Government wants to railroad rates regime

The chancellor is due to deliver his conclusions on reform to the appeals process later this year and we wait, more in hope than in expectation, for changes to the government’s proposals for ‘Check, Challenge, Appeal’. If, as Norris suggests, the opposition is “not doing its job”, let’s hope that the weight of professional (and public) opinion does it for them.

The government is clearly - and understandably - seeking to restrict appeals, while at the same time blocking access to the evidence supporting the valuations undertaken by the Valuation Office Agency (VOA).

While the government is keen to retain rates because it raises so much (£27bn a year in England and Wales) and because the system is reliable, it does not like the cost of stewardship on appeal through the VOA (HMRC) running to a few tens of millions. Although ‘business rates as a tax’ is essentially a subjective process, there is a clear but perverse move to restrict discussions.

Not only is the proposed system fraught with bureaucratic and technical difficulty and likely to be long-winded, but the government is proposing draconian fines and charges in an attempt to dissuade appellants from appearing before the relevant appeals tribunal. This appears to ratepayers and their advisers to be an attempt to impose the opinions of government valuers without a professional discussion.

As a predictable consequence of previous ill-conceived legislation (placing a deadline on current appeals early last year leading to a surge in 2010 litigation), the government is desperately attempting to reduce the workload of civil servants beyond 2017. Unfortunately, the new proposals are likely to lead to a more intensive but deferred process of litigation, because refusals to negotiate and exchange evidence at an early stage will lead to matters reaching the tribunal that otherwise could have been resolved ‘face to face’ between surveyors.

In the past, the VOA has been hung out to dry by ill-informed politicians and the same thing is likely to happen again. There is no substitute for an open and professional two-way negotiation. If the government seeks to force through an untried and closed regime, most professionals will regard the change as a flagrant abuse of power. If an evidence-based regime persists, then it will require a proper exchange of opinions. The same goes for discussions both inside parliament and with the professional bodies.

Richard Wackett, partner, Montagu Evans