Dodds considers Rating help for Councils

Finance Minister, Nigel Dodds, today met with the Northern Ireland Local Government Association and district council representatives to discuss their concerns about local government finance.
The discussions focussed on local government concerns about the possible impact of reduced revenue levels.

Speaking following the meeting, the Minister said: “I welcomed the opportunity to meet with local government representatives today and listen to their concerns. We share the same desire to make the rating system deliver for local government as well as the Assembly”.

“Following a period of sustained increases in income, all sectors, including central government, are facing increased pressures on available revenue and resource distribution”.

The Minister stressed that steps are being taken to improve the accuracy of the process for estimating council revenue levels and said: “Both Land and Property Services and councils have a role to play in this. My officials will be taking steps to improve the reliability of the forward estimates so that greater certainty can be added to the system that has served local government well over the years”.

During the meeting, a number of factors which are impacting on rates revenue were discussed. These included the impact of changed economic circumstances, with few new properties being built and increasing payment difficulties; the long overdue modernisation of the rating system; and the accumulated impact of large valuation settlements for the Ministry of Defence and British Telecom, which have been tied into GB negotiations and have only recently been settled.

In relation to the British Telecom issue, changes facing the telecommunications industry have given rise to an 8% backdated reduction for BT. This reduction, which will affect both central and local government, has been offset by increases in the valuations associated with the mobile networks in recent years.

In the course of revising the BT assessment, two administrative errors were also discovered dating back to the mid 1990s. Councils were overpaid at that time amounting to around £600,000 spread across all 26 councils.

Signalling that he would consider what he could do for councils, the Minister concluded: “I have noted councils’ concerns around the MOD and BT issues, which will be an unexpected financial concern for some district councils”.

“Following the meeting I want to consider the impact of these in more detail. I also want to look at what my Department can do within its limited existing powers to cushion the impact for the councils most affected at this difficult time”.

Notes to Editors:

1. Media enquiries only to DFP Communications Office on 028 9052 7374 or 028 9052 7375. Out of office hours please contact the Duty Press Officer via pager number 076 9971 5440 and your call will be returned.
2. The estimated district council revenue for 2008/09 is £426m.