New burden for hospital trust
Extra £1.2 million to be paid in business rates from April
The trust which runs Peterborough City Hospital will have to fork out an extra £1.2 million in business rates from April. The 43 per cent rise in rates will force the trust, whichlost £37.1 million in the last financial year, to find new savings according to chief executive Stephen Graves.
He said: “The trust will now need to put additional cost efficiencies in place, on top of the savings that we had already planned for, to ensure that we reach our financial control total for next year.”
The rise in business rates from £2.7 million to £3.9 million comes after the rateable values of business properties was increased.
Accordingtopropertyconsultants CVS, the trust will be the third biggest losers out of all hospitaltrustsfromtherise in business rates.
Thecompanysaidthetrust in Peterborough will be paying £1.82 million a year more on average over the next five years than it currently does.
NHS trusts claim they should be classified as charities, meaning they would be eligible for an 80 per cent tax discount, but this has beenrejected by local councils.
Many private healthcare groups are registered as charities andbenefitfromsuchtax breaks.
Steven Pilsworth, finance director at Peterborough City Council, said:“It’s anationalissueandtheLocalGovernment Association is leading it. And we have taken legal advice.
“Thesimplefactofthematter is hospital trusts are not charities.”
Rateable values are set by the Valuation Office Agency, a government agency.
However, a spokesman for the Department for Communities and Local Government said the Government has no involvement in the setting of rateable values.
MPforPeterboroughStewart Jackson said he was waiting for a detailed brief from the hospital trust before commenting.
North West Cambridgeshire MP Shailesh Vara said: “Peterborough City Hospital has experienced financial difficulties for many years but I do not believe that frontline services will beaffectedbythe revised business rates.
“The hospital’s focus must continue to be on getting out of the position it finds itself in, but expecting to pay lower rates while other organisations around it are paying the full amountisnottheanswer.”