Harrow look at rates discounts to troubled firms

LB Harrow is looking at giving firms in trading difficulty a discount on their business rates, in order to try to avoid job losses in the Borough.

The Council Cabinet is considering a proposal to allow up to a £5,000 let off for firms whose collapse would put Borough residents out of work, or leave a gap in essential services. The proposal suggests the discount should be given to companies whose “closure is detrimental to the council taxpayer”.

Around 360 businesses have declared difficulties in paying their business rates since April 1, according to the Harrow Observer, so this would mean the Council foregoing around £300,000 in revenue.

A report to the cabinet committee said: “Harrows economy is dominated by small and medium enterprises. For these businesses, relatively small sums of money can be the difference between survival and closure. However, the scheme will be operated to support viable and sustainable businesses only, and not to support poor investment or poor business models that the market would weed out naturally. Officers will therefore follow criteria to assess whether it is right to save a business, which will include ensuring applicants undertake a business diagnostic from Harrow in Business as well as examining their business plans to ensure long term viability.”

When considering applications, the council would have to take account of the fact that European Union competition rules generally prohibit government subsidies to businesses that are capable of affecting trade between member countries, and this normally includes any manufacturing firm, however small.

Harrow In Business chief executive Alan Pluck told the Observer: “We would welcome the hardship fund. With 61 per cent increase in local shop closures in the last six months, it’s much needed.”


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