In addition to local rating lists in England and Wales, there are also Central Rating Lists in each country. Central lists are administered for billing by Department for Communities & Local Government (DCLG) for England and the Welsh Government for Wales. The Central Lists contain network type rating assessments of major transport, utility, telecom and cross-country pipelines usually spanning more than one billing authority and in some cases the whole country. Consequently each Central List entry is a single aggregate or “cumulo” for each ratepayer.
There is a fairly strict definition on what can or cannot be included in the Central List. Where some of a designated ratepayer’s property falls outside the definition it will be assessed separately with its own rateable value in a local list. The rating valuation for a cumulo assessment is generally complex and can require specialist expertise in the use of the Receipts & Expenditure and Contractors Test methods of valuation.
The table at the top of the page shows some examples of Central List ratepayers and the shifts in rateable values due to the 2017 Revaluation.
There has been significant increase of total rateable value of over 41% and 25% in England Wales respectively. Whilst there are significant increases for most, what really stands out is the increase for BT at an incredible 325% and 287% in England and Wales.There has also been a similar increase for BT’s network assessment in Scotland.
BT is not the only major telecoms provider to see an unheralded rate liability increase, with Virgin Media also seeing a similar fourfold increase for their cable networks in various local rating lists. Both BT and Virgin Media networks are valued using the Receipts & Expenditure (R&E) method of valuation.
In comparison other fibre optic networks in England and Wales, which are valued mainly on a rental basis, has increased far more modestly.
It appears that the Valuation Office Agency has altered its assumptions and approach to the R&E method of valuation leading to such a massive increase for BT and Virgin Media and may also account for some of the other utility increases that also use the R&E approach. However, there is a mixed picture in the Central List with some utility ratepayers seeing significant rises while others have even seen a fall.
Both BT and Virgin Media have voiced their considerable concerns with regard to this alarming liability increase as it may have a negative impact on any future infrastructure investment plans and may lead to an increase in prices for their customers.
Cushman & Wakefield has the expertise to advice on this type of specialist valuation field notably in water and power utilities together with the telecoms sector.