Edinburgh council elections 2022: Business rates tops concerns at hustings
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Roddy Smith, chief executive of Essential Edinburgh, said city-centre businesses had struggled during the pandemic and now faced a whole series of problems – business rates, shortages of staff, National Insurance increases and empty lets.
Speaking at the end of a council elections hustings, organised by Edinburgh Chamber of Commerce and Essential Edinburgh and chaired by Evening News editor Euan McGrory, he said: “Edinburgh as a whole does have a strong economy, but that’s not shared equally – some businesses are doing well, some are struggling. Edinburgh needs strategic support and it can’t be used as a cash cow for the rest of the country, which I think probably it is at the moment. With the city and businesses working together we can achieve great things for this city.
"At the moment there is a perception that Edinburgh drives the whole economy, which I think is correct. The problem is a lot of the money that is generated in our city goes out of our city to support other places in Scotland. That, of course, is potentially a positive for other places but people in Edinburgh certainly feel that we need to get more support from government in terms of rates relief and other things.”
And he signalled that he would welcome more people returning to offices. "The city centre has had a really, really difficult two years – lots of our businesses have struggled. We’re now coming out of the back of it. What we really need is people to come back to work in the city centre.”
The problem individual companies face with business rates – which are set at national level – was voiced in the very first question put to the panel of politicians. A representative from city-centre micro-business Hanover Health Foods said the business had survived two world wars and the Great Depression. “However, there's no guarantee we will make it to the autumn without further support from the council. In the last two years we have adapted and changed as much as we reasonably can. But all the support has dried up – obviously there's the retail relief on the rates for the next three months.
"One of problems we’re facing at the moment is I am going to be paying premium rates in the city centre where a lot of business has moved to Stockbridge and Morningside, to towns and villages in Edinburgh's hinterland and online. I don't think it's fair that businesses in the city centre should continue to be paying rates on the basis of two years ago because the environment has changed.”
Council leader Adam McVey, representing the SNP, argued that rents had to be looked at as well as rates and there needed to be conversations with landlords of city-centre properties. “While rates might be too high for some businesses that are still operating, we are getting to the point that we should not be having rates relief on premises that landlords are sitting on and keeping economically active.
“There is a somewhat ridiculous expectation on some of our city-cente streets, with landlords thinking because it's occupied they're going to hold their rent rates at pre-Covid levels – that's unrealistic, that has to change. Yes, a rates review would probably be helpful in the context of post-Covid realignments we have seen in the economy, Far better I think to channel our efforts as a council into trying to hold as much value as possible in our city centre.
“We need to keep the city centre active and vibrant in order to hold the value they expect of their business . We're in danger of going into a false economy where landlords hold such a rate that we end up in spiral of decline.”
Asked if there also needed to be a conversation with the Scottish Government over business rates, given that Edinburgh contributed far more than it received, he said the conversation had to be not only with government but with other local authorities in the umbrella organisation Cosla.
“We need more of an ability to respond to our economic environment. If every council has more of a say in the economic success of their area there's more of an incentive to channel policies to encourage that. Everybody wants a more successful economy in their area, but it is a difficult conversation to have with councils who are coming from a very different economic place and are very resistant to change.
“Until we get more say in our economy we will still be in the position where economic success isn't reflected in our budget.”
Tory Joanna Mowat said micro-businesses were vital to the city centre to allow residents to shop locally. And she argued the council had sent “the wrong message to the city” by continuing to hold almost all its meetings online. “Our offices are in the city centre. It's one way we could have actively supported the city centre.”
Lib Dem Neil Ross said the council had to engage with businesses. "Where big changes are being made by the council, with the City Centre Transformation and in George Street, which directly affect access to shops, we ought to consider compensation for extended disruption to local businesses."
‘Free out-of-town parking hitting city centre’
The city centre is losing out because there is not a level playing field with out-of-town shopping centres, Essential Edinburgh chair Denzil Skinner told the hustings.
He said more people were now driving out of the city at weekends because they could park free there.
Megan McHaney from the Greens said her party believed there should be fewer cars on the road altogether. “For us it's about how we can invest in a net-zero transport system.”
Tory Joanna Mowat said she wanted to see “good accessible public transport” as well as “appropriate parking” and innovations, such as the option offered in the St James Quarter of having purchases delivered rather than having to carry them home on the bus.
Adam McVey, for the SNP, said the answer included more park and ride facilities, the tram extension and more bus priority funds.
And he hailed the redevelopment at Ocean Terminal, where one of the two massive car parks was to be removed. “That will take away a huge amount of car parking because they realised that is not the future.”
He added: “We need to provide alternatives so if someone is living in Corstorphine they see the way of getting into the city centre as the tram or bus, and don't see the car as the most convenient, quickest way of doing that.”
Labour’s Stephen Jenkinson said public transport was key to the future. And he described Lothian Buses as “almost Edinburgh’s NHS”. “People want to see investment in it, want to see the integration between trams and buses and potentially the South Suburban rail line to allow people to move around.”
But Mr Skinner was not impressed with their answers. “None of you have addressed the issue that until this Utopia appears, you can park free out of town, in town you can’t – that is not a level playing field.”