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Port Business Rates

It is a pleasure, Mr. Benton, to serve under your chairmanship. It is also a pleasure to respond to my hon. Friend the Member for Brigg and Goole (Mr. Cawsey) on a subject that is difficult because of the consequences of its complexity. I congratulate my hon. Friend on giving such an extremely clear outline of what has happened. The situation arose from changes of ownership in the ports about 40 years ago. Previously, the port authorities paid the business rates of the businesses that operated within the ports. The situation has changed over the years, and that transition is the crux of the problem. It became clear that some properties that should have been separately rated had not been separately rated. It became equally clear that some properties were still paying what they considered to be their business rates to the port authority, but that some were not. The result was a loss not only to the Treasury but to the other businesses that had to make up the shortfall, because not all the business rates liability was being collected. It became obvious in 2006 that the problem existed in the country's 55 ports. The Government undertook a review. The delay that my hon. Friend mentioned was not only caused by the fact that the mills of government grind exceeding slow, as he will know from watching "Yes, Minister". The review started in 2006 and took approximately two years, ending in 2008. The result was that ratepayers in 725 properties became liable for backdated bills. Backdated bills are a feature of the business rate system, which is 100 years old. Every year, individual companies are found, for one reason or another, not to have paid all their liability, and they have to pay back that money. This is the first time that we have had a sector-specific review, and it obviously led to a great deal of hardship. I very much regret what has happened to Scotline in my hon. Friend's constituency. This is not a time to lose jobs, and I regret what has occurred. One reason why the problem arose is that the system is so ancient. There is no requirement for potential ratepayers or the port authorities to inform the Valuation Office Agency that a separate hereditament may exist—I may have mispronounced that word, Mr. Benton. For example, if my hon. Friend decided to rent out his office in Parliament to my hon. Friend the Member for Cleethorpes (Shona McIsaac), it would become liable for business rates—if he were allowed to do so; I am using it as an example. However, there is no obligation on either of my hon. Friends to inform the Valuation Office Agency. It can therefore take quite a long time for the agency to find out where those separate heredi—