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IRRV CONFERENCE: PRESIDENTIAL ADDRESS (FULL TEXT)

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Thank you very much Mr mayor for opening the 1998 annual conference of the IRRV in Blackpool and for your kind comm...
Thank you very much Mr mayor for opening the 1998 annual conference of the IRRV in Blackpool and for your kind comments with regard to the institute and your welcome. I can assure you that delegates to the IRRV conference need no encouragement to enjoy themselves and Blackpool is a 'fun' place in which to have a conference!

I would also take the opportunity to thank in advance all of the speakers who will be attending the conference for the forthcoming contributions and the debate which will follow their presentations. To all of the delegates a similar welcome and I look forward to your contributions to this conference during question time, which are an important aspect of any conference. At the end of this week, I and my IRRV council colleagues will be delighted if you leave this conference in the belief that the debate and discussion has provided you with real value and proved worthy of your time. Please do participate in the conference. The value your participation will bring is helpful both to the speakers and to your own colleagues in the audience. The debate is almost as important as the contributions. It will also make my job as chairman of the conference straightforward and relaxing.

For my address today, I have decided to concentrate on four main themes:

- Local Taxation

- Best Value

- Housing Benefits

- And Education

Local Taxation

Turning first to local taxation, I will deal with two main aspects, Council Tax and Business Rates.

Council Tax

In respect of Council Tax the Institute has reflected during the summer months the detail of the government's White Paper on local government. The Institute shares the widely held view that the White Paper is very much a curate's egg: good in parts but poor or downright bad in others.

The area of most urgent concern to us is the government's decision to postpone any major changes to the system of Council Tax until after the next general election. Whilst politically this may be understandable due to conflicting parliamentary pressures, practically the institute would welcome several technical changes which we believe would make Council Tax a better, more progressive and fairer tax.

That Council Tax has been a success is without question. But thanks to the Community Charge anything would have been better.

It has been:

- implemented well by dedicated practitioners

- it is perceived as largely fair by the taxpayer's

- it is relatively certain

- it is collectable

- it is robust

What it is not is, it is not perfect. No taxation system is likely to be universally accepted but no taxation system will be perfect from the outset. Change is part of any good taxation system and the changes proposed by the Institute are designed to 'iron out the wrinkles', rather than fundamentally change the structure of the tax. I wish to summarise for conference the main proposals which we believe will make the system into a more robust and effective taxation system.

The institute has argued for some time that the long-term stability of the Council Tax cannot be guaranteed unless and until regular revaluations are held to maintain the tax base. Any taxation system which does not have a regular review mechanism applied is in danger of falling into disrepute.

To confirm this, we only have to look at the old rating system and the disgraceful way in which regular revaluations were postponed until the tax became politically discredited. We cannot, and will not allow history to repeat itself.

The institute has responded to this lack of revaluation action by commissioning two major research projects, both of which demonstrate that property prices have moved sufficiently since 1 April 1991 to shift significant numbers of properties into different Council Tax bands. The institute believes that there should be a commitment in the primary legislation to ensure regular revaluations for Council Tax purposes. We are disappointed that the government has decided to postpone this decision for at least another 3 or 4 years.

The one area of Council Tax legislation which the government has committed itself to changing is Council Tax Benefits subsidy. In future years, government will reduce the benefits subsidy paid to local authorities that exceed a 'guideline increase' in their Council Tax.

Whilst we accept that this will not impact on individual claimants, this change will add another complexity to a local government finance system which is already overburdened with rules and regulations. We need to ask of the government:

- How will those authorities with above average numbers of benefit claimants be protected?

- How will the government ensure that the benefit subsidy for a billing authority is not reduced simply because a precepting authority raises its Council Tax above the guideline limit?

The government's proposal, if enacted, will merely re-introduce Council Tax capping by the back door, with local authorities setting their Council Tax levels with one eye on the government's 'guideline increase'. I think we have been here before and we know what this type of control can lead to.

The institute does not believe this proposal to be fair or equitable and we call on the government to reconsider this unwelcome change to benefits subsidy arrangements.

Turning to the second aspect of local taxation, Business Rates.

It now seems increasingly unlikely that the government's modest proposals to allow councils to charge a 'top-up Business Rate' will be enacted in the next parliamentary session. This suggests to us that we in local government will have to wait until the year 2001 before we can begin to levy the modest one percentage point of additional Business Rates proposed. On this basis, it will not be until the year 2006 that local authorities will be able to levy the full 5% proposed in the White Paper! Hardly a progressive taxation system I would suggest.

This is excessively cautious. Given that local authorities will need to seek the agreement of local businesses both to the consultation arrangements that will be put in place to support the local levy, and to the way in which the revenue will be spent. It seems to the institute that we could, and should, move forward to the full local rate earlier than the government suggests in the White Paper. We will be progressing our discussions with the government on this basis.

It would be inappropriate to leave the topic of Business Rates without referring to the government's on-going review of the rating appeals process, a topic that is of great interest to conference generally.

Ministers appear to be inching towards making final proposals for fundamental changes to the appeals system. In a number of consultation papers and letters from the department of environment, transport and the regions a series of guiding principles have been established. These include such aims as a desire for:

- 'better guidance, especially for unrepresented ratepayers'

- 'greater transparency and certainty'

- 'clearer identification of the responsibilities of each party at each stage' and so on

These are all quotations from the previously mentioned consultation papers and letters from the DETR.

The institute welcomes many of these principles - indeed who could object to such reasonable requests? But, I am strongly advised by my colleagues in the rating valuation world, that when it comes to rating legislation the devil is always in the detail.

It is right for the government to be clear about its aims and objectives. But government must also be certain that any proposals that are finally brought forward will actually deliver those objectives, and it must also be clear that improving the speed and efficiency with which appeals are processed may cost more, rather than less, money. If the government wills the end, it must also will the means necessary to achieve those ends.

Best Value

Turning to other issues of a legislative nature, the institute welcomes the CCT moratorium in Scotland. We await with interest the future abolition of CCT altogether and its replacement with the scheme of best value. The institute is not, however, against the use of competition to deliver efficiency and effectiveness in the delivery of local services.

What the institute is against is using the threat of compulsion as a stick with which to beat local government into submission, rather than devising a scheme within which local government can flourish to deliver the efficiency and effectiveness, which governments of any political persuasion crave.

Local government does not need or deserve to be threatened by punitive action to make it respond to governmental action. We are not naughty schoolchildren misbehaving. We are professionals who are committed to, and who believe in the concept of public service.

The relationship between local and central government has to be one of mutual respect, not suspicion. Compulsory competitive tendering was, and is, fundamentally flawed in that it is all about cost and not about quality. It is about efficiency without necessarily effectiveness.

Whilst I am referring to efficiency and effectiveness, I must state that one without the other will not achieve the overall objective. It is in my view more important for local government to be effective rather than efficient. The public wants effective local government, which provides services when they are required to the standards, which are required; not merely efficiency which can often be misconstrued as service at any cost, provided the cost is low.

CCT was, and is, all about cost issues; the institute's view is that issues of quality are equally, if not more important. Quality, correctly managed can deliver effectiveness provided there is an investment in resources. Low cost does not correlate to effectiveness.

The institute welcomes the concept of best value as a more equitable way of ensuring service delivery to standards which the public can understand by reference to the issue of innovation in service delivery and consultation which are major elements of the best value initiative. These will bring both quality and effectiveness and will provide efficiency of resource usage without the threat of compulsion.

This, surely, must be a more democratic way of operating in mutual respect and trust, rather than under the spectre of threats and penalties.

The institute has responded to the development of best value in a number of ways. We have organised regular meetings to which all of the 36 best value pilots have been invited and the vast majority of these pilot sites attend. These have been described by delegates as providing a real forum for discussing and exchanging views on best value.

We can all learn from other's experience. The institute is grateful for the support of the Local Government Association in this initiative.

The institute is also developing a good practice database and a best value guidance manual to be published in the near future. We will be running a range of best value seminars and meetings at locations around the country and we look forward to your involvement in these meetings.

Enough of Best Value! What about Housing Benefits?

Housing Benefits

The government's commitment to welfare reform has put benefits, especially Housing Benefit, under the spotlight. In this critical time the institute is talking to the DSS, playing its part in bringing practitioners' views to the attention of policy-makers.

The government's objectives are now fairly clear and well known, but with the summer's dramatic changes to the DSS ministerial team the key decisions are still waiting to be taken. We heard the announcement last week in this very hall that there is to be a Welfare Reform Bill in the next queen's speech, and await confirmation of the contents of that Bill, together with a series of other important announcements over the next few months.

The government's welfare reform green paper earlier this year made plain the new principles which will guide future policy.

The government wants to shape an:

- 'active, modern service', flexible and personalised

- and to help individuals to move from welfare into work

Having just returned from representing the Institute at the International Association of Assessment Officers Conference and the International Property Tax Institute conferences in America, welfare to work was constantly being refereed to on the national media. We will surely follow suit.

The reinterpretation of social security to include positive action is a bold and exciting policy development and one in which we wish to be involved.

The green paper rejects the view that 'poverty is alleviated by more money rather than more opportunity'. Simply handing out cash benefits will not help people to escape social exclusion, but the fact remains that benefit levels determine the week-by-week income of millions of people; as such it is an issue of primary importance in determining the effectiveness of social security provision throughout the United Kingdom.

A modern service.

A key objective is to provide the claimant with a seamless interface throughout the national welfare system. The government wants to simplify the process of claiming benefits and is looking for more effective working between Benefits Agency offices, jobcentres, and local authority Housing Benefit departments.

This will provide an opportunity to improve access to advice and information about the complete range of benefits available, and about services to support clients in their attempts to find employment. An important practical reform would be to integrate the payment of housing assistance with income support and jobseeker's allowance.

These are all issues that the institute has been grappling with in the belief that the particular role and characteristics of local authorities should make them key players in bringing an active modern service into being.

Fraud

The government has produced a separate green paper on fraud, one of Frank Field's last acts as welfare reform minister. It picks up on many of the arguments made by the institute during the last few years in advancing solutions based on the expertise of practitioners. These may be summarised as:

Firstly, in February last year the Institute proposals highlighted the regulations which make Housing Benefit vulnerable to fraud, including the rules on living together and the treatment of capital. Now the government is looking at those same weaknesses as part of its drive to design security into the system.

Secondly, the institute pointed to the lack of support authorities receive in bringing prosecutions - now the green paper wants more fraud cases to be taken to court.

Thirdly, the institute has sought to interest government and the BFI in the development of professional training - the DSS now wants to increase the calibre of fraud investigators. These are all key areas which the institute has made proposals which have eventually been enacted.

That was just the green paper. The creation of an inspectorate, and powers in the Fraud Act to refuse direct payments and demand information from landlords, were Institute proposals long before being adopted by government.

The institute's approach to reducing fraud emphasises the importance of improving the effectiveness of administration, and accurate assessment of claims. Quality before cost.

This is where the new verification framework should deliver results, by putting the administration process itself right at the heart of counter-fraud strategy. Without good administration, mistakes result and allow incorrect assessment and opportunities for fraud. The detailed checking prior to initial assessment of claims will reduce errors and help to reduce fraud.

All well and good, but many authorities are wondering how this will feed through to the customer, when they are asked for extra documentation, and find their claim delayed by the verification process. Some authorities see the framework as a minimum standard which they would expect to exceed anyway, others are worried about how they will cope with the extra demands on staff time.

Ultimately, the issue here is about knitting together the government's parallel objectives of a secure system and an 'active modern benefits service'.

If the framework simply increases bureaucracy, it will do nothing for the creation of a speedy and customer-friendly service. But there are opportunities to make a virtue out of necessity: stepping up contact with the customer, and obtaining more complete information from them, can lead to a more focused service delivering quality benefits advice. Home visits work as benefit take-up tools as well as checks on fraud.

All this requires benefit sections to take a hard look at their structure and their work processes. It means freeing up more time to focus on the customer, with the help of new technology. This, of course, means spending money, which is what the delay to the framework has been all about.

Subsidy

With the administration of the Housing Benefit scheme centre stage, the future of the subsidy system is especially important. What should subsidy be based on?

- the implementation of the verification framework?

- meeting targets?

- developing good practice?

There is a clear thread connecting fraud, subsidy, performance standards, and best value.

As Ian Stewart of the Benefit Fraud Inspectorate has said explicitly, the current subsidy system is fatally flawed and must change. One option would simply be to make ad hoc funding arrangements for each new initiative. But this has contributed directly to the delay in introducing the verification framework. Is this to be repeated for every new initiative?

Achieving a secure and accurate service should come within best value. And best value provides a strong logic for moving away from dedicated budgets, negotiated separately and subject to separate evaluation. Under best value, the resources and powers at the disposal of authorities will depend upon their success in delivering value for money services. This can only be properly assessed through a regime of inspection and audit which takes an overall view, getting behind the performance 'scores' to find out how things are really going.

I would like to move on to my last theme for today and comment on an area which is at the heart of the Institute's mission to be the leading professional body in our chosen field our education work.

Education

The new initiatives, which the institute has been developing, will, when fully implemented, provide real educational opportunities for all levels of staff from the junior clerk with limited career aspirations to the high flying professional.

Lifelong Learning

The institute is developing quickly towards its aim, which is to have a comprehensive programme of 'lifelong learning' serving the needs of members at every stage of their professional careers. This is the way of the future and the very considerable effort which we are putting into this work is keeping us at the forefront of professional associations in the education and training field.

Continuing Professional Development

A year ago we established a CPD (Continuing Professional Development) scheme for corporate members. This has had an enthusiastic welcome from members across the UK. The scheme is a liberal one and participants control their own programmes as they work towards the CPD Certificate award.

Other professional bodies and Institutes have expressed astonishment that we are able to run such a scheme on a purely voluntary basis; but their astonishment misses the point that in this as in other areas, a professional association's only real strength is its members.

National Vocational Qualifications and Scottish Vocational Qualifications (NVQs and SVQs)

Establishing National Vocational Qualifications and their Scottish equivalents has been a bit like preparing for D-Day, and has certainly taken just as long.

An NVQ Level 4 in Valuation is now available from the awarding body for the Built Environment, which we formed, and now manage, in collaboration with other professional associations. Fuller details of this scheme are available from the main IRRV stand in the exhibition centre.

We are delighted that the Valuation Office Agency is one of the first employers to participate in the NVQ Valuation scheme.

Our Revenues and Benefits NVQ schemes are now in the final stages of development and we hope next year to be able to offer these NVQs as Technician equivalent qualifications.

The work of preparing these awards could not have reached its present stage without the help and enthusiasm of a great many local authorities and individual practitioners and to them we extend our thanks to what they have done for the profession as a whole.

Traditional Examinations Courses

In the midst of these new developments, we should not forget that our traditional examination courses are continuing to flourish. We are keen to make these courses more accessible to those who wish to achieve the institute's professional qualifications. A network of colleges, including two new tuition centres, along with the distance learning are the means of providing this access. But we cannot be complacent; as one college opens another closes and we need to keep abreast and continually look to new opportunities for educational services to be provided to our members.

Quality and Standards

A great deal of effort has been put in throughout the year to quality assure our educational provision. A new course validation scheme has been introduced. The so called Quality in Partnership Scheme is just that; it is a partnership between colleges and the Institute which aims to identify and address quality issues.

Over the course of the summer a major review of all of the distance learning material has been conducted by independent 'quality checkers'. The results of this exercise have cheered us greatly.

That is not to say that there have been no quality issues raised but what is important is that the positive steps are being taken maintain and drive up standards.

The institute is one of the first professional associations to have received recognition for its qualifications (Technician grade) from the Qualifications and Curriculum Authority. The new requirements for this official recognition are demanding and many awarding bodies have not been successful in meeting the necessary quality criteria.

Meeting the Needs of Members

In addition to meeting the needs of student members we need to be alive to the needs of our wider membership. For this reason we have periodic reviews of our syllabus and we have consulted widely with employers over the introduction of NVQs and SVQs. As working practices change, as for example, with new technology, new techniques of collecting revenues, new approaches to checking benefits' entitlement and the introduction of the so called generic working, so we need to be able to meet the needs of practitioners. It is vital, therefore, that we continue to review the needs of members so that our educational provision meets their requirements.

Benefits Fraud Investigation

While we are on the subject of meeting members' needs, one area which affects nearly all of us is that of investigation of fraud as it relates to the administration of benefits. As part of the institute response to the Green Paper, we have put forward proposals for the development of a suite of qualifications at Foundation, Technician and Full Professional Level which will be cover all aspects of benefits administration and fraud prevention, detection and administration.

Challenges for the Future

Our traditional examination based qualifications, together with NVQs, SVQs and CPD, form the building blocks of our lifelong learning scheme. To them we must add the possibilities of using the Internet and other new technologies as part of our course delivery and tutorial system. In our education work, therefore, the future is full of opportunity and promise.

The Future of the Institute is in safe hands!

I took as one of my major themes for the presidential year the issue of education. I am, therefore, delighted that I will have the opportunity at conference to meet a particularly dynamic and enthusiastic group of institute members. These are the prize-winners from the December and June examinations and they represent the future of the institute.

On Thursday the prize-winners will be attending a special prize-winners lunch hosted by Kaz Janowicz and Arthur Morris of Risk Management Partners Limited. Later in the day I shall have the pleasure of meeting the prize-winners in the presidential suite before we all attend the dinner and performance awards presentation. They are an elite group of people who have worked hard and been rewarded. They are also part of the future of the institute.

Conclusion

The four main themes I have addressed today are vital to the future of local taxation and valuation. Each in their own way have a risk and an opportunity. As an institute and as individuals, whether as local authority staff or members, private and public sector valuers or members such as myself operating in the private sector supporting local authority local taxation administration, we have a responsibility to minimise the risk and maximise the opportunity. I trust you will all have:

- a wonderful conference here in Blackpool over the next four days

- that you will work hard during the sessions and participate

- that you take advantage of the record number of exhibitors and sponsors at this year's conference to see how the exhibitors and sponsors can help you

- and lastly, to enjoy the conference its facilities and Blackpool itself

We all work hard but we also need to relax and enjoy ourselves as well. I hope you all have a wonderful conference and look forward to meeting as many as I can during the forthcoming four days.

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