LIVERPOOL MP TO LEAD DEBATE IN THE HOUSE OF COMMONS ON PORT RATES CRISIS
General, 13 Jan 2009
Adjournment debate to Discuss the Impact of New Business Rates in Ports and Urge Government to Work with the Industry on a Workable Solution
The issue of the port rates crisis and its negative impact on port businesses in the UK is to be debated at the House of Commons on Monday 19th January.
Louise Ellman, MP for Liverpool Riverside and Chair of the influential Transport Select Committee, said "This is a major problem for port businesses, caused by the failings of the Valuation Office Agency. I am pleased the Government has now made proposals but we need much stronger action to protect businesses in this difficult economic climate"
The debate follows on from the reception held at Westminster in mid December at which MP's from all parties, local authority leaders from the 55 statutory port areas and affected businesses met together to further raise the profile of the issue, and discuss the situation in detail present a workable solution.
"Local authorities are now required to issue, in some cases, very large and disputed bills for the 2008/2009 financial year while the massive backdated element of the bill has still to land on the desks of company directors. We need stronger action to resolve this problem" added Ms Ellman
Last month saw the first Merseyside victim of the rates crisis with stevedoring firm Thomas Nichols Brown (TNB), based in Ms Ellman's constituency calling in the administrators as a result of the introduction of crippling new port rates. Its smaller Wirral-based sister company, Dobro, also went into Administration. A total of 27 jobs have been lost.
David Pendleton, Business Development Director for Mersey Maritime said," Louise Ellman has been a champion of the maritime industry on Merseyside for many years and we are grateful for her leadership in this debate. It is vital that the Government understand the damaging impact that continuing with their new rating system is having on port related businesses in what is an increasingly difficult economic climate. This whole issue has arisen as a result of admitted failings of the Valuation Office Agency and we would urge the relevant Minsters to use their powers to return to the previous rating system which will allow the industry to work with the VOA in preparing their businesses and their customers for the additional costs when the new rate book is introduced in 2010 and not fighting the threat of insolvency."
The Government proposal of spreading the backdated payments over the next eight years has already been dismissed by the industry as unworkable.
Kieran Hall, Chair of the Mersey Dock Rating Group and Managing Director of Denholm Handling said, "Spreading out the backdated payments over the next eight years will not work for simple business accounting reasons. Once the rates bill arrives, the liability has to be recorded on the company's balance sheet. If the bill is greater than the company reserves, then the company becomes insolvent regardless of when the liability has to be paid."
He added, "Those companies that do survive will find their balance sheets adversely affected and it may well present them with difficulties in gaining additional finance for expansion in an already difficult lending environment, as lenders will see their increased liabilities as an increased risk. We hope the debate will bring this and all of the other relevant issues out into the open and allow Government to see sense in this matter."
Notes to Editors
The Maritime Sector is one of the key growth sectors which make up the Merseyside Sector Development Programme (SDP). These sectors are identified and supported by The Mersey Partnership, Government Office North West and the Northwest Regional Development Agency as vital for the future economic growth of the Liverpool City Region.
For further information/Interviews, please contact:
David Pendleton/Annette Parker
Mersey Maritime
Tel: 0151 647 4747
Mobile: 07919 558 396/07919 558 397
Email: David.Pendleton@merseymaritime.co.uk
Forthcoming Maritime Related Events 02/02/2010 - 'FACE-2-FACE'
