Finance chiefs have demanded the Scottish Government use the £350million funding announced by Westminster to soften the blow of crippling business rates in the north-east.
Willie Young, convener of Aberdeen’s finance committee, will write to Finance Secretary Derek Mackay, asking him to use some of the cash allocated by Chancellor Philip Hammond to assist struggling businesses across the north-east of Scotland.
His call was backed by North East MSP Ross Thomson, who urged Mr Mackay to use it to “give businesses a break”.
And leading Aberdeen hotelier Stewart Spence last night urged Scottish ministers and others outside the north-east to “grasp the problem” over business rates across the region.
Mr Spence, who owns the five-star Marcliffe Hotel and Spa at Pitfodels, successfully appealed against a hefty 25% increase in his rates bill.
He has managed to reduce his bill for 2016/17 to its current level of £253,000 a year.
But next year it will rise by nearly 7% to £270,000 based on a rateable value dictated by the estimated value of his property at a time the north-east was only just starting to adjust to the shock of a slump in oil prices.
Mr Spence, who previously said he would not pay a penny more than the current levy, said the whole “crazy” system needed a rethink.
And he said it would have made “complete sense” to wait for the outcome of the Barclay review into business rates north of the border, which reports back to the Scottish Government later this year, before introducing new rateable values.
“I just don’t think they have grasped the problem in Aberdeen,” he said last night, adding: “It’s a problem that’s not going to go away.
“The north-east has suffered a huge downturn. Many businesses are in a much worse position financially than a few years ago.”
Mr Young revealed he would be calling on the Scottish Government to use the budget boost to help struggling firms shortly after the funding was announced.
He said: “Now that we’re getting this £350million from Westminster, now is the time for the SNP government to go back on the business rates.
“Because they’re getting £350million that they never expected, what they need to do is set up a scheme to ensure that all businesses in the north-east are not affected by the business rates.
“Of that £350million, £30million should come to the north-east to make sure that no businesses are affected by the business rates.
“The time for excuses is gone. We’ve got this money available to Scotland now from Westminster, so Derek Mackay can no longer claim we’re the poor forgotten relative of the United Kingdom.”
Mr Thomson, former vice-convener of the city’s finance committee, also appealed to Mr Mackay to support north-east businesses.
He said: “Derek Mackay should use this extra funding from the UK Government to give businesses and taxpayers a break.
“He can no longer claim that he needs to cut the budgets of local councils while penalising middle earners through income tax changes.”
But Stephen Flynn, the leader of the SNP group at Aberdeen City Council said: “To have a Labour councillor championing a Tory funding announcement of just £350million when Scotland’s budget has been decimated by £2.9billion in real terms is deeply disturbing and instead of trying to play petty games Cllr Young should simply use the powers and funds at this council’s disposal to protect businesses.”
Last night Aberdeenshire Council’s SNP co-leader Richard Thomson said his authority was already offering local firms the most “generous” rates relief package in the whole country.
“Any extra resource coming to Scotland in the budget deserves a cautious welcome,” Mr Thomson said. “However, given the background of reducing funding to Scotland, the finance secretary should be given time to study the small print very carefully.”
Finance Secretary Derek Mackay said last night: “The Scottish Government has already committed to £660million of rates relief next year, including an additional £7.5million relief recently announced for Aberdeen. This is alongside an additional £130million resource for local government announced last month, including additional £4.5million for Aberdeen City Council.
“Aberdeen City Council can also reduce rates bills, but has so far not decided to support local businesses in this way.”
