Summary: Mrs X complained the Council did not refer her to the Valuations Office Agency meaning she missed out on business grants and, it delayed in communications. We found the Council at fault. We recommended it pays Mrs X £150 for time and trouble.

The complaint

1. Mrs X complains the Council did not contact the Valuations Office Agency (“VOA”) or tell her to do so in 2021 and it failed to respond to her communications in a timely manner from 2021 to 2023. Mrs X says she missed out on business grants and spent time and energy in the complaints process.

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What I have and have not investigated

2. Mrs X contacted the Ombudsman in February 2023 so matters arising before February 2022 are out of time. While we usually expect complainants to complete a council’s complaints process before coming to us, our website makes clear complainants can contact us if a council does not respond within 12 weeks. On review of the documents provided, I am satisfied Mrs X could have contacted us sooner.
3. I do not consider there is good reason to investigate any matter arising before February 2022. However, I consider it is appropriate and proportionate to consider whether any remedy is due for fault the Council has recently accepted.

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The Ombudsman’s role and powers

4. 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’. If there has been fault which has caused an injustice, we may suggest a remedy. (Local Government Act 1974, sections 26(1) and 26A(1), as amended)
5. We cannot investigate late complaints unless we decide there are good reasons. Late complaints are when someone takes more than 12 months to complain to us about something a council has done. (Local Government Act 1974, sections 26B and 34D, as amended)
6. If we are satisfied with an organisation’s actions or proposed actions, we can complete our investigation and issue a decision statement. (Local Government Act 1974, section 30(1B) and 34H(i), as amended)

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How I considered this complaint

7. I spoke to Mrs X and I reviewed documents provided by Mrs X and the Council.
8. I gave Mrs X and the Council an opportunity to comment on my draft decision. I considered their comments before making a final decision.

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What I found

VOA rating list

9. The Valuation Office Agency (VOA) compiles and maintains lists detailing the rateable value of 1.9 million commercial properties for business rates; the rating list.
10. Business rates can change if:
• you move or make changes to your premises
• the nature of your business changes
• you sublet part of your property
• you merge 2 or more properties into 1.
11. A business must report any changes to the VOA to ensure they are paying the right amount in rates.
12. Councils may also contact the VOA and ask it to reassess a property.

Business rates, rate payers

13. A business must register with its local council to pay business rates.
14. However, a business cannot register to pay rates unless it is first on the VOA rating list.

Restart grant

15. During the COVID-19 national pandemic the Government introduced various business grants and tax reliefs to support business.
16. The Restart grant opened from 1 April 2021 to 30 June 2021. Councils had to run an application process for the grant. Where eligible a business would receive a one off grant payment depending on its rateable value.
17. To be eligible a business had to be:
• based in England
• rate-paying
• in the non-essential retail, hospitality, accommodation, leisure, personal care or gym sectors
• trading on 1 April 2021
18. Government guidance said any changes to the rating list (rateable value or to the hereditament) after 1 April 2021 should be ignored for the purposes of eligibility. Councils were not required to adjust, pay or recover grants where the rating list is subsequently amended retrospectively to 1 April 2021.

What happened

Background

19. Mrs X sought planning permission for change of use to her home to allow her to use part for business purposes, namely rental accommodation. The Council granted permission.
20. In January 2021 Mrs X submitted a business rates change of circumstances form to the Council, as she wanted to register the property for business rates.
21. In April 2021 Mrs X received a council tax bill for the property and so contacted the Council again.
22. Mrs X says she tried to apply for a Restart grant but she could not complete the application process without a business rates reference number.
23. In June 2021 Mrs X contacted the VOA directly.
24. In August 2021 the VOA entered the property onto the rating list backdated to 2017.

Recent matters

25. The Council’s call records of July 2022 show it told Mrs X it could not update her account until it heard from the VOA and so it was not responsible for any missed grant. Mrs X then escalated her complaint to stage 2.
26. The Council issued its stage 2 response in January 2023. It apologised for the delay in response and explained:
• Mrs X contacted the Council with regard to changing the use of part of her property on 12 January 2021. However, the VOA first needed to add the property to the rating list before the Council could record this business for business rates. It therefore should have told her to contact the VOA.
• Staff were facing an extremely difficult and challenging time while also dealing personally with the pandemic, working from home, dealing with day-to-day business and also a number of separate COVID business grants. But it still should have provided a better service.
• A property had to be on the rating list and the ratepayer registered for rates, on the qualifying date of 1 April 2021 for the Restart Grant. As the property was not registered on those dates she was not entitled to a grant.
• The Government guidance made clear it had to ignore any later changes to the rating list.
• She could contact the Ombudsman.
27. When I spoke to Mrs X I asked why she had not contacted us sooner. She explained she had been following it up with the Council but it delayed at every stage.
28. In response to enquiries the Council acknowledged its delay in addressing Mrs X from January 2021. It explained this was due to unprecedented demand on its resources during the COVID 19 pandemic. It offered a payment of £150 in recognition of its delay and the amount of communication.
29. In comments on a draft decision Mrs X said:
• The Council did not tell her to register for business rates during the planning process. She had no reason to avoid doing so but thought the Council would arrange this.
• The Council should amend its procedures so that it contacts the VOA.
• She was under pressure at the time due to the pandemic, while awaiting planning permission and due to the poor health of a relative. If the Council could rely on the pandemic as reason for its delay, she should be able to also.
• She contacted the Council in January 2021 after realising the Council had not registered her business.
• She understood she had to exhaust the Council’s complaints process before contacting the Ombudsman. Had the Council addressed matters in a timely manner she could have contacted us sooner.

Findings

30. The Council’s planning department has no remit or responsibility to give advice or act on business rates. This is not a matter that falls under its duties as a planning authority, as part of the planning process or otherwise.
31. Once Mrs X contacted the Council’s business rates department, this department had a responsibility to act as this is part of its remit and functions. The Council could have decided to contact the VOA at this point or told Mrs X to do so.
32. The Council accepted it did not tell Mrs X to contact the VOA in January 2021 as it should have done. This is fault. However, Mrs X could have sought independent advice on business rates’ liabilty at any time and asked the VOA to assess her property. It is not appropriate to hold the Council responsible for injustice Mrs X could have avoided. I therefore find no remedy is due.
33. The documents seen show significant delay by the Council in addressing Mrs X’s complaint. This is fault. Mrs X was put to avoidable time and trouble. This is injustice. I consider the £150 offered by the Council is a suitable remedy, while noting it previously apologised for delay.
34. For completeness, I recognise the Council was under pressure during the pandemic but that does not excuse or justify the considerable delay, hence my finding of fault.

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Agreed action

35. To remedy the injustice above I recommend the Council carry out the following action within one month of the date of my decision:
• Pay Mrs X £150 for time and trouble.
36. The Council should provide us with evidence it has complied with the above action.
37. The Council has accepted my recommendations.

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Final decision

38. I find the Council at fault for not referring Mrs X to the VOA and for delay in complaint handling. The Council has accepted my recommendations and I have completed my investigation.

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Investigator's decision on behalf of the Ombudsman