Forecourt Trader
Home
Menu

Make your voice heard

01 February, 2010
Page 10 

Retailers have been urged to keep up the pressure on MPs as the debate rages over the proposed increases in Business Rates. RMI Petrol said the Valuation

Office Agency (VOA) had met with its representative, forecourt rating specialist MUA Property Services at the end of January, with another meeting planned for the first week of this month. But RMI Petrol, formerly the PRA, said that while it was pleased the negotiations were taking place, there was still a long way to go.

RMI Petrol chairman Brian Madderson commented: "No one is committing themselves to saying what has and has not been agreed in these talks. At least negotiations are ongoing but of course this does not mean that we can take our foot off the accelerator."

The talks follow several recent developments in RMI Petrol's challenge to what it sees as the unfair methodology used to work out the new business rates. Industry experts feel the VOA revaluations have penalised independent forecourt operators, with many due to see steep hikes in their business rates on April 1.

Last month Conservative MP Philip Dunne added his weight to the campaign and tabled an Early Day Motion (EDM) which called on the government to postpone the business rates revaluation for petrol stations.

The MP for Ludlow warned that there were 'flawed changes in Valuation Office Agency methodology' and said the new rates threatened to put some forecourts out of business.

At the time of Forecourt Trader going to press, 28 MPs had signed the EDM. Madderson said he wanted to get this figure up to at least 50 signatures, adding that more retailers must take action and write to their MP asking them to add their support.

The main areas in the assessments that concern RMI Petrol are the way fuel margins are assessed, the broad brush approach of working out the rateable value of car washes and the fact that forecourt shops are rated on turnover and not on square footage like all other UK retailers. There is also the matter of the 2 million cap on shop sales which is seen to favour bigger stores, especially the supermarkets.

RMI Petrol has predicted the new rates will cost the industry at least 1,000 jobs because an additional 200 sites, mainly rural, will be put out of business by rate increases of more than 400%.

Last month, the organisation also estimated that the financial cost to the taxpayer in increased benefit payments and clean-up costs would be about 11m.

Madderson said: "The costs, both social and financial, of this change which, according to the quango responsible isn't going to raise funds for the Exchequer are enormous to rural societies, the motor retail industry and the economy as a whole.

"Put simply, this is a quango cock-up which will cost the economy 1,000 jobs and 11m. If this is allowed to go through it would be a victory of needless and intrusive bureaucracy over common sense."

Madderson said RMI Petrol was strengthening its high-profile political lobby, including correspondence with the Chancellor of the Exchequer, the Department for Communities and Local Government (DCLG), the chief executive of the VOA, the director of ratings for the VOA and the Commission for Rural Communities (CRC). In addition to Philip Dunne's support, Madderson said RMI Petrol representatives had also held a meeting with Labour MP Lindsay Hoyle, who offered his full support for the campaign.

Meanwhile, Madderson has told retailers they can expect to see more parliamentary questions tabled as well as more EDMs and hopefully an adjournment debate (more details are available in the RMI Petrol column on page 7).

RMI Petrol also has the support of the UK Petroleum Industry Association (UKPIA) and the Association of Convenience Stores (ACS). And Madderson has been in correspondence with the economic secretary to the Treasury, Dr Ian Pearson. As minister responsible for the VOA, and also within the Treasury for business rates, Pearson replied by letter to Madderson on behalf of the Chancellor of the Exchequer.

In his letter, Pearson stated: "The VOA is prepared to revisit the scheme and review and alter their approach if evidence shows this to be appropriate. I understand that the VOA is currently reviewing information about petrol filling stations provided in December alongside other new and existing evidence. I can assure you that the VOA is willing to continue discussions with representatives of petrol filling stations and consider further evidence presented, and is keen to resolve outstanding issues as quickly as possible."

Madderson responded by warning Pearson that "the present impasse is without precedent and the ramifications of failing to agree will leave both the VOA and industry struggling to cope with the welter of appeals that will surely arise from April 1 onwards".

In the letter Madderson also questioned the methodology used by the VOA to work out fuel margins, asking how it could be fair that it was assumed that smaller sites were making the same margin as multi-national chains. He concluded: "We remain convinced from anecdotal comments by the independent sector, particularly those sites operating in the fragile rural economies, that the enormous increases in RVs (rateable values) will lead to yet more site closures over the next year or so."

A VOA spokeswoman said: "The VOA has been meeting with representatives from RMI Petrol to discuss their concerns. The talks are ongoing and we will make a statement about the outcome once the talks come to a close."