Malvern Hills District Council appeals over Business Rates ruling

A change to the way Business Rates are calculated for GP surgeries is set to cost Malvern Hills District Council millions of pounds.

Chief executive Jack Hegarty has sent a letter, along with the chief executives of the county's other district councils and Worcestershire County Council, asking the Government to urgently review the situation.

Earlier this year a valuation tribunal ruling resulted in a change to the way Business Rates for purpose built GP surgeries are calculated meaning in future they will pay significantly less. As a result a number of GP surgeries have made successful appeals to the Valuation Office against the value given to their property in 2005 and 2010.

It is estimated surgeries in Malvern Hills will receive a £3milliion refund and £400,000 a year on an ongoing basis from this financial year.  Malvern Hills District Council, Worcestershire County

Council and Hereford & Worcester Fire Authority will be responsible for half of the total losses. Malvern Hills will have to pay the majority share which will total £1.2million and £160,000 a year ongoing.

It is understood the money related to the historic payments will be retained by NHS England and the future money by local Clinical Commissioning Groups.

Malvern Hills, and other Worcestershire councils, are appealing to the Government for support as prior to 2013 Business Rates were collected centrally by the Government and redistributed according to a set formula as a grant. It is only since 2013 Worcestershire councils have been able to retain half of the Business Rates they collect locally.

Cllr Paul Cumming, portfolio holder for finance on Malvern Hills District Council, said: "We know a number of other authorities have been similarly affected and expect the issue to eventually have an impact across the country. We are raising the issue and the unfairness of the situation with MPs, the LGA and district council representative bodies.

"This decision will place even more strain on our finances and whilst front line services have been protected from the cuts we've had to make so far, this new situation may put them at risk.

"We're hopeful the Government will listen carefully to our concerns on this matter. I also sincerely hope that any money retained by the NHS will be spent for the benefit of local patients."