Chamber
Meeting of the Parliament 21 June 2012
21 Jun 2012 · S4 · Meeting of the Parliament
Item of business
Local Government (Empty Property Relief)
I am four and a half minutes into my speech and I should make progress.
Over the five-year period before revaluation, £750 million will still be dedicated to empty property relief—indeed, even after the reduction in relief the figure will be only marginally lower that it currently is. The small business bonus scheme and other reliefs, which amount to £0.5 billion every year, will continue.
If members think that a reduction in rates relief is the wrong policy, I wonder why Labour introduced such a policy in 2008 and why the Conservatives and Liberal Democrats—the Liberal Democrats are again not in the chamber—retained the policy objective. If there is evidence that the policy has failed in England and Wales, why has not the policy been reversed?
We want to learn lessons from what has happened in England and Wales and ensure that the policy can be deployed in a way that supports sustainable economic growth. However, we cannot disentangle the evidence, because the policy was introduced in England in 2008, at the time of the bank lending issue, changes in shopping patterns and the recession. The VAT rise that the UK Government introduced—with a £1 billion price tag for Scotland, of course—also affected the commercial world. It is fair to say that it is difficult to draw conclusions from the experience in England. However, the policy has been sustained in challenging financial times.
By working through our regeneration and town centres strategies, we can ensure that there are incentives to use empty properties. Empty property relief is part of the rating system, on which we will consult during the summer. It is a property tax. Many would ask why it is just the active premises that pay that tax and subsidise closed premises in the overall tax take.
We are not dismissing the concerns of the private sector. I am listening to a wide range of stakeholders on the proposed reforms to empty property relief. I emphasise that there is flexibility in our approach, which the Parliament and the committee can consider when it comes to looking at the regulations. The assessment of the policy will continue. There is no rush to make a decision. We have outlined a flexible approach and we will continue to listen to people. We will also use agencies such as Scottish Enterprise to promote properties, with the new property database that was announced recently, to give maximum possible exposure to the empty properties that exist.
Whatever we do, the Scottish Government will ensure that we have a competitive edge over our counterparts in the rest of the United Kingdom.
I move amendment S4M-03397.1, to leave out from “is concerned” to end and insert:
“welcomes the measures that the Scottish Government is taking to help tackle the prevalence of empty properties afflicting Scotland’s high streets by creating a new incentive, which links to the Scottish Government’s regeneration strategy and future town centre review, to bring these premises back into economic use; notes that, even after reform, empty property relief will remain significantly more generous than that available in England and, in particular, that Scotland will retain 100% relief for industrial properties; notes the considerably greater impact on Scottish business of the UK Government’s VAT rise, which is expected to cost Scottish business £1 billion, and congratulates the Scottish Government on the wider package of business rate relief measures, worth over £500 million per annum, that has ensured that Scotland remains the most competitive place to do business in the UK.”
10:46
Over the five-year period before revaluation, £750 million will still be dedicated to empty property relief—indeed, even after the reduction in relief the figure will be only marginally lower that it currently is. The small business bonus scheme and other reliefs, which amount to £0.5 billion every year, will continue.
If members think that a reduction in rates relief is the wrong policy, I wonder why Labour introduced such a policy in 2008 and why the Conservatives and Liberal Democrats—the Liberal Democrats are again not in the chamber—retained the policy objective. If there is evidence that the policy has failed in England and Wales, why has not the policy been reversed?
We want to learn lessons from what has happened in England and Wales and ensure that the policy can be deployed in a way that supports sustainable economic growth. However, we cannot disentangle the evidence, because the policy was introduced in England in 2008, at the time of the bank lending issue, changes in shopping patterns and the recession. The VAT rise that the UK Government introduced—with a £1 billion price tag for Scotland, of course—also affected the commercial world. It is fair to say that it is difficult to draw conclusions from the experience in England. However, the policy has been sustained in challenging financial times.
By working through our regeneration and town centres strategies, we can ensure that there are incentives to use empty properties. Empty property relief is part of the rating system, on which we will consult during the summer. It is a property tax. Many would ask why it is just the active premises that pay that tax and subsidise closed premises in the overall tax take.
We are not dismissing the concerns of the private sector. I am listening to a wide range of stakeholders on the proposed reforms to empty property relief. I emphasise that there is flexibility in our approach, which the Parliament and the committee can consider when it comes to looking at the regulations. The assessment of the policy will continue. There is no rush to make a decision. We have outlined a flexible approach and we will continue to listen to people. We will also use agencies such as Scottish Enterprise to promote properties, with the new property database that was announced recently, to give maximum possible exposure to the empty properties that exist.
Whatever we do, the Scottish Government will ensure that we have a competitive edge over our counterparts in the rest of the United Kingdom.
I move amendment S4M-03397.1, to leave out from “is concerned” to end and insert:
“welcomes the measures that the Scottish Government is taking to help tackle the prevalence of empty properties afflicting Scotland’s high streets by creating a new incentive, which links to the Scottish Government’s regeneration strategy and future town centre review, to bring these premises back into economic use; notes that, even after reform, empty property relief will remain significantly more generous than that available in England and, in particular, that Scotland will retain 100% relief for industrial properties; notes the considerably greater impact on Scottish business of the UK Government’s VAT rise, which is expected to cost Scottish business £1 billion, and congratulates the Scottish Government on the wider package of business rate relief measures, worth over £500 million per annum, that has ensured that Scotland remains the most competitive place to do business in the UK.”
10:46
References in this contribution
Motions, questions or amendments mentioned by their reference code.
- S4M-03397.1 Local Government Motion
In the same item of business
The Deputy Presiding Officer (John Scott)
Con
The next item of business is a debate on motion S4M-03397, in the name of Gavin Brown, on local government. Mr Brown, you have up to 10 minutes.10:27
Gavin Brown (Lothian) (Con)
Con
I bring to the chamber our deep concern with a part of the Local Government Finance (Unoccupied Properties) (Scotland) Bill. Our particular concern involves ...
The Minister for Local Government and Planning (Derek Mackay)
SNP
I welcome the opportunity to debate the Government’s proposed reform of empty property relief for commercial properties, as set out in the Local Government F...
Gavin Brown
Con
Does the minister accept that the policy memorandum quite clearly states why the Government is doing that, and that the Government immediately intends to red...
Derek Mackay
SNP
I am happy to discuss that further as I continue, but the fundamental power that we are seeking in the bill is the enabling power to vary those reliefs. The ...
Annabel Goldie (West Scotland) (Con)
Con
I do not want to preach, but I have personal experience, which perhaps the minister does not have. I have been the owner of office property that was unoccupi...
Derek Mackay
SNP
I do not deny that Annabel Goldie has experience in the area. I have experience in leading a public-private partnership in Paisley, in Renfrewshire, to try t...
Michael McMahon (Uddingston and Bellshill) (Lab)
Lab
Will the minister give way?
Derek Mackay
SNP
I am four and a half minutes into my speech and I should make progress.Over the five-year period before revaluation, £750 million will still be dedicated to ...
Sarah Boyack (Lothian) (Lab)
Lab
I welcome the debate that the Conservatives have stimulated. I also agree with most of the motion. However, I want to give the Scottish National Party the ch...
Derek Mackay
SNP
I make the point again that the Government is taking a flexible approach. We will listen to stakeholders, to the committee and to the Parliament. We are list...
Sarah Boyack
Lab
Without a business and regulatory impact assessment, the Government is listening without having properly considered the evidence. That is the key issue.The G...
The Deputy Presiding Officer (Elaine Smith)
Lab
We now move to the open debate. Time is tight, so speeches should be a strict four minutes.10:51
Mark McDonald (North East Scotland) (SNP)
SNP
How I yearn for the days when the Labour Party and the Liberal Democrats had a functioning majority in the Parliament. They used to listen to Parliament at e...
Gavin Brown
Con
Will the member give way?
Mark McDonald
SNP
Gavin Brown or his colleagues can deal with that point later. He will not impinge on my time, when he had 10 minutes to talk about that earlier.At present, t...
Anne McTaggart (Glasgow) (Lab)
Lab
I declare at the outset that I am a member of the Local Government and Regeneration Committee, which is in the latter stages of producing its report on the L...
Derek Mackay
SNP
Given that this point might well be reiterated again and again by Opposition speakers, I must point out that the issue of demolitions in England refers speci...
Anne McTaggart
Lab
People in town centres are worried about this issue.Despite the fact that groups such as the Confederation of British Industry and Scottish Chambers of Comme...
George Adam (Paisley) (SNP)
SNP
Today we heard a first: Gavin Brown and the Conservatives have concerns. After that I stopped listening, of course, as there was not much else in his speech....
Gavin Brown
Con
Will the member give way?
George Adam
SNP
I will after I have finished this point. Mr Brown clearly does not live in the real world, because in high streets across the country there are shops that ha...
Gavin Brown
Con
George Adam is a remarkable man. He did not listen to a word I said—he switched off—but he has spent the past minute quoting me, which is quite impressive. C...
George Adam
SNP
There is potential to bring 5,500 properties back into use. The alternative is that, as Mr Brown suggested, we do nothing and leave our town centres the way ...
Margaret Mitchell (Central Scotland) (Con)
Con
Throughout Scotland, town centres that were once the vibrant and thriving hubs of local communities are increasingly in decline. Closed-down notices and boar...
Derek Mackay
SNP
Margaret Mitchell paints a pretty grim picture of town centres in Scotland. If that is the case under the current regime, why is the status quo so acceptable?
Margaret Mitchell
Con
If we let the business rates incentivisation scheme and the bonus scheme—our ideas—kick in, the status quo has a chance of survival. However, the Government ...
Richard Lyle (Central Scotland) (SNP)
SNP
I welcome this debate on reducing empty property relief for non-domestic rates. I remind members that we subsidise vacant properties by more than £150 millio...
Michael McMahon
Lab
Is it possible that that has not been mentioned because it is not in the motion, which is about non-domestic rates?
Richard Lyle
SNP
It is still in the bill.The Tories have been rumbled. Despite the rhetoric of the Conservatives in the Scottish Parliament, the Con-Dem Government has failed...