Exeter BID proposal 'comes at a terrible time for businesses'

With a second ballot on establishing an Exeter Business Improvement District expected later this year, one city centre trader has posted their views on thisisexeter.co.uk, arguing the proposed compulsory levy is a bad idea.

TWO years ago, the Exeter Business Improvement District proposal was overturned by a 48 to 52 per cent majority, a disastrous result considering the resources that had gone into promoting it.

It was clearly the wrong tax at the wrong time – hated by a majority of small business owners but supported by the council because of the revenue it would raise.

There are three main reasons why I think it is a mistake to try to force the BID levy on us again.

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Firstly, the timing of the BID levy could not be worse. Businesses are currently facing a triple-dip recession, and the BID levy amounts to an additional tax that many will be unable to pay. What many people do not know is that if you are unable to pay the BID levy, then recovery orders will be implemented through Exeter City Council. The last thing already beleaguered businesses need is another council bailiff knocking at the door.

Secondly, I believe that the BID levy in fact represents poor value for money. Ten per cent of the BID levy will be used on administration costs. This is £300,000 to be spent on admin costs that local businesses currently do not have to find. It is simply an added cost that includes wage bills of £50,000 and £39,000 per year for running the scheme – a far higher wage than many small business owners earn.

How the remaining BID levy will be spent is determined through BID proposals, which BID members (anyone who has to pay) are invited to put forward. These included, in the previous BID proposal, a possible £200,000 per year for Christmas lights, £55,000 for CCTV and £1,500 per year "to sort out the seagull problem". Many of these proposals directly benefit Exeter City Council, which is empowered by voters to provide these services in the first place.

The council argues that it no longer has the budget for providing these services, but pleading poverty seems unfair when vast sums have been spent on the Royal Albert Memorial Museum (£24m) and the landscaping of the area surrounding John Lewis (£2m).

The BID levy simply takes £750,000 out of Exeter businesses' pockets, then gives it back to them via BID proposals – minus the cost of admin fees.

This brings me to my third point – that the BID levy could prove to be a public relations disaster because of the way project proposals are brought to the table.

In a real business environment an individual would live or die on how they spend their money. Under the BID levy scheme our money is pooled, then the BID company takes out its cut (leaving at least 10 per cent less cash than to begin with), leaving a committee to come up with ideas as to how to spend the rest of the cash.

My argument is that businesses know best how to spend their own money, and the very success of their business is what makes the district they operate in thrive.

Empty shop units drive people away from a street much more than poor signage (look at the Harlequin Centre).

The committee mentality that drives the BID is much more suited to the public sector than the private sector. This is because the public sector takes their wages out first, then divvy up the rest of the budget, where the private sector have to do exactly the opposite to survive.

Many businesses feel that their huge rates bill is enough of a contribution to the public sector, especially in the wake of horror stories in the press about political corruption, let alone the banking crisis.

In short, I feel that businesses already contribute enough to the local economy, and that the BID is an ill-conceived idea.

What do you think? Visit www.thisisexeter.co.uk to have your say on whether a BID would be a good idea for the city centre.