The council introduced a levy in November 2014 in a bid to help fund the cost of policing the late-night economy. The fee applied to premises permitted to supply alcohol between midnight and 6am.
A freedom of information request by the Publican’s Morning Advertiser’s legal specialist Poppleston Allen asked for details on the levy’s impact in the year following its introduction, comparing the information provided against what was proposed by the council.
The council estimated that the gross revenue raised from the levy in its first year would be £446,000. The actual amount raised was £294,834 — 34% less than forecast. Greater administrative costs than originally expected reduced this figure by a further £65,000.
The primary reason for the drop in revenue compared to initial estimated figures was due to the lower than expected number of premises that paid the levy.
The number of licensed premises that actually contribute to the levy was in fact almost half the number that had initially been estimated by the council to be ‘eligible’ before its introduction.
The council’s initial levy report of December 2013 estimated that 398 premises would be affected by the levy; this was “assuming no exemptions or reductions are applied”.
However, following the consultation, the council approved an exemption from the levy for premises which were members of Nottingham Business Improvement District.
Poppleston Allen’s report states that Home Office guidance makes clear that any financial risk — for example lower than expected revenue — should be fully considered prior to adopting a levy, along with the desirability and viability of the proposal including other arrangements as an alternative.
Some 131 premises reduced their hours via minor or full variation applications so they were not liable to pay the levy — almost one third of the 405 premises that were eligible to pay the levy before it took effect. Additionally, 35 licences were surrendered and 29 premises were exempt.
The proceeds for the levy are split 70:30 between the police and council. The money raised was proposed to be used to fund ways to clean up the city’s streets and police the late-night economy.
The council said that its share had been used to-wards funding three community protection officers, responsible for reducing antisocial behaviour and alcohol-related crime. The police said its share would be partly used to fund a street pastors scheme.
Poppleston Allen said it was difficult to assess the true effect on crime and disorder in Nottingham “until the funds are used and the funded operations are given time to show their effectiveness in reducing crime”.
However the council said there were no current plans to hold a review on amending or revoking the levy.