2. Will the First Minister make a statement on the business rates system? OAQ(5)0290(FM)

Yes. The non-domestic rates system in Wales contributes more than £1 billion towards the funding of local services in Wales.

I thank the First Minister for his answer. Looking ahead to proposals for new business rates arrangements post 2018, is the First Minister able to give an indication of his thinking regarding community sports clubs? I understand that, at the moment, there’s a threshold where 70 per cent of members of such clubs have to be actively participating in that club’s activities to qualify for relief. It seems a very high threshold, considering wider plans and strategies for greater physical activity promotion, especially among younger people. So, I’d appreciate it if the First Minister could give an indication on his thoughts on that matter.

Yes, we are aware of the point that the Member makes, and it does form part of our thinking as we develop a permanent system from 2018 onwards.

First Minister, on many occasions in this Chamber we have heard about the question of relief on plant and machinery in business rates, particularly in areas such as Tata Steel, where we had the blast furnace. Has your Government actually given any further consideration to looking at relief for plant and machinery in the business rates, to ensure that investment can come in to industries, such as the steel industry, and that they will not be penalised as a consequence?

It is something that we looked at with the Valuation Office Agency. It is a highly complicated area. What we have done instead, of course, is to put on the table a more generous package for Tata than business rate relief would offer. So, I would argue that what we have on the table goes well beyond what business rate relief on plant and machinery would be able to offer in the first place, especially given the complexities and the time it would take to put such a system in place.

In light of your answer to me last week, First Minister, saying that you would be able to give full consideration, after the autumn statement, to increasing funding for support to small businesses, how will your Government use the budget consequentials from the Chancellor’s announcement that he will extend rural rate relief to 100 per cent, giving small businesses in England a tax break of up to £2,900?

Well, the revenue consequential is very small—some £35 million, of which £20 million has already been announced. So, we have not been showered with largesse from the UK Government when it comes to revenue funding. Nevertheless, we will look to see how that money can be best used for the good of the people of Wales.

First Minister, I’ve had countless constituents write to me about business rates—small business holders, people running independent shops—and they’re all telling me that your Government’s business rates are threatening their businesses, may lead them to close or, certainly, lay people off. Why are you hurting small businesses in my region?

Well, I think the Member has to remember that the last time there was a revaluation was when his party was in Government. I heard no complaints at that point. It’s right to say that, in some parts of Wales, there are particular issues that will need to be addressed, but this is revenue neutral. This is not a way of the Government getting more money. This is a way of rebalancing the business rates system without there being a net gain to Government. That said, of course, we recognise that there will be some parts of Wales where things are difficult, and that’s why we’ve already announced a transitional relief scheme of £10 million, and we will look to see what else we can do in order to smooth the transition process.