Ways and Means

Once again, the hon. Gentleman pre-empts my speech. I shall come to how we can ensure that we support regeneration in the areas that he is talking about; indeed, there are ways we can do so through these provisions. As I said, we have consulted widely and we have received a wide range of positive contributions as part of that process. Sir Michael also received representations that did not favour change, predominantly from the property industry. Some pointed to the past as a reason for not going ahead with change today, suggesting that reform would impact, as was said, on redevelopment. Others, such as the Royal Institution of Chartered Surveyors, suggested that there are a number of other aspects of business rates reliefs and exemptions that also merit re-appraisal. These are serious issues that we have reflected on, and they will in part be incorporated into the detail of the regulation that will be put before the House in due course, and into some of the accompanying measures that I will discuss in more detail in a moment. However, on balance, the Government agreed with Sir Michael and Kate Barker that reform should go ahead. Sir Michael said:"““Demand for land for development is growing as a result of economic change and household growth, and it is clear that, more than ever, we need to ensure that all previously developed land is used most effectively.""Analysis shows that vacant property is found in areas of high demand as well as in areas of low demand and former industrial areas.""Finding ways to raise the opportunity cost of holding unused land and property in areas of high demand at such a time would be desirable. Reforming the empty property relief would help to provide this, and thus assist local authorities””." It was on the basis of Sir Michael’s advice that the Budget announcement on this issue was made. Let me discuss the detail of our proposals, which will be set out in due course before this House in detailed regulation and legislation. The proposed reform will mean that most properties will enjoy a three-month rate-free period on becoming empty; the period for industrial properties will be six months. Three months was the limit on the rate-free period already established in legislation, but because Kate Barker demonstrated in her report that there is no inherently greater risk of particular types of property falling empty, it is right that there should be convergence in the tax treatment of all forms of property. We are therefore bringing the treatment of industrial property toward that for office and retail property, allowing it a six-month period with no rates. We intend to exempt charities and community amateur sports clubs altogether from paying rates on empty properties that they own. These reforms will impact on the owners of long-term empty property, including existing and new build premises, but because the Government now have the evidence that we need to create targeted support in areas where it is needed, we are bringing forward reform to empty property rates as part of a wider package of incentives for the future use and re-use of land and property.