Tag: business rates

Havering Council and the St Francis Hospice Charity

There are an impressive 16 charity shops in Havering.1 The charity with the greatest number is St Francis Hospice with three shops.

Rated outstanding by the CQC, Saint Francis Hospice [SFH] provides expert care for people in our community with palliative and end of life care needs.2

SFH’s three shops had sales of £2.6m3 in 2023. This success encouraged them to open a ‘superstore’ in Hornchurch. Additionally, there’s the Loughton Boutique, which is their first shop in west Essex.4 SFH is a retail operator mixing charity with sound business acumen. It has reserves of £17.3m.5 SFH is a significant charity but ‘small’ financially.

Havering Council has tiny reserves,

“£8m of un-earmarked reserves is equivalent to c4% of the Council’s projected 2024/25 net budget of £19.75m [this is an error. It ought to read £197.5m] This is far below the recommended minimum level of reserves and is significantly lower than the average level of un-ring-fenced reserves across London.”6 (my explanation)

Havering’s dire financial position is illustrated by the fact that SFH has reserves twice the size of theirs.

Havering is a compulsory supporter of SFH.7 SFH pays 20% of the business rates due because of a 1988 decision.8 This decision costs Havering tens of thousands of pounds in business rates from the 16 charity shops.9

Havering is a ‘victim’ of a decision made 37 years ago forcing them to reduce the business rates for charity shops by 80%. Charity shops are worthy but there is no chance they’d still be getting a reduction if Havering had a choice.

Notes

1 havering’s charity shops – Search This site includes a map

2 Saint Francis Hospice – Home CQC = Care Quality Commission

3 application-pdf p26

4 loc.cit.

5 ibid. p44

6 5-14 Appendix H – Section 25 Statement of Robustness.pdf para 8:1

7 Charity Relief – Businessrates.uk

8 Business rates—charities and not-for-profit organisations | Legal Guidance | LexisNexis

9 This is a heroic estimate.

Havering’s Council Tax: The Government’s Exemption Policies

Ray Morgon uses apocalyptic language when discussing government funding. In 2010, before the Conservatives’ Age of Austerity, Havering received £70m. This was reduced to £2.9m in 2023. A £100m per year reduction when corrected for inflation.1 Religious buildings are zero rated for business rates and charity shops pay only 20%. Havering’s finances are damaged by these exemptions.

Uncosted exemptions reflect prejudices of by-gone eras.2 The government imposes exemptions for religious buildings without compensation for the council.3 Voters haven’t a say as to whether they want to subsidise religions.4

“….belief in ‘a god’ in the UK is low. Only a quarter of Britons (27%) say they actually believe in ‘a god’. A further one in six (16%) believe in the existence of ‘a higher spiritual power’, but not ‘a god’.”5

As 73% of people aren’t religious, why do tax exemptions exist? It isn’t obvious why churches should get financial support from Havering.

Charities are different. Local charities command general support. St Francis Hospice is a well-loved charity in Havering. Their shops provide funds beyond normal charitable giving. Their accounts don’t acknowledge the value of the 80% business rate reduction. However, their reserves of £19.44m are helped by those reductions.6

Havering has had massive reductions in annual funding but can’t maximise its tax base. Government decisions about religion and charities are paid for by Havering’s taxpayers.

Notes

1 Inflation calculator | Bank of England

2 There are 110 Christian buildings in Havering which don’t pay business rates. Havering’s flagship church is St Edward’s, Romford. Its financial statement reveals the building is worth £16.24m and they have reserves of £318,000 de5291_4413260d7c764342a5681c27d3be80a8.pdf (stedwardsromford.com)

3 There are 7 charity shops on Hornchurch High Street charity shops in hornchurch – Search (bing.com) They don’t pay VAT and so have further commercial advantages. See VAT for charities: Overview – GOV.UK (www.gov.uk)

4 See Havering Council and Religious Diversity – Politics in Havering

5 How religious are British people? | YouGov

6 388190336.pdf (sfh.org.uk) See also do charities pay business rates uk – Search (bing.com)