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Central and Local Government

It is difficult to blame one set of people at one point. The fact is that, over the decades, a variety of people have, if I may describe it this way, bottled out. On the other hand, this country's experience of changing local government taxation systems has been an unhappy one, and I can absolutely see why central Government of whatever party, having been rather burnt by the poll tax experience, take the view that minimal and incremental change is the best way forward. Personally I think that incremental change on council tax reform, for example, could go a lot further than it has; all Governments seem to be extremely timid about the matter. To be fair, I understand that. We all know that when a system is changed, there are winners and losers. The winners take what they have got, keep quiet and carry on and the losers make a lot of fuss. It is extremely difficult. Sooner or later, however, somebody will have to bite the bullet because we cannot carry on nibbling away at the system and changing it incrementally. We certainly reiterated the view that the Committee had taken before, which was that the business rate should be relocalised. Speaking personally again, I should say that I was on the other side of the argument in the sense that I was in local government when the business rate was taken away. It was alleged that some councils were bleeding businesses dry because the businesses had no vote. However, I recall that there was never any concrete evidence that that was happening on a grand scale. It seemed to me at the time a pretty poor evidential basis for reducing—removing, essentially—any accountability between a local council and its local businesses. The fact that business rates are not localised means that whether there are active and successful businesses in an area makes no difference to the income of the local council, which will get exactly the same amount of redistributed business rate back. The relocalisation of the business rate is an extremely important issue.