East Sussex councils could keep £4.3m extra business rates income in Government pilot

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Councils in East Sussex may be set to keep an extra £4.3m of local business rates after being offered a place in a Government pilot scheme.

The proposed scheme would see East Sussex authorities retain 75 per cent of the county’s business rates growth – 25 per cent more than under the current arrangement.

As a result, an estimated £4.3m more locally-raised business rates could stay within the county, where it will be split between the county council, the fire authority and the district or borough council which collects it.

The scheme was welcomed by East Sussex County Council’s deputy leader David Elkin at a meeting to discuss the plans on Tuesday (January 8).

He said: “To me it is a no-brainer. We have done a lot of work to work out how much the gain is, the split is well-established and it has proven successful with the pooling.

“The boroughs and districts are very supportive and actually it is a no-brainer.”

Cllr Elkin also confirmed the council would be taking part in the pilot during the meeting.

East Sussex County Council is expected to gain the most from taking part in the pilot – with the top tier authority expected to gain an additional £1.6m as its share of the money retained.

East Sussex Fire Authority, meanwhile, is expected to gain around £300,000 from its five per cent share of the business rates pool.

The district and borough councils involved will generally receive smaller gains, dependent on the amount of business rates they can collect within their authority areas.

Each of the other participating authorities will also need to formally sign-off on joining for the pilot scheme to go ahead, with Hastings Borough Council doing so on at a cabinet meeting on Monday (January 7).

Hastings Borough Council estimates it will see around £40,000 and £80,000 extra income from the scheme – the lowest amount among the participating authorities.

While joining the pilot was approved, the lower level of estimated income saw Hastings council leaders less supportive of the overall scheme during discussion at the meeting.

Council leader Peter Chowney said he felt the scheme was ‘not ideal, but better than nothing’ and said he had even the possibility considered ‘holding out’ for a better deal instead of joining.

Meanwhile cabinet member Andy Batsford said: “While we are having to accept this really pretty rubbish deal, the background to it is that this council – one of the poorest councils in the country – has lost over £10m of Government grants in the last eight years.

“It is appalling. It is a shameful piece of politics really, that this town, with one of the poorest populations has seen the sort of reduction in its funding that it is having to accept a deal which gives us a piffling £80,000 more money.”