Dan Peters 03 June 2019

Government pays £15m to councils after business rate 'error'

The Government may have to pay out up to £15m to councils after it made yet another error in its business rate pilot administration.

It admitted it will be making ‘special payments to a number of local authorities’ after making the same error in the formula that prompted it to order a review last year.

The Ministry of Housing, Communities and Local Government (MHCLG) permanent secretary Melanie Dawes said considering former Valuation Office Agency chief executive Andrew Hudson has carried out a review into the department’s oversight of the business rates system in 2018 it was ‘all the more disappointing that the incorrect formula in the guidance note, which originated from the computation error, which was discovered last year, was not corrected before that guidance note was reissued’.

Ms Dawes said the ministry was ‘looking into the precise circumstances of how this happened’ and she had now decided to ‘accelerate and widen’ a post-implementation review of the Hudson review.

In a letter to auditor general Amyas Morse, Ms Dawes said she would commission a ‘broader review, for which we intend to appoint external advisers’.

The letter read: ‘This year, there has been no mistake in any of the calculations, nor any payments, relating to the business rates pilots.

'However, as last year’s error was corrected for, officials failed to update the relevant guidance note.

'As a result the NNDR1 [national non-domestic rates] guidance note for the financial year 2019/20, which was issued to local authorities on 17 December 2018, contained the same error in the same formula.

‘The incorrect formula has the impact of exaggerating the forecast benefit of participating in a pilot.

‘Given that the financial year has already started, and particularly since the error in the guidance repeats the same mistake as last year, the secretary of state has exceptionally decided to offer a goodwill payment to those councils that used the incorrect guidance for their financial planning in 2019/20 and where the consequences of doing so could be more difficult to mitigate.’

SIGN UP
For your free daily news bulletin
Highways jobs

Quality and Review Support Assistant

Durham County Council
Grade 4 £26,427 - £27,709 (Pro rata)
Applications are invited for the above post within the Quality and Review Team. WHAT IS INVOLVED? You will provide administrative, clerical and typ Spennymoor
Recuriter: Durham County Council

Business Services Senior Co-ordinator

Durham County Council
Grade 7 £31,015 - £34,811
An exciting opportunity has arisen within Business Services for two Business Services Senior Co-ordinators on a temporary basis for 12 months.   We ar Peterlee
Recuriter: Durham County Council

Enhanced Teaching Assistant

Durham County Council
£29,071 - £32,046 pro rata
The Head Teacher and Governing Body of Tudhoe Moor Nursery School wish to appoint a confident, enthusiastic and highly motivated person to join our Ea Spennymoor
Recuriter: Durham County Council

Business Services Senior Co-ordinator

Durham County Council
Grade 7 £31,015 - £34,811
Are you an experienced administrator who enjoys supporting people, leading a team and making sure services run smoothly? A fantastic opportunity has Durham
Recuriter: Durham County Council

Instrument Repair and Maintenance Technician

Durham County Council
Grade 6 - £29,071 - £32,046 pro rata, per annum
An exciting opportunity has arisen at Durham Music Service for an Instrument Repair and Maintenance Technician (Grade 6) on a 0.2 FTE fixed-term contr Durham
Recuriter: Durham County Council
Linkedin Banner