15 June 2004 Minister Launches Consultation On Hardship Relief For Businesses

Announcing the consultation today, the Minister said: “I am pleased to be able to launch this paper, which contains proposals that will address a major omission in the current rating system. The publication of the original Consultation Paper on the Review of Rating Policy, in May 2002, included a question on whether there was a need in Northern Ireland to have a hardship rate relief scheme. “

Many of those who responded supported the need for such a scheme to be available to help businesses in exceptional circumstances. This view was repeated and endorsed again during the public consultation exercise late last year on the draft Rates (Amendment) (Northern Ireland) Order.

Mr Pearson said that the intention of the proposed scheme is to allow Government to respond in a practical and timely way to the needs of businesses facing difficulty for reasons beyond normal commercial risk:

“It will not be a replacement for industrial de-rating, but it will allow Government to be more responsive and flexible in targeting support at individual businesses where and when it is most needed.

The Minister stressed the importance of this consultation as an opportunity for interested parties to contribute to the development of the scheme, adding:

“I believe that the introduction of such a scheme will be widely welcomed by the wider business community, though in seeking views it is important to recognise that there is a cost involved that ultimately may have to be met through the rates.”

NOTES TO EDITORS:

On 1 March 2004, Ian Pearson MP, the Minister with responsibility for Finance, announced in Parliament that the draft Rates (Amendment) (Northern Ireland) Order would be amended to include an enabling power to introduce a hardship rate relief scheme by regulations. This announcement followed an extensive public consultation on the Order that began in October 2003. During the parliamentary stages of the Order in early 2004 there was broad support for the introduction of a hardship rate relief scheme.

Article 8 of the Rates (Amendment) (Northern Ireland) Order 2004 sets out the four broad principles relating to hardship rate relief:

· The relief is to be granted only in respect of rates payable on non-domestic property;

· The relief is to be ‘discretionary’;

· The circumstances that give rise to a request from a ratepayer for hardship relief have to be

· ‘exceptional’; and

· The relief may be given only where a ratepayer would otherwise suffer ‘hardship’.

There are several key issues associated with these broad principles on which final decisions have yet to be taken. These are set out below and responses to the Consultation Paper will inform the preparation of the Regulations:

· What factors should the Department take into account when considering the interests of other ratepayers?

· What evidence or information should an applicant for hardship relief is required to produce in support of an application?

· In addition to the interests of other ratepayers, what other factors should the Department take account of when assessing applications for hardship relief?

· Should the regulations exclude certain classes of non-domestic ratepayer from hardship relief and if so, which ones?

· What type of exceptional circumstances do you think should give rise to hardship relief?

· Do you agree with the Government’s proposed broad definition of hardship? What causes of hardship should be taken into consideration?

· Do you foresee the introduction of a hardship relief having any negative impacts on any Section 75 group, or on disadvantaged or rural areas?

Any comments on these issues should be submitted to the Department by 17 September 2004.

The consultation documentation launched today is available on the Internet at: www.nics.gov.uk/ratingpolicy.