To receive an update on the status of the Business Rate Pool and the governance arrangements of the Strategic Economic Development Fund.
David Stanley, (Accountancy Manager at Stroud District Council) gave an update on the Gloucestershire Business Rates Pool (GBRP) and Strategic Economic Development Fund. The GBRP was set up to maximise the business rate income retained within the County and to support the economic growth within the geographic area overseen by the LEP. The Pool is led by a management team represented by the Chief Financial Officers from each of the district authorities.
It was noted that the existing 100% business rates pilot was due to end on 31 March 2019. An application for Gloucestershire to be considered as a 75% pilot area was submitted to Government in late September 2018, with successful pilot areas due to be announced in early December 2018.
The committee received an update on the cumulative amount of funding generated by the Business Pool to the Strategic Economic Development Fund (SEDF). The award of funds, (involving discussions with the Chief Executives and Leaders of each participating local authority), is subject to the unanimous agreement of each member of the Business Pool.
Members were reminded that each Joint Committee member needed authority from their respective councils to make decisions on behalf of that authority in relation to the GBRP and to the SEDF. Members accepted this requirement but requested that sufficient notice was given for them to consider the decision they would be required to make.
At the time of the meeting, the cumulative amount of funding generated by the GBRP for the SEDF since 2013/14 was £1.134 million, with £0.798 million of this amount arising from the 2017/18 pool outturn position, (these funds will be available to be drawn upon from January 2019.
The forecast position for the amount of funding generated in 2018/19 indicted £2.9 million would be available to the SEDF from the 100% Business Rates Pilot. It was noted that the level of business rates retained and the SEDF share of the business rates pilot would need to be derived from pilot members’ estimates of the rates collection forecast.
To reduce the level of risk associated with backdated appeals and the possibility of having to make refunds, the committee noted the advice of the Business Pool Management Team, advising that ‘resource allocation’ decisions on pilot funds should be made following the announcement of the 2018/19 outturn position in April 2019. This would enable the respective councils to make decisions following clarification of the amounts of business rates to be retained or distributed. Funding from the business rates pilot would not be available until the 2019/20 financial year.
Members recalled that at the September committee meeting, the GEGJC had agreed to consider the following ‘in principle’ funding requests, based on a report to this meeting.
a) County Council and LEP economic intelligence work costs;
b) Business case for improvement works to Junction 10 of the M5 Motorway
c) County Council committee costs
In addition, the committee to give consideration to the process for considering and prioritising future funding and investment requests, where it was suggested the committee establish and agree an approach to identifying eligibility criteria and approval of the award of funding to the SEDF. Any suggestions on the proposed approach to be referred to the Senior Officer Group for consideration, the criteria of which was set out in the committee report.
Seeking clarification on the decision-making powers of the committee, it was explained that final decisions on future funding bids would be authorised by the committee, following recommendations by the Senior Officer Group. It was suggested members report back to their individual authorities to enquire how local decision-making arrangements could be aligned with the decision making process of the committee.
In noting the report, the committee
i. £275,000 of reserves currently held in Strategic Economic Development Fund are used for the purposes of revenue funding contribution/support for the M5 Junction 10 improvement scheme (reserve funding available from January 2019)
ii. £50,000 of reserves currently held in the Strategic Economic Development Fund are used for the purposes of commissioning additional Economic Intelligence to support the work of the LEP and GCC Data and Analysis Team, in refreshing the current Strategic Economic Plan and working towards the preparation of an Industrial Strategy for Gloucestershire (Reserve Funding available from January 2019)
iii. The Senior Officer Group is requested to consider the eligibility, criteria and project approval process for the assessment of future funding bids from the Strategic Economic Development Fund and make recommendations to the Joint Committee at its meeting on 20 March 2019.