UP To £2m a year in business rates would be raised if the proposed Ikea store in Sheffield gets the go-head, it was revealed yesterday.
Half of that money would be kept by the cash-strapped city council, which is currently looking at closing both libraries and leisure facilities to cope with budget cuts of around £50m in the next financial year.
These new figures have been revealed after questions were asked of the authority by opposition Liberal Democrat councillors.
Sheffield Council’s leading Labour group, and officers, are understood to have “serious concerns” about the impact of traffic from the planned 37,000 square metre Ikea store and its impact on retail development in the city centre.
Before settling on the site at Meadowhall Retail Park, Ikea apparently considered – and rejected – several city centre sites, including spots on The Moor; at the St Mary’s Gate retail park and within the proposed new Sevenstone development.
The preferred Sheffield Road site lies out of town, close to the Meadowhall shopping centre and the already-busy junction 34 of the M1 motorway at Tinsley.
It is also close to Sheffield Arena and the Centertainment leisure complex.
Liz Orme, Sheffield Council’s assistant finance director, said in a reply to the Liberal Democrats: “Potential business rates for the proposed Sheffield development could be between £1.5m and £2m.”
Ms Orme added that the business rate valuation is a “broad estimate” and that an accurate figure could not be calculated until detailed plans have been submitted to the city council.
She also said that it would be “more difficult” and amount to “only guessing” to estimate potential business rates for the proposed Next Home store at Meadowhall, as there are currently only two such stores in the UK.
The £10m Next home and garden store was previously refused planning permission by Sheffield Council, but is currently the subject of an appeal.
Coun Shaffaq Mohammed, Liberal Democrat opposition leader on Sheffield Council, said yesterday: “These reports show the real positive impact an Ikea store could have for Sheffield.
“Under new funding rules, introduced by the coalition, 50 per cent of these new business rates would go straight to the council, which means £1m to support local services like Stocksbridge Leisure Centre or local libraries.
“The council need to be pro-active in supporting Ikea’s application to ensure it overcomes any hurdles.
“Ikea moving to Sheffield will be a real boost for the local economy, creating 700 new jobs.”
Two exhibitions organised by Ikea, in Tinsley and in the city centre’s Millennium Galleries, together attracted around 1,000 people, according to the Swedish furniture giant.
Although the exhibitions have now ended, comments on the plans can still be made on Ikea’s website.
The proposed store at Meadowhall Retail Park would create up to 400 new jobs, from assistant to manager level.
At present, customers in Sheffield who wish to shop at Ikea face either a 70-mile round trip north to Leeds, or an 88-mile round trip south to Nottingham.
It is expected a planning application will be submitted in the coming weeks.
Coun Leigh Bramall, Sheffield Council’s cabinet member for business, said: “Ikea is currently consulting with the general public and stakeholders about the plans for a development in Sheffield.
“When Ikea does submit a planning application we will work with them and help support them to bring an Ikea store to the city.
“Sheffield Council is committed to doing everything we can to bring jobs, growth and investment to Sheffield and would welcome the benefits that a development such as the planned Ikea store would bring to our city’s economy”.