The Budget contained eye-catching measures to stimulate business investment, which has been lagging badly behind the current recovery, and to encourage exporters, whose performance has trailed off after a promising mid-recession uptick when the pound weakened.
But there was little to address the scandalous unfairness of business rates about which I regularly hold forth. These punitive charges — ‘£26 billion for George Osborne that… he might otherwise have to take direct from you and me,’ I wrote last year — on which businesses have no vote and for which they get so few services in return, are still based on pre-recessionary 2008 valuations of commercial property. The next revaluation has been deferred twice and won’t happen until 2017, supposedly to provide ‘stability’ but clearly also to avoid upsetting core segments of Tory business support before next year’s election.
What’s significant about the overdue revision is that it might erode the divide between London and the rest of the country. Research suggests that more than half the retailers in the north and Midlands would have had their business rates cut in a 2015 revaluation, while half the shops in London would have faced a significant rise. Tackling that imbalance would send a slice of prosperity up the line 20 years faster than HS2.
More Spectator for less. Stay informed leading up to the EU referendum and in the aftermath. Subscribe and receive 15 issues delivered for just £15, with full web and app access. Join us.