G1. In November 1999, the Government, announced that there would be a Review of the revaluation of NNDR in England early in 2000. A review group was established comprised of representatives of DTLR, HM Treasury, DTI, the Valuation Office Agency (VOA), the National Assembly for Wales, the Local Government Association, the CBI and the Federation of Small Businesses. A full list of participants is attached at appendix 1.
G2. Ministers set the following terms of reference for the review:
- To consider how better to provide for the revaluation of properties for NNDR to improve certainty, stability and simplicity for ratepayers, local authorities and central government, while maintaining an appropriate level of fairness in the relative valuations of properties.
- In particular, to examine the case for changing the current five-year revaluation cycle and for introducing valuation bands, taking account of the costs to business of uncertainty and instability and to central government of transitional relief schemes.
- And to consider how best to maintain the aggregate tax yield in real terms.
G3. Ministers made it clear they were satisfied that the fundamental basis of the NNDR system in England is working well. NNDR will remain a tax based on the rental value of an individual property, the level of tax set nationally for England and collected by local authorities. Central pooling of the revenue raised and its redistribution to local authorities would also remain unchanged. The review considered only the revaluation process. It did not have as part of its remit current systems of reliefs and exemptions (other than transitional relief), nor the treatment of specific groups of ratepayers.
G4. Local government is a devolved matter and is the responsibility of the National Assembly for Wales (NAW) and Scottish Executive in their territories. Although this review is concerned with England only, the legislation (principally the Local Government Finance Act 1988) covers both England and Wales. The VOA carries out the valuations in both England and Wales. Any changes that the Assembly wishes to make to rating in Wales may need primary legislation in the UK Parliament. However, the Assembly has powers to make its own secondary legislation, such as for the transitional relief scheme that came into effect on 1 April 2000. Rating in Scotland comes under separate legislation, which can be amended by the Scottish Parliament, although the current system is similar and has the same revaluation cycle as in England and Wales. The Scottish Executive has been kept informed of progress in the course of this review.
The consultation process
G5. A consultation paper setting out the main issues to be considered by the review was published on 28 February 2000. It was sent to a wide range of bodies and individuals with an interest, covering ratepayers and their representative bodies, rating professionals and local authority groups. It was also made available on the internet(www.dtlr.gov.uk). The consultation period closed on 31 March, with 114 responses having been received. An analysis of responses received is at appendix 2.
Main issues considered
G6. The review concentrated on the lessons to be learned from Revaluation 2000, including what worked well and what could be done better within the existing revaluation system; different revaluation cycles; the future of transitional relief; a possible banding scheme; alternative valuation methods; maintaining the gross yield from NNDR by mitigating losses on appeal; and improving the quality of valuations, especially by improving the flow of information between ratepayers and the VOA.
G7. A key aspect of delivering better revaluations in future is to develop a greater partnership between ratepayers and the VOA. This can build on the good work already done for revaluation 2000.
[ Summary of Conclusions ] [ Contents ] [ Annex G Section2 ]
Published on 19 September 2000
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