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

Senior Social Worker/AMHP

Wakefield Council
Grade 10 - Grade 11, 37 hours, Permanent
Join Us as a Senior Social Worker – Make a Real Difference in Community Mental Health Wakefield, West Yorkshire
Recuriter: Wakefield Council

Graduate Ecologist

The Royal Borough of Windsor & Maidenhead
£30,193 - £34,104 per annum
We have an exciting opportunity for a Graduate Ecologist to join us! Maidenhead, Berkshire
Recuriter: The Royal Borough of Windsor & Maidenhead

Fostering Practice Supervisor

North Yorkshire Council
£47,181 - £51,356 per annum pro rata
Are you an experienced Social Work professional with a passion for fostering and improving outcomes for children? Northallerton, North Yorkshire
Recuriter: North Yorkshire Council

Children's Residential Short Breaks Worker

North Yorkshire Council
From £31,537 up to £34,434 per annum
Join Our Team – Make a Difference in a Child’s Life Scarborough, North Yorkshire
Recuriter: North Yorkshire Council

Clerical Officer Receptionist

Durham County Council
Grade 3 £25,185 - £25,989 pro rata
We have an exciting opportunity for a temporary part-time Clerical Officer/Receptionist to join our dedicated team within Business Services.   WHAT Stanley
Recuriter: Durham County Council
Linkedin Banner