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02 February 2006 Rooker Reviews Progress on Capital Value Rating Plans

ROOKER REVIEWS PROGRESS ON CAPITAL VALUE RATING PLANS

Northern Ireland is well on the way to capital value domestic rating by the April 2007 deadline, Finance Minister Jeff Rooker said today.
The Minister was speaking following a briefing from Valuation & Lands Agency (VLA) officials, during which he was updated on the progress of the exercise involving more than 700,000 homes across Northern Ireland.
He said: "As you can imagine this is an enormous undertaking, requiring a great deal of collation, validation and analysis. The Computer Assisted Mass Appraisal system being used to process the information is proving an invaluable tool and is the first time such a system has been used in the UK.
"It had been hoped to make the capital values available to the public by April of this year, but the complexity of the work involved means the information will not be released until the end of June.
"Although this represents a slight slippage to the original timetable, I am content that a little bit more time is spent ensuring that the values produced are accurate and acceptable to the public. I remain confident that the target date of April 2007 for the implementation of the new rating system will be met.
"I am very grateful to all the staff at VLA, from the professional valuers to the clerical staff, for the work they are doing. It is a mammoth undertaking, but because it is being carried out by local experts, using local knowledge, it is one in which the Northern Ireland public can have confidence."
NOTES TO EDITORS:
  1. In October 2002, the Government announced its intention to change the basis of valuation for rating purposes from rental to capital values in line with the outcomes of an extensive consultation exercise on the Review of Rating Policy in Northern Ireland.
  2. This led to the publication in 2004 of a policy paper, and following a further 16 week consultation, a report in March 2005 which set out the Government's intention to introduce a capital value rating system based on individual valuation assessments in April 2007.
  3. Independent research shows that, taking account of Northern Ireland's particular circumstances, a capital value system based on individual valuation assessments is likely to result in a fairer distribution of the rating burden than any of the alternatives such as the current system based on rental values or a banded capital value system.
  4. The revaluation exercise is being carried out by the Valuation and Lands Agency (VLA) and is the first domestic revaluation since 1976. Non-Domestic Revaluations took place in 1995 and 2003. The domestic revaluation in 1976 was based on rental values dating from the late 1960s, which even then was a declining sector. Revaluation using capital values will restore fairness in the system, addressing the differing levels of growth over the 30-year period. Given that over 70% of houses are now owner-occupied, it will also be easier for ratepayers to understand.
  5. The tool being used to assist VLA with the revaluation exercise is known as Computer Assisted Mass Appraisal (CAMA). CAMA is a world recognised standard approach to mass valuation exercises for property tax purposes. It involves the use of verified sales data from 50 000 properties in Northern Ireland combined with a range of analysis techniques such as multiple regression.
  6. Initial valuations, produced using CAMA are then reviewed and verified by a local qualified valuer before being finalised. VLA have also been updating the data that they hold on all domestic properties in Northern Ireland.
  7. VLA are already making plans to deal with enquiries following the release of the capital values. The intention is to deal with ratepayers as promptly and helpfully as possible. It should also be noted that by publishing the capital values at the end of June 2006 and enabling them to be reviewed on request, VLA hope to resolve as many queries as possible prior to the new system coming into effect and therefore reduce the need for formal appeals after April 2007 when rate bills based on the new capital values will issue.