Summary: A business owner complained that the Council had wrongly calculated his business rates. But the Ombudsman does not have grounds to investigate this matter because there is no sign of fault by the Council.

The complaint

1. The complainant, who I shall call Mr B, complained that the Council was overcharging him for business rates. In particular Mr B said the Council had increased his rates by more than the percentage allowed under the Government’s Transitional Relief scheme. He also complained the Council had delayed in responding to his queries and complaints about this matter.

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The Ombudsman’s role and powers

2. We investigate complaints about ‘maladministration’ and ‘service failure’. In this statement, I have used the word ‘fault’ to refer to these. We must also consider whether any fault has had an adverse impact on the person making the complaint. I refer to this as ‘injustice’. We provide a free service, but must use public money carefully. We may decide not to start an investigation if, for example, we believe:

• it is unlikely we would find fault, or
• the fault has not caused injustice to the person who complained, or
• the injustice is not significant enough to justify our involvement, or
• it is unlikely we could add to any previous investigation by the Council. (Local Government Act 1974, section 24A(6), as amended)

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How I considered this complaint

3. I considered the information Mr B provided with his complaint. I also gave Mr B an opportunity to comment on a draft of this decision before I reached a final view in his case. In addition I took account of the Council’s correspondence with Mr B concerning his complaint.

What I found

4. The Valuation Office Agency (VOA) is responsible for setting and reviewing the rateable value of business properties. Central Government decides the mathematical formula by which the gross business rates for a property are calculated, based on the rateable value. Councils then bill for business rates having applied any relevant national or local relief schemes.
5. The VOA’s most recent revaluation of rateable values took effect in April 2017. This resulted in the rateable value of Mr B’s property being almost doubled.
6. However the Government introduced a Transitional Relief scheme which phased increases in rates bills over five years. The Government set fixed percentages for rates increases which limit how much bills can go up in any one year.
7. Mr B complained to the Council because the increases in his rates bills were greater than the Government’s published percentages. In response the Council set out how it had calculated Mr B’s business rates liability and confirmed its figures in his case were correct. Mr B was not satisfied with this response and complained to the Ombudsman.

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Analysis

8. But I consider we do not have reason to start an investigation in Mr B’s case as there is no sign of fault in the Council’s calculations of his business rates liability.
9. In particular, I consider that the Council has followed the formula set by the Government for calculating the gross rates for Mr B’s property and has used the correct percentages in applying the Transitional Relief scheme in his case.
10. From the information provided it seems there are good reasons why the increases in Mr B’s final bills have been greater than the headline percentage figures under the Transitional Relief scheme. This is because there are other charges the Council must include in reaching its final calculation.
11. In particular I note that a set amount for inflation is added to the percentage increase each year. In addition the Council had to include a Business Rates Supplement levied every year by the Greater London Authority to help fund the Crossrail project.
12. I also note the Council explained to Mr B why he does not qualify for the Government’s Retail Discount scheme or its own Hardship Relief scheme. But I do not see any fault in its decisions and explanations in these respects.
13. There is sign of fault by the Council because of a delay of almost two months in responding to the query about his rates which Mr B sent it in June, and a delay of several weeks in responding to his complaint at the second stage of its complaints procedure.
14. But the Council has apologised for its delays, and I am not convinced that Mr B has suffered a significant injustice in this respect which would warrant us pursuing a further remedy in his case. In particular, despite the Council’s delays, the outcome for Mr B did not change and he still remained liable to pay the same amount of business rates it originally billed him for.

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Final decision

15. The Ombudsman does not have reason to investigate Mr B’s complaint that the Council had wrongly calculated his liability for business rates. This is because there is no sign of fault by the Council regarding this matter.

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Investigator's decision on behalf of the Ombudsman