Rooker tells BIDs rebels to fall in line

The Government has threatened to tear up proposals to introduce US-style tax plans to pay for improvements to Britain's towns and cities if the House of Lords insists on making amendments.

The ultimatum comes from Lord Rooker of Perry Barr, Minister of State for Housing and Planning. He says plans to create so-called Business Improvement Districts (BIDs) must not delay the Local Government Bill, which is at the committee stage in the Lords. BIDs would introduce a levy on businesses to pay for enhancements to Britain's high streets including landscaping, security and cleaning.

The British Property Federation (BPF) and the Confederation of British Industry (CBI) are worried the BIDs scheme may fail as it does not require the involvement of landlords. On Wednesday, the Lords debated amendments tabled by Conservative peer Lord Jenkin of Roding proposing the compulsory involvement of property companies in BIDs. They were supported by the BPF and the CBI.

But Lord Rooker warned that the Government does not support Lord Jenkin's amendments as they would meana "wholly new tax on property ownership", and would slow up the passage of the Local Government Bill through Parliament. If the amendments went ahead, said Lord Rooker, BIDs would be removed from the Bill.

The Government is keen to see the smooth passage of the Local Government Bill because it includes high-profile policies, such as the abolition of Section 28, which restricts the promotion of homosexuality by local authorities.

Liz Peace, chief executive of the BPF, said: "On balance it is better to drop the amendment and concede defeat. However, the Government should review BIDs after the first year."

Martin Moore, managing director of Prudential Property Investment Managers, which controls £12bn worth of property assets, said: "I am disappointed by this. Ensuring property owners' involvement would have strengthened the likelihood of BIDs succeeding."