Thousands of pubs at risk after business rates revaluations pushed back

Last week Brandon Lewis, community pubs minister and parliamentary under-secretary for the Department for Communities and Local Government, announced that the Government is to push back revaluations by two years.

However his comments were met with dismay from the trade as licensees thought they were set for lower rates after tough trading and the impact of the recession. The current rates are based on 2008 figures.

Jim Yarwood, head of rating at Fleurets, labelled the Government’s proposals “scandalous”. He said: “A lot of pubs were looking for lower rates. It’s pretty well-known that, in the pub trade, things have been dire. To carry on with this situation for another two years is pretty scandalous.

“Pubs in the north, Midlands and the south-west will suffer the most.”

Business rates firm CVS also predicted that thousands of businesses will suffer. Chief executive Mark Rigby said: “(This) simply creates a toxic cocktail which is going to be very hard for thousands of businesses to swallow and survive.

“No business could get away with charging prices that are so many years out of date. Struggling firms shouldn’t have to take it from the government, yet they are being required to do so.”

The British Beer and Pub Association said it will raise concerns during its next meeting with Lewis.

Don Jackson of the Blacksmiths Arms in Talkin, Brampton, Cumbria, believes he would have seen a £10,000 drop in his rateable value next year. His rateable value increased from £25,500 to £45,500 in 2008.

“It’s going to make life harder,” he said. “When we filled the figures in for the business rates we are paying now, it was 2008, which was a fantastic period for us but we haven’t touched that since. This year, we will be 6-7% down on last year’s turnover.”

Regular PMA forum user, Steve Wilson of the Kings Head in Well, Somerset, added: “This is absolutely incredible on two counts: firstly, that any government could make a decision like this in the current economic climate, and secondly, that they would attempt to claim it is in any way good for businesses?

“There is one reason for this decision and one reason only – it is to give the Government a further two years for the possibility of the economy growing, so they don’t face a wholesale downward-adjustment of business rates due to decreased business.”

Michael Yass, director at Chesterton Humberts, also raised concerns with transitional rates relief, which tapers the amount of money licensees pay each year. Those benefiting from a lower bill may be hit with the full payments after 2015 because current legislation says that transitional rates relief only runs until 2015.