Aberdeen city centre business leaders are appealing to the SNP government to take action on business rates relief or risk the future regeneration of Union Street as popular venues close their doors.
SNP minister Mairi Gougeon heard the stark reality facing firms in the city centre during a visit to The Esslemont restaurant on the city’s granite mile.
She was there to unveil £5,000 of Scottish Government funding to expand Aberdeen Restaurant Week, which runs from January 22 to February 4.
Despite the optimism around the popular foodie fortnight, business leaders are keen to make a direct plea for support tackling crippling business rates.
Findlay Leask, managing director of Aberdeen coffee supplier Caber Coffee, said if rates support is not offered, then new businesses won’t be attracted to move in to the city.
It comes just days after the shock closure of Aberdeen food hall Haigs and a fundraiser launched to save city centre cafe and vinyl store, Red Robin Records.
Mr Leask said: “Rates is a huge issue that needs to be addressed.
“Without addressing that, where is the incentive for new businesses to come in to the city centre? It’s all about diversity.
“We’ve seen this week there are two businesses of great diversity elected to close, or look to be closing. And if we can’t address the rates issue, we won’t attract new businesses, we won’t attract new life into the city centre, and that’s concerning.”
What do business leaders want?
City centre business leaders want to see the Scottish Government introduce a 75% rates relief like that extended in England as part of the autumn statement.
However, Finance Secretary Shona Robison failed to replicate the scheme for mainland Scottish hospitality businesses when setting out her budget last month.
Those on the islands will be given 100% relief and Ms Robison announced a freeze to rates for premises valued at less than £51,000.
Allan Henderson, founding director of The McGinty’s Group, which runs some of the city’s most popular pubs and restaurants, said the relief must be matched.
He said money was available to government but not passed on.
“If it’s doable in England and the Westminster government has passed that on to us then that argument doesn’t hold for me,” he said.
“What’s clearly apparent is that the Scottish Government has no time for the hospitality industry in Scotland.”
Business rates support is an issue that is raised by “many city businesses day in and day out”, echoed Adrian Watson, chief executive of Aberdeen Inspired.
We revealed new figures last month that show 96 properties on Union Street have sat empty at some point during this financial year so far, including 64 offices and 26 shops.
‘Really concerning’
In a sit-down with the P&J, Ms Gougeon, who is Rural Affairs Secretary, agreed it is a “really concerning time” for the hospitality sector.
On the rates relief ask, she said: “We’re facing one of the worst budget settlements that we’ve ever seen in Scotland.
“We’ve had a real terms decrease and if we were to replicate the rates relief that’s been seen down south in Scotland that would mean quite bluntly that we wouldn’t have the same money to invest in our NHS and schools, in our emergency services as well.”
She emphasised the support that has been available through freezing business rates for properties under £51,000 and the small business bonus scheme which allows around 100,000 businesses to avoid paying any rates.
And the SNP minister said the Scottish Hospitality Group will be meeting with Ms Robison to put their concerns to her directly.
Ms Gougeon said: “She announced the budget on December 19 but it’s still to work its way through parliament and go through that scrutiny process.
“There could well be changes along the way but I think it’s really important that these discussions are had so we can fully appreciate and understand the concerns that businesses are experiencing.
‘The city centre is not broken’
Despite the concerns, there does remain optimism amongst business leaders who are working hard on breathing new life into the city centre.
Mr Leask said: “The city centre is not broken. It can come back. It needs the correct decisions to be made because we need to have not just footfall of people coming in from suburbs or the shire, the city needs people in the heart of it.”
And Mr Henderson, who is behind the plans for Aberdeen’s new indoor food market, said: “There is absolutely no doubt that Aberdeen city centre has been down on its heels. But there is some positive things happening.
“The work that Aberdeen Inspired do and Our Union Street are trying to do to reinvigorate Union Street will come to fruition.
“What you’re also seeing is that some of the rentals are coming down in the city centre so basic economics mean that some of the units will fill up.”
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