My Lords, it is an invidious task to be rising at this hour to address this important issue. I, too, am very grateful to the Minister for having organised the meeting with officials from the Valuation Office Agency, some of whom I would even classify as old friends. As I said to her at the end of meeting, I was better informed but, I am afraid, none the wiser.
The Valuation Office Agency maintained that no more detailed breakdown of the figures was available and that it had disclosed everything that was at its disposal, and I have to accept that. However, I point out that it concludes that there are 817,000, which has been rounded down in popular parlance to 800,000, business hereditaments out of a total of 1.7 million nationally that are said to benefit from the deferral of the revaluation. We also learnt that 64.6% of that 817,000, or 528,000, are classified in a very broad and non-subdivided category of “other”: that is, “other”
than the bulk classes of retail, office and industrial. The 528,000 represents 31% of the 1.7 million hereditaments nationally. The narrative goes that all the 528,000 would be gainers under the deferral.
Given the spread of gainers and losers in the far smaller bulk classes, the assertion that the whole 528,000 in that “other” class of non-bulk properties constitute gainers stretches credibility. In truth, and from what I know of the market, it is most unlikely to be correct. Moreover, if it is true that the Valuation Office Agency has no other more detailed breakdown of “other”, it is difficult to see how it could have reached a conclusion on the 817,000 beneficiaries. It is an untested, apparently untestable and unverified basis of valuation opinion.
My own view, for what it is worth, is that around 600,000 to 700,000 businesses will be losers under this proposal, but I can no more prove that than the Valuation Office Agency is able to convince me of the veracity of the figures, except that I have used the same figures that it has used. I think this House should be furnished—indeed, I believe Parliament is entitled to be better furnished—with information that is accurate in order to enable it to make an informed decision. We are told that that additional information cannot be provided without spending some £40 million on a revaluation, as I think the noble Baroness said during the previous stage of the Bill. That is not my understanding of the typical cost of an impact assessment on tax changes of a type that I used to get involved with when I was in the public sector. I do not think that consultation of the sort that the noble Lord, Lord McKenzie, has suggested could come anywhere near that sort of figure.
10.30 pm
We have reached an impasse with this situation. I have to accept, to a degree, that the noble Baroness has to accept the advice that she is given and that I have no way of finding a way around that. I do not have access to the number-crunching facilities or the data that would enable me to get behind those figures. However, the bottom line is not really whether I or the Opposition, or indeed the Minister, are convinced but whether businesses out there and the people in private practice who have to deal with this matter are convinced. My clear impression is that they are not and that they will see this as a classic exercise in smoke and mirrors.
Moreover, however much of a gloss one puts on this—and I made my views clear when we had our meeting with the Minister and VOA officials—I do not believe that it will have the slightest effect on what effect real market forces will have. Movements in markets will occur, because of the immutability of this fixed and historically high cost basis for the non-domestic rate, in many of our most threatened or economically challenged areas. I mentioned at a previous stage the Portas pilot towns. Mary Portas herself has come out and made comments about the effect of the rates. Those comments were not, perhaps, specifically in the context that we are talking about, but it is a burden that you cannot negotiate away as a business rate payer.
I support the amendment and I have no confidence that the Government are paying any attention to what has been said over this. I am sorry to stand here at this hour of the night and record that feeling, but there it
is. We are where we are and, as a debating Chamber, we ought to have been given better background information than that with which we were provided. Business rate payers should also have been given a better and more compelling explanation than the one that has been consistently given to them thus far.