• Home
  • About
  • Newsletters
  • Conference
  • TMS Links
  • Calendar
  • Log In
  • Register

Room 151

  • 151 BRIEF

    What's New?

  • LGPS infrastructure partnership invests £1.8bn in renewables

    December 12, 2019

  • Brunel appoints global high alpha managers

    December 11, 2019

  • City of London completes £250m debt deal

    December 11, 2019

  • Mystery bidder appointed on £250m waste contract

    December 11, 2019

  • Investors withdraw from property fund

    December 11, 2019

  • Highland councillors back tourist tax

    December 11, 2019

  • Treasury
  • Technical
  • Funding
  • Resources
  • LGPS
  • Development
  • 151 News
  • Blogs
    • David Green
    • Agent 151
    • Dan Bates
    • Richard Harbord
    • Stephen Sheen
    • James Bevan
    • Steve Bishop
    • Cllr John Clancy
    • David Crum
    • Graham Liddell
    • Ian O’Donnell
    • Jackie Shute
  • Interviews
  • Jobs

Richard Hardbord: Revaluation strategy

0
  • by Richard Harbord
  • in Resources · Richard Harbord
  • — 28 Sep, 2015

There are many uncertainties facing Section 151 Officers as they look forward over the next few years and many of them are around business rates.

However, chief finance officers do need to give some thought to the effects of the 2017 Revaluation of Business Properties.

Experience

Part of the difficulty facing local authorities is that most people with detailed business rate experience have gone. After 1990 when business rates became a central government tax (albeit collected by local authorities) most authorities gave up any detailed work on the grounds that there was no return for any investment.

Any extra money collected went to the centre and allocations back to local authorities were unaffected by the sums collected in improvements to the debit.

In a perfect utopian world, of course, a business rate revaluation would not make a lot of difference. The total of rateable values would increase and the rate poundage, or multiplier, would go down. The sums of money raised would thus stay the same.  The problem is that not all classes of property will  see rent increases to the same degree, and not all local authorities have the perfect mix of properties. Thus there could be considerable differences and difficulties arising as yet unforeseen.

Timing

A key date is the Autumn statement in December (the effect of global warming on autumn!). This may signal some changes to the future of business rates in particular the intervals between revaluations, back dating of appeals and the appeal process generally.

Then the draft 2017 rateable values will be published in September 2016. This is an important time for reviewing the local list and correcting errors of fact. Over the years quite substantial omissions in the list have been found.  Local Authorities who have taken the step of employing an inspector have found that the increase in rateable value has funded their investment.

Then the autumn/winter of 2016 will see decisions on the poundage and the need for any transitional arrangements. Transitional arrangements are not welcomed generally by local government as they add a level of complexity to the billing and collection. On the other hand they will be necessary if the change in values over the seven years since the last revaluation are considerable and unevenly effect different categories of property.

Message

Those attending the Room 151 LATIF Conference recently will have seen an interesting presentation by John Kelly of CCLA on property investment for local authorities.

There was however one slide which has, I think, wider significance. It showed the rise in capital values since 2010. Using this as a guide to possible rental values there seemed to be a considerable difference between the rise of offices, particularly in London and South East (although those elsewhere seemed to have dipped and returned to 2010 values) and a clear poor performance in the retail sector where outside the south east there may even have been a fall in rental values over that time.

This is not certain data and the VOA and the agents for businesses will clearly have better comparables but it does give a clue that authorities who rely on retail as a sector for their business rates could well be losers against authorities with a lot of office space or even industrial properties. That could even have diverse effects within London.

The message is clear that directors of finance need a clear strategy to deal with this revaluation. Waiting until information becomes officially available will leave little time for action. The situation will be confused by a large number of appeals and this could lead to considerable uncertainty spreading over several years

 

Share

You may also like...

  • Simplicity the key to shared services Simplicity the key to shared services 5 Jul, 2012
  • Brexit, business rates and the forecasting challenge 5 Jul, 2016
  • Housing companies criticised for focus on revenues 6 Aug, 2015
  • Lancashire pulls out of One Connect Limited Lancashire pulls out of One Connect Limited 27 Jan, 2014

Leave a Reply Cancel reply

You must be logged in to post a comment.

  • Register to become a Room151 user

  • Latest tweets

    Room 151 4 hours ago

    Court rejects NHS trusts’ claim for millions in business rates relief: A judge yesterday threw out a claim by 17 NHS trusts that they are charities and should receive millions of pounds of business rates relief. Derby Teaching Hospitals NHS Foundation[...] dlvr.it/RL8F7D pic.twitter.com/fxt6Sor3Q7

    Room 151 4 hours ago

    Authorities turn away from PWLB in favour of borrowing from peers: Councils borrowed just £80m through the Public Works Loan Board (PWLB) during the first full month since the Treasury’s rate rise, a mere 4% of August’s total. Just two authorities[...] dlvr.it/RL8F57 pic.twitter.com/zIOf1KlNpc

    Room 151 1 day ago

    County introduces new rules after £9.1m funds gaffe: A report to Hertfordshire’s most recent audit committee meeting said the “treasury control failure” had come to light in August, one day after the multi-million-pound redemption was not received.… dlvr.it/RL5DP0 pic.twitter.com/6LvY71zUew

    Room 151 1 day ago

    News just in - #WorkingtonWoman is believed to represent roughly half the electorate in Workington.

    Room 151 2 days ago

    LGPS urged to put the ‘social’ back into ESG: LGPS committee members and managers have been asked to elevate the importance of the “S” in ESG (environmental, social and governance) to help protect workers’ rights as the world confronts[...] dlvr.it/RL1c9p pic.twitter.com/xv590d3qm8

    Room 151 2 days ago

    Room 151’s top 10 news stories of 2019 room151.co.uk/treasury/room-… #localgov

    Room 151 3 days ago

    Room 151’s top news stories of 2019: As an eventful year for local authority treasurers draws to a close, Room 151 takes a look at the top 10 stories from the sector during 2019. 10. Spending watchdog[...] dlvr.it/RKy49q

    Room 151 1 week ago

    Council files £130m claim against PFI contractor for post-Grenfell estate costs: London Borough of Camden is suing a former PFI partner and its main subcontractors for £130m for costs relating to the evacuation of one of its housing estates the week[...] dlvr.it/RKkR8C pic.twitter.com/zIfQcikMjq

    Room 151 1 week ago

    Review highlights ongoing financial management issues at Northamptonshire: Northamptonshire County Council’s new section 151 officer should draw up plans to repatriate powers from government commissioners amid ongoing problems with financial management,… dlvr.it/RKjLkN pic.twitter.com/tQIxMDawQV

  • Categories

    • 151 News
    • Agent 151
    • Blogs
    • Chris Buss
    • Cllr John Clancy
    • Dan Bates
    • David Crum
    • David Green
    • Development
    • Forum
    • Funding
    • Graham Liddell
    • Ian O'Donnell
    • Interviews
    • Jackie Shute
    • James Bevan
    • Jobs
    • LGPSi
    • Mark Finnegan
    • Recent Posts
    • Resources
    • Richard Harbord
    • Stephen Fitzgerald
    • Stephen Sheen
    • Steve Bishop
    • Technical
    • Treasury
    • Uncategorized
  • Archives

    • 2019
    • 2018
    • 2017
    • 2016
    • 2015
    • 2014
    • 2013
    • 2012
    • 2011
  • Previous story VNAVs are a “stable place” to park money
  • Next story James Bevan: A long-term view of credit -1985 to 2015

© Copyright 2019 Room 151. Typegrid Theme by WPBandit.

We use cookies to ensure that we give you the best experience on our website. If you continue without changing your settings, we'll assume that you are happy to receive all cookies from this website.OK