English UK increasingly frustrated by 'postcode lottery' on business rates relief
On Tuesday 17 March 2020, Chancellor Rishi Sunak announced that business rates relief extension outlined in the budget to support the UK hospitality and leisure industries would be applied to all businesses in these sectors. However, many of the 400+ English language teaching centres across the UK are unable to access this relief due to an absurd and arbitrary interpretation of the scheme.
Guidance from the Ministry of Housing, Communities and Local Government
English language teaching centres, along with a number of other businesses in the sector, are being excluded from relief based on guidance provided by the Ministry of Housing, Communities and Local Government to local councils that they do not qualify because customers do not enter the premises to make a purchase. With the students studying at these language schools often making journeys of thousands of miles to the UK to access this resource, contributing hugely to the local economy when they arrive, it is hard to imagine how they might do that without making a purchase before they set off.
Mixed messages from central government
This week members in Brighton & Hove and Ealing were added to a small list of councils offering the rates relief package outlined by the Chancellor of the Exchequer in March, aimed at businesses in the retail, hospitality and leisure sectors. Members across the country are still being excluded from this relief by local councils however, despite a joint letter addressed to the Chancellor and signed by English UK, along with the Tourism Alliance, CPT, ETOA, UKInbound and Coach Tourism Association.
English UK initially found support from the Local Government Authority in a statement published on their website interpreting the scheme in favour of providing support for English language teaching centres. This advice has since been removed, adding to the confusion and frustration felt by an industry that feels overlooked by central government.
'A postcode lottery'
"The Chancellor has made it abundantly clear in public pronouncements that the tourism and leisure industry needs particular attention as it was hit early, and business will stay frustrated late into this crisis", says Jodie Gray, English UK's interim chief executive. 'The English language teaching sector in the UK contributes £1.4 billion pounds a year to the UK economy and supports over 35,000 jobs. The average length of stay for an ELT student is less than 4 weeks. This is a thriving part of the tourism and leisure economy that is being overlooked. If our members don't survive this because of a postcode lottery, these students will go to Canada, Australia, Ireland and the USA in 2021.'
Around the country members tell heart-breaking stories of family businesses facing permanent closure as their large business rates bills (ELT centres have high rates as they need large buildings to accommodate classrooms) keep coming, whilst other centres in neighbouring councils have been granted the relief and the accompanying grants.
In London, over 100 English language teaching centres create 2,100 teaching posts and a further 1,440 in their wider activities, with a GVA of £30m and a £68m turnover. Most London councils have refused rates relief to these businesses however, to the increasing frustration of business leaders that have a permanent place in their local communities. Jane Dancaster is Managing Director of Wimbledon School of English which was established in 1964.
'We pay £106,000 in rates every year and for the remainder of 2020 we foresee having no students studying with us. Our teachers, host families, coach companies, local cafes, shops and restaurants all rely on WSE. Business rates relief might be the difference between survival and closure for us. If all these people suffer as a result of an arbitrary interpretation of a scheme that is designed to support UK tourism and leisure, that would be scandalous.'
'Extend this relief unequivocally'
Gray summarised the feeling of frustration. 'As an industry, we contribute hugely to the soft power enjoyed by the UK overseas. People want to study English in the home of the language, and they want to spend their money on exploring the region they choose to study in. Our students support jobs, families and local businesses and then they go home and tell the world how great the UK can be. To be able to rebound from this and contribute again to the growth of the UK economy, our members need this relief, and they need it now. The only way to prevent further random interpretation of the rules is for the Chancellor to recognise our industry and our members as a critical part of the tourism and leisure industry and extend this relief unequivocally to our sector.'
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