COUNCILS in Hartlepool and east Durham are set to be handed back control of business rates under controversial plans announced by the Government.
Under the changes local councils would keep all the business rates they collect.
Currently they are paid into a central pool and redistributed in grants by the Treasury.
But under the system Hartlepool receives around £20m more than it collects, almost double, on the basis of an area’s population and deprivation levels.
There are fears within Hartlepool council that he authority could be hit hard by the changes.
But Local Government Minister Eric Pickles has assured authorities that they will not be worse off as a result because of safeguards that will be put in place. The Government says the aim is to make local councils less dependent on grants and provide incentives for business growth.
Mr Pickles said: “By letting councils keep the products of enterprise we will end their disparaging dependence on government handouts, finally start rewarding economic growth and support local firms and new jobs.
Councillor Robbie Payne, Hartlepool council’s cabinet member for finance, previously said they would strongly protest if the changes meant the town would be worse off.