Issue - meetings

Business Pool Fund

Meeting: 03/06/2020 - Gloucestershire Economic Growth Joint Committee (Item 6)

6 Business Rate Pool Funding Update and SEDF Funding Proposals pdf icon PDF 128 KB

To receive an update on the Business Rate Pool, (report attached), prior to considering the following funding proposals for the allocation of funding from the Strategic Economic Development Fund, (SEDF).

 

a)    SEDF Funding Proposal: Central Gloucestershire City Region Board

 

To consider a recommendation from the GEGJC Senior Officer Group to allocate £2 million, (to be set aside within the SEDF), to support the work of the proposed Gloucestershire City Region Board, as requested by Leadership Gloucestershire.

 

b)    SEDF Funding Proposal: Multi-Modal Transport Brief

 

Pending the outcome of the decision at 6 a), (above), to consider a recommendation from the GEGJC Senior Officer Group to allocate £410,000, (from the approved SEDF ring-fenced funding allocation allocated to the Central Gloucestershire City Regional Board), to support the commissioning of a Multi-Modal Transport Brief.

 

Additional documents:

Decision:

The committee: -  

 

1)    Received an update on the forecast outturn of the 2019/20 Business Rates Pool and the estimated balance of the SEDF.

 

2)    Considered funding proposals from the GEGJC Officer Group for the allocation of funding from the Strategic Economic Development Fund, (SEDF) and

 

RESOLVED to: -

 

a)    SEDF Funding Proposal: Central Gloucestershire City Region Board

 

Allocated £2 million, (to be set aside within the SEDF), to support the work of the proposed Gloucestershire City Region Board, as requested by Leadership Gloucestershire.

 

b)    SEDF Funding Proposal: Multi-Modal Transport Brief

 

Allocated £410,000, (from the approved SEDF ring-fenced allocation allocated to the Central Gloucestershire City Regional Board at 6 a above), to support the commissioning of a Multi-Modal Transport Brief.

Minutes:

Andrew Cummings, (Strategic Director of Resources at Stroud District Council), gave an update on the forecast outturn of the 2019/20 Business Rates Pool and the estimated balance of the Strategic Economic Development Fund (SEDF) for Gloucestershire.

 

Key points highlighted by the report included:

 

1.    The final financial gain to the SEDF from the 2018/19 100% Business Rates Pilot was £3.438 million.

 

2.    The impact of the coronavirus pandemic was expected to have a fundamental impact on the economy of the county, including the level of business rates collected.  Noting that the government restrictions had only come into place at the end of March 2020, it was anticipated that there would probably be minimal impact on the actual business rates collection for the 2019/20 year. 

 

3.    There had been a significant positive change in relation to the business rates position at Tewkesbury Borough Council during the last quarter for 2019/20.  This has seen the authority being able to release provisions previously set aside to cover appeal losses.  The release of these provisions had seen a significant boost to the position of both Tewkesbury and the pool.  This major boost was a one off event.

 

4.    Based upon the new positions, an estimated pool gain of £4.5 million was anticipated, of which £900k would be passed to the SEDF. The committee was advised to view this estimation with some caution, pending potential changes to the year end final position. As a result of the pandemic, the deadlines for producing year end figures had changed and local authorities would now have until the end of November 2020 to publish their final accounts

 

5.    The long term impact of the pandemic was not yet known.  An anticipated 20% reduction on the previously estimated figure was included in the report. This would, however, be subject to significant fluctuation.

 

6.    It was confirmed that the Business Rates Pool would continue into 2020/21, (under current arrangements), with Stroud DC acting as the lead body. It was hoped this arrangement would generate a further year of gain for the SEDF in 2020/21, currently estimated at £578k.  The uncertainty surrounding this figure would mean caution would need to be exercised if using this balance as part of any funding allocations.

 

7.    Members recalled previous updates regarding the risks to the pool from a legal case by the NHS foundation Trusts. In December 2019, the High Court had ruled that NHS Trusts and Foundation Trusts would not be eligible for business rates relief, which was considered to have eliminated the risk. Pending a possible appeal by the NHS Trust, it was agreed further updates would be required at future meetings. The issue of the NHS Trusts requesting charitable status remained the most significant financial risk to the pool.

 

a)    SEDF Funding Proposal: Gloucestershire City Region Board

 

  1. In October 2018, Leadership Gloucestershire had established 3 Boards to help deliver the eight ambitions of the Gloucestershire Vision 2050.

 

The three boards included:-