Deadline imposed on IT suppliers to rescue council business rates relief payments
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Central government has stepped in to force IT suppliers to sort out software problems for councils unable to make business rate relief payments.
Earlier this year the government put aside £300m to soften the blow of bill revaluation after an outcry over the impact on businesses.
However, the scheme was initially delayed as councils waited for government guidance. Now, local government minister Marcus Jones has been forced to call a summit with IT suppliers because of problems with software.
According to reports, the suppliers have now all promised to ensure that changes to systems will be ready for local authorities to use by 21 August.
A spokesperson for the Local Government Association, said: “This has been a complex exercise for councils.
“Uncertainty caused by the calling of the General Election led to late government confirmation of the funding and rules around how it should be distributed.
“This has been compounded by delays caused by the time taken by suppliers to make software changes which has made it more difficult for councils to plan and administer the schemes effectively.”
But the spokesman said that the panic had been intensified by government rules meaning the cash has to be spent this financial year.
He said: “The government needs to give councils the flexibility to shift this funding between years, for the benefit of businesses, rather than it being returned to the Treasury.
“Giving councils the freedom and funding to set all discounts and reliefs locally remains the best way to help them support small businesses and local economies.”
One of the IT firms involved told Room151 that it has been assisting local authorities in managing the implementation of the recent government changes to English business rates legislation.
“As part of this,” the firm added, “we have provided tools to help our customers identify those businesses that will be affected and are working with them to ensure our software reflects the new rules.
“The software is currently going through our development and testing processes and as soon as that is complete, it will be made available to customers.
Another of the affected suppliers, Civica, said: “The company takes seriously and has a strong track record with all matters related to the implementation of new legislation and the support for local communities.
“All suppliers are working under the same constraints with short timescales for delivery of the new legislation.”
The company added that new functionality to apply the discount is currently available for immediate use, with further developments to be delivered this month.
The other supplier involved, Capita, said it has designed a workaround so that the business relief fund could be issued to small businesses at the council’s discretion.
It said: “A planned general software update, which will include functionality relating to the fund, will be provided to our local government clients shortly.”
A DCLG statement said: “We’ve been clear that local authorities should take urgent steps to make sure small businesses benefit from the funding that we announced at the Budget in April.
“There are councils that have pressed ahead and issued revised bills. Others have chosen to wait for software updates to deliver this particular scheme and we’ve taken steps to make sure business get this relief as quickly as possible.”
