The 25-Year Gamble: Who Really Wins When Corporations Build the Roads?

Rates Waived, Questions Raised By: Shahab Mossavat 18 March 2026 A £4bn gigafactory. A 25-year business rates waiver. A council that says there is nothing to worry about. The announcement that Agratas – Tata Group’s battery business, building the UK’s biggest EV gigafactory near Bridgwater in Somerset – will fund £150m of local infrastructure improvements in lieu of paying business rates for a quarter of a century is being presented as a clean swap. Somerset Council borrows nothing. Agratas builds the roads. Everyone wins. But is it really that simple? The core question is one that economic development professionals should be asking far more loudly: does a single upfront corporate investment deliver better long-term value for a local economy than a sustained, predictable stream of tax revenue? And if the answer to that is genuinely uncertain – which it is – how can anyone responsibly sign off a 25-year calculation? Business rates, for all their much-criticised rigidity, are flexible in one crucial respect: they respond to revaluations. A thriving facility pays more as its rateable value rises. Rates revenue compounds with economic success. A fixed £150m infrastructure deal, agreed today, does not. Consider the variables that no one can reliably model over 25 years: inflation, interest rates, the pace of EV adoption, Tata Group’s strategic priorities, the shifting competitive landscape for battery manufacturing, the ongoing government review of the entire business rates system. The Transforming Business Rates interim report, published as recently as September 2025, acknowledged that the system itself is under fundamental redesign. Somerset is locking in a deal built on a framework that may look very different by 2030. Council leader Bill Revans says the deal eliminates a “small amount of risk” by removing the council’s exposure to interest rate movements on a loan. That is true, as far as it goes. But it substitutes one risk for several others: the risk that £150m of roads and training provision proves inadequate as the factory scales; the risk that Agratas’s needs evolve in ways Somerset’s infrastructure cannot accommodate; the risk – and this is the one rarely discussed openly – that a corporation’s priorities change. The Government’s own infrastructure analysis is instructive here. Large upfront costs deliver benefits that can take decades to materialise – and can just as easily fail to materialise at all. Japan spent trillions on prestige infrastructure and built bridges to nowhere. Spain constructed airports that saw no planes. The presence of steel and tarmac does not guarantee the economic activity that was supposed to justify it. None of this is to say the Agratas deal is wrong. A £4bn factory, up to 4,000 jobs, and an anchor role in the UK’s EV supply chain is a transformative prize for Somerset. The council may well have made the right call. But “the right call” and “a rigorously tested 25-year financial model” are not the same thing, and the distinction matters. As more corporations – often with the blessing of enterprise zone designations – look to substitute upfront infrastructure investment for ongoing tax obligations, local authorities need independent analytical frameworks to evaluate these deals properly. The asymmetry of information and negotiating power between a global conglomerate and a county council is considerable. The question we should all be asking is not whether Agratas is a good corporate citizen – by all accounts it is working hard to embed itself in the Somerset community. The question is structural: when a company writes the cheque for the roads it needs to operate, who is really getting the better end of the deal? Twenty-five years is a long time. It would be reassuring to know that someone has done the maths with genuine rigour – and published it.