Borough’s financial independence bid has ministerial backing

If successful, the  London borough would forgo its £18.6m share of the centrally set RSG in exchange for a greater share of business rates. According to Local Government Chronicle, of the £81.8m of business rates Kingston upon Thames expects to collect this year, it will only keep 30 per cent, returning half the amount to the Treasury while passing the remaining 20 per cent to the Greater London Authority.

By increasing its share to 54 per cent at the Treasury’s expense, Kingston would no longer require a penny of RSG and could reduce its planned budget cuts from £27m to £10m over the next two years.

Cllr Davis has said that the plans would encourage economic growth in the area and would help the borough adopt a ‘more entrepreneurial approach’ to council running. This has been championed by supermarket chain Lidl agreeing a deal earlier this year to move it headquarters to the borough, a move bound to boost business rates growth.

Davis said: “As always with these things it comes down to the Treasury. My judgement is it’s a great deal because it gives us independence but it still gives the Treasury a stake in our growth.

“The big risk is if the economy crashes and business starts to dry up, then actually we’d struggle as a borough. But if business went bust to that sort of level [everywhere would] be in trouble.”

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