📚 Delegated Legislation Committee

• The session discussed the Draft Non-Domestic Rating (Levy and Safety Net) (Amendment) Regulations 2025, which aim to update the business rates retention system. This system allows English councils to keep a portion of the business rates they collect, encouraging local growth.

• The Minister for Local Government and English Devolution, Jim McMahon, explained that the amendments are technical but necessary to ensure councils receive their expected business rates income. The updates adjust the calculation of retained rates income for safety net eligibility and levy payments.

• Key Changes:
  1. Adjustment for councils with enhanced rates retention to ensure fairness in levy and safety net calculations.
  2. Compensation for major precepting authorities (like county councils) for reductions in income due to new business rates reliefs.
  3. Correction of an error in the calculation of small business rates relief compensation for North Northamptonshire council.

• David Simmonds, a Conservative MP, questioned the timing of these changes relative to local authorities’ budget-setting processes. He emphasized the importance of providing local councils with adequate notice and information before implementing changes that could affect their budgets.

• The Minister responded by assuring that local authorities had been kept informed of the coming changes, and he recognized the need for thorough preparation and consideration, especially with ongoing local government reorganizations.

• The discussion also touched on broader issues of local government finance, including the ongoing review and the alignment of devolution agreements with the business rates retention system.

• The Committee agreed to the regulations, recognizing their importance for maintaining the business rates retention system’s operation.

The session displayed minimal disagreement among the participants. The primary interaction between Jim McMahon (the Minister) and David Simmonds (the Opposition spokesperson) was characterized by a cooperative and constructive dialogue. Simmonds expressed general support for the policies and the continuation of the business rates retention system, which has cross-party support, and raised only technical questions regarding the implementation and potential impacts of the regulations. Below are detailed reasons and examples supporting the rating:

• General Support and Agreement: Simmonds opened his remarks by noting the importance of the business rates retention system and its origins, reflecting a policy with broad cross-party support. He said, “The decision that we are asked to take this evening reflects the work and policy of the previous Government…It is a principle on which there has been a high degree of cross-party agreement for many years…” This indicates an overarching consensus on the system’s continuance.

• Technical Questions Rather Than Disputes: Simmonds’ questions about the adjustments due to local government reorganisation and the timing of budget decisions were framed as requests for assurance and information rather than as points of contention. He sought confirmation from the Minister that adequate consideration had been given to these technical aspects, showing a desire for clarification without opposition.

• Positive Ministerial Response: McMahon responded to Simmonds’ queries positively, acknowledging the importance of local government stability and agreeing on the need for long-term security. He also confirmed that local authorities were prepared for the changes and offered a technical briefing, demonstrating a collaborative and open approach. This response further indicates the absence of significant disagreement.

• No Objections or Dissent: The session concluded without any formal objections or dissent from the Committee. The final comment, “Question put and agreed to,” suggests unanimous support for the regulations.

Overall, the dialogue was focused on ensuring the smooth implementation of technical adjustments to a widely supported policy, with no evidence of significant discord or opposition.