Proposal to return Non Domestic Rate setting
to Local Authority control
The UNISON Scotland Response to the consultation
on the SSP proposal to return Non Domestic Rate setting to Local
The UNISON Scotland Response February 2006
UNISON Scotland welcomes the opportunity to respond
this consultation. We are Scotland's largest public sector trade
union representing over 150,000 members over 90,000 of whom
work in local government or related services.
UNISON Scotland fully supports the return of non-domestic
rates to local authority control. The return of non-domestic
rate setting would increase local democracy and the accountability
The following represents UNISON Scotland's Response
to the proposal to return non-domestic rates setting to local
What would the democratic benefits of this
Allowing councils to raise a greater proportion
of funding themselves would give local authorities the opportunity
to engage more with local people. It would boost local democracy
by making councils accountable to all local tax payers for the
decisions they make about funding for services. Currently the
central:local split for funding is 80:20 this change would make
the balance closer to 50:50. This would limit the blame game
of local versus central when council tax/funding reviews take
This proposal would also enhance general understanding
of the role of local government and so enhance participation
in local democracy and strengthen citizenship generally.
In what way would local authorities benefit
from this proposal?
Local authorities would benefit from the ability
to raise and control revenue maximising their autonomy and freedom
from central control. Currently councils are accountable for
most spending (not ring-fenced grants) but have control over
only 20% of fundraising.
The current system discriminates against cities,
which generate most of the revenue, but do not see an equitable
share of resources. The return of the business rate would help
city councils pay for the services that not only local residents
but those from other areas also use. These include cultural
and leisure facilities and economic development which provide
jobs for many who live out-with the cities in which they work.
There would be a need for some adjustment in grant aid expenditure
following the end of the current pooled system but this should
not mean a straight claw-back from the finance settlement for
areas who gain.
Councils could also use the business rate as a
tool for economic development i.e. lower business rates for
certain areas or for employing certain groups of people, for
example, people with disabilities.
What would the effect be on businesses from
Local businesses would be brought closer to the
discussions on and resourcing of local services. Business people,
who work in the communities in which they live, would be able
to vote and campaign in their local elections and influence
their local councillor on issues which concerned them. This
would increase their stake in local services many of which they
rely on for success.
Local authorities could use control of the business
rate to support local businesses. Nothing in the proposals means
that business rates would have to rise.
What effect would this proposal have on local
This proposal would ease the burden on council
tax payers. Council tax is currently the only direct tool councils
have to increase their funding. Residents would also be able
to hold councils more accountable, for funding decisions, via
the ballot box as they would be responsible for more of their
own financial decisions.
What would be the financial implications of
UNISON does not foresee any rise in local authority
costs as they already bear the costs of administering the collection
of non-domestic rates. The actual business rate would not be
a function of where it is set and would be a political decision
Are there any equal opportunities implications
that you believe arise from this proposal?
UNISON does not foresee any equal opportunities
implications from this proposal.
UNISON fully supports the return of non-domestic
rate setting and retention to local authority control. Returning
non-domestic rates would increase local democracy and the accountability
of councils to their residents.
For further information please contact:
Matt Smith, Scottish Secretary
14, West Campbell Street,
Glasgow G2 6RX
Tel 0845 355 0845 Fax 0141 342 2835