Monday 1 October 2018

October 2018 – Letter from the President

Gordon Heath signs off his Presidential duties, leaving the Institute once again in good health and in good hands 

Dear reader,

August is a quiet month as far as formal IRRV duties for the President is concerned, apart from signing the examination certificates for the successful candidates.

However, the month began on a very sad note, with the funeral of John Charman, Past President of the Institute some years ago.  John was a charming man with whom both Carla-Maria and I shared a love of fine wines and good food.  However, I cannot claim to match his skills in the kitchen!  I was pleased to see that so many of his IRRV friends were there.

September brought the IRRV Scottish conference, held once again in the picturesque surroundings of the Crieff Hydro Hotel. I am grateful to Kevin Fraser and the Scottish Executive for inviting Carla-Maria and I to the conference.  I would also like to thank Fraser Macpherson for all his hard work in organising the event.  I was delighted to Chair the first session with the minister, Kate Forbes MSP, who had only just been given business rates and council tax to add to her brief.  

I have only one further conference to attend before the Institute’s Annual Conference in Telford in October that will be both the climax and the end of my Presidential year.  

People ask me if I have enjoyed my year and I can honestly say that I have.  There has been far more to do than I imagined, but it has given me an opportunity not just to appreciate the differences throughout the UK but to take a much wider international perspective.

More than ever, I see the need for modernisation.  Why are we still struggling with implementing Universal Credit?  It could and should have been so much better.  Why are we still using 1991 values for council tax? The technology and the data are there to have annual domestic revaluations to discrete values if we wanted to.  But it is business rates that keeps hitting the press.

Just as local government is becoming more dependent on business rates, the calls for it to be abolished or replaced have grown louder. It is constantly being blamed for the demise of the high street and the closure of businesses. Small fixes such as internet transaction taxes have been suggested.  Alternatively, others are simply calling for abolition.  The Liberal Democrats have been promoting Land Value Taxation but it is unclear how this would work, for example with agricultural land.  

This is against a background of the UK having the highest property taxes in the OECD.  The problems with business rates stem from an increase in rates payable compared with rent, infrequent revaluations, an opaque valuation system with a difficult appeals process and often little benefit from successful appeals. This cannot go on forever.

I was amazed to visit Northern Ireland and see the modernisation that has taken place there.  The ready availability of data linked to maps online has resulted in a low appeals rate.  I suggest that the Valuation Office Agency and the Scottish Assessors go and look at what is happening there and copy it.  They have not gone as far as automated valuation methods (AVMs) in Northern Ireland but that is starting to happen elsewhere.  AVMs may have had a bad press but with proper regression analysis of enough factors, they can be a useful valuation tool.

When I became President last October, I wanted to plan for the future of the Institute. We needed to review our organisation and develop our strategy.  I also wanted to set out what our policies are.  I do not claim credit for this, because it is a joint effort by the Institute’s Council and staff.  As a first step we have taken the opportunity to recruit two IRRV qualified staff to strengthen the organisation.  They both have a strong background in local government revenues and benefits.  The valuation side already benefits from a strong Valuers’ Association with international links to The European Group of Valuers’ Associations.

A proposal to establish a new fraud faculty is being taken forward.  Also, a consultation paper on strategy matters will shortly be given wide circulation.  The responses to this will feed into implementation of the agreed proposals.  Work is also taking place to draw up a compendium of Institute policies.

The process is not finished, but thanks to the efforts of the Council and staff we are planning for the future. 


Yours, 

Gordon

Gordon Heath BSc IRRV (Hons) is President of the Institute

Presidential handover at IRRV Annual Conference

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