Purpose of Report
To inform the Executive of the estimated balance for the Business Rates element of the Collection Fund and the surplus or deficit to be declared for 2021/22.
Decision
(1) That the action of the Chief Finance Officer in declaring a business rates deficit of £8,907,238 for 2021/22 be confirmed, subject to the confirmation of the business rates base by 31 January 2022, with any amendments to the declared deficit being notified to the relevant preceptors and being included in the Final Medium Term Financial Strategy 2022-27, to be presented to the Executive 21 February 2022.
(2) That the spreading adjustment of a £1,202,848 deficit to be distributed in 2022/23 be noted.
Alternative Options Considered and Rejected
None. The Council was required by law to estimate whether there would be a surplus or deficit on its business rates collection prior to setting its budget for the following year.
Reasons for the Decision
The Council would declare a deficit on the Business Rates Collection Fund of £8,907,238 for 2021/22. This figure would be subject to the confirmation of the Business Rates base by 31January 2022, of which its share was £3,562,895.
Much of the deficit had been offset by government grants to compensate local authorities for the business rate reliefs awarded to businesses in 2021/22, as part of the response to the Covid-19 pandemic.
In addition, as part of a spreading adjustment in respect of 2020/21 deficits, a deficit of £1,202,848, with the City Council’s share being £481,139, would be distributed in 2022/23. The net position to be distributed in 2022/23, for the City Council’s share, was therefore a deficit of £4,044,035.