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Redditch Council joins forces to embrace the economic future
4:20pm Thursday 6th September 2012 in Local
REDDITCH Council has moved to embrace the economic future together with the Greater Birmingham and Solihull area, after a vote by councillors at a recent meeting.
Councillors at the town hall voted unanimously to form a ‘Business Rates Pool’ with authorities in the Greater Birmingham and Solihull Local Enterprise Partnership (LEP) from April 1 2013.
Changes coming to the way councils are financed will see local authorities rely far more on local economic activity to pay for local services. This is because they will keep far more of the tax paid by local businesses (business rates) than at present.
Under the new system rather than paying all business rates to the government and receiving an amount back, councils will get to keep a capped amount of local business rates with the rest going to the government.
As a result, councils nationwide are considering collaborating with neighbours to pool this money, creating a source of finance for investment in local economic development as well as sharing the benefits and mitigating the risks of changes to local economic activity.
Redditch is now set to enter such an arrangement with councils within the Greater Birmingham and Solihull LEP that also decide to take part.
In making the decision, councillors also resolved to hold any final decision until the full implications of this year’s Local Government Finance Settlement are clear - expected to be around January 2013. This allows the council time to amend its approach should any additional information or changes in proposed national policy come to light in that time.
Redditch Council leader, Bill Hartnett, saidL “This council wants to see Redditch's economy grow and prosper.
“With good projected growth figures for the Greater Birmingham and Solihull LEP area and the changes coming to the way local services are funded, this decision is a move in the right direction to support local businesses and the town's economy.
“Pooling our rates could create a powerful way to fund local economic development and create jobs.”