Background and Introduction

1.1     Kent County Council, Medway Council, and all 12 districts within Kent successfully applied in 2017 to become a 100% Business Rates Retention pilot for the financial year 2018/19. This meant that the Government allowed 100% of Business Rates growth to be retained within the local area, with an estimated financial gain of £24.7 million in 2018/19 expected across Kent as a consequence (to be split 70:30 between a “Financial Sustainability Fund” and a “Housing and Commercial Growth Fund”).

Financial Sustainability Fund

1.2     Maidstone’s share of the Financial Sustainability Fund (FSF) was originally estimated as being £640,000. Officers developed proposals for a number of discrete projects which would meet the criteria for the FSF and Policy and Resources Committee agreed 13 projects at its meeting on 28th March 2018, as follows:

1.3     The projects were divided into tranches so that funding for each tranche could be released as soon as it was considered prudent to do so. Emerging projections during the year indicated that the £640,000 funding assumption would comfortably be met from the Pilot, so all three tranches of funding have been released.

1.4     Progress to date is set out in Appendix 1.

1.4.1      Work has either commenced/is well advanced or has been completed on all of the projects; and

1.4.2      In total, £621,000 has been spent or committed, with a small budget surplus of £19,000 anticipated.

Housing and Commercial Growth Fund

1.5     The Business Rates Retention Pilot bid specified that the Housing and Commercial Growth Fund would be allocated between three clusters of authorities, representing East, North and West Kent. Decisions about use of the fund are made using the established leaders’ board arrangements in the respective areas. North Kent leaders (Dartford, Gravesham, Medway, Swale and Maidstone) have met and agreed a prospectus setting out proposals for use of the Fund.  This includes a contribution of £750,000 towards Maidstone Council’s Mall Bus Station redevelopment project.

Further Developments

2         AVAILABLE OPTIONS

2.1     This report is to note only.

3         RISKS

3.1     As with any projects, the Business Rates Retention Pilot projects could fail to be delivered, or could be delivered but exceed their budget allocations.  This risk is mitigated in several ways.  There is a strong project management culture in the Council.  Monitoring arrangements have been put in place for all the projects, to ensure that they deliver within budget and to the agreed timetable.  Finally, post project reviews will be carried out to evaluate the outcomes and to derive any lessons learned from the projects.

4         CONSULTATION RESULTS AND PREVIOUS COMMITTEE FEEDBACK

4.1     Policy and Resources Committee received an initial report on Business Rates Retention pilot projects at its meeting on 24th January 2018.  A draft set of projects was included within the budget proposals considered by the Committee at its meeting on 14th February 2018.  The Committee requested that further consideration be given to the priority and scope of the projects.  An informal briefing was held on 8th March, to which all councillors were invited, at which project sponsors described their projects and answered questions on them.  The Committee then formally agreed thirteen projects at its meeting on 28th March and has reviewed progress on a quarterly basis since then.

5         NEXT STEPS: COMMUNICATION AND IMPLEMENTATION OF THE DECISION

5.1     Progress with the pilot projects is being reported to Policy and Resources Committee on a quarterly basis during the course of the year.

6         CROSS-CUTTING ISSUES AND IMPLICATIONS

7         REPORT APPENDICES

7.1   The following documents are to be published with this report and form part of the report:

8         BACKGROUND PAPERS

8.1   There are no background papers.