Which is it? Inefficiency? Incompetence? or Morton's Fork?

Such is the continuum of the perception of the ratepaying public of the current English rating appeal system. It is a train crash which is in the process of happening: the end of the 2010 rating lists saw a large backlog of appeals pending in the Valuation Tribunal, which has been criticised by the Upper Tribunal for striking out cases, too readily; there is a Bill going through Parliament to reverse the Supreme Court decision in the Mazars case (the "staircase tax") which the Valuation Office Agency ("VOA") will now have to unscramble, going back to 2010; in the current rating lists, the appeal system simply does not work, over a year after it was introduced; and now we are to have another general revaluation in 2020. How, one might ask, is VOA going to be able to cope?

I am not seeking to attack VOA in this piece - far from it: but it must be borne in mind that the Agency has been subject to budget cuts, annually, since 1990. In London alone, in the 1980's, there was a district office in each borough, there were four regional offices to manage them, and the Chief Valuer's Office was there, as well. With effect from this summer, though, fourteen boroughs will be dealt with by a single office, in Docklands, which will be shared with the CEO's office. There are no regional offices any more; and I understand that valuers (sorry - "caseworkers") are discouraged from going out to inspect the properties which they are to value, and to value them on a "desktop" basis. The first question I was wont to ask in cross-examination was always about when the witness had inspected the property: now, it seems, this is not necessary, thanks to the availability of online maps and photographs - although these do not show the interior of a building, or its physical condition. Is this another mechanism for making savings? Private practice will invariably inspect.

Closure of offices and reductions in staff numbers have bitten deeply. At the first quinquennial review, in 1995 (the only one, I think, carried out by Parliament) additional funding was requested of the Treasury but was refused. The decline has continued, since then, to the extent that I have questioned whether VOA is any longer capable of fulfilling its statutory responsibilities, although these questions have met with either blanket denials or silence. It is clear that list maintenance has slipped down the list of priorities: jobs will be done when time and resources permit.

There have already been cases where VOA delay has cost ratepayers repayments of overpayments. Now, the situation is not going to get any better under CCA, particularly when list alterations are requested following a material change of circumstances in respect of a property. Delays by VOA, coupled with the operation of the Material Day Regulations, as they now stand, are going to cost ratepayers dearly.

CCA seems to have been brought in to defeat the strategy of certain practitioners (yes - private practice is not completely without sin) whose strategy was to appeal everything, almost willy-nilly. VOA, in its reduced circumstances, could not cope with the tsunami of 2010 list appeals. The trouble has been that the Agency's new software simply does not work correctly, or at all. Owners and occupiers not based in UK may not use it, for example; and the result of this has been that, while VOA may be trying to operate the system, supported by IT people from HMRC, the consequences are glaringly obvious, from the number of appeals against the 2017 lists in their first year as against those during the first year of the 2010 lists, which is down by over 90%. Is this the result of an unprecedentedly-accurate revaluation, or of an inability to carry the job through?

And let us not forget that, apart from clearing the backlog of 2010 list appeals, and trying to make CCA work, the 2010 list will have to be extensively revisited, in order to demerge the assessments which, correctly, were merged by the Agency following the decision of the Supreme Court in Mazars. It should not be forgotten, either, that in less than a year, VOA is going to have to start work to prepare for the 2020 revaluation, the valuation date for which will be the day following Brexit! What fun it is going to be, sorting out the rental evidence for that!

This is why I have likened the situation in rating to that of an ongoing train crash. The public perception, leaving aside the efforts of the professionals on all sides to ameliorate matters, may have started with the feeling that the system was being applied, inefficiently. As the shortcomings of CCA failed to disappear, increasing numbers of ratepayers have suspected incompetence. We have to hope that sufficient remedial action will be taken before the public suspects Morton's Fork - which, for those who have forgotten their social history, refers to the ploy of a much earlier Chancellor, John Morton, who served Henry VII and who extracted gifts of money for the Treasury, arguing (with threats in the alternative) that if a man lived well, he was obviously rich and if he lived frugally then he must have savings, so either man could afford to pay.

There is a great deal to be done, as Ministers are now aware, and as I have been told, myself, directly, in Parliament. Rating is a specialised subject, tied in as an integral part of the funding of local government; and the generalists perhaps do not have access to all of the specialised knowledge, across the spectrum, having which might have prevented the quick fix of CCA from causing such mayhem. Have Ministers been correctly advised, over the years? Or if they have been so advised, have they listened? And acted? Even allowing for the constraints of austerity over the past decade, VOA was being bled out for years before the onset of fiscal woes in 2007.

Sorting out the IT must be beneficial to the system. The professions, generally, want to see a property tax system which is balanced, even-handed and transparent, and which works efficiently and at low cost. Throwing money at a problem does not always solve it - but, in this case it just might help, quite a bit.