Nursery fees ‘could increase’ as business rates rise

Kelly Culbard with her daughter Hope and other staff from the nurseries with their children. Picture: Greg Macvean

Kelly Culbard with her daughter Hope and other staff from the nurseries with their children. Picture: Greg Macvean

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NURSERIES have warned that fees will rise and jobs could go amid crippling increases in their rates bills.

Thousands of businesses in the Capital still face soaring costs despite the Scottish Government’s U-turn on help for some sectors.

And today opposition politicians claimed there were “fundamental problems” with the way revaluation of some properties had been calculated.

Finance Secretary Derek Mackay responded to mounting protests last week by announcing a 12.5 per cent cap on the increases in rates bills for pubs, hotels, restaurants and cafes.

But figures show a total of 10,346 businesses in Edinburgh – about a third of the total rateable properties in the city – still face a rise without any relief.

Nurseries are among those hit. Kelly Culbard, manager of the City and Little City Nurseries in Greenbank Drive, Morningside, warned prices would rise and jobs could go.

The nurseries’ two buildings currently have a combined rateable value of £82,600, which is due to rise to £140,800. That will mean the total rates bill rocketing by 55 per cent from around £42,000 to over £65,000 from April 1.

Ms Culbard said the fees charged to parents would have to rise to meet the extra burden.

She said: “A lot of parents are going to end up unable to afford it. That might mean they’re not able to work.

“And that results in our staff losing their jobs – if we don’t have the children coming in, we would have to start redundancies.

“It’s not that we don’t expect rates to go up, but the scale of the increase is ridiculous.

“The government goes on about free childcare and encouraging people back to work, but the rates rises push all that in the other direction. We can’t appeal until April 1 when it comes in and we’ve been told it could be up to two years before they deal with it – and during that we have to pay anyway. The business could have been destroyed by then anyway.”

Daniel Johnson, Labour MSP for Edinburgh Southern, said 98 out of 112 nurseries in the Capital had seen their rateable values rise by an average of 77 per cent.

He said: “The rateable values at the City Nurseries has soared and now it’s higher than the rateable value for South Morningside Primary School, just around the corner.

“It seems ludicrous – and this is happening across Edinburgh – at a time when the Scottish Government is trying to increase nursery provision. It seems completely counter-productive.”

An outcry over soaring business rates prompted the announcement by Mr Mackay on February 21 that no pub, hotel, restaurant or cafe would see its bill rise by more than 12.5 per cent from April 1.

The Espy bar and restaurant in Portobello had been facing a rise in its business rates from £7350 to £40,344 a year.

Mr Mackay found an extra £44.6 million to limit the impact of the increases after warnings that businesses would be forced to close if the rises went ahead. The cash will go to 8500 companies across Scotland in the hospitality industry and 1000 in the north-east of Scotland, which was singled out for special help.

But Lothian Conservative MSP Gordon Lindhurst said the cap was a “sticking plaster” solution.

He said: “While it is welcome to see at least some action, it does not go far enough in resolving the fundamental problems with the way that some of these rates have been calculated.

“A large proportion of Edinburgh businesses who do not qualify under the cap will see their bills increase and the future is unclear even for those who do qualify, as the relief is only for one year.”

Fellow Lothian Tory MSP Miles Briggs said it was unfair that many businesses and organisations facing big rises had received “absolutely nothing” from the government.

“This suggests the Scottish Government simply hasn’t understood the level of concern that exists across all sectors with rateable properties.

“Some retail premises, offices, nurseries and other firms are still facing very significant rates hikes which will put real pressure on their viability and lead to questions about jobs.”

ian.swanson@edinburghnews.com