End the business rates stranglehold

I've recently been more closely involved in what Pub is the Hub is doing. It's brilliant to see it engaging with local authorities to try and gain much-needed grant aid to help enhance and diversify pub businesses so they, the pubs, are more able to meet the needs of their communities.

The ideas and resources coming from the local authorities and some of the regional development agencies involved shows what can be achieved with a targeted approach and it should be applauded.

On the other hand, it's very disappointing that local authorities are adding significantly to the failure of pubs and small businesses, too. The grants licensees can gain from Pub is the Hub are taken back three fold in business rates, so it's one step forward and three steps back.

A licensee recently told me that his business rates had tripled and there had been no change in his trading area — and I have had a desperate call from one of our own licensees who has experienced the same. This licensee has been in the business for the past four years and he and his wife are two of the most hard-working licensees I know. They turned around a small rural pub into a successful destination food site in just 18 months. Last year their 50 covers were just not enough and Greene King invested to extend the pub and create a further 22. Concern was raised that the work would spoil the traditional aspects of the pub, but we all tried hard to maintain the look of the extended site.

Business went up, more staff were employed and more local suppliers used — then the valuation office arrived. The result: business rates up from £11,200 to £33,500, a 67% increase on 22 covers. Apparently, it's all down to the turnover, but if the valuation office cared to look at the profit and loss, it would see profit has declined per head — duty, staff and food costs have all increased this year. In addition, it is backdating the charges to the date the business was extended — there's no account of how long it takes to build business and the associated costs. This process just cannot be right.

Our free rates appeal service has been notified and now the long process against this will begin. In the meantime, our licensee will have to pay the increases and, in his own words, "consider his future at the pub".

So what we see is a great rural pub with fantastic licensees keeping it alive being destroyed by its business rates — some of which, no doubt, go to funding business-support initiatives by local authorities with the help of Pub is the Hub. Talk about biting the hand that feeds you.