The Financial Secretary to the Treasury (Lord Livermore) (Lab)

I am very grateful to the noble Baronesses, Lady Neville-Rolfe and Lady Kramer, for their comments and questions, and for their cautious welcome of what we have announced. The noble Baroness, Lady Neville-Rolfe, ignored what we announced in the Budget: the £4.3 billion of support for those experiencing increases in business rates. As she knows, the previous valuation was based on property values during the Covid pandemic, which meant that rateable values were much lower. As a result of that valuation, some businesses, including the retail, hospitality and leisure venues that we are discussing, are now seeing an increase. At the Budget, we announced three elements of support at a cost £4.3 billion, which neither noble Baroness mentioned in their comments. We are implementing transitional relief that will cap increases at 5% for the smallest properties and at up to 30% for the largest. For any business whose value increase has meant that they are no longer eligible for small business rates relief, we are capping their increase. We have expanded the supporting small business relief scheme, to provide specific support to those who are currently eligible for the 40% RHL relief. The noble Baroness, Lady Kramer, said that the wider system needs reform; we absolutely agree on that and have begun that. We are reforming the business rates system by introducing permanently lower tax rates for over 750,000 retail, hospitality and leisure properties. The noble Baroness, Lady Neville-Rolfe, said that what we are doing is temporary, but those new lower rates are permanent—unlike what the previous Government did—and they will be funded by higher rates on the most valuable properties, including those of online giants. I remind the noble Baroness, Lady Neville-Rolfe, that the previous Government’s plans were to scrap entirely the temporary Covid-era retail, hospitality and leisure relief in 2025—but she now says that more support should be offered. If they had won the last election, their plans clearly show that they would have removed it overnight in April last year. They now claim that they would extend it, so why did they not say so or include that in their forecasts or projections? I am grateful to the noble Baroness, Lady Kramer, for what she described as her cautious welcome of what has been announced. We have of course been listening to the industry. We have announced that, from April, every pub in England will get 15% off its new business rates bill, on top of the support announced at the Budget. Their bills will then be frozen in real terms for a further two years. The noble Baroness noted that the support will be worth £1,650 for the average pub next year, but that means that three-quarters of pubs will see their bills either fall or stay flat next year. This decision will also mean that the amount of business rates paid by the pub sector as a whole will be 8% lower in 2028-29 than it is today. The noble Baroness, Lady Kramer, said that pubs with ratable values of over £100,000 would not benefit, but we are clear that this will apply to all pubs. I am grateful for what she said about this applying to music venues too. Many live music venues are valued as pubs, and many pubs are grass-roots live music venues, so it would not be right to seek to draw the line so tightly as to include some but not others. The noble Baroness, Lady Neville-Rolfe, also talked about the structural issues that many of these businesses are facing, and she will know that the sector has raised concerns about the way that they are valued. The Government agree that this needs to be looked at. We are therefore launching a review that will examine how pubs are valued for business rates, and we will set out more detail on that in due course. The noble Baroness, Lady Neville-Rolfe, spent a lot of her statement telling us about what businesses need. What they need most is stability; they did not need the previous Government, with the Liz Truss mini-Budget, Brexit and austerity, and all the consequences that they had. The noble Baroness commented on what we are doing for business. She will know that, under the previous Government, business investment was the lowest in the entire G7, and that, since the election, business investment has increased faster in this country than in any other G7 country. I am more than happy to compare her record with ours. The noble Baroness will know that we are pressing ahead with wider regulatory reforms to help businesses, as well as carrying out licensing reform, and that we are looking at loosening planning rules to benefit pubs more generally. She will also know that we are doubling the hospitality support fund with £10 million of funding over three years. The noble Baroness, Lady Kramer, talked about the importance of the sector for growth, and the noble Baroness, Lady Neville-Rolfe, talked about the challenges faced by the wider sector. I understand the challenges that many other retail, hospitality and leisure companies are facing. We have already taken significant steps to support businesses, including, as I said, the £4.3 billion of business rates support. As we all know, consumers have changed their habits over the past decade and are increasingly working from home and shopping online. Combined with the pandemic and the increase in energy costs since Russia’s invasion of Ukraine, these trends have continued to make it harder for high street businesses. Therefore, later this year the Government will bring forward a high street strategy, and we will work with businesses and representative bodies to look at what more the Government can do to support our high streets.