The Bill now before the House, which passed all Stages in Seanad Éireann prior to the Christmas recess, is a further step in the modernisation of the valuation code.
As Deputies are aware, the rateable valuation assessed on properties under the Valuation Acts form the basis for the computation of rates and, as such, play a significant part in the system of local authority financing. Rates revenue from commercial and industrial property amounted to £175 million in 1987. It is, therefore, important that the valuation system be operated in a cost effective and equitable manner. Efficient and flexible procedures for the listing of properties for valuation, determining valuations and the hearing of appeals must be available.
The bulk of the existing code is rooted in mid-19th century legislation, the Valuation Act of 1986 being one of the few valuation statutes in the 20th century. During the passage of that Act, Members of both Houses expressed the view that far more radical changes were required. In response the then Minister for Finance explained that this was a major undertaking, that the Valuation Acts were being reviewed and that further legislation of a more comprehensive nature would follow later. The proposals in this Bill represent very positive progress in the modernisation process.
The examination of other aspects of the legislation is continuing and my objective is to introduce a single modern statute at the earliest possible date covering all aspects of valuation for rating purposes. I am sure that the House would welcome such a development and I will be glad to have the views of Members on the nature and content of such a statute.
The main purpose of the Bill is, first, to establish a Valuation Tribunal to hear appeals against rateable valuations determined by the Commissioner of Valuation in the course of first appeals to him. This will replace the present system of appeal to the Circuit Court; second to introduce continuous revision of the valuation lists throughout the year in substitution for the existing single annual revision; third, to provide for the valuation of public utility undertakings on a global basis and the apportionment of the valuation between the functional areas of local authorities and fourth, to provide for the delegation of functions by the Commissioner of Valuation.
I will now explain the background to the measures proposed and the consequences. First, the Valuation Tribunal: under existing law a first appeal against a valuation can be made to the Commissioner of Valuation. His determination can then be appealed to the Circuit Court but it is now proposed to establish a tribunal to hear such appeals. Valuation appeals raise complex questions about technological developments, returns on investment, diverse uses of property, commercial practices and market trends, issues which are best decided by a specialised tribunal. Members of the valuation profession, both in the public and private sectors, and the rating authorities strongly support the establishment of a specialised appeal authority.
The new Valuation Tribunal, to be appointed by the Minister for Finance, will consist of persons with professional competence and business experience in the area of property valuation and law. The intention is that the chairman and deputy chairmen will have legal qualifications. Determinations of the tribunal may be appealed to the High Court on a point of law.
It is envisaged that the tribunal will issue written judgments setting forth the reasons for the determinations and that such reports will be available within a short period. If the volume of work so demands, the tribunal may act by divisions and the question of sitting in different provincial centres can be considered also.
I now turn to the second measure proposed in the Bill, the introduction of continuous revision of valuation. At present listing and revision of property valuations works on an annual cycle. The Valuation Office issue the valuations of listed properties to local authorities for publication on a statutory date, 1 November each year. The process of appeal then begins together with the listing of properties, including new property for first-time valuation, for the following year's revision. Such requests for revision, which must be submitted to the Valuation Office by 14 February, average 60,000 per annum and form the largest part of the workload of the Valuation Office. All of these requests have to be submitted during the same short period, and subsequently valued by a specified date, compelling both local authorities and the Valuation Office to operate within an inflexible system.
Under the system of continuous revision now proposed, a ratepayer, a local authority or an officer of the Commissioner of Valuation may, at any time during the year, seek a revision of the valuation of property entered in the valuation lists or the inclusion of new property on the lists. The commissioner will appoint persons from among his staff to investigate the requests for revision. The revision work, in virtually all cases, will be completed within six months of receipt of the request. However, it is necessary to allow for some flexibility in the residue of cases where the availability of documentation or other complications cause unavoidable delay in determining a valuation. The results of revisions will be incorporated in a list of valuations issued by the Valuation Office to rating authorities at quarterly intervals. For rates purposes, the relevant valuations will be the latest ones available when a local authority meet to strike the rate in their rating area. The commencement date of continuous revision will be fixed by ministerial order.
Continuous revision will promote greater efficiency in operating the valuation system, and will also ensure that revisions can be quickly and regularly entered in the rate books. I am confident that the change will be welcomed by local authorities and the professional valuation bodies.
The Bill also provides for the global valuation of public utility undertakings and the apportionment of such valuation across local authority areas. The term "public utility" is applied to concerns such as the Electricity Supply Board which supply services to the public on a national or regional basis. These undertakings consist of a number of main production units, such as an electricity generating station, but, in producing and distributing the service, they comprise a wider network of lines, pipes, cables or wires which are necessary to get their products to the consumer. These "appendages" are an integral part of the undertaking and must therefore be included in the valuation. Unfortunately, existing legislation does not readily permit the valuation of all such property. The only way in which the property of a public utility, such as the ESB, can be valued is to have every single item of property, which is widely distributed throughout the country, listed by each rating authority.
The global basis of valuation, which will look at all the property of an undertaking, gets around this problem. The global valuation will be based on an estimate of the effective capital value of the undertaking as a whole. The Bill also provides that the global valuation may be apportioned by the Commissioner of Valuation across different local authority areas.
Finally, the Bill provides for delegation of functions by the Commissioner of Valuation. Under the present legislation the commissioner has virtually no discretion to delegate any of his functions. For instance, there are about 4,000 first appeals each year but each of these must be personally determined by the commissioner. Many of the appeals could be handled by the senior valuer staff in the Valuation Office if the commissioner had authority to delegate the authority to his officers in appropriate cases. Delegation of functions, as proposed, will improve the operational efficiency of the Valuation Office and will enable the commissioner to concentrate on the more complex valuation cases, the management of the Valuation Office and the very necessary review of valuation legislation to which I referred earlier.
I now turn to the detailed provisions of the Bill. Section 1 defines the terms used. Section 2 provides for the establishment of a Valuation Tribunal to hear appeals against determinations of the Commissioner of Valuation on first appeals. Details of the constitution and procedures of the tribunal are given in the First Schedule. The decision of the tribunal will be final subject to a right of appeal to the High Court on a question of law. The tribunal will be established on a date to be fixed by ministerial order. Appeals already lodged and pending before the Circuit Court at the time of the establishment of the tribunal will not be affected.
Section 3 provides for continuous revision of the Valuation Lists throughout the year. A ratepayer, a local authority or an officer of the Commissioner of Valuation can seek a revision of the rateable valuation of property at any time. The Commissioner of Valuation will issue the results of revisions at quarterly intervals to local authorities. The owner or occupier of any property listed for revision will be so notified by the rating authority which will also notify him of the outcome of the revision and his right to appeal against it to the Commissioner of Valuation. The section also provides for appeals to the Valuation Tribunal against decisions of the Commissioner of Valuation on first appeal and sets out the procedures involved.
Section 4 provides for the valuation of public utility undertakings on a global basis by the Commissioner of Valuation. The global valuation will be based on an estimate of the effective capital value of the undertaking as a whole. The section also provides that the global valuation may be apportioned by the Commissioner of Valuation across different local authority areas on a basis to be fixed by ministerial order. Any undertaking valued on a global basis will have the right of appeal to the Commissioner and the Valuation Tribunal.
Section 5 sets out the procedures to be followed in the case of an appeal to the High Court on points of law arising from decisions of the Valuation Tribunal. Section 6 provides that the Commissioner of Valuation may delegate any of his functions under the Valuation Acts to any officer of the Commissioner. Section 7 provides authority to set fees in respect of appeals to the Commissioner of Valuation or to the tribunal or in respect of an application made to the commissioner for the fixing of valuations.
Section 8 empowers the Minister for Finance to prescribe the form of various documents required for the purpose of the Valuation Acts. Section 9 contains the usual provision for the payment of expenses incurred in the administration of the Act. Section 10 enables the Minister to deal by regulation with any unforeseen administrative difficulties which may arise in bringing the Act into operation. Any such regulation must be laid before each House of the Oireachtas. Section 11 provides for the laying of certain orders and regulations by the Minister for Finance before the Houses of the Oireachtas. Section 12 gives the short title of the Act.
The First Schedule deals with the constitution, membership, terms and conditions of office, staffing, powers and procedures of the Valuation Tribunal to be established under section 2. The Second Schedule relates to the property of public utility undertakings for the purpose of global valuation under section 4.
I commend the Bill for the approval of the House.