Dodds introduces new voluntary rates deferement scheme
4 November 2008
Finance Minister Nigel Dodds announced today that he intends to introduce a rates deferment scheme for home owning pensioners.
The deferment scheme will enable home owning pensioners to defer their rate payments, which could provide a further payment option and remove rates from their day to day budgeting. Its implementation is a result of last year’s Executive review of rating.
Announcing his decision Mr Dodds highlighted that he was moving ahead, assured and informed by the detailed feedback he has received during the consultation period. He said: “In taking forward the rating reforms we have already shown that local people and local views can shape and influence the decision making process. The consultation process undertaken last year went way beyond identifying what was wrong with the system and presented ideas on how it could be changed for the better.”
Commenting on the quality of the consultation responses Mr Dodds added: “The measures announced today would not have been possible without the responses to the latest consultation exercise. This feedback included advice, guidance and expertise from a wide range of representative groups, interested bodies and individual ratepayers. It has allowed us to develop local policies for local people.”
Speaking about the deferment scheme, the Minister noted the broad support for the proposal and highlighted how he had carefully considered the consultation responses before deciding on the way forward. He said: “In light of the consultation responses I have decided to reduce the eligible age for home owning pensioners from 65 to 60, subsequently increasing in line with changes to pensionable age. I have also decided that independent financial advice will not be made compulsory prior to an applicant entering a deferment agreement. However, I want to stress that this will be strongly recommended given the long term financial commitment involved. Finally, the interest rate levied will be the Bank of England base rate minus 1% - in light of current economic uncertainty the Department will reserve the power to introduce a minimum interest rate threshold.”
The Minister pointed out that the scheme was not a new relief or allowance, but rather it will provide a further payment choice. The Minister cautioned that it should not be viewed as an investment decision and said: “This will be a serious financial commitment for any applicant, involving administrative and legal costs in setting up the property charge and securing independent advice. It is there, however, as a safety net for pensioners, particularly those who are ineligible for low income rate relief and yet are having to contend with ever increasing household bills on a fixed pension. Many are facing hard choices, and this scheme will at least remove the issue of rates from their day to day budgeting.”
The measures are to be introduced in early 2010, given the time needed to pass the necessary legislation through the Assembly and put the necessary administrative systems in place.
NOTES TO EDITORS:
1. 1. Media enquiries only to DFP Communications Office on 028 9052 7374 or 028 9052 7375. Out of office hours please contact the Duty Press Officer via pager number
2. 076 9971 5440 and your call will be returned.
3. 2. Further details on consultation on deferment can be found at http://www.ratingreviewni.gov.uk/
4. 3. A consultation report will be published in the coming weeks providing an overview of the consultation responses and setting out the Minister’s decisions on a range of rating reforms.
5. This will also be published on the Rating Reform website.
Finance Minister Nigel Dodds announced today that he intends to introduce a rates deferment scheme for home owning pensioners.
The deferment scheme will enable home owning pensioners to defer their rate payments, which could provide a further payment option and remove rates from their day to day budgeting. Its implementation is a result of last year’s Executive review of rating.
Announcing his decision Mr Dodds highlighted that he was moving ahead, assured and informed by the detailed feedback he has received during the consultation period. He said: “In taking forward the rating reforms we have already shown that local people and local views can shape and influence the decision making process. The consultation process undertaken last year went way beyond identifying what was wrong with the system and presented ideas on how it could be changed for the better.”
Commenting on the quality of the consultation responses Mr Dodds added: “The measures announced today would not have been possible without the responses to the latest consultation exercise. This feedback included advice, guidance and expertise from a wide range of representative groups, interested bodies and individual ratepayers. It has allowed us to develop local policies for local people.”
Speaking about the deferment scheme, the Minister noted the broad support for the proposal and highlighted how he had carefully considered the consultation responses before deciding on the way forward. He said: “In light of the consultation responses I have decided to reduce the eligible age for home owning pensioners from 65 to 60, subsequently increasing in line with changes to pensionable age. I have also decided that independent financial advice will not be made compulsory prior to an applicant entering a deferment agreement. However, I want to stress that this will be strongly recommended given the long term financial commitment involved. Finally, the interest rate levied will be the Bank of England base rate minus 1% - in light of current economic uncertainty the Department will reserve the power to introduce a minimum interest rate threshold.”
The Minister pointed out that the scheme was not a new relief or allowance, but rather it will provide a further payment choice. The Minister cautioned that it should not be viewed as an investment decision and said: “This will be a serious financial commitment for any applicant, involving administrative and legal costs in setting up the property charge and securing independent advice. It is there, however, as a safety net for pensioners, particularly those who are ineligible for low income rate relief and yet are having to contend with ever increasing household bills on a fixed pension. Many are facing hard choices, and this scheme will at least remove the issue of rates from their day to day budgeting.”
The measures are to be introduced in early 2010, given the time needed to pass the necessary legislation through the Assembly and put the necessary administrative systems in place.
NOTES TO EDITORS:
1. 1. Media enquiries only to DFP Communications Office on 028 9052 7374 or 028 9052 7375. Out of office hours please contact the Duty Press Officer via pager number
2. 076 9971 5440 and your call will be returned.
3. 2. Further details on consultation on deferment can be found at http://www.ratingreviewni.gov.uk/
4. 3. A consultation report will be published in the coming weeks providing an overview of the consultation responses and setting out the Minister’s decisions on a range of rating reforms.
5. This will also be published on the Rating Reform website.
