THE new coalition government has scrapped the backdated business rates which threatened up to 3,000 jobs across the Port of Liverpool.

Business Secretary Vince Cable insisted on the move as part of the Liberal Democrat-Conservative pact.

His party had included a moratorium in its election manifesto, and the Tories followed suit but warned that given the deficit they might not be able to pay the estimated £35m cost.

That changed when Mr Cable dug in his heels to benefit both Merseyside and Humberside.

From today local authorities will be told to stop sending in retrospective bills, and those in doubt will be forwarded to Communities Secretary Eric Pickles.

Negotiations will continue in coming days to sort out practicalities, including whether to give those firms which have already paid retrospectively credits to offset against future rates bills.

David Pendleton, business development manager of Mersey Maritime which represents 1,000 port businesses, said: “This is fantastic news. The commitment is front and centre of the coalition agreement. It is a coalition of common sense.”

The previous government decided to backdate port business rates to April 2005 as part of a rating “tidy-up”, although the March Budget included a compromise deal to spread payments over eight years.

Mr Pendleton said: “That failed to prevent some firms becoming technically insolvent. They were faced with bills of up to £100,000, enough to drive some of them to the brink of bankruptcy.

“Even those who weren’t in that position had to put aside money which would otherwise have been spent on expansion.”