Almost £2.5m lost every year due to empty businesses in Portsmouth

ALMOST £2.5m of taxpayer cash is lost every year due to empty businesses in Portsmouth, new figures have revealed.

Thursday, 16th January 2020, 6:00 am
Updated Thursday, 16th January 2020, 7:32 am
The landlord of 104 Elm Grove, which was empty until recently, had to pay business rates for three years. Picture: Habibur Rahman

During the 2018/19 financial year empty premises in the city were exempt from paying a total of £2,484,170 to Portsmouth City Council - or 2.4 per cent of all its business rates - with this expected to rise in 2019/20.

Gosport lost £336,400 to empty building rate relief in 2018/19, Fareham - £1,407,807, East Hampshire - £1,415,004, and Havant - £1,058,524.

Empty units are excused from paying rates for three months, but can seek for an extension from the council in some cases. And although the money is collected by the council the majority is funnelled back to central government.

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An investigation by the BBC shared data unit also showed across England and Wales this has led to a 'gap' of around £1bn a year with some council's losing six per cent of rates.

Councillor Richard Watts, chairman of the Local Government Association’s resources board, believed changes were needed to address this.

He said: 'Business rates are an extremely important source of income for local government and with an overall funding gap of £8bn by 2025, the government must commit to moving forward with vital reforms, which include addressing business rates avoidance and the impact of reliefs, such as empty premises relief.'

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As of December 31, 2019 there were 419 empty premises out of a total 6,475 rateable properties in the Portsmouth area.

In 2018 the council collected £89,746,039 in business rates, although this is predicted to decline in 2019/20 to £84,300,000.

City councillor and high street advocate Cllr Luke Stubbs supported the relief scheme, despite the losses to the council.

'Empty buildings don't do anyone any good,' he said.

'They mean lack of business, lack of jobs and lack of economy. The council needs to put more effort and money in attracting businesses.

'There are pressures on everybody, no landlord wants to sit on an empty building, which is why the rate relief was introduced.'

Long-time commercial landlord Bob Levin agreed. Mr Levin, 66, currently owns two units in Elm Grove, in Southsea, which until recently were empty for three years. During this time he had to pay business rates.

He said: 'It's not the responsibility of the landlord if a commercial premises becomes empty as it's in the absolute best interest of the landlord to have the premises occupied and producing income.

'Three months is not long enough, there needs to be more compromise.'

His premises, which are now independent Asian convenience shops, had been used by Blockbuster Video and Morrison's in the past.

He added: 'I prefer to let to businesses who are able to make an individual personalised offer to their customers because they add to the high street and to the diversity of the community and do well.

'If you're selling something you can get online or in a supermarket you're not going to last.'