Rating and Valuation (S.I., 2009, No. 204)

Part of Business of the House – in the House of Commons at 5:11 pm on 1 April 2009.

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Photo of Bob Neill Bob Neill Shadow Minister (Communities and Local Government), Deputy Chair, Conservative Party 5:11, 1 April 2009

If the right hon. Gentleman is patient and listens to me, he will be enlightened in due course. It will help him if I put everything into context; that will lead him to where we are going to be.

How has this regulation come about? It is an attempt by the Government to pick up some of the mistakes of the Valuation Office Agency, for which the Department for Communities and Local Government does not have direct responsibility, but which is the responsibility of the Treasury. Those mistakes were made at a time when, ironically, the Prime Minister was Chancellor of the Exchequer. I do not know whether that had anything to do with the Treasury's having taken its eye off the VAO, but that is the simple chronology of the matter.

What has arisen is this: after the 55 registered ports were denationalised—for good reasons—it was initially decided that they should be rated under a system different from that relating to other businesses in the UK. Rates were raised through a system of prescription by the Secretary of State. The payments generally took place through a system known as the cumulo, in which the port businesses—the warehousemen, the stevedores, the crane operators, the importers of vehicles, the engineers and so on—paid their rents and rates to the port owner. In due course, the rate element was paid to the local authority, which had a duty to collect. The rates were then paid to the Treasury, as they were national non-domestic rates.

It was a reasonable enough proposition back in 2003 for the Government to decide to move to normal rating practice for the businesses in the ports and to move away from the cumulo. We could have debated the matter separately, but it is not the main issue. To achieve that change, the VOA was tasked with drawing up an up-to-date rating list, and that is where the catalogue of errors starts. The prescription system had in fact been extended to 2005. The VOA has a statutory duty to maintain accurate rating lists and that was due to come into force on 1 April 2006. Of course, today is a particularly important day for us to be discussing the issue of rating because it is the quarter day—many people are filing and so the rate bills are dropping on their doormats.

The practical effect of the VOA was, frankly, woefully negligent and inadequate. It did not start the preparatory work until after the due date in 2006. It managed somehow to inform the owners and operators of the ports but not generally the businesses that they would be rated separately and that, in effect, they were to be rated as separate hereditaments and rating units rather than under the cumulo system. So, although many of the big boys—the operators—knew of the change, the small and medium-sized businesses did not. They were not kept adequately informed. The VOA accepts that, in what I suspect is almost as mealy mouthed an apology as when Pontius Pilate said in another place that he might have got it wrong. In a limited fashion, the agency accepts that there was inadequate communication, which puts it mildly. There was no communication at all and there was gross negligence on the part of the VOA.