The reduction of business rates to help firms survive the Covid pandemic could be problematic, according to a leading council executive.
Richard Cairns who is West Dunbartonshire Council’s executive director of infrastructure and regeneration said he was not a fan of rates relief when questioned at a meeting recently.
During the meeting of West Dunbartonshire’s community planning management board, Councillor John Mooney suggested giving firms a break or reduction in their payments could help them survive and thrive.
But the executive said the strategy wasn’t one he was fond of.
He explained the reasons saying: “I am not generally a fan of business rate holidays or reductions as a mechanism for driving growth.
“If you were to attempt to put some kind of targeted reduction, the question would be where, when and how you would then justify that to those who for whatever reason were excluded from that scheme.
“Generally speaking, business rates aren’t a major component of business cost depending on the nature of the business.
“There’s a risk that the actual benefit could be minimal and the complexity of operating it could be significant.”
He said the biggest hurdle for firms at the moment is getting their customers back which will be a real focus post-Covid.
Mr Cairns went on: “The real challenge businesses across West Dunbartonshire face at the moment isn’t their costs but it’s the fact that their customers aren’t there and their turnover has collapsed dramatically and in some cases they have been unable to trade.
“As a consequence, they have been supported by various government grant schemes all of which are welcome.
“The simple fact is you don’t grow a business by cutting it’s cost. You grow it by increasing the value of what it does and the number of customers it has.
“The major challenge is going to be the impact of Covid and the subsequent recession on levels of employment and local business.
“The focus has got to be on minimising the impact by attempting to sustain local business and ensuring that those who unfortunately do find themselves unemployed are unemployed for as short a period of time as possible.”
Meanwhile chief officer of housing and employability, Peter Barry said that unemployment in the region could be as high as 10 percent once Covid eases with rates currently at around 5.3 percent.
He added: “A lot of that impact has been disguised by the furlough scheme which is very welcome.”
Mr Cairns said, however people, should be reassured by the fact work has continued on major projects such as the overhaul of the former Exxon site at Bowling which was approved by the planning committee last month and is expected to generate almost 1000 jobs.
For more local news, click here
