Local authorities are under a statutory obligation to levy rates on any property used for commercial purposes, in accordance with the details entered in the valuation lists prepared by the independent Commissioner of Valuation under the Valuation Act 2001. The levying and collection of rates are matters for each individual local authority.
The annual rate on valuation (ARV), which is applied to the valuation for each property determined by the Valuation Office to obtain the amount payable in rates, is decided by the elected members of each local authority in the annual budget and its determination is a reserved function.
However, I am acutely aware of the pressures on small and medium sized businesses at the present time. Local authorities have been asked by my Department to exercise restraint or, where possible, to reduce commercial rates and local charges for 2013 and have responded well to such requests in recent years. In 2013, 87 out of the 88 rating authorities either reduced their ARV or kept it the same as in 2012.
Local authorities have a leading role in creating a pro-enterprise supportive environment to generate new jobs and sustain existing ones. They are committed to local economic development, and are best placed to meet many of the needs of businesses, in terms of infrastructure, local promotion and other key enabling measures. Under the Action Plan for Jobs, the local government sector has developed a sectoral strategy, Supporting Economic Recovery and Jobs – Locally, to promote employment and support local enterprise, including measures in the area of business charges, local enterprise and business support arrangements, procurement support, local development and community-based initiatives, the Green Economy and participation in employment support schemes.
The implementation of the Action Programme for Effective Local Government - Putting People First provides an opportunity to achieve a more coherent approach to rates and charges on a county-wide basis, having regard to funding requirements and the need to support employment and business competitiveness.
I will continue to keep the approach to rates by local authorities under active review, and am determined that every avenue will be pursued to optimise efficiency and contain costs in the local government sector.