GROWING OUR SMALL BUSINESSES

A Plaid Cymru government will involve the private sector and its representative bodies in providing business support and advice aimed at small businesses (less than 10 employees) by strengthening the current Business Wales network. Plaid Cymru will also pass a Regulatory Reform Act to lower the bureaucratic burden on business.

Plaid will increase business rate relief so that more than 70,000 small and medium companies will pay no business rates at all. Any firm with a rateable value of less than £10,000 per year will pay no business rates and a Plaid government will introduce a tapered relief for another 20,000 firms whose rateable value is between £10,000 and £20,000. In order to enourage new startups Plaid will not charge any business rates due for the first year of operation.

The Party of Wales will review business rates every three years, so that they are kept up-to-date, and investigate the impact of premises investment so that businesses are not penalised for improvements that they make. We will subject small and large businesses to different multipliers as is the case in Scotland and England and will index rates to CPI not RPI.

Additionally targeted business rate reliefs will be offered for larger companies that agree to meet certain criteria on corporate social responsibility – including opportunities for local suppliers, the Welsh Living Wage, the minimisation of waste and the use of renewable energy. Businesses of all sizes that meet the criteria will be entitled to display a kitemark as responsible Welsh businesses.

Plaid Cymru in government will act immediately to set up a new fund to enable local authorities and community groups to offer two hours free car parking in towns throughout Wales, providing a vital boost to town centre regeneration across all of Wales. 

We will support social innovation, social enterprise, employee and consumer co-ops. We will establish a co-operative challenge fund to provide financial support for feasibility and market studies and early stage finance for groups exploring the option of establishing cooperatives. Plaid Cymru will support the establishment of a social business school to develop the skills of social entrepreneurs, and a social innovation park to incubate new ideas.

BACKING OUR SMALL BUSINESSES

Our small businesses in Wales make a vitally important contribution to our economy and account for 99% of all businesses in Wales; it is vital we support this sector. Business rates account for a significant part of operating costs for small businesses and as a result prevent businesses from growing, from investing in themselves and in many cases, creating more jobs. We need to remove the burden of business rates and allow our private sector to flourish and create employment opportunities. 

Small businesses are vital for our economy, they form the backbone of our economy and they are vital in terms of spreading economic growth beyond the cities and into our smaller towns like Abergavenny, Chepstow, Caldicot, Monmouth and Usk. If we want our small towns across Wales to be thriving, then we have to support small businesses. Business rates are a burden – they account for a far greater proportion of operating costs for a small business than they do for large businesses.

Plaid has long championed the importance of local economies when it comes to generating national wealth. Every £1 spent in a local business selling local produce is worth twice as much to the economy as £1 spent in a supermarket, due to local reinvestment and spending. As noted by the Campaign for the Preservation of Rural England, every £10 pound spent in a local business circulates at least three times before it leaves the local economy rather than vanishing when spent in the branches of chains.

A Plaid Cymru government would extend the rate relief scheme that we implemented in Government to covers all businesses whose rateable value is £10,000 or less and extend the tapered relief scheme up to £20,000.  Some 90,000 businesses would see a reduction in their business rates as a result and more than 70,000 businesses across Wales would be taken out of the rates system.

Plaid would raise the money, which would go towards paying for this, by mirroring the business rates system, as it currently exists in England where large businesses pay more than small businesses. While larger businesses would pay more, they would still pay less in Wales than they would across the border. The extra money raised through the increased bill for large businesses would raise more than enough to cut bills for small businesses.

OUT OF SIGHT AND OUT OF MIND

Once again a UK Westminster government has put the needs of rural Wales last by failing to include Welsh regions in a scheme to help lower fuel bills in rural areas. The application made by the UK Government included seventeen areas in the UK for a 5 pence per litre fuel duty discount, but oddly enough none of the seventeen areas were in Wales.

Plaid Cymru has argued that Wales has some of the most rural areas of the UK, and should qualify for the scheme. Rural Wales has already been very badly hit by numerous decisions taken by both the Westminster Government and Labour in Wales Welsh Government, with decisions being made to cut the EU budget, to reduce CAP payments to Welsh farmers by a quarter of a billion pounds and a failure to support rural businesses.

The decision to exclude rural Wales from the fuel duty discount is just another example of the Westminster parties neglecting to work in Wales’ best interests. Farm incomes fell by 24% last year, and farmers are facing extremely difficult economic conditions. The UK Westminster Government has publically acknowledged that rural areas face added financial pressures, but they have yet again failed to deliver for Wales.The Labour in Wales Welsh Government has also failed to support our rural communities.

The Westminster parties voted to cut the CAP budget on a EU level, and the Labour in Wales Welsh has failed to invest in broadband and mobile connectivity, or step up to help our rural businesses with their business rates. Rural Wales has pretty much been abandoned by the UK Westminster parties, clearly only Plaid Cymru is prepared to step up and fight for Wales’ needs at every opportunity.

BACKING OUR SMALL BUSINESSES

Small businesses in Wales make a vitally important contribution to our economy and account for 99% of all businesses in Wales; it is vital we support this sector. Business rates account for a significant part of operating costs for small businesses and as a result prevent businesses from growing, from investing in themselves and in many cases, creating more jobs. We need to remove the burden of business rates and allow our private sector to flourish and create employment opportunities. The figures highlight the number of small businesses which are struggling to meet their bills and who, under Plaid Cymru plans, would not have to pay any non-domestic rates.

A Freedom of Information request by the party revealed that more than 3,000 businesses with a rateable value of under £10,000 had liability orders issued against them for non-payment over the past three years, they would be among 70,000 businesses taken out of the rates system. Over 3,000 small businesses in Wales fell into debt over their business rates would be taken out of paying non-domestic rates altogether under plans drawn up by Plaid Cymru. The Party of Wales’s has pledged to scrap business rates for all enterprises with a rateable value of under £10,000 relief with those between £10,000 and £15,000 also seeing their bills reduced.

Plaid has long championed the importance of local economies when it comes to generating national wealth. Every £1 spent in a local business selling local produce is worth twice as much to the economy as £1 spent in a supermarket, due to local reinvestment and spending. As noted by the Campaign for the Preservation of Rural England, every £10 pound spent in a local business circulates at least three times before it leaves the local economy rather than vanishing when spent in the branches of chains.

It is vital to ensure more people have the opportunity to economically support their local town centres across Wales, so we making them the vibrant heart of the community they once were. Over the last 30 years in Monmouth constituency (and elsewhere) we have all seen the damaging economic and social effects of bad shortsighted questionable planning decisions on our small towns. The Welsh Government needs to actively support our town centres and create a more level playing field for small to medium sized local businesses. Our town centres should be the economic heart of our communities, generating local wealth and jobs for our people.

Business Rates in the Gwent area

BLAENAU GWENT

2013 and 2014:Non-domestic rates liability orders (as of January 30 2015): 232

Arrears @ March 31, 2014: £1,233,000

Liability Orders on businesses with rateable value of less than £10,000:  168 (running total as of September 2014):

CAERPHILLY

2013-14:Non-domestic rates liability orders: 229

Arrears @ March 31, 2014: £1,078,399 (year only)

Liability Orders on businesses with rateable value of less than £10,000: 290 over three years

MERTHYR TYDFIL

2013-14:Non-domestic rates liability orders: 76

Arrears @ March 31, 2014: £797,946

Liability Orders on businesses with rateable value of less than £10,000: 53 over three years

MONMOUTHSHIRE

2013-14:Non-domestic rates liability orders: 209

Arrears @ March 31, 2014: £1.6m (gross)

Liability Orders on businesses with rateable value of less than £10,000: 307 over three years

NEWPORT

2013-14:Non-domestic rates liability orders: 310

Arrears @ March 31, 2014: £1.92m

Liability Orders on businesses with rateable value of less than £10,000: 104 over 3 years

TORFAEN

2013-14: Non-domestic rates liability orders: 39

Arrears @ March 31, 2014:  £1,287,084Liability Orders on businesses with rateable value of less than £10,000: 39 over three years

AUSTERITY IS NOT WORKING

Lets be honest, Westminster austerity agenda is not working in our national interest. In response to the Chancellor's Autumn Statement, Plaid Cymru has renewed its commitment to securing a Welsh economic recovery and tackling the cost of living crisis by creating meaningful, well-paid jobs and bringing down energy prices. Over £ 1 billion pounds will have been wiped from Welsh economy this year by the Westminster Government, and cuts to Welsh public services extending far in to the future are having a devastating effect.

That is why Wales needs greater financial and policy powers to shape the economy here, create jobs and more sustainable growth. The Government response to the Silk Commission has said that Wales is set to have greater investment powers which would be maximised by the income tax sharing arrangements. All parties in Wales need to  push on with this for the benefit of the Welsh economy.

The change of focus in the Funding for Lending scheme from mortgages to businesses should be welcomed as both business investment and lending remain in a depressed state. Plaid Cymru would implement a public development / business investment bank ("A Bank of Wales") to lend to SMEs, and develop local industries here. Plaid Cymru also wants to cut business rates for thousands of Welsh businesses.

Although a reduction in consumer energy bills is to be welcomed, Plaid Cymru has concerns that the reduction will not apply to off-grid consumers in rural areas. The real reason for soaring bills is profiteering by the members of the ‘Big 6’ energy cartel, something that the current Con Dem Coalition government and the last Labour government entirely failed to tackle. That is why Plaid Cymru has proposed a publicly-owned energy company, Energy Wales, with a not-for-distributable-profit model.

Plaid Cymru has also criticised the Chancellor's announcement that workers will be expected to work for up to five years longer in changes to the state pension. We in Wales will be hit disproportionately by these changes due to our lower life expectancy, and it is particularly perverse to reduce the job opportunities available to young people at a time when UK youth unemployment stands at a million.

DOING THE NUMBERS

The Labour in Wales Government’s reaction to the report of the Silk Commission, which recommended limited tax varying powers be devolved to Wales, is somewhat subtle, if not unexpected. Carwyn Jones, First Minister, has said that there should be no question of the raising (or perhaps using) the power to vary tax rates being devolved until the unfair funding formula which ‘robs’ Wales of some £350 million pounds a year is reformed.

Oddly enough when in government from 1997 until 2010 the Labour Party (whether in Wales or Westminster) consistently refused to accept that Wales was underfunded and that there was any problem with the Barnet funding formula. Now in opposition and (despite the surface gloss) fairly hostile to the idea of devolving further powers to Wales (if not to the concept of Wales itself) things have somewhat unsubtly changed.

Sleeping soundly for Wales, because of the financial disaster left by the last Labour in Westminster Government, Carwyn can safely call for fair funding, in the knowledge that he won’t get it.  Loudly calling for something he knows Wales won’t get he can safely ignore the recommendations of the Silk Commission and focus our attentions on the fair funding issue. All well and good, save for the fact that Labour in Wales (and London) did precisely nothing to fix the problem of fair funding in Wales when they had both the power and the opportunity.

The Commission has recommended that control a number of smaller taxes be devolved to Wales including air passenger duty on long haul flights (a reduction of which could benefit Cardiff-Wales airport); stamp duty, the aggregates levy, landfill tax, and the full devolution of business rates, etc. I have no problem with any of that at all, or the devolution of the power to vary income tax by up to ten pence in the pound.

The failure to consider the devolution of corporation tax (unless it is devolved to Scotland and Northern Ireland) is in my opinion a missed opportunity. I welcome the proposed if limited devolution of borrowing powers for capital projects, current spending and tax revenue variation. The proposal to create a Welsh Treasury function for better financial accountability should also be welcomed if a little belated.

As for the referendum, Wales only got one last time because Labour in Wales had to pay that price to be in government. I have no doubt that whatever the Labour in Wales National Assembly manifesto includes for 2016 it won’t include any reference to the Silk Commission’s findings or another referendum. Labour has been consistently ambivalent on further powers and remains (however well camouflaged) decidedly ambivalent on the issue of devolution project.

The Commissioners, who have hitched the whole financial package to a further referendum, may have potentially brought the whole devolutionary process to a grinding halt. Any referendum cannot be held until it gets the support of a Welsh Government, two thirds of elected AM’s and the support of the Secretary of State – who may well be a Labour Party selectee by 2016

By 2016 the political landscape in Westminster may have changed - we could be a good year into another Labour in Westminster government who would by fairly indifferent to making parliamentary time for Wales related issues in their first year of office. By way of comparison, Peter Hain’s delaying tactics prior to the last referendum on legislative powers might pale into insignificance when compared to what the self-interested Labour in Wales parliamentary representatives might accomplish.

Yet perhaps if Labour in Wales found itself faced with the prospects of no majority (and no trimmings) in Cardiff Bay after May 2016 it would either be forced to choose between forming a minority government or going into coalition with Plaid of the Lib Dems (if there are any left by then). Post 2016 the political situation in the bay could be much more complicated with Conservative AM’s and a smattering of UKIP AM’s. So any chance of a rainbow coalition and a referendum will be entirely dependent (no pressure) on Plaid’s performance, with a new Leader and the desire to stand up for Wales – so there is everything to play for over the next three years.

A FIGHTING CHANCE?

Take a wander around most of our town centres and the out of town retail parks and with your own eyes you will see that impact of the ongoing recession in the rising number of empty shops. With this in mind the recent study produced by the British Retail Consortium which has revealed that the town centre vacancy rate (high streets and shopping centres) in the UK was 11.3% in October 2012 will come as no surprise. This grim statistic is this highest figure that the BRC has recorded since they began the Monitor in July 2011. The highest shop vacancy rates were recorded in Northern Ireland (20.0%), Wales (15.1%) and the North & Yorkshire (14.6%). The BCS has noted that these are the worst vacancy rate since the survey began in July 2011 and tend to confirm that financial challenges for both customers and business retailers are far from over yet.

It not just the local shops that are feeling the pinch, in my home town (where this has been going on for a while) and in more than a few other places even the old high street big names are bugging out, not necessarily because they are necessarily making a loss more that they trying to maximise their profits in the teeth of the recession and the growth of on-line business. Creating the conditions for a stable future for our town centres and high streets will not be easy, but we have to do something and relatively quickly. Obliterating or at least driving a coach and horses though the planning regulations will not provide a sustainable solution, ending business rates and replacing them with a local income tax might go some way towards giving local businesses a fighting chance of keeping their heads above water until the recession begins to end.

GOING THE EXTRA MILE

Plaid has rightly called for an urgent extension of support for small businesses in Wales in order to safeguard jobs and livelihoods during the recession. Welsh Government support for small to medium sized enterprises (SMEs) is due to run out in March 2013 – and the doubts over future support are leading to uncertainty for businesses throughout Wales. The Welsh Government needs to commit itself to extending support for SMEs beyond March 2013. Plaid has renewed its call for government support to be extended to help more businesses.　Plaid’s Small Business Job Protection Scheme would give financial help to extra 8,000 businesses in Wales by offering full relief from Business rates to businesses with a rateable value of up to £12,000 and tapered support up to a rateable value of £18,000. Plaid has argued that revised GDP figures that show that the double dip recession is even deeper that initially feared something that make it exceptionally important for the Welsh government to take urgent action on business rates.　The party has also said that the Welsh government should be investing in capital projects which would help to create and safeguard thousands of jobs across all of Wales.　

Plaid Cymru AM, Rhodri Glyn Thomas, said:

"It is imperative that the Labour Welsh Government takes urgent action in light of yet another stark warning about the depth and severity of this recession. The revised GDP figures show that the double dip recession is even deeper that initially feared and that is very worrying news indeed for the people of Wales especially as the worst of the ConDem cuts is still to come.

"As well as the general economic conditions which are making life very difficult indeed for small businesses, there is currently great uncertainty about how much support they will get from the Welsh Government after March next year. We’re now less than 9 months away and businesses do not know what their business rate bills will be for next year. The Labour Welsh Government is making it increasingly difficult for businesses to plan – and that is leading to uncertainty about jobs as a result.　

"Small business owners have been doing all they can to maintain staffing levels during the economic crisis, yet their efforts are under threat from Labour’s lethargy.　This situation needs urgent action if jobs and livelihoods are to be safeguarded.　

"It’s bad enough that Labour ministers have refused to commit to Plaid Cymru’s plan to support small businesses during the economic crisis. We would extend support to more than 8,000 companies in Wales that do not currently receive any tax relief at all.　But currently, Labour won’t even extend the current level of support – and if this uncertainty continues, there is a clear danger that further jobs will be lost."