Nurseries across the district could see their business rates halved in a move which would ease the ‘pressure’ created by the government’s changes to free childcare.
Harrogate Borough Council is believed to be one of the first authorities in England to offer a discretionary reduction in business rates of 50 per cent for child care providers, following approval for the relief in April.
It means the tax on property used for businesses could be reduced if they meet criteria including offering the government-funded 30 free hours of childcare per week for three to four year-olds.
Last week Josy Thompson, owner of Funcare Ltd which operates three nurseries across Harrogate, learned that her own application was successful.
The discount will make a big difference to nursery businesses still reeling from the Government initiative to double the number of free childcare hours from 15 to 30.
She said: “The amount that I am going to save as a result of this rates reduction is the equivalent to 15p an hour, which goes towards a loss of £1 an hour following the changes by Government. This will mean we will see some of the pressure taken off .
“I haven’t heard of anyone else who has taken this step. It will make a big difference for us and means I can offer more places for disadvantaged children, around 10 to 12 places.
“I don’t think nurseries should be paying any business rates though, in Scotland none of them pay.”
Alongside other local members of the National Day Nurseries Association (NDNA) Josy previously contacted authorities over the issue of business rates.
She said: “The fact that Harrogate Borough Council doesn’t have to do this but recognised that nursery care is important for infrastructure, helping people being able to get to work, is important. They listened to us.”
Fellow member, Bruce Warnes of Sunflowers Day Nursery in Pateley Bridge will not be applying this year for the relief but said he was delighted at the news, with the cost of the free hours 'getting wider and wider.'
He said: “With each piece of meaningful research that is published we can see evidence that the gap between our 3 and4 year old funding rate and the cost of actually providing the place is getting wider and wider. In order to remain sustainable and maintain the quality that we are so proud of we need to find other ways of reducing our cost base. Money saved on things like business rates is money that we can put towards keeping the level of quality and outcomes that our children deserve”
“I know this has been tried by providers in different areas without success so we are very fortunate. It’s interesting that our funding Authority (North Yorkshire) and our Business Rating Authority (Harrogate Borough Council) are different entities, I don’t know whether this has had an impact on this forwards thinking decision.”
He added:“I’m actually not applying for this for my own setting this year, we are in a rural area and Harrogate Borough Council already recognise our really important role though some fairly generous rural reliefs, but I’m glad that taking a bit of collective action has helped others - there’s definitely a big potential benefit when we can work together. I’d urge anyone to get together and try this locally as well as supporting the national campaign for business rates relief. For the price of a stamp you never know."
Purnima Tanuku OBE, Chief Executive of National Day Nurseries Association, which is a national membership organisation based in West Yorkshire, said Harrogate could be the only council in England offering the relief and hoped that others will take note.
She said: "NDNA has been lobbying for nurseries to receive business rates relief for a number of years now. We have had success in Scotland where nurseries are now exempt from paying business rates and in Wales, many more nurseries are being given rates relief.
“Our network of nurseries in the Harrogate area applied to the council and achieved this success for all nurseries. NDNA is not aware of any other council in England giving similar rates relief to all childcare providers, but this is a step in the right direction. We are delighted that Harrogate Borough Council is leading the way on this issue.
She added: "We hope that more local authorities in England will follow suit. NDNA highlighted in our annual survey report this month that business rates are a huge cost. We urged the government to give full business rates relief to all nurseries so they would not have to pass this growing cost onto parents in the form of higher fees."
Coun Graham Swift, Harrogate Borough Council Cabinet Member for Resources, Enterprise and Economic Development said: “We recognise the benefit to local communities of childcare providers which enable parents to work to support family life and the local economy.”
“We are pleased to be able to offer this discretionary reduction in business rates which we hope will be of benefit to providers across the Harrogate district.”