surely the time has come to halt the march of regulation.
- David Shephard - Devon Policy Chairman FSB