Agenda item - Public Involvement

To consider the following matters raised by members of the public:

(a)               Petitions: to receive any petitions presented by members of the public to the full Council or at the meeting itself.

(b)               Written Questions: to receive any questions submitted by the due date of 12 noon on 14 November 2013.

(c)               Deputations: to receive any deputations submitted by the due date of 12 noon on 14 November 2013.

18a.1  There were none.

18b.2  There were none.

18c.3  A Deputation was submitted by Mr K McGrath.

18c.4  The Chair welcomed Mr McGrath to the meeting and asked him to present his deputation. The Deputation stated:

            We are prompted to bring this appeal to the Committee for two reasons;

·        We only became aware that the SEV fee had increased to £6500 in early November 2013, even though this decision was made last year. With the utmost respect, we would ask that the Local authority in future adopt a working practice to notify license holders of increases as and when they are set. If we had been aware of this, we could at least have tried to make some plan or financial provision for it over the last year.

·        We have previously made discretionary arrangements with the authority to pay this license fee by installments, but have again only very recently been advised that this may not be possible in the current year. We appreciate the historic support that this arrangement has provided to us through a very difficult trading period.

However, having received no prior notification of either the 41% fee increase or the change of policy on installment payment has created an immense and urgent problem which is compounded by the flat rate nature of the SEV fee itself. The fixed fee structure takes no account of the size of the premises, the revenue of the premises or the level of individual costs incurred directly or indirectly at particular premises by the Local authority. When the SEV License was first introduced, representations along these lines were made by us to the Committee and we suggested that a fee linked to Rateable value was a more appropriate structure whereby the fee would generally reflect the size of the business. The Committee decided ultimately to adopt a fixed fee structure and I highlight this now only to draw your attention to the dramatic impact that such a large increase in the fee has upon a small local operator, as opposed to a large multi million pounds, national or international operator. The Pussycat Club (“PC”) was the first of 3 local lap-dancing clubs and was originally established in Hove in 1998, moving to its current location in Brighton in 2007. PC is privately owned and operated by the McGrath family and is fundamentally different from the other two license holders in two respects;

·        PC is a private members club which only admits members who are subject to a 48 hour waiting period, guests of members and does not admit or offer membership to the under 25’s. Annual membership fees are payable by members and guest admission is charged at £15 per person.

·        PC is a very small club located in a discreet secondary location, on two floors with a maximum capacity of 100 persons, but as the second floor is used not as a seating area but as the dance area only, the practical capacity is 45 persons.

As a consequence, PC is a discreet, quiet and entirely trouble free premises where the significant anti social behaviour and public order issues which are often evident at other venues simply do not exist. It is our argument that PC therefore creates little or no requirement for additional resources, such as additional police and licensing resources, which are increasingly required to be provided at other clubs who encourage free admissions by persons as young as 18. PC has not had any time or opportunity to plan for or make provision for the new increased fee, nor indeed had any time to make provision for single payment of such a fee and it is a commercial reality that trading conditions throughout the current recession have been extremely difficult for several years and many small businesses like us lack any support from the banks, even our new state owned banks. Our own principal bankers were Bank of Scotland (“BOS”), now Lloyds. BOS provided us with an overdraft facility of £30k for many years, but the new state controlled Lloyds withdrew this facility, demanding repayment despite that the facility had been properly conducted by us for many years. Like many small businesses, we had used our overdraft as working capital to meet unexpected expenditure, such as this massively increased SEV fee, but this is no longer an option available to us. My research has been limited by the short time available to me but I understand there is some suggestion that there may be ambiguity if the license is issued before the full fee is received. Even as a layman I would contest this and I can think of many licenses which are issued with an associated installment agreement, such as my own TV License. There has also been an argument made to me of financial probity and administration costs. This can surely be addressed by making an administration or interest charge such that the authority achieves increased revenue with any such agreement. I understand that income raised by license fees aims to cover the cost of administration of each regime within constraints of regulation, that such fees must be reasonable and it is incumbent on you to review fees in a proper and transparent way and set such at a level you can reasonably expect to recover. There appears to be no legal authority that you cannot accept fees by installments. Permitting PC to pay this fee over the year will at least recognise the unfairness to us of the fixed fee structure and go some way towards recognizing that PC is the one of three venues which does not in fact add to the Authority’s costs. Perhaps in the longer term, the Committee could consider generally whether it is possible to allocate costs, as supplementary annual fees, directly against any venue where additional resources are provided which incur additional or unusual costs. At the moment there exists a balance amongst the 3 license holders who each pursue different segments of the market. If the PC License were to become available, it is possible, perhaps even likely that another large operator would move into Brighton & Hove. It is my submission to you that this would be generally undesirable strategically for our city and I say this not as the operator but as a city resident with young children. This is of course a secondary argument to the proposal before you but worthy of consideration as an aspect of this appeal.

·        We formally request that the Committee do not withdraw (at such short notice) the discretionary facility previously agreed and permit the Head of Regulatory Services discretion to consider our request for an installment payment arrangement for the forthcoming year.

·        We formally request that the Committee take account in its generality, of the contents of this document when setting new fees for the 2014-15 year and consider the adverse impact of the fee on small business. We respectfully ask that any further increase be kept to a minimum and related to inflation.

18c.5  The Chair thanked Mr McGrath and stated:

The information relating to this is covered by the licence fee report at item 22 in the agenda. The Council is clear on the basis of fees collected and the basis on which these are calculated. This is dealt with in detail in the report. Officers have explained to Mr McGrath that legislation makes no provision for payment by instalments. In this case, officers have in previous years, in recognition of supporting business, offered the facility to pay in instalments.

The corporate debt collection and recovery policy states that business debtors seeking help due to financial difficulties will, where appropriate, be considered for alternative payment plans on a case-by-case basis, however allowing for an instalment system in the past has resulted in cases of late and non-payment causing budgeting monitoring issues. For clarity, it is preferable for the full fee to be collected before the licence is issued. Strictly speaking, an applicant for the grant of a sex establishment licence should pay the fee at the time of application and although the authority’s officers had tried to help local business, offers had informed applicants that they could no longer accept part payments. Not only is there no clear legal authority but occasionally these arrangements had led to late payment and budget management difficulties. Sex entertainment licences are currently issued annually, the maximum period. Licences for shorter periods would increase costs. Sex entertainment venues and sex shops are currently at the policy cap, three and five respectively.

18c.6  The Chair said that Mr McGrath would receive a written copy of her response.