EMROs/Late Night Levy / 21 June 2016

Sun sets on Late Night Levy

Creating a safe and vibrant night-time economy has been the Holy Grail for both local authorities and the trade throughout the UK, and has increasingly appeared at the forefront of the agenda. Yet seven local councils have now adopted a Late Night Levy, a decision that seems to neglect the collaborative vision supported by the trade. The Levy is a discretionary power, introduced through the Police Reform and Social Responsibility Act 2011, and allows licensing authorities to raise contributions from late-night alcohol suppliers to help fund policing of the night-time economy. Levy charges are based on the rateable value of the property where the premises licence is held. Whilst the power is discretionary, local authorities work within a framework that is established at a national level and can then adjust certain aspects to suit specific localities.


Yet it has recently come to light that Cheltenham Borough Council will consult on the Levy that is currently in place. Cheltenham was the second ever local council to utilise the discretionary power but may now choose to abandon it altogether. If a decision is made to end the Levy, it will cease to be effective from March 31, 2017. The consultation follows a vote from local businesses in Cheltenham, supporting the establishment of a Business Improvement District (BID). The policy reversal would raise questions over the effectiveness of the Levy to achieve desired outcomes – and so it should.


In practice the Levy has proved inflexible and unworkable. The BBPA has been vocal on this point and has responded to a number of local council consultations on the Levy, as well as producing a joint report on alternatives to the Late Night Levy. In essence, a number of fundamental flaws exist. Firstly, the Levy can only be charged between the hours of 12am and 6am. This has led to a vast number of local businesses enacting minor variations to scale back opening hours, unveiling a sobering reality in which Levy revenue has fallen far short of local council predictions. Furthermore, legislation dictates that only 30% of Levy revenue can be allocated to local councils, with at least 70% allocated to police. A combination of the two aforementioned factors has led several councils to reject the Levy on the grounds that net revenue from the Levy will be insignificant when factoring in administration and implementation costs. Cheltenham Borough Council raised less than 39% of the £199,000 figure that had been predicted in the first year.


Most important of all, in its most basic form the Levy is a direct tax on local business, and one which unfairly disadvantages pubs. Pubs are at the centre of local communities up and down the UK and many are small, independently-run local businesses. What is more, pubs are leading the charge when it comes to championing a safe and vibrant night-time economy. The key criticism of councils that adopt the Levy is that they have not truly engaged with the local initiatives that are already in place, and to which many pubs are fully committed. The most relevant example here is the BID that Cheltenham will implement, possibly in place of the Levy. A BID scheme is fairer as it spreads the burden between businesses of all kinds and undoubtedly provides for more a targeted and business-led allocation of funds. Cheltenham’s willingness to implement a BID and to consult on the removal of a Levy is perhaps illustrative of a wider concept where local businesses are no longer viewed as the problem, but instead the solution to the problem, and a number of local councils have recognised partnership working as the way forward:


  • A 2013 report by Bristol City Council’s Licensing Policy Scrutiny Board concluded that a BID scheme would provide for more targeted spending of funds and include businesses and stakeholders in efforts to manage the night time economy.
  • In October 2012 Havant Borough Council’s Licensing Committee rejected a levy, citing falling levels of alcohol crime and disorder which the police had partly attributed to the successful local PubWatch scheme.
  • Weymouth & Portland Borough Council Licensing Committee rejected a levy in 2015, due to a lack of evidence to support the scheme. In a report providing evidence to the council, Dorset police highlighted that a BID was already in place and it was supporting the local Best Bar None scheme.

BIDs, PubWatch and Best Bar None are just three initiatives that exist within a broader partnership framework. Other schemes such as Purple Flag, Street Pastors, Community Alcohol Partnerships and PASS have also provided tangible benefits and proven their worth in creating the night-time economy that all stakeholders are striving for. Local businesses are both willing and, more importantly, able to assist in creating a safe and vibrant local economy. With effective partnership working in place, such an environment is no longer the Holy Grail, but instead is entirely within reach. In contrast, the Levy is a step in the wrong direction.

Written by

Philippa Borrowman

Policy and information officer

Further Reading