Leading the BID industry
Leading the BID industry
We are now in the middle of the famous golden quarter, and much is happening in both our towns and city centres and the BID community. Since the October newsletter, we have a new government, new ministers and a new budget, the business rates revaluation has been published, and we have emerging data on retail and online performance across the countries. At the same time, there has been the usual range of ballots for business Improvement Districts and the annual British BIDs BID survey has been published.
The key first item is clearly the Autumn Statement last week. This new statement is a complete reversal of the mini-budget only a few weeks ago, and Chancellor Hunt announced a package of measures to support businesses in England, worth an estimated £13.6 billion over the next five years:
These helpful changes will have effect from 1 April 2023 and hopefully will go some way to alleviating the impact of business rate changes on many of our levy payers. Sadly, of course, they won't necessarily impact on BIDs and our own levy income.
Local authorities will be expected to use their discretionary relief powers to grant reliefs in line with the relevant eligibility criteria and they will be compensated for the cost of granting these reliefs via a Section 31 grant from the Government. No new legislation will be required to deliver these schemes. The full details of all this are here.
The government has now released details of the latest Business Rates Revaluation of properties across England and Wales. This will affect all those BIDs who use the current rateable value lists for their levy assessments and will eventually impact all BIDs as they slowly move onto the latest list for their next ballots. The impact of the revaluation on BID levy income will depend very much on the balance of different types of levy-paying businesses in the BID, and their geographical region.
As in the case of individual levy payers, for BIDs, there will be losers and gainers in the process and most of us will need detailed conversations with our local taxation departments in order to model the impact of all the individual changes on our budgets.
The overall picture of this 2023 revaluation shows an increase in the total rateable value for England and Wales. The number of properties on the 2023 draft list in England and Wales on 12 November 2022 was 2.14 million. The total rateable value of these properties was £70.3 billion compared with £65.7 billion on the 2017 rating list. The total rateable value on the local lists for England and Wales increased by 7.1%. The East region showed a 14.4% increase in rateable value, the largest increase in any region in England, whilst the North East region showed a 2.2% increase in rateable value, the smallest increase. The retail sector showed a 10% decrease in rateable value, the only sector to show a decrease and the industry sector showed a 27.1% increase in rateable value, the largest increase in any sector.
A statistical summary of these changes is here and for more detailed data from the local authority read more here.
Onto these new rateable values, the now frozen multiplier of 51.2 is applied, meaning that for each business or hereditament, the annual business rate bill is 0.521, or just over half, of the rateable value of any property. Many public buildings are expected to be among the losers in this revaluation, and those in big offices, the largest retail properties and historic hotels are among the winners. Those operating large distribution sheds may lose, such as Amazon, whose bill is expected to rise by 75% at one warehouse. Supermarkets with food delivery businesses, such as Tesco and Sainsbury’s, are also likely to be hit. Convenience stores will see their rateable values increase overall by 12.7%, while hairdressing and beauty salons are facing a 6.3% rise. However, many independent convenience store owners will be protected by measures to protect small businesses, including a special discount for retail and hospitality outlets and for those whose rateable value is less than £15,000.
Many high streets and shopping centres will be big winners and department stores such as Harrods and Selfridges will see their tax bills slump by about £8m each from April next year after the revaluation. All the individual outcomes are accessible here. BIDs should be able to get their new levy income data from their local taxation or revenue and benefits offices in the next month or so and for some of us the impact might be considerable. This will require rethinking on boundaries, thresholds, levy percentages and levels of service.
The Golden Quarter these are clearly going to be tough times for both individuals and businesses and all the main pundits are projecting a hard few years.
But there is much variation in the data. The UK’s online pandemic winners are losing their lustre thanks to shoppers returning to stores, surging costs, and supply issues. Online supplier Eve Sleep, which saw soaring demand during the pandemic, collapsed into administration after its rescue efforts failed, while Made.com, which recently culled a third of its workforce, is desperately seeking a buyer following a failed fundraising. The travails of many online players have resulted in plunging share prices across the sector, which have wiped millions off the value of businesses that just a year or two ago were soaring. Retail Gazette looks at how the UK’s biggest online retailers have performed over the last year, in terms of sales, profits and share price.
For others, the High Street is back in fashion as retail sales get a boost, official figures show retail sales rose 0.6% last month.
High Street queen Mary Portas says retail’s race to the bottom is finally over “ I think people will buy more carefully, a bit less, but they will still spend. Inclusive pricing strategies are key. Awareness of sustainability and provenance is also more and more important so tap into that. And the other big driver at Christmas of course is joy. Retailers need to think about how they deliver that” https://www.cityam.com/exclusi...
The new team at the Department of Levelling Up, Housing and Community, is now complete and Dehenna Davison has been confirmed as a Parliamentary Under Secretary of State for Levelling Up.
It has been a busy month for BID Ballots with eleven successful outcomes in Harborne Village, Experience Guildford, Lowestoft, Epsom, Southend, Winchester, Worthing, Dorking, Oswestry, Paddington Now, and Cambridge. Unfortunately, King's Heath was unsuccessful
For those who want to look at the annual data on BIDs, we have just published the annual BID Survey which can be downloaded here. We continue to grow in numbers of BIDs, with 332 across the British Isles, and the total financial impact of BIDs, including inward investment and projects, also continues to grow and is now £525,694,084 per annum. BIDs are most certainly a force to be reckoned with.
British BIDs continues to provide support, learning, research and training, with our Certificate in BID management and Diploma in BID leadership, both now running online twice a year, along with 35 days of training through the year on nine online courses. Further details as ever are here and Shayni Langhelt, British BIDs contact@britishbids.info is the person to speak to on any of these.
Professor Christopher Turner, Chief Executive, British BIDs
