Hansard

I am pleased to open the stage 3 debate on the Non-Domestic Rates (Scotland) Bill. I start with a number of thank yous, first to the Local Government and Communities Committee and the Delegated Powers and Law Reform Committee for their detailed scrutiny of the bill. I had the pleasure of meeting Ken Barclay for the first time yesterday, and I thank him, too, for his contribution to the review that led us to the bill.

The Barclay review was established a number of years ago with a very specific remit:

“To make recommendations that seek to enhance and reform the non-domestic rates ... system in Scotland to better support business growth and long term investment and reflect changing marketplaces”.

The need for reform was widely recognised across the chamber. Only two weeks ago, Mr Fraser, on behalf of the Conservatives, wrote in a national newspaper:

“It is our view that the current system of rates is ... in need of comprehensive reform.”

I will say this only once: wise words indeed. The bill was introduced to support growth, improve the administration of the system and increase fairness for ratepayers. It is fair to say that, after a bumpy few weeks, it now does just that.

The bill has been built on collaboration and consultation. I thank the individuals on the Barclay implementation advisory group and its associated sub-groups who have freely devoted their time to the development of its provisions. I also thank members of the business community, as well as officials in councils and assessors’ offices across the country, who have worked to produce a bill that will not only deliver the word and the spirit of the Barclay review but work on the ground operationally.

Finally, I thank the Convention of Scottish Local Authorities for its recognition that non-domestic rates are too important to be considered in isolation from wider fiscal framework arrangements and treated like a plaything or a negotiating tactic. I look forward to working closely with COSLA on the fiscal framework, which will proceed at pace.

The bill, which is the first on non-domestic rates to come before the Scottish Parliament, was introduced to deliver the 30 recommendations of the Barclay review. Derek Mackay is to be commended for the speed with which he moved to implement the recommendations that could be implemented without the need for primary legislation. I have been pleased to progress work on the bill, which seeks to support growth, improve administration of the system and increase fairness. We have just had a debate on the budget and the need for economic growth. I point out that the bill’s aims are integrally linked to the economic performance of our businesses.

The Scottish Government has accepted the majority of the review’s recommendations and, as I have said, where possible, it has moved quickly to implement them. The best examples are the business growth accelerator, which is the only relief of its kind in the United Kingdom, and nursery relief, which supports our expansion of nursery and childcare provision. Until yesterday’s stage 3 proceedings, both of those initiatives were under serious threat of abolition.

The bill delivers on the Barclay review recommendations that required primary legislation. The provision that is probably of most importance involves the move to a three-year revaluation cycle to minimise the risks of the volatility that the adoption of a one-year tone date should reduce. It will ensure that rateable values are more closely aligned with real market rents and has been widely welcomed across the board by the business community.

The bill also gives new powers to assessors, local authorities and ministers to improve the administration of the system and to tackle tax avoidance, which I think that every member in the chamber would support.

Perhaps the most critical reforms that the bill delivers are those to the appeals system, which are intended to reduce reliance on the formal system and speed up access to justice in relation to properties that are involved in appeals. Throughout the bill’s progress through the Parliament, I have consistently said that if we did not get the appeals right, the rest of the reforms would be redundant. Our systematic reforms will benefit around 255,000 non-domestic properties in Scotland, 90 per cent of which already benefit from the application of a lower poundage in Scotland than they would attract if situated elsewhere in the UK, and also from the most generous package of reliefs available anywhere on these islands.

As legislators, we have a duty to deliver legislation that improves outcomes for stakeholders. We take that duty seriously. In a Parliament of minorities, no legislation will deliver everything that we want, so it comes down to a question of priorities. I think that we have heard that view being expressed quite starkly, particularly from the Scottish Conservatives. It is unfortunate that avoiding a level playing field between independent schools and local authority schools appears to have become so totemic to them in the bill process that 125 affected properties were considered to be of greater priority than the other 255,000 non-domestic properties.

The decision whether to support the bill comes down to the simple question whether members believe that the rates system needs reform. The Scottish Government’s view is that the reforms that the Barclay review proposed struck the right balance between ambition and pragmatism. However, most of them could not be implemented mid-revaluation, and we simply cannot wait until 2027 to do so. The majority of them have been universally welcomed by ratepayers and administrators alike. We need more regular revaluations; we need a reformed appeals process; we need greater powers to tackle rates avoidance; and councils and assessors need the tools to do their jobs more efficiently and effectively. Surely we can all agree on that, and that is the prize that is on offer. The bill delivers on the cross-party agreement on rates system reform and I encourage everyone in the chamber to support these critical reforms.

I move,

That the Parliament agrees that the Non-Domestic Rates (Scotland) Bill be passed.