The Deputy Chief Executive/Director of Finance reported that the Local Government Resource Review was launched by the Government on 17 March 2011 and the central issue was the repatriation of business rates, whereby local councils kept their local business taxes with grant dependence scaled back except where it was needed to protect the interest of taxpayers. The intention was to set an initial baseline and local authorities whose business rates income was higher than the baseline would pay the difference to the Government by way of a tariff. Those whose income was less than the baseline would receive the balance in the form of a top up. He commented that reports to the Cabinet on 14 April 2011 and 22 September 2011 outlined the basic proposals and he indicated that the latest consultation set out the proposed core components for a business rates retention system. In addition, it sets out how Tax Incremental Financing would operate within the system and further outlined how the proposals interacted with wider Government initiatives to promote growth, including the New Homes Bonus.

The Director provided a summary of a further eight technical papers, in addition to the core proposals, to which councils could respond and, which provided further details on the topics covered in the core consultation. He submitted a proposed response to the core consultation but not the technical aspects as they purely informed the overall response that had been agreed by the Cabinet on 13 October 2011 (minute 153 refers).

Resolved – That the response to the core consultation be noted.