The Government is pursuing a deeply-flawed policy on empty rates relief and has missed a golden opportunity to bring vacant properties back into use, according to business rates expert Jerry Schurder of property consultancy Gerald Eve.
It has been announced that the Government will not offer business rates relief on empty properties being refurbished or regenerated, despite overwhelming consultation responses that such a move would stimulate development and help bring vacant buildings back into use. Instead, the Government is to press ahead next month with proposals to offer a business rates grace period for newly-completed commercial properties, a policy previously described by Jerry Schurder as ‘a waste of time that will achieve next to nothing’.
Jerry Schurder, head of rating at Gerald Eve, said: “This blinkered approach to empty rates, ignoring the evidence and pursuing a policy that will make no material difference to the commercial property market, represents a missed opportunity that will do little more than give the illusion of a Government doing something to support the sector.
“Rather than listen to the respondents to the consultation, who were almost universally critical of the proposals and instead backed rates relief on buildings being refurbished, the Government has ridden roughshod over the opinions of those genuinely in the know and instead opted for a policy that will do next to nothing to stimulate development.
“The scheme will be complex, exercised at the discretion of local authorities and subject to European state aid rules, and as such is unlikely to achieve its stated ambition of kick-starting speculative development. Whereas well-targeted rates relief could help bring vacant properties back into use, unviable or borderline schemes costing millions are not suddenly going to be given the go-ahead because of a reduction in the empty rates risk by £55,000 per year for up to three years.
“It is yet another example of deeply-flawed Government policy towards business rates that is seemingly designed to give the impression of providing assistance rather than providing any material benefit.”