£1 billion future high streets fund not enough to offset business rates fiasco says colliers

Rating Experts Welcome Initiative but Doubt Its Impact Without Proper Business Rates Reform

 

Boris Johnson’s announcement that the £1 billion Future High Streets Fund will expand to 50 more towns, as part of the government’s plans to reshape town centres and high streets has been cautiously welcomed by rating experts at Colliers International, the global property agency and consultancy. However, unless business rates are properly reformed, Colliers believe it won’t get to the heart of the problem and in itself is not enough to counter the impact of the 2017 business rates revaluation and introduction of downward phasing.

Under the new initiative, towns such as Harlow, Barrow and Dudley will join 50 areas already shortlisted to develop plans to reinvent their high streets. The announcement comes after an additional £325 m was pledged to the Future High Street Fund last month and takes the overall size of the fund to £1 billion. The fund will be allocated to towns to improve transport and access to town centres, convert empty retail units into new homes and workplaces and invest in infrastructure.

All very good” says John Webber, Head of Business Rates at Colliers, “but it just simply won’t go far enough and certainly won’t help retailers struggling with their current rate bills.”

Webber points out that £1 billion between 100 towns is £10 million for each town which each local authority will decide how to spend. However, there is no coherent strategy on how it should be spent, how businesses can bid/claim for support nor anything about using the money to tackle the business rates crisis. Discussions and then implementation about any serious town centre redevelopment could take months, indeed years and meanwhile high street retailers are still paying too high rate bills on their properties because of both downwards transition and a too high multiplier - and stores will still be closing as a result.

“It would be much better to get to the heart of the problem immediately” says Webber “And to use the money to remove downwards transition and reduce the multiplier now.”

Webber explains that the impact of delaying the 2015 Business Rates Revaluation by two years to 2017 meant that many retail businesses in towns such as these, were two years late in receiving a fairer (and lower) business rates revaluation, which would have substantially cut their rate bills. Government policy of implementing any business rates rises immediately, but phasing in any reductions over the four years of the list has also meant that many retailers have been and are still paying too high business rates on their property than they should be if rates had been allowed to reach their correct level on day one.

This is added to the fact that the multiplier, (the UBR figure against which the rateable value of the property is multiplied to give the final rates bill) is still too high at 50p in the pound and looks likely to move to nearer 60p with the next Revaluation. This 50 to 60% tax is and will continue to be unsustainable for most retailers on top of all their other costs. If it could be reduced to say 34 p in the £1 as it was in the 1990s, Webber argues, businesses could more easily meet their costs and more stores stay open.

Webber cites the experiences of some of his clients including high street retailers with stores in a number of these “chosen “towns. "Due to downward phasing, several will find they have spent over £10 million in their rate bills MORE than they should have done if their rates bill had been at their true levels, over the four-year period of the current list."

 “And given that a quarter of their stores have rates bills at least half their rents bills, you can see the devastating impact of the Revaluation on retail. There is no doubt such costs will influence decisions such as whether or not to keep stores open and such decisions won’t really be impacted by this Government policy, however well intentioned. When you multiply that experience around other retailers in the market, you can see how large the problem is.” 

“If the Government is serious about saving the high street it must abolish downwards transition and reduce the multiplier now. I hate to say it but without that, retailers in many of these towns will stay under threat, stores will be closed and jobs lost, despite all the rhetoric and well-meaning Government plans.”


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John Webber

Head of Rating

Birmingham

I have over 30 years’ experience in the rating industry and lead a 90 plus rating team at Colliers International.  When I took over responsibility for the team in 2005, it consisted of only a dozen people and has now grown into one of the leading rating advisory teams in the country.  I am a member of Colliers International Management Executive as well as sitting on the company’s promotion panel. 

I am regularly called upon by the national media to give my views on a range of business rates issues and I am vocal commentator on the 2017 Revaluation.

I started my career in the Valuation Office Agency in Kidderminster.  I joined Gerald Eve in 2000 where I spent 10 years before moving to Gooch Webster (now Colliers International). I sit on the National Retail Panel of Rating Surveyors Association which provides guidance on how the RSA town committees work with the VOA and valuation matters.  John sits on the RICS Rating Diploma Committee having passed the prestigious qualification in 2014.

Philip Harrison and I founded 'Accurates' in 2007, the Collier's Compliance and Audit team, which although forms an integral part of the Rating Team is now a leading brand in its own right.

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Suzy Simpson

Associate Director

London - West End

As Acting Head of PR & Communications for UK and EMEA, I am currently covering maternity leave for Director of PR & Communications,  Charlotte Williams. 

In this role I am responsible for:

• Developing and executing internal, external & digital communications strategy for the UK and EMEA business.
• Developing and implementing tactical communications plans to build the brand and promote key messages across all aspects of the mdeia - print, broadcast and social
• Advising senior management on communications and developing a media engagement programme that supports key business lines.
• Media evaluation and reporting objectives, targets and successes across the business.
• Reputation management and crisis management
• Media training

Managment:

  • Manage the UK in-house PR team and oversee the work of our external PR agencies and consultants
  • Provide strategic direction to the PR & Digtal Marketing teams across EMEA
  • I am a member of the EMEA Marekting Leadership and Global PR & Social teams
  • I lead the EMEA PR Leadership team

Prior to taking on this role, I was an Associate Director with my main responsibilities being to oversee PR strategy for the UK regions, my key resiponsibilities include:

  • Developing and implementing PR campaigns for service lines across the UK/EMEA regions as well as on ongoing profile raising of our UK regional offices.

  • Delivering creative PR campaigns and distributing news from across the business, including new instructions, transactions, research reports, new starters and new business initiatives.

  • Developing relationships between key individuals and relevant journalists through our strategic media engagement programme. 

  • Drafting and managing industry award entries.

  • Supporting PR Director Charlotte Freeman on EMEA M&As and major corporate annaouncements  to ensure that the brand is properly represented externally.

  • Media Training for key spokespeople

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