Agenda item

For this meeting, Members were provided with reports from Rates Plus which provided the background and context to Business Rates at Heathrow Airport.

Simon Horsington and Roger Messenger from Rates Plus attended the meeting and informed Members that Rates Plus had formed an association with the Chartered Institute of Public Finance and Accountancy who had acknowledged the benefits that Rates Plus was able to offer local authorities.

The Committee was informed that local authorities now had more interest in their business rates revenue as Councils were now able to retain a percentage of these rates. Councils therefore had a greater incentive to increase yield within the Authority on rate losses through rating appeals, demolition of properties and material changes which might affect business rates.

Members were provided with a presentation on the information contained in the report:-

·         There was over £340m Rateable Value contained within just four assessments at the core of Heathrow Airport complex, of which the overall "cumulo" assessment was on its own around £243m.

·         Members were reminded that Rateable Values were calculated on rental values as at 1 April 2010.

·         The rateable value which was ascribed to each property was subject to an annual "multiplier" which was prescribed by the Government. The current multiplier was 0.49, so broadly speaking, a Rateable Value of £1m, would attract a Rates bill of around £1/2m per annum.

·         The Valuation Office was responsible for the calculation of the Rateable Value and the Council as Billing Authority was reliant on the information provided by the Valuation Office, through their agents, Gerald Eve.

·         The Heathrow main assessment had only changed 8 times since the commencement of the 2010 list and this had been despite developments at the Airport.

·         The information provided by Rates Plus on high value assessments was sourced from analysis of publically available data published by the Valuation Office.

·         At Heathrow there were a number of separate assessments and the Valuation Office had identified around 1200 units of occupation.

·         The "cumulo" comprised of everything else and the Council was not provided with details of what this was.

·         A weakness of the current business rates system was that the Billing Authority had no formal rights of access to premises and was reliant on the information provided by the Valuation Office.

·         The Valuation Office despite requests from the Council did not provide sufficient information on what was in the "cumulo".

·         The statutory rights of Billing Authorities were limited, with the Inland Revenue Act 2005 providing limitations to the information released by Ratepayers.  

·         The Heathrow assessment was the largest significant assessment in the country (£243m). By way of comparison, Gatwick's assessment was £59m and Sizewell Power Stations assessment was £66m.

·         Reference was made to the difficulties which Council Inspectors had in relation to accessing the airport, particularly "air-side". However, from the information supplied by Rates Plus there could be missing identifiable units at the Airport such as ATMs, shops, Radio Masts and Advertising Rights. 

·         The Valuation Office could back date appeals back to 2010 and the deadline for this was 31 March 2016.

·         With regard to the inspection of premises, reference was made to the Valuation Office possibly having the ability to delegate inspections.

·         Billing Authorities did have the power to alter the Local List based on the information they possessed.   

Discussion took place on the information presented to the Committee and officers were asked to provide the following for future meetings of the review:

·         An estimate on the Rateable Value at the Airport based on the information which the Council had in terms of shops, ATMs, TV screens, car parks. Also to include runways.

·         Reference was made to information contained in planning applications which the Council had access to which could help with the assessment.

·         The Borough Solicitor be asked to provide a legal perspective on some of the issues of the review and the powers which the Council had as Billing Authority.

·         An officer from the Valuation Office be invited to attend the next meeting to provide information for the review.

·         That advice be sought from the Greater London Authority on the Council's options in respect of the approach to Business Rates at Heathrow.

RESOLVED –

1. That Rates Plus be thanked for the informative reports they had submitted and officers be asked to take forward the actions requested.

2. That the information provided be noted and be taken into consideration as part of the review.