The next item is the Non-Domestic Rating (Chargeable Amounts) (Wales) Regulations 2016. I call on the Cabinet Secretary for Finance and Local Government, Mark Drakeford.

Motion NDM6187 Jane Hutt

To propose that the National Assembly for Wales; in accordance with Standing Order 27.5

Approves that the draft The Non-Domestic Rating (Chargeable Amounts) (Wales) Regulations 2016 is made in accordance with the draft laid in the Table Office on 22 November 2016.

Motion moved.

Diolch yn fawr, Lywydd. The Non-Domestic Rating (Chargeable Amounts) (Wales) Regulations of 2016, which Members are being asked to approve today, will provide for transitional rate relief for small businesses affected by the 2017 non-domestic rates revaluation. These regulations are needed to ensure that the £10 million announced for this purpose on 30 September reaches its intended beneficiaries. The revaluation itself was carried out by the Valuation Office Agency, the statutory body responsible for assessing and assigning rateable values in both England and Wales. The office is separate from the Welsh Government and reaches its valuation conclusions entirely independently. As the revaluation must be revenue neutral, it redistributes the rates payable between properties based on their relative values at the time of the revaluation. Inevitably, this means that some rateable values rise and others fall, and, in some areas, that effect has been exacerbated by the length of time since the last revaluation.

As a Government, we recognise that these changes can represent a higher proportion of costs for small businesses, and particularly those whose entitlement to small business rate relief might be reduced as a result of the revaluation. As a result, our £10 million transitional relief scheme is specifically targeted at those small businesses, allowing them to phase in any increase in liability over a three-year period. This £10 million scheme will provide additional support to more than 7,000 ratepayers.

Llywydd, the scheme will be fully funded by the Welsh Government, and that scheme was supported by a number of key stakeholders in response to our consultation. In contrast, the transitional relief being implemented by the UK Government in England will be funded entirely by ratepayers themselves. Once the transitional relief scheme or £100 million small business rate relief and other mandatory and discretionary reliefs are taken into account, £200 million of financial assistance will be provided for these purposes in 2017-18 and this will benefit more than three quarters of all ratepayers in Wales.

Now, I understand that many Members here have called for further assistance beyond the £10 million covered in these regulations. You will have heard what the First Minister said earlier this afternoon about thought continuing to be given to this matter. I simply need to be clear, Llywydd, that none of that is relevant to these regulations. They refer to the scheme announced on 30 September and, if these regulations are not passed, that help will not be available.

I ask Members to approve these regulations today so that the £10 million-worth of transitional relief can be provided to small businesses in Wales from 1 April next year.

As the Cabinet Secretary has explained, these regulations do offer some temporary relief to businesses, particularly in the wake of the revaluation. To that extent, we have to welcome that, because, as we’ve heard from this party and from other parties in the Chamber, there are businesses that are going to suffer very badly because of this revaluation. There is a very different geographical pattern to be seen—that is, an increase of nearly 9 per cent in Gwynedd, for example, and 9.2 per cent, the highest, in Conwy, for example. Of course, within that, there are individual businesses, particularly in some of the sectors that are detailed in the explanatory memorandum—for example, hotels—which face particular pressure.

He has foreseen what I was going to say, of course: £10 million is not enough. The Cabinet Secretary is a reasonable man, he is willing to listen, and I would ask him to listen again. He has said—and, as the First Minister has said, the Government is still considering the scope that exists for more help outside of the framework that we’re talking about today with the £10 million. That would certainly be welcomed by businesses across Wales within the sectors that do face this increase, but particularly in those areas that are identified here.

So, could I ask him to go further? Naturally, we wouldn’t want to oppose this today, because, as the Cabinet Secretary said, if we did that that £10 million that is on the table would be lost. Certainly, we need more money, and certainly we don’t want to take that £10 million away. So, could I ask him, in the spirit of the Christmas period that we’re in—? But, seriously, small businesses in Wales, the backbone of the economy, are asking for help from the Welsh Government, so, could I ask him, once again, to listen to those voices?

Can I concur with the comments that Adam Price has made? Cabinet Secretary, as you know, the business-rates revaluation continues to be a source of immense concern for those businesses facing sizeable increases in their rateable value. This concern extends to the scheme of relief that the Welsh Government has decided upon and the transitional relief that we are voting on this afternoon.

I read through the explanatory memorandum, and the three options the Welsh Government considered are listed. Clearly, option 1—do nothing—was not a viable way forward; I think we all agree with you there. However, we did see some merit in option 3, making regulations based on the transitional relief scheme provided in England. The English scheme is self-financing, or supposed to be, anyway, and that could have been a basis for a scheme, but I understand you’ve not gone down that route. The idea of transferring funds from those who are going to see a reduction in their rates due to the revaluation to other areas where there’s going to be an increase we did think had merit and we’re sad that you dismissed that. However, as Adam Price has said, we do need to have a transitional rate relief scheme, and next April is now approaching very fast, and businesses would be more concerned by not having a scheme at all than having one that is flawed. I would point out, though, that these are potentially crushing increases in rates payable for some businesses—a minority of businesses, but, still, a significant number of businesses across Wales. We do urge the Welsh Government to look at providing additional support for those businesses before this kicks in next April.

We do have serious concerns about the approach that the Welsh Government has taken in this area, so we will be abstaining on these regulations today, but we do recognise that we need a transitional rate relief scheme, so we will not be blocking or attempting to block this going through. But we would urge you to look again at the system that is in place and to make sure that those businesses that are going to experience some of the worst rate increases do get the support that they need.

As has already been said, it would be remiss, as we are discussing regulations, not to reflect on some of the difficulties that have been caused in certain sectors and certain parts of Wales by the uprating that has taken place under the valuation office. In parts of Gwynedd and certainly within the tourism and hospitality sector, there have been particular issues that I hope the Government will look at when it looks at the potential re-evaluation of how much resource might be available for transitional relief.

But I wanted, also, to bring the attention of the Government, and the whole of the Assembly actually, to a particular issue that I’ve been alerted to that is quite new, I think, and hasn’t been reflected in discussions so far, and that is the potential for the new valuations to thwart some renewable energy schemes. What’s happened is that a revaluation of properties that have solar panels, for example, for the purpose of business rates—that includes schools—has led to a higher valuation being put on those properties, because, if you see a property with solar panels on it, it’s now worth more than it was without sonar panels. But if they then end up paying more business rates because of the solar panel installation, you’ve got the right hand and the left hand not joining together and working together for a more sustainable future.

Now, we can’t address that in these regulations, and these regulations are for transitional relief, but this is the first opportunity I have had to put it on the record that this is an issue that could come, in the next financial year, to haunt us and to reveal that some of the things that the Government is doing in encouraging renewable energy—solar panels have been a particular issue that has been brought to my attention, because it’s the one that is installed on buildings and is, therefore, very visible to the valuation office. A solar heat pump may not be so visible to an official who comes and looks at what your new property looks like. These are things that I think that the Government should be aware of. We cannot control what the valuation office says about the value and the appreciation of the value of a building for rateable terms, but we can, of course, design a business rates system that recognises public goods such as renewable energy. Going forward, in fact, that is exactly what we need: a review of the business rates system that does take much more account of public goods like renewable energy, of public benefits such as small and local businesses, and of public disbenefits like free car parking around supermarkets.

I call on the Cabinet Secretary to respond to the debate.

Thank you very much, Llywydd. May I start by recognising the fact that Adam Price had welcomed what is in the proposal before the Assembly today, and to say that I am still listening to everything that those in this Assembly tell me? I’ve heard Nick Ramsay’s comments in the past, and what he said this afternoon too. The point that Simon Thomas raised is a new issue, but, of course, we have already said that we are going to reform the system that we have in Wales for the financial year following the next.

Y cwbl a ddywedaf wrth Nick Ramsay am y cynllun yn Lloegr yw fy mod innau wedi gweld ei atyniadau hefyd, oherwydd ni fyddai wedi arwain at unrhyw gost o gwbl i Lywodraeth Cymru. Ond byddai wedi arwain at gost y sector dur Cymru a meddygfeydd meddygon teulu Cymru, a fyddai yn y pen draw yn talu i gefnogi busnesau eraill. Ond mae’r cynllun o flaen y Cynulliad y prynhawn yma yn un lle mae gwerth £10 miliwn o arian newydd, arian Llywodraeth Cymru, yn cael ei ddefnyddio at y dibenion hynny. Credaf fod hyn yn well. Rwy'n ddiolchgar i'r Aelodau hynny sydd wedi nodi rhywfaint o gefnogaeth iddo, ac rwy'n gobeithio y bydd y rheoliadau hyn yn cael eu cymeradwyo heddiw.

The proposal is to agree the motion. Does any Member object? [Objection.] I will defer voting under this item until voting time.

Voting deferred until voting time.

The next item is the Social Care Wales (Extension of Meaning of ‘Social Care Worker’) Regulations 2016, and the Social Care Wales (Specification of Social Care Workers) (Registration) Regulations 2016. In accordance with Standing Order 12.24, I propose that the following two motions under items 10 and 11 are grouped for debate. Does any Member object?