Mersey Maritime

This afternoon I met with Mersey Maritime based in Wirral to discuss the impact on businesses with the changes to port rates and the general economic situation.

Under the old scheme the Port Authority was responsible for payment of business rates, based on port turnover and was collected as part of the rent charged to leaseholders (businesses).  However, the new scheme has shifted payment from the port owner to the tenants – this has been backdated to April 2005.

The difference between the two schemes to the Government is £8m.  At a time when the Government says it wants to help small and medium businesses then surely a rethink is in order.

The backdated demands have already claimed one business – stevedoring firm Thomas Nichols Brown (TNB) – which went into administration last month with the loss of 27 jobs. 

When the 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.  This may present businesses with difficulties in gaining finance for expansion.

It took more than two years for the bills to be finalised and sent to firms.  However, because business rates are based on five-yearly valuations – the last one should have been conducted by April 2005 – tax bills are being back-dated three years.  Port businesses did not know in advance of the increased liability they would have to pay.

Any loss in dock business will result in people being made redundant both directly and indirectly.  Mersey Maritime estimate that somewhere in the region of 3000 jobs are at risk in Merseyside alone.

For more information click here to go directly to Mersey Maritime’s website you can also add your name to the ports rate petition.