Summary: Mr B complained that the Council had failed to award COVID-19 relief to the business rates payable on his business property following a change to the way in which the property was listed. We have not found fault with the Council’s actions.

The complaint

1. Mr B complained that Cumberland Council (the Council), following a change by the Valuation Office Agency (VOA) to properties subject to business rates, removed the COVID19 relief awarded in 2021/22 and says it is unable to reapply it retrospectively. This has caused Mr B’s business financial loss.

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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’. If there has been fault which has caused significant injustice, or that could cause injustice to others in the future we may suggest a remedy. (Local Government Act 1974, sections 26(1) and 26A(1), as amended)
3. 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

4. I have considered the complaint and the documents provided by the complainant, made enquiries of the Council and considered the comments and documents the Council provided. Mr B and the Council had an opportunity to comment on my draft decision. I considered any comments received before making a final decision.

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What I found

COVID-19 Additional Relief Fund (CARF)

5. In March 2021 the Government introduced this fund to support businesses affected by the pandemic but ineligible for existing support with the business rates. The Government produced guidance for councils to explain how the money should be allocated according to the rateable values of the properties involved. It was paid through section 47 of the Local Government Finance Act 1988.
6. The guidance allowed for a recalculation of the relief in the event of a change in circumstance during the year in question or a later year. But, the Local Government Finance Act 1988 says that discretionary relief for a property liable for business rates can only be given up to six months after the end of the relevant financial year (ie by the 30 September of that year).

What happened

7. Mr B’s business took over responsibility for business rates for property Z in March 2020. On 28 September 2022 the Council applied CARF relief to the property reducing the amount of business rates payable by 50%.
8. Mr B then discovered that although the business was paying business rates for the whole property it was only leasing part of the building. He applied, via an agent, to the VOA, which maintains the Rating List, to change the way the building was rated.
9. In February 2023 the VOA informed the Council that with effect from 11 March 2020, property Z had been removed from the list and replaced by three new properties, with Mr B’s business liable for one of them.
10. As property Z had been removed from the list the Council removed the CARF relief because no rates were payable in respect of a withdrawn property. It issued new bills for the new property listing but without any CARF relief, as the new property was listed after 30 September 2022.
11. Mr B complained to the Council. The Council replied explaining that no new CARF relief could be applied after 30 September 2022 and as the new properties were listed in February 2023, the Council could not apply CARF relief to them. It also said the VOA decision was made independently of the Council.
12. Mr B then complained to us. In response to my enquiries the Council explained that it could not apply any backdated CARF relief because the original property was removed from the list and the new properties were listed after 30 September 2022. The law did not allow it to make any discretionary awards after that date.

Analysis

13. I have not identified fault in the way the Council has acted. It has applied the relief in accordance with the law and guidance in place at the time. Following a change to the ratings list in February 2023 where one property was removed completely, and replaced by three new properties the Council could not apply any new CARF relief as it was more than 6 months after the end of the financial year for which the relief was originally applied.
14. If the original property had remained it could have recalculated the relief but as the original property was removed no rates remain payable in respect of that property and so no recalculation is possible. Neither does it have any additional discretionary powers to award relief.
15. While I understand Mr B’s grievance at the outcome of the changes to the property ratings, I am unable to say the Council has acted with fault.

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Final decision

16. I have completed my investigation into this complaint as I am unable to find fault causing injustice in the actions of the Council towards Mr B.

Investigator’s decision on behalf of the Ombudsman

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Investigator's decision on behalf of the Ombudsman