Greenfield development needed to fill £31m funding gap

Issue 491

LOCAL greenfield sites “must” be built on to help plug a potential £31m funding gap facing Kirklees Council, according to leader Mehboob Khan.
The Labour chief has spoken out amid the controversy of earmarking 35 hectares of land at Chidswell near Shaw Cross for a business park and the building of thousands of homes in Thornhill Lees – and other sites could follow.
Coun Khan said such schemes were needed to cope with anticipated reforms to business rates that could see Kirklees lose £31.1m in funding.
The council has already had £80m slashed from its budget by the Government, but business rate changes threaten a further blow.
Coun Khan said: “Losing that £31m is a scary spectre. We have to do something about it as it could affect the provision of public services.”
Local authorities currently collect the business rates. The tax goes into a central fund that gets divided back up among councils, according to need.
Kirklees collected £92.2m last year, but got back £123.3m, to account for higher levels of deprivation compared to other parts of the country.
The coalition Government plans to end the redistribution by only allowing councils to keep the business rates they collect themselves.
Kirklees would face a £31.1m funding shortfall, based on the tax take from the 2009/10 financial year, if that were to happen.
Coun Khan said putting up business rates to cover the shortfall may see some firms go under or move elsewhere.
So instead he wants to encourage firms to move here – which also means having the housing needed to accommodate their workers.    
He said: “In two years’ time, when the proposed changes are expected to come into force, we need to make sure Kirklees is in a fit state.
“There is a concern in both central and local government that the economy will not grow without changes to encourage private enterprise.
“Over the past 10 years, for every seven jobs created in Kirklees, six have been in the public sector and only one in the private sector.
“In the next 10 years, we have to reverse that and quickly because the public sector is going to see a significant reduction in jobs.”
Coun Khan added the lack of public sector jobs could leave Kirklees with a ‘lost generation’ of unemployed young people.
Private firms need help to take up the slack, which is why Coun Khan does not want to hammer them with increased business rates.
He said: “The chancellor, George Osbourne, wants to remove the barriers to help businesses thrive. One of those barriers is land availability.
“We want to encourage the use of brownfield sites. But there is competition from other councils for inward investment.
“We need to achieve a consensus on employment land. If we don’t we’ll have no new jobs for the next generation of young people in Kirklees.”
Coun Khizar Iqbal (Con, Dewsbury) feels the shortfall could be bridged by a better balance between industrial and retail developments.
He said: “I’m in favour of the business rates reforms. It’ll mean local taxes will be spent locally. But I’m sympathetic to much of what Coun Khan says.
“We could though do it in a way that doesn’t sacrifice a lot of land. A survey showed 40 per cent of the shops in Dewsbury town centre are empty.
“Now that we’ve got the Dewsbury Regeneration Board, I challenge the chairman (Coun Paul Kane) to help achieve a better balance.
“And by doing that we’ll perhaps kill two birds with one stone by bringing muchneeded investment into Dewsbury town centre.”
See Comment, p8

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