Select Committee on Treasury Minutes of Evidence

Memorandum by the Royal Institution of Chartered Surveyors


  These comments from the Royal Institution of Chartered Surveyors (RICS) are in response to the Treasury Sub-Committee Inquiry into the Valuation Office Agency (VOA). The Royal Institution of Chartered Surveyors (RICS) welcomes the opportunity to give evidence to the Treasury Sub-Committee as our members are very much involved in the day to day working of the VOA.

  Naturally, we would be more than pleased to attend the Committee to discuss or develop our comments.


  The RICS as a profession deals very closely with the VOA on two fronts:

    (1)  Firstly, most senior officers of the Valuation Office Agency, as well as all Group Valuation and Listing Officers throughout England and Wales, are Chartered Surveyors. Furthermore, all Valuation and Listing Officers within Billing Authorities (whose job is to compile non-domestic rating assessments and council tax bandings) are members of our Institution. Indeed, the VOA, although numerically far smaller than it was a few years ago, remains the largest single employer of Chartered Surveyors.

    (2)  Secondly, RICS members in the private sector deal with the VOA on a day to day basis as property advisers on the rating assessment and consequential liability of their clients' property. Chartered Surveyors also have dealings with the VOA on a variety of non-rating issues, including valuations for tax and compensation purposes.

  The short timescale set out in the invitation to comment has prevented the RICS consulting widely amongst those members who practise as rating surveyors. We do, however, receive correspondence from members about the VOA from time to time and our response seeks to incorporate as wide a cross section of these views as possible.


  1.1 In general terms, the VOA enjoys a high reputation within the profession for competence and impartiality. It provides many important valuation services—both to the public and private sectors—through a core of highly skilled personnel and a unique and valuable database. It also brings a consistency of approach to areas such as the negotiation of rating assessments, inheritance tax and capital gains tax valuations.

  1.2 A testament to the professionalism and the integrity of VOA staff is the fact that none of them have ever, to the best of our knowledge, been convicted of a criminal offence arising from their professional work at the VOA.

  1.3 The VOA has traditionally been the provider of professional property advice and services to government departments and many local authorities. This role has diminished recently as these bodies have either taken the work in-house or engaged the services of private practice.


  We have set out our response to the first question posed by the Committee in the form of positive and negative comments. We have sought, where our comments are negative, to provide constructive criticism. The second question raised by the Committee looks into the future and here we have restricted ourselves to recommendations.

Q1. Changes introduced since the 1995 Next Steps Agency Review

(a) Positive factors

  2.1 It is widely understood that on its establishment as a "Next Steps Agency", the VOA was required to adopt a five year business plan, one element of which was to reduce operational costs by 6 per cent per annum in real terms, or by something over 30 per cent in absolute terms. This was a major constraint on the business of the VOA at a time (the last revaluation of commercial property in 1995) when the demands of the public and the professions for a faster and more responsive service had never been higher. It is to the credit of the VOA that it has achieved this target by a combination of the greater use of information technology (IT) and an early retirement and voluntary redundancy programme, albeit with the loss of a large number of experienced senior staff.

  2.2 We understand that the VOA has met this undertaking to reduce its costs by 6 per cent per annum in real terms. This is a major achievement for a department which was not obviously over-staffed.

  2.3 The staff of the VOA have laboured diligently to make the Next Step changes work well. This is a significant achievement in light of the upheaval of office closures, staff regrading and the introduction of advanced IT on a piecemeal basis. Furthermore, there has been a change in the mindset of VOA staff who now see rate payers and their agents as customers who deserve good service.

  2.4 There has been an obvious change in working practices within the VOA. The Agency consults widely both locally and centrally with ratepayers and their agents, listening to their views with the desire to achieve more accurate initial valuations. This co-operation has established a climate where changes in valuation practice can be incorporated into rating law and procedures via a consensual rather than confrontational process. This can only be positive.

  2.5 The VOA has created Specialist Rating Units (SRUs) on a regional basis to deal with more complicated and unusual valuations. This has been particularly successful as the professional skills required to value these unusual hereditaments are necessarily scarce in both the VOA and the private sector. The establishment of the SRU has meant that experienced specialist surveyors in the VOA and in private practice are able to meet and negotiate the assessments of these difficult hereditaments on equal terms and with considerable savings in time and costs. It has meant that, where necessary, more senior and experienced valuers are available to defend these assessments before either the Valuation or Lands Tribunals.

  2.6 A point consistently stressed by our members is their respect for the professional attitude of the qualified staff within the VOA and their commitment to achieving the correct valuation, regardless of how much work is involved and frequently in the face of co-ordinated and weighty arguments (often supported by greater resources) from private practice. The professional commitment of the VOA to their job of defending the rating list is very high and as one of our members commented, " . . . in this respect, the [VOA] is a credit to the taxpayer."

(b) Negative factors

  3.1 The reorganisation of the VOA on a "Group Office basis" has imposed upon the Group Valuation Officer many additional responsibilities. Unlike the old District Valuer and Valuation Officer, the Group Valuation Officer is responsible normally for more than one local office. Furthermore, this responsibility extends well beyond the professional tasks relating to Group offices and includes dealing with issues such as personnel and administration. However, unlike the previous system, they must resolve these matters without the support of the regional network which formerly co-ordinated the activities of local Valuation Offices.

  3.2 The VOA conducted detailed aptitude tests before appointing the Group Valuation Officers and engaged the services of external consultants to carry out the necessary appraisals. Only time will tell if those appointed are up to the task or not, but the RICS remains concerned that the successful administration of the rating system rests on the shoulders of the Group Valuation Officers, who would benefit from more central support and enhanced training in management skills.

  3.3 The VOA has tried to incorporate some of the ideas from private practice into the changes it has introduced following the Next Steps Review. It needs to attract high quality surveyors/managers into its ranks as Group Valuation Officers. To be successful in this, it should consider the introduction of market driven rewards which are capable of being reviewed against expected targets.

  3.4 The VOA are currently engaged in both preparing the 2000 revaluation assessments and defending the 1995 Rating Lists. These two tasks are stretching the VOA's resources. As a result, the speed with which outstanding appeals (and changes to the 1995 lists) are being resolved is slowing. The RICS believes that the professional resources of the VOA need to be enhanced if the public is to receive the service it deserves. Whilst it is understandable that appeals arising from the changes negotiated during the life of a rating list will remain outstanding when that list ceases to apply it is, in our view, unacceptable that appeals against the original list assessments (as opposed to the changes negotiated) should remain in dispute after the list ceases to have effect.

  3.5 It would be unfair to the VOA to suggest that it is solely to blame for delay in settling appeals. The problem is systemic and needs to be resolved. Realising that the system needed to be modernised, the RICS established the "National Committee on Rating" which published the Bayliss Report in the summer of 1995. This report was the consensual result of 12 months discussion between 16 organisations assisted by eight government departments. We believe it offers a viable long-term framework for the future of the rating system and would be happy to supply members of the Committee with a copy.

  3.6 The VOA is no longer seen as an attractive first choice employer by qualifying and experienced Chartered Surveyors. The recent limited recruitment drive by the VOA was instructive. It showed that in London and the South East—where employment for Chartered Surveyors is plentiful—recruitment levels and the quality of candidates has been poor. This contrasts sharply with elsewhere in England and Wales, where the quality and number of applicants was high.

  3.7 This may be a factor of the market, but it might also emphasise that employment by the VOA is looked upon as something other than a first choice by many Chartered Surveyors. The VOA used to have a reputation for providing some of the best technical training within the profession. Sadly, this is no longer a generally held view and, together with uncertain career prospects, discourages high quality entrants.

  3.8 The VOA used to train its own young Chartered Surveyors under its Cadet Valuer Scheme. The quality of training and work experience provided by that scheme was very high and appointment as a Cadet Valuer was eagerly sought after by those wishing to become Chartered Surveyors. This scheme has been discontinued by the VOA on what we understand to be cost grounds. As a consequence, the Agency is not replacing valuation skills at the younger end of its workforce. This is likely to create difficulties in the future. The RICS believe that the VOA should re-introduce its Cadet Valuer Scheme and help train—in common with other responsible employers—the surveyors and valuers the country will need in the future.

  3.9 It is apparent to private practice members of the RICS who visit local Valuation Offices in the course of their business, or who meet members of the VOA at professional meetings, that morale throughout the Agency is very poor. Staff and Valuers at local office level are disillusioned and unhappy. It is widely reported that a recent survey by the VOA found a disturbingly high percentage of staff showing symptoms of depression.

  3.10 We understand that VOA valuers, having to meet ever increasing targets from diminishing resources, understandably feel that the quality of their work (once the hallmark of the VOA) is starting to slip. The economies referred to and a shortage of qualified surveyors has led to unqualified staff (in this case termed "Valuation Technicians") being asked to deal with the settlement of more complicated appeals. They have to do this under the supervision of a qualified surveyor and as a result normally have no authority to settle these claims. This leads to delay and adds to the frustration of the supervising surveyor. There is no doubt that these unqualified technicians work extremely hard, but their knowledge, training and expertise cannot match that of a fully qualified valuer.

  3.11 The changes introduced following the Next Steps Review emphasised the importance of settling cases and, consequently, many qualified valuers feel that the VOA is more concerned with the number of appeals settled than with the accuracy of the resulting assessments.

  3.12 One of the strange ironies of the VOA restructuring plan was that it offered financial incentives to surveyors at different levels to take early retirement or voluntary redundancy. This encouraged those who saw the greatest opportunities outside the VOA to leave. These individuals included many with the highest technical skills or those who thought they had the necessary entrepreneurial flair to make a success of transferring to private practice. This contrasts sharply with the private sector where any employer would have identified the poorest performers and selected them for redundancy, thus improving the overall quality of staff retained.

  3.13 Staff normally rise to a challenge and part of the responsibility for this demoralised and unhappy state of affairs must rest with the former leadership of the VOA which failed to explain and sell the changes to the workforce.

  3.14 The investment in IT support within the VOA has, we believe, been slower and less intensive than that of equivalent-sized surveying businesses in the private sector. We understand that this has been partly due to Treasury restrictions on investment which does not show a positive return in a single year. Whilst we welcome the current moves to relax these restrictions, we would point out that rating is currently run on a five year cycle and the continued investment in IT that will be needed to deal with the ever greater demands from customers also needs to be assessed on a five year cycle.

Q2. Changes recommended for the 2000 Revaluation

  4.1 The VOA is well advanced with the preparation of the 2000 Rating List and has undertaken to provide the first draft to the DETR/Welsh Office by May 1999. We do not feel that it would be helpful to suggest changes in their procedures at this time as this would only disrupt this difficult task.

  4.2 There are apparently 1.7 million non-domestic hereditaments in England and Wales. Of this total, some 1.25 million comprises of shops, offices and industrial properties which are normally let in the open market and are valued using direct rental evidence. The RICS understands that the work on preparing these assessments is more advanced than that in respect of other, more specialised hereditaments, where different and more complex valuation techniques are required. We believe that the VOA has made great strides in developing a customer focus, but it cannot rest easy. It must constantly strive to improve its working relationship with ratepayers and their surveyors so as to increase the accuracy of their initial valuations of these properties. The RICS is, quite naturally, willing to play its part in improving this relationship.

  4.3 As part of this process of improving customer focus, steps must be taken to raise the morale of staff in local VOA offices.

  4.4 The VOA should act as a responsible employer and help train its share of young surveyors in the future. It is still the largest employer of Chartered Surveyors and, as such, has a moral responsibility to bring on its share of young valuation surveyors for the future.

  4.5 Major savings can be achieved—for Government, local authorities, valuation tribunals, ratepayers and the VOA—through the whole-hearted adoption and introduction of modern compatible IT systems.


  5.1 The VOA is a worthwhile and hard working agency of Central Government whose staff have been demoralised by a combination of an extensive and arbitrary five year cost reduction plan, inadequate past leadership, the unsettling effect of office closures and the piecemeal introduction of IT.

  5.2 Ironically, the very professionalism of the staff has contributed to their demoralisation as they have been trained to provide a certain level of service and now feel they are required to place the rapid settlement of appeals above their professional responsibility (both to the ratepayer and public at large) to achieve the correct assessment.

  5.3 The changes introduced following the 1995 Next Steps Review are now almost complete and the benefits of these changes, coupled with the implementation of the latest IT support, should provide an opportunity for the Agency to re-build its morale.

  5.4 The professional surveyors and staff within the VOA are resilient and, provided it is explained to them that they have an interesting and rewarding future, they will respond to positive leadership.

March 1999

previous page contents next page

House of Commons home page Parliament home page House of Lords home page search page enquiries

© Parliamentary copyright 1999
Prepared 7 June 1999