Minister makes U-turn over £300m business rates relief fund

Communities secretary Sajid Javid says there will be no delay to help for small businesses because of general election. The government appears to have performed a weekend U-turn on business rates and says a £300m relief fund to help small businesses worst hit by the shakeup is now available for councils to share out.

On Friday the Guardian was told by the Department for Communities and Local Government that although the consultation on how to distribute the money was complete it would require the approval of the new government – signalling a hiatus of several months until after the 8 June general election.

However, speaking in the House of Commons on Monday the communities secretary, Sajid Javid, insisted there would be “absolutely no delay because of the general election”. “It’s going ahead, exactly as planned. Councils are free to start using the scheme and helping local businesses.”

The business rates revaluation triggered a furious political row in February with the government coming under fire from its own MPs over the impact of the changes in their constituencies. Many of the affected businesses are in Conservative heartlands and the pressure saw the chancellor Philip Hammond announce a £435m relief package in the budget.

Half a million shopkeepers, pubs and restaurants saw their rates bills – the commercial equivalent of council tax – increase at the start of this month after a revaluation of property hit parts of the country where prices have surged.

For example, a property boom in the Suffolk coastal town of Southwold forced rateable values up by 152%, with some shop owners saying the resulting hike in their rates bill threatened the viability of their businesses.

Rachael Maskell, the Labour MP for York Central, described the situation created by the revaluation as “totally unfair” as although more small businesses were exempt from rates in her constituency others had seen their rateable value increase by 600%. “No one knows how the new relief funds will be distributed,” she said. “Total chaos.”

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