Some businesses in Penrith are questioning the impact and value of an organisation tasked with reversing the fortunes.
The town’s Business Improvement District (BID) has a mandatory 1.5% levy that must be paid by all non-domestic rate paying businesses in the town centre at a time other business costs continue to increase.
Concerns have surfaced about the cost and benefits as updated rateable values introduced by the Valuation Office Agency on 1 April 2026 have led to higher bills for many, increasing not only business rates that the 1.5% BiD levy is charged against.
Penrith BID underwent two renewal votes in 2023 after the first vote by local levy paying businesses resulted in the bid renewal failing to get the required threshold in support to continue resulting in the bid board holding a second renewal vote in June 2023.
According to its website Penrith BiD uses funds raised to "enhance the promotion of the town centre to thousands of visitors, increasing footfall and encouraging additional consumer spending in Penrith town centre".
The BID claims the benefits of paying the mandatory charge "more than outweigh the cost of the levies for many members".
As part of the 2023 renewal a vote by local businesses, Penrith BID increased the levy local businesses in the BiD area pay to 1.5% levy on top of their business rates and other running costs. A business with a rateable value of £10,000 pays £150 as a BiD levy.
Many local businesses have seen their business rates increase after the Valuation Office Agency (VOA) updated the rateable values of all commercial, and other non-domestic, properties in England and Wales that came into effect on the 1st of April 2026.
Increasing for Penrith Businesses not only the business rates they pay but the 1.5% levy amount they pay to Penrith BiD collected for the bid by Westmorland and Furness Council who also carry out the enforcement action against any levy payer refusing to pay the Penith BiD levy.
It has emerged that since the new BiD term began in July 2023 Penrith BiD and Westmorland and Furness Council have no agreement in place to date although Westmorland and Furness Council has agreements with other BiD’s such as Barrow BiD and Penrith Industrial BiD that covers the towns industrial parks and was subject to a renewal vote in 2023.
Westmorland and Furness Council was asked about the lack of an agreement with Penrith BiD despite the council still collecting and taking enforment action on behalf of the BiD, A spokesperson for Westmorland and Furness Council said: "Having a signed operating agreement in place is certainly desirable and good practice and is always something the council will work towards.
"Such an agreement helps set out the working arrangements and roles of both parties and provides additional clarity over and above the details set out in the BID proposal regulations.
"However, it is not unusual for the establishment of an operating agreement to follow after the start of a BID term and it is not an absolute requirement. It is also not legally required before being able to collect the BID levy – the ability to legally set, collect and enforce the BID levy is created by the democratic vote to establish the BID and the BID proposal regulations.”
"Happily, we already have very good working relationships with all our BIDs and we are actively working with them to establish signed agreements anywhere they are currently not in place.''
Guidance by Government and the British BiDs association however sets out that the local authority is required to manage the collection and enforcement of BID levy charges. The BID body and the local authority establish a levy collection agreement often known as an Operating Agreement. The principle of this agreement is to define the principles and processes for collecting the levy; enforcing the payment of the levy; reporting on collection and bad debt; monitoring provisions between then BID and the local authority; and providing regular detailed and summary information on the service to the BID as the client. Best practice suggests that a draft arrangement between the authority and BID should be available for scrutiny by businesses during the ballot period.
Penrith BiD receives annually before the increase in the business rates came into force on the 1st of April approximately £131,406 in levy charges paid by local businesses in the town centre. Along side the levy money the BiD also receives thousands of pounds from Penrith Town Council as grants from its budget paid for by Penrith households as part of the Council Tax and some grants from Westmorland and Furness Council.
One local trader who spoke with Penrith Town News that has traded in Penrith “long before the BiD was introduced”, described the levy as "been robbed by Dick Turpin" and did not think the levy represented value for money.
"There are more and more shops closing and sitting empty in Penrith day by day and I don't see any improvements to the town centre or extra footfall."
“Flowers and Christmas lights are nice to look but don’t bring in trade that helps the local businesses at a time our costs are going through the roof. The flowers and Christmas lights both happened in Penrith long before the BiD existed. The events the bid funds with our levy money benefits the various often out of town stall holders on the day and blocks our shop fronts from view in the process”
A handful of local business and property owners that have to pay the levy even if the business property is unused said they are aware of Penrith BID in name, but are still unsure what the organisation does for them despite the 1.5 % levy.
Penrith BiD in its business plan in 2023 said that without one, they believe many projects would not be delivered to the extent that only the BID can do and that the towns business has a weaker voice at the table with the new and local Councils if the BiD did not exist. It claimed, local businesses won’t always be consulted with matters in the town that directly affect local business.
Penrith BiD Chairman at the time of the second renewal vote said “I am often asked what BID has done ‘for me’, and I answer that with, ‘it is not what BID has done for you, but what BID has done for the town’.”
“A lot of what we do is usually in the background and behind the scenes, working very closely with our partners to ensure businesses are represented at all levels in the decision-making process.”
“I work very collaboratively but I’m also not afraid to say no, disagree or walk away from what I think is not in our best interest or does not benefit the town.”
Despite a handful of new businesses opening in Penrith over the last month and some relocating in the town over 60% of the commercial space in Penrith is currently closed with may commercial properties up for sale.
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