Birmingham City Council is set to offer its support for a West Midlands-wide business rates pilot to ensure the region is best prepared for when central government financial reforms become mandatory for local councils.
The government is planning to implement the concept of 100 per cent local retention of business rates by the end of current parliament, and is giving local authorities that have agreed to a devolution deal (which includes the West Midlands) an opportunity to pilot the new arrangements from 2017/18 onwards.
Any pilots will operate on a “no detriment” basis, so that no participating authority can be any worse off financially than they would otherwise have been – but there is the potential for financial benefit arising from the real terms growth in the share of business rates that is currently passed to government.
Here in the West Midlands, council leaders have backed the idea, which now needs all seven metropolitan councils to formally agree to the plan, before any final sign-off by the government.
Cllr John Clancy, Leader of Birmingham City Council, said: “The government’s reform of local government finance will become a reality sooner rather than later, so our participation in a pilot will give us the opportunity to look at how it works in the West Midlands, and then help shape national thinking about the way the full national scheme will be implemented in due course.
“Just as importantly, it will also facilitate discussions with government about further devolution, again ensuring that Birmingham and the wider West Midlands gets the best deal possible.”