Meeting of the Parliament (Hybrid)

Meeting date: Wednesday, December 2, 2020

Official Report 1144KB pdf

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Parliamentary Bureau Motions

The next item of business is consideration of Parliamentary Bureau motion S5M-23563, on the approval of a Scottish statutory instrument.

Motion moved,

That the Parliament agrees that the Valuation (Postponement of Revaluation) (Coronavirus) (Scotland) Order 2020 [draft] be approved.—[Kate Forbes]

Liam Kerr wishes to speak against the motion.

18:07  

I rise to speak against the order, and I urge MSPs to vote against it at decision time. The order concerns the business rates that our shops, enterprises, hospitality businesses, restaurants and so on pay each month. Periodically, there is an assessment of the rates that each should pay, and the order seeks to move the date on which the next assessment will be made. If the motion to approve the order is passed today, instead of business rates being reassessed and a different figure being paid from April 2022, the reassessment will be pushed back, with the rates changing from April 2023.

Will the member take an intervention?

I will make a little progress and then I will come back to Ms Boyack.

I understand why the change is being proposed. The minister will tell us that the Government’s concern is that, if we were to reassess the figures any earlier, the result would not be truly reflective of conditions in the market, due to the coronavirus pandemic. I expect that the minister will also tell us that pushing back the revaluation will allow current and post-Covid trading to be assessed, and it will allow time for the vaccine to do its thing, people to get back on the high street and sales to stabilise.

I get that, but that does not work when set against the principles that the minister will claim to be working to. It does not work because the whole point of the Barclay review of rates was to design a rates system that directly responds to changing market conditions. These are the changing market conditions, so any delay to the revaluation, as per the order, runs counter to the flagship recommendation for more frequent, not less frequent, assessments.

Furthermore, members will be aware that the Scottish Government recently introduced legislation to further constrain appeals on the grounds of material change in circumstances, which will only really work in a context in which there are more regular revaluations. If the order to push back the next reassessment is approved today, after we have removed those crucial grounds of appeal, it will be the perfect storm for many businesses. In other words, the order will bring in a one-size-fits-all solution that does not fit all—it certainly does not fit the north-east.

Does Mr Kerr agree that, although the majority of Scottish businesses support a delay to the tone date, the evidence that the Local Government and Communities Committee took showed that many business groups do not support the tone date that is in front of us tonight? It is disappointing that the Scottish National Party Government was not prepared to bring forward the alternative tone date that many would prefer, especially given the lack of a robust economic assessment that would enable us to take a good decision.

Yes, I agree with that. I can see from the record that many business groups did not support the proposal in the order. I will shortly speak specifically about one such group, and about a solution that might be of interest.

The last revaluation was several years ago. The north-east was accordingly assessed against trading conditions as they stood at that time. That reassessment completely failed to take into account the impact of the oil downturn and its effect on the north-east economy. As a result, business rates bills were based on rateable values that failed to reflect the reality of trading in the north-east when they came into force in 2017.

North-east businesses have been paying eye-watering rates ever since. This is their chance—at last—to be reassessed against realistic trading conditions and the market in the north-east as it is, and not as the central belt thinks that it is. Businesses in the north-east cannot wait any longer. One needs only to walk down Aberdeen’s Union Street to see the impact of the crippling and inaccurate rates on that great city.

MSPs need not feel pressured into voting for the order. There is a solution, and it is in the Scottish Government’s own paper as option 2. That solution, which I suspect Sarah Boyack was referring to, is endorsed by Aberdeen and Grampian Chamber of Commerce, and is that the Government should carry on with the 2022 revaluation, but introduce a valuation date of 1 April 2021. Revaluing rates as early as possible to align rateable values with current market conditions, in the light of Covid-19 and the most recent restrictions, would be a fairer and vastly more sensible step to aid economic recovery than delaying the revaluation.

For years, the conditions against which the north-east was assessed have not existed. For years, the north-east has paid crippling business rates that have had dramatic—sometimes terminal—impacts on our high streets and jobs. That must not continue for one minute longer than necessary.

The solution is clear: MSPs should vote against the order, send it back so that the committee can reconsider option 2, and deliver a fair deal for the north-east. MSPs can back the north-east and its people by doing so at decision time.

18:10  

Contrary to Liam Kerr’s point, the Barclay review’s primary concern was to provide stability and minimise the impact of economic shocks. It would be irresponsible for the Scottish Government to proceed with a 2022 revaluation based on information as at April 2020, which was only a month into lockdown.

This is not a political decision, which is clearly demonstrated by the fact that the Scottish, Welsh and United Kingdom Governments have all taken the same decision.

The delay was also requested by Ruth Davidson in the chamber on 1 September—the day that the proposal to do exactly that was announced in the programme for government. I see that the Conservatives now want to do a U-turn on Ruth Davidson’s request.

Will the cabinet secretary acknowledge that the tone date in Scotland is different from the tone date in Wales and the rest of the United Kingdom?

Yes, and I celebrate that, because it minimises the time for the market to be considerably different at the point on which the revaluations are based. A one-year tone date—which was recommended by the Barclay review—was chosen precisely to minimise the shocks. We should therefore be proud to be able to deliver that in this country.

The equivalent delay in England was described by Luke Hall, the UK local government minister, who I believe is a Conservative, as “important” and “common sense”. Similarly, Labour MP Kate Hollern said that it is

“a common-sense response to the virus”.—[Official Report, House of Commons, 20 September 2020; vol 681, c 371.]

The chamber should know that there is no political or financial benefit from the delay. On the contrary, annulling the order would ensure that the system would revert to a 2022 revaluation with a tone date of 1 April 2020, increasing uncertainty for business, locking them into new revaluations that likely would not reflect the full impact of the pandemic and risking the Government’s ability to fund a programme of business support because of the risk to public finances.

Liam Kerr said that we should reflect market conditions. Information as at 1 April 2020 would not reflect market conditions, and the big fear and concern—based on the evidence that we have received—is that information as at April 2021 would not reflect market conditions either.

As Sarah Boyack rightly said, the business community agreed universally that the status quo is not an option, and annulling the order would force us back to the status quo.

Scottish businesses also agree overwhelmingly that their top priority is to have certainty about the future of reliefs. That discussion should be held in advance of next year’s budget and is different from a discussion about locking businesses into revaluation values.

In his statement last week, the chancellor systematically failed to provide the devolved Administrations with any clarity about the future of non-domestic rates reliefs. Instead of posturing over the date of the revaluation, we should unite to call on the chancellor to provide certainty now, rather than making us wait until March, only a month before the beginning of the next financial year.

The order is based on an understanding of the risks to businesses. That is, in turn, based on the most robust and verifiable evidence and data that we have. It is the same “common-sense” approach adopted in Wales under Labour and in England under the Conservatives. I call on Parliament not to agree to the proposal to annul—not for the sake of Government, but for the sake of businesses in every constituency, which have been through the most challenging of years.

The vote on that SSI will be taken at decision time.

The next item of business is consideration of Parliamentary Bureau motion S5M-23557, on approval of the Health Protection (Coronavirus) (Restrictions and Requirements) (Local Levels) (Scotland) Amendment (No 2) Regulations 2020.

I call Graeme Dey to speak to and move the motion.

18:16  

In keeping with the Covid scrutiny protocol that was agreed between the Government and the Parliament, I should outline the purpose of this Scottish statutory instrument, which is to modify some of the restrictions and requirements for the different levels and to set out changes to the levels that apply to some areas of Scotland.

The regulations give effect to the First Minister’s announcement of 10 November and came into force on 13 November.

I move,

That the Parliament agrees that the Health Protection (Coronavirus) (Restrictions and Requirements) (Local Levels) (Scotland) Amendment (No. 2) Regulations 2020 (SSI 2020/374) be approved.

The decision on that SSI will also be taken at decision time.

The next item of business is consideration of six Parliamentary Bureau motions. I ask Graeme Dey, on behalf of the Parliamentary Bureau, to move motions S5M-23561, S5M-23558, S5M-23560 and S5M-23562, on approval of SSIs; motion S5M-23555, on acting conveners; and motion S5M-23556, on committee membership.

Motions moved,

That the Parliament agrees that the Scottish Parliament (Elections etc.) (Miscellaneous Amendments) Order 2020 [draft] be approved.

That the Parliament agrees that the Health Protection (Coronavirus) (International Travel) (Scotland) Amendment (No. 23) Regulations 2020 (SSI 2020/378) be approved.

That the Parliament agrees that the International Organisations (Immunities and Privileges) (Scotland) Revocation Order 2021 [draft] be approved.

That the Parliament agrees that the UEFA European Championship (Trading and Advertising) (Scotland) Regulations 2020 [draft] be approved.

That the Parliament, under rule 12.1A.6, agrees that the time period specified in motion S5M-21129 be further varied to 7 December 2020.

That the Parliament agrees that Rhoda Grant be appointed to replace James Kelly as a member of the Justice Sub-Committee on Policing.