Council Tax (New Valuation Lists for England) Bill

I shall direct my remarks to the amendment and its implications. The assumption behind several contributions this afternoon has been, frankly speaking, wrong. It concerns the fear of potential political manipulation, and it assumes that the relative increase in property prices within an area and between areas has taken place only or mainly in areas with higher incomes. However, statistics published by independent bodies show that that is not the case. In layperson’s terms, the Conservatives assume for the purposes of this debate that oop north, we are all poor and live in terraced houses. I should point out to them that Cheshire is the second richest county in the country—and a very beautiful county it is. The second mistake that has been made is to assume that those areas that have had relative increases in prices, where a revaluation would increase the tax yield, are all under the control of the Conservative party. That is not the case. The Conservatives make the same mistake as my party made in the 1980s, which is to assume that certain parts of the country are naturally aligned with one party and parts are aligned with another. If a revaluation were to increase the tax yield and therefore reduce the resource equalisation element—the hon. Member for Mole Valley (Sir Paul Beresford) covered that point—the implication is that that would take place entirely in non-Labour areas. One could not achieve that outcome even if one wanted to, and I shall explain why. I reject the allegation about the allocation under the formula and I reject the allegation, also made by some Opposition Members, that that would be used in a politically manipulative way. The Government will ask the House not to support the amendment. I was a little confused when I saw the amendment, but I now have a much clearer understanding of what the hon. Gentleman is trying to achieve. He gave the example of a particular area in the country, but Madam Deputy Speaker ruled it out of order, so I shall not repeat it—but it is by a big river in the south-east of England. The hon. Gentleman seemed to think that all the new properties that are built in that area will be revalued when they are first sold, and that therefore it is necessary to have a local valuation of the existing properties. However, the new properties will be valued and allocated to council tax bands, based on the values of the antecedent valuation date of 1991, the same date at which all properties in the country continue to be valued. If there were to be a subsequent resale of those properties, they would be revalued only if they had been significantly improved, for example, by the addition of a swimming pool, but perhaps not by the addition of a patio, as some hon. Members have suggested. That is the policy that has been in place since 1991. Even then—this is the crucial point—the revaluation would still be based on the 1991 antecedent valuation date. That addresses the point that was drawn to our attention by the hon. Member for Cotswold (Mr. Clifton-Brown). As is so often the case, the devil is in the detail. I have some practical arguments about why the amendment would not work, as well as policy ones. As many hon. Members have said, at first sight, the amendment seems consistent with the policy of devolution, given the flexibility to carry out a revaluation limited to a single billing authority or a group of adjacent billing authorities if a such a revaluation is demanded locally. However, the detail shows the difficulty of the amendment’s practical implications. First, let us consider the implications for the Valuation Office Agency. Perhaps I can give the House some information that will be useful in considering the amendment. Following significant investment in modern technology, which essentially involves the computerisation of manual records, and the development of the automated valuation model, whereby a computer is given the details of different properties, it is true that the VOA could calibrate the system to cope with different valuation and revaluation dates for the billing authorities. Modern technology could allow what the hon. Member for Mole Valley suggests. However, let us consider for a moment the situation that could prevail in years to come. As a result of the amendment, we could face a national taxation system based on multiple valuation dates and a host of different banding structures. Of course, we cannot revalue without rebanding. That is an essential point. If we assume that each valuation would involve a transitional scheme—the hon. Gentleman may want to address that point if he wishes to respond to the debate—we would be left with a hotch-potch of systems operating in different parts of the country and the confusion for the public would be too dire to contemplate.