Businesses still at odds with Government’s new Business Rates Appeals System

John Webber, Head of Rating, Colliers International. Copyright Nick Cunard / NCSM Media.

Businesses are still struggling with CCA, the new “Check Challenge Appeal” Business Rates Appeals System which is clearly not up to the job, according to rating experts at Colliers International, the global commercial real estate agency and consultancy.

In answer to FOI Requests made by Colliers International to the Government’s Valuation Office Agency (VOA) concerning “Find My Business Rates” and the three part : “Check Challenge Appeal” system, the VOA revealed that in the five month period 20th March to 8th August 2018 over 85% of 505 respondents who had not yet completed the Check stage of the process, said they were dissatisfied or very dissatisfied (17% and 69% respectively) with the new system and only 3.2% were very satisfied. These figures largely mirror findings for the first year of CCA (April 2017 to March 2018) where a FOI revealed over 88% of the 2085 respondents in the period said they were either dissatisfied or very dissatisfied with the system too.

Putting the figures together shows that 87% of users trying to get their business rates checked were dissatisfied or very dissatisfied (17% and 71% respectfully) out of 2590 respondents in the 17-month period since CCA was introduced on April 1st 2017.

These figures also come hot on the heels of the VOA’s announcement that the number of appeals started in the 15 months since the 2017 rates revaluation (and since CCA came into play) have fallen by more than 86% compared to the corresponding period following the 2010 revaluation. Indeed, proceedings to challenge VOA business rates assessments have only begun on only 36,310 properties in England, which reflect less than 2% of the 1.88 million properties assessed for business rates. There were 266,870 appeals (over 7 times as many) in the same period after 2010.

“Over complicated procedures, lack of guidance and a largely un-navigable new on-line portal are discouraging those with good cases from challenging their bills,” said John Webber, Head of Business Rates at Colliers International. “At the very least businesses now need to employ agents to help them get through the system, whereas before many could appeal directly themselves.”

He added, “And the fact that only 36,310 checks have been registered (on 1.9% of the properties in England) suggests that 98% of businesses are happy with their current rating assessments, which is of course “delusional.”

CCA was introduced on the day the largest changes to business rates in a generation were published in April 2017. This included significant rate increases across London and the South East alongside a downside transitional scheme for the rest of the UK that offered little respite to rate payers in the depressed areas. This has caused chaos and economic difficulty for many businesses, particularly retailers – as reported in the latest business news.

To counter this criticism, the VOA has claimed that those companies that have finally managed to negotiate the system and get past the Check stage of the process are happier about it. A VOA Satisfaction Survey of over 2000 companies past the Check stage found 47% were satisfied or very satisfied with their experience. However, this could be because 71% of those whose cases have been resolved have found themselves successful in their battle with the VOA and now have a reduction in their rates bills. It is difficult to work out if they are satisfied because they have won their cases or whether because they were happy with the system

Moreover, as John Webber adds, “Turning the figures on their head, 47% satisfied, still leaves the majority- 53% -either impartial or dissatisfied, and that’s with 71% of them successful in their appeals. “

He added “And whilst it sounds great for ratepayers to see 71% of Checks have led to a reduction in rate bills, one wonders why this win figure is so high and what it says about the quality of the VOA assessments in the first place. Given so few companies have managed to get to this stage and actually register for a check, you are left wondering about all those thousands of others who have given up making the challenge. There are many companies deserving fairness, but many find it too expensive or time consuming to pursue. “

Complaints about the system have also little changed in the 17-month period. Still high on the list was the wish to “Have people you can actually talk to so as to explain the situation.” Users still seem frustrated that there is no one that can guide them through the system, no one to explain their issues to and no opportunity to even put forward their reason for challenging their business rates assessment.

As Webber comments further, “The lack of planning, insignificant time to trial the system before it went live and apparent lack of desire by the government to engage with agents and their software providers has resulted in an appeal system unfit for purpose, however the VOA tries to dress up the figures. With the 2017 rating revaluation producing some of the largest increases in liability in a generation, and 2018 building up further rises, it appears this government has proved again that it neither understands the pressures facing businesses or has a willingness to act on calls to change “