Previous SectionIndexHome Page

Mr. Gummer: The Bill relates in large part to England and Wales, with some provisions covering Scotland. We pay particular attention to hon. Members from Northern Ireland on issues relating to local government in Northern Ireland. I have no doubt that, if they wanted the measures extended to Northern Ireland, my right hon. and learned Friend the Secretary of State for Northern Ireland would be happy to consider it.

I believe the proposals to be beneficial. The hon. Gentleman may want to talk to my right hon. and learned Friend, who I know is apprised of his concern. I have talked to my right hon. and learned Friend about the measures, and he may want to extend them to the rest of the United Kingdom, as the hon. Gentleman proposes.

Sir Jim Lester (Broxtowe): While my right hon. Friend is on that point, may I ask a related question? I live in a village with neither a post office nor a village shop. However, it has a village pub, around which everything circulates. The pub has struggled to stay in existence, mainly because of the changes in people's drinking habits, but it is a vital part of the community. Is there some way to facilitate the continued existence of village pubs as well as the vital post offices and village shops?

Mr. Gummer: I remind my hon. Friend that one of the best ways of ensuring that the village pub stays in business is to take into account the well-known phrase, "Use it or lose it." I hope that my hon. Friend will ensure that the pub has continued support from his own patronage and that of his friends.

I assure him that village pubs will have the chance to be involved in the discretionary scheme. That is helpful, and will enable local authorities, with considerable help from the Exchequer, to give support to village pubs, which are often important community centres.

My hon. Friend made the important point that the great advantage of our rural scene is variety. Different villages operate in different ways. My hon. Friend the Member for Lancaster (Dame E. Kellett-Bowman) mentioned a village garage. In that valley, the garage is the centre of village life, and it will be up to the local authority to consider the opportunity of supporting it. In some villages in my

6 Nov 1996 : Column 1247

constituency, the village pub performs that role, but in others--the majority--it is the post office and the village store. I hope that the Bill is flexible enough to cope with that variety.

Mr. Tim Devlin (Stockton, South): The real problem for small village shops in the north-east of England is the oppressively high level of rates levied on them by local Labour councils. Can my right hon. Friend assure me that the Bill contains no proposal for a further oppressively expensive local authority in the form of any kind of regional government run from Newcastle?

Mr. Gummer: My hon. Friend is right to say that many areas suffered considerably when their local authority controlled the business rate. For example, before the Government changed the rules, a shop in Newcastle could pay three times as much in rates as a similar store in Oxford street. Labour councils drove shops out of the centre of Newcastle by charging them three times the rate charged in Conservative-controlled Westminster. Happily, as a result of the change in the business rates, that is no longer a problem.

My hon. Friend the Member for Stockton, South (Mr. Devlin) is right to suggest that the problem would return if a regional system of government were introduced. Such a regional government would then impose an extra tax--one of the so-called "advantages" of an extra tier of government--to do what it is difficult to imagine needs to be done. My hon. Friend is perfectly right--[Interruption.]

The laughter from Opposition Members shows their uneasiness about their devolution proposals. They know perfectly well that regional government is a cover-up, and that what they want is to give a degree of independence to Scotland and Wales, without losing the votes of Scottish and Welsh Members in this House. We know what the Opposition are about. They are as uneasy in general as the hon. Member for Greenwich (Mr. Raynsford)--who sits with a permanent smile on his face--is uneasy in particular. I assure my hon. Friend that we shall certainly stand against regional government.

General stores have particular problems, and that is why we provided a mandatory reduction in rates. The non-domestic rates are a disproportionate burden of the costs on a small business, and the Bill will automatically halve the rates bills of the only general store and the only post office in a village. That will reduce the rates bills of some 6,000 shops by an average of £500 a year, and, as a result, will transfer from the rates bill to the profits of a small business a significant sum of money. Very often, that money will provide the difference between a company continuing and going out of business, and that is of great importance.

Mr. Christopher Gill (Ludlow): Can the measures be extended to include village pubs, many of which are extremely vulnerable--particularly in the rural areas that I represent--and can be isolated and under severe financial pressure?

Mr. Gummer: As I explained to my hon. Friend the Member for Broxtowe (Sir J. Lester), there are two ways

6 Nov 1996 : Column 1248

to help village pubs. One is to adopt the "use it or lose it" attitude, while the other is to accept that discretionary rate relief will be provided for village pubs in particular circumstance. My hon. Friend the Member for Ludlow will be pleased to know that a pub that is the only available community facility in a village will be eligible in some circumstances to receive the discretionary rate relief of up to 50 per cent.

The discretionary power will help local authorities to give assistance where it is necessary. At the moment, the only way in which a local authority can reduce the rates bills of such businesses is if the ratepayer is able to prove hardship, which inevitably means that help goes only to those in particularly serious financial difficulties. One of the things we discovered during our discussions on the rural White Paper--both in advance of its publication and afterwards--was that many businesses could not be saved if they reached the point of having to seek hardship relief. We need to give businesses help before they reach that point, and the change in the discretionary arrangements makes that possible.

In recognition of the importance to the community of such businesses, we are seeking to allow local authorities to provide help in time. Instead of being a safety net, the measure will be a means of helping businesses to flourish. In all, we anticipate that the measure will help up to 30,000 businesses in England and Wales by reducing their rates bills by some £20 million. The full cost of the mandatory scheme will be met by the Exchequer, with some £3 million going to the 6,000 or so general stores and post offices, and 75 per cent. of the cost of discretionary relief will be met by the Exchequer, giving more than £12 million for other rural shops and businesses.

Therefore, for both the mandatory scheme and the discretionary scheme, the Treasury will pick up most of the bill, so that people in the locality will be able to make decisions on the discretionary scheme without concerns about the weight that might be placed on other local businesses. But the local authorities will have to make sufficient contribution to ensure that they are sensible and choose appropriate businesses for the necessary support.

Mr. Keith Mans (Wyre): Will the discretionary relief be available in cases in which the hardship has been caused by the councils themselves? For instance, both Lancashire borough council and Wyre borough council are imposing car parking charges and voucher schemes that are driving people out of towns such as Garstaing and Poulton-le-Fylde, which is causing hardship to local small business men and putting them out of business. People are driven to shop in out-of-town shopping centres and to support national chains rather than local shops.

Mr. Gummer: My hon. Friend is right to point out that, although our proposals will be important to shops of all kinds in villages, other factors contribute to their ability to survive. One is the provision of proper car parking to enable people to use village shops in the way in which they use out-of-town shopping centres.

I know that the Labour party has made it clear to the newspapers that it would, were it ever elected, reverse the policy on out-of-town shopping centres, so I hope that Opposition Members will listen to my next point, which is important. One reason why it is important to get local

6 Nov 1996 : Column 1249

authorities to support our plans is that, without proper parking, people--especially women with children, who constitute a high proportion of shoppers--find it impossible to bring their cars close to the shops.

Mr. David Rendel (Newbury): Will the Secretary of State give way?

Mr. Gummer: In one second.

The discretionary relief will not depend on hardship, and the shopkeeper will not have to prove hardship. That is an important change, which I am sure will be welcomed on both sides of the House.

Mr. Rendel rose--

Mr. Stephen Day (Cheadle) rose--

Mr. Gummer: I shall give way to the hon. Member for Newbury (Mr. Rendel), because I promised to do so earlier.

Mr. Rendel: Will the Secretary of State clarify a point about which businesses will come within the scope of the legislation? He has talked of businesses that are, in some senses, the centre of the local community. I fully understand that, and everyone appreciates their importance, but the Bill states that those businesses must be of benefit to the local community.

That provision could have a much wider scope, in that many local businesses may provide, for example, employment for the local community, and that could bring in many more businesses than the Secretary of State has so far identified. Will businesses be included if their benefit to the local community lies in providing employment?

Next Section

IndexHome Page