British Telecom's challenge to its rating assessment will have important implications for the rating of other publi...
British Telecom's challenge to its rating assessment will have important implications for the rating of other public utilities, Paul Sanderson of the Valuation Office Agency told delegates at the IRRV conference in Blackpool yesterday.
All public utilities used to have their rating assessments prescribed by government, and they had no right of appeal. BT was taken out of prescription for the 1995 revaluation and the government is considering whether to end prescription for other industries, such as water and gas, for the year 2000, Mr Sanderson explained.
For the 1995 revaluation, the Valuation Office gave BT's network a rateable value of£520m - compared to the£360m RV it had been prescribed under the previous system. BT's appeal was heard by the Central London Valuation Tribunal but the company failed in its efforts to have the valuation reduced. The tribunal in fact increased the rateable value to£523m.
'This case required us at the VOA to think very carefully about some fundamental rating assumptions', Mr Sanderson said. The VOA had to find the appropriate method of valuing BT and used the receipts and expenditure method. BT argued for the contractor's test method, which produced a lower valuation, but the Central London VT agreed with the VOA's method.