Gale's View (January 21st 2009)
A stroll down any of Thanet's High Streets quickly reveals the number of properties vacated by big name and other stores that have either moved out of town or gone into administration.
The sad fact is that as Brown's recession bites we may expect more stores, large and small, to close leaving behind "For Sale" or "To Let" signs in the forlorn hope that some other user may wish to move in.
On the industrial estates the situation is not dissimilar. Commercial properties stand empty and are likely to remain so until there is the as yet distant upturn in the economy. Faced with high levels of personal debt and uncertainty of employment people are understandably not buying the goods and services that have hitherto been on offer.
It is against this backdrop that the Government introduced, last April, the imposition of 100% commercial rates on empty retail and business properties and last week, in the House of Commons, the government promoted a piece of legislation that could, through what is called a "Business Rate Supplement", Increase the cost burden still further.
The Government's justification of its empty property policy, repeated in the Commons on 12th January, is that the prospect of having to pay full rates will "increase the incentive to re-let, re-use or sell empty properties". This, of course, flies in the face of the fact that there are, in the current economic climate, no takers at literally any price to rent or buy properties that will prove to be a liability rather than an asset. To potentially add a Rate supplement to these charges (Councils will have the power to exempt empty properties from the supplement but, strapped for cash themselves, will they do it?) is little short of madness.
Government claims that "70%" of premises will be exempted from empty property rates next year but this figure is open to challenge and at present the rates are having to be paid.
Does this matter to anyone other than the owner of a retail or business property? Yes, it most certainly does. The recession may be long and hard but there will come a time when, under another government, there will be a need for these units as business once again starts to expand. At present there is no incentive for property developers to speculatively invest in new or the refurbishing of shops and offices and warehouses. That costs immediate jobs in the construction industry and is likely to prove damaging to employment prospects in the longer term.
Instead of loading yet more costs onto businesses already struggling, the government should end the nonsense and withdraw empty property rates and the prospect of business rate supplements in their entirety at least until there is renewed and real sustained growth in the economy and preferably for good.