House of Commons Hansard Debates for 6 Nov 1996 (pt 38)

Ms Armstrong: The hon. Gentleman misunderstands the point that we sought to make. That rural activity provides work for those involved in beating, raising the pheasants and related activities. However, it is the landowner and not those people who will benefit from the rate relief. We want to encourage the creation of more jobs in those areas, and ensure that everyone who is able to makes a contribution to that.

Mr. Atkinson: I appreciate the hon. Lady's knowledge of grouse shooting, because many of her hon. Friends are utterly ignorant of that activity. But sadly her knowledge does not extend to the basic laws of economics. If money is put into a community--whether it is given to a landowner or anyone else--that money trickles down. [Interruption.] Of course it does. If the hon. Member for Holborn and St. Pancras, who laughs into his beard, were to listen to the shadow spokesman on agriculture, the hon. Member for Edinburgh, East (Dr. Strang), he would realise that I was right.

His hon. Friend and I agree that, if farmers had higher incomes, they would spend more money in their local economy--they would buy things and employ more people. The same applies to the shooting business. If it is more profitable, it spends more money improving the shoot, upgrading its facilities and employing more people. That is one of the basic laws of economics.

Mr. Dobson: The hon. Gentleman gives the impression that field sports are on their beam ends. According to the Government, they are worth £2,700 million a year. If my maths is correct, the £5 million contribution is 0.2 per cent. of that. The hon. Gentleman said earlier that that figure was extremely marginal. If it is so marginal, why do the Government choose to give that tax reduction to a small group of, generally speaking, wealthy people, whereas they bunged 22 tax increases on everyone else?

Mr. Atkinson: I do not think that I said that it was marginal. For many people, it will be a significant

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amount. I reiterate the point that I made earlier. The anomaly of that form of rating--it always was an anomaly--works both ways. An institution--or an individual--may own land and let it to a tenant farmer, but reserve the shooting rights to itself because it does not want them to be used. It may not want its tenant farmers to shoot over the land for particular purposes. It is nevertheless vulnerable and liable to pay rates on the sporting rights that it does not use. The proposal helps people involved in one form of land management, and it helps those involved in running a shooting business.

I welcome the Bill. It has been criticised by hon. Members on both sides of the House for possibly not going far enough, but it has to be limited, and it is right that the Bill is targeted at those providing rural services--rural shops, pubs and post offices--and other important parts of the rural infrastructure. I look forward to the Bill being enacted in time for rebates to be given as from next April.

7.22 pm

Mr. Jamie Cann (Ipswich): I thank the hon. Member for Caernarfon (Mr. Wigley) for his typical Welsh generosity in allowing me to speak ahead of him.

I do not come from a rural constituency. There is one farmer in my constituency, and for that I endure--that is not the right word; for that I am given--a National Farmers Union briefing once every six months. I know all about his farm, that is for sure. I am a small town boy: I lived in Ipswich for 30 years, but I come from a small town. I love the villages and small towns of Suffolk, as does my neighbour, the Secretary of State. My hon. Friend the Member for Hexham (Mr. Atkinson) was a county councillor in Suffolk before he got his present job.

I know the importance to villagers of their shop, their post office, their church, their school and their pub. However, I represent an urban constituency. I welcome the proposals in part I, clause 1 and schedule 1 to reduce the rates of general stores and post offices in rural communities. I have nothing but praise for the proposals. I do not propose to go into any other part of the Bill.

There are two reasons for the reductions in the rates of general stores and post offices in rural areas. First, superstores have opened across the country, usually centred on trunk routes and junctions of trunk routes. In Ipswich, we have been particularly unlucky. We have four on the western periphery of the town, and two on the east. Permission for almost all those superstores was granted on appeal by the late Lord Ridley against the wishes of the local authorities. They have had a pernicious effect on the town centre of Ipswich, especially on the food trade, and on the small towns and villages that the Secretary of State represents.

Secondly, in 1992 many small shops were uprated for the new business rate. That increased their costs. At the time, the Government rightly introduced transitional arrangements to delay the blow to small businesses, but those arrangements have now worked their way through and out of the system. The pernicious effect of the superstores and of the increase in business rates on historically low-costed properties has resulted in problems for small business men in rural areas, and in areas such as the one that I represent. Butchers, newsagents, bakers and grocers are increasingly going out of business as more and more trade is concentrated in larger and larger shop

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units. They may not necessarily be superstore size: Mace shops are putting newsagents out of business. And so it goes on.

We should concentrate on not only helping rural shopkeepers to compete against superstores, but helping small post offices and small shopkeepers in general. It is not the location of the small business that is the problem; it is its size compared with the Sainsburys and Tescos of this world. It is proving increasingly difficult for small shops to cope.

If it is right--I think it is--mandatorily to reduce the rates of small shops in Woodbridge, Framlingham and in other small towns and villages across the county of Suffolk and across the country, it should be right to do the same for small businesses and small shops in my constituency. They are suffering from the same pressures.

In Committee, I should like the categories referred to in clause 1 to be altered to enable all shops of a given size to be viable. Incidentally, I have been unable to find in the Bill a description of a given size of small shop.

I have a few queries. If those shops are charged less in rates, there will be less income. The Bill refers to a figure of approximately £20 million. That does not sound too much, but I should like to know where it will come from. If it will come from a reduction in the pooled national business rates, my people in Ipswich will be paying more so that rural shops of an equivalent size can pay less. That cannot possibly be right. I invite hon. Members to think about that effect on businesses in their own constituencies.

If rates are not the same for shops inside my constituency as they are for businesses just outside it, people will be incensed. I shall use the example of my road. I live within a hundred yards of the Ipswich boundary. Just outside the boundary is a village called Kesgrave, which clearly would come within the limitations set out by the Bill. The Government are seriously mistaken if they think that they would receive popular approval by halving the rates of a little general store that is a hundred yards outside my constituency while leaving unaltered the rates paid by the little general store that is a hundred yards within my constituency. That would be utterly unfair.

Small shops compete against superstores, but they also compete against each other. What is sauce for one should be sauce for the other, but the Bill does not recognise that.