MPs back London Councils call for local Supplementary Business Rate

London Councils is pleased the House of Commons' Communities and Local Government Committee has today (Tuesday) endorsed its calls for London's boroughs to be able to set a local supplementary business rate.

The Lyons Report, published in March, had suggested that in the capital only the Mayor of London should have the ability to raise extra funding for projects through the introduction of an additional levy on businesses.

But London Councils called for boroughs to be able to set up a local supplementary business rate to ensure that local communities would benefit from money raised in their own area.

This view has been backed by today's report, entitled Local Government Finance: Supplementary Business Rate, which says:

"We do not agree that the powers to levy a supplementary business rate should rest with the Greater London Authority only. We recommend that the GLA should have the power to initiate a London-wide supplementary business rate which could only be blocked by a two-thirds majority of London local authorities.

"In addition individual London boroughs and the Corporation of London should be able to initiate a supplementary business rate either individually or in co-operation with other boroughs."

Welcoming the report, Chairman of London Councils Councillor Merrick Cockell said:

 "Local communities and businesses must be able to directly benefit from the additional money that a Supplementary Business Rate could raise. To achieve this, boroughs must have the power to levy a local supplement on business rates.

"This is why I am delighted the Select Committee has endorsed our view that any moves to introduce a Supplementary Business Rate should include a local element."

The Lyons Report suggested that a Supplementary Business Rate (SBR) could be used by authorities to raise additional funding for local schemes improve the lives of their residents.

The government is scheduled to launch a consultation on how an SBR could be introduced towards the end of the year. It is unlike that the power to be able to introduce SBR's will be available before 2010/11.

For press enquiries please contact: Stewart Henderson on 020 7934 9620 Stewart.henderson@londoncouncils.gov.uk

Holly.Sutton@londoncouncils.gov.uk  Fax 020 7934 9769

For non-media enquiries contact: London Councils, 59½ Southwark Street, London SE1 0AL Tel 020 7934 9999 www.londoncouncils.gov.uk