Hope for automatic rate relief

A minister says the Government won't rule out automatic rate relief for small firms "as an option for the future".

Local government minister Sadiq Khan made his comments at a Parliamentary debate on a Private Members' Bill calling for the relief to be applied automatically.

The Bill is from Peter Luff MP, who chairs the Business and Enterprise Committee inquiry into pubcos. Luff has now withdrawn it as he believes the Government will act.

Small Business Rate Relief lets firms with a rateable value of up to £15,000 (£21,500 in London) claim up to 50% relief. It's been applied automatically for firms in Wales since April 2007.

Khan told Parliament: "The Bill is full of good intent. We're not ruling this [automatic rate relief for small businesses] out as an option for the future.

"The Federation of Small Businesses [which helped formulate the Bill] has truly served its members' objectives well in the area of rate relief."

The Campaign for Real Ale's head of policy and public affairs, Jonathan Mail, said: "Today's commitment by the Government to look at automatic payment of Small Business Rate Relief moves us one step closer towards ensuring all small businesses, including small community pubs, receive the financial help to which they are entitled.

"Nearly six pubs a day are closing and many of these are small community pubs that would be helped by automatic payment of Small Business Rate Relief, worth up to £1,200 every year."

FSB national chairman John Wright said: "Around £400m goes unclaimed every year by those small businesses that don't know they can claim rate relief. Making it automatic will mean all the difference to small firms who may be struggling with their cash flow at this difficult economic time.

"This important issue was given a good airing in the debate today and we look forward to what we hope will be a commitment from the Government that rate relief will be automatic for small businesses in the Budget announcement."