Small businesses being targeted over Government’s business rates discount, says Simon Danczuk

Simon Danczuk MP

Rochdale MP Simon Danczuk has condemned the approach taken by a firm of Heywood surveyors alleging they are "demanding small businesses pay them £500 from the Government’s business rates discount announced in last year’s Autumn Statement".

RVA Surveyors strongly dispute Mr Danczuk's allegations saying they are "in parts incorrect, misleading, uncorroborated" and "defamatory" and are seeking legal advice and will be contacting him directly.

Mr Danczuk, who is chairman of the All Party Parliamentary Small Shops Group, said he’d been contacted by businesses from all over the country complaining that they had received court threats unless they paid 50 per cent of the Government’s business rates discount.

He explained that RVA Surveyors had approached the businesses asking if they wanted them to act on their behalf to get a reduction in business rates. When they subsequently signed a contract it stated that RVA were entitled to commission on any reduction on business rates payable.

Businesses that have contacted Mr Danczuk say they did not get any discount as a result of RVA acting on their behalf and were therefore shocked to receive a demand for money.

Mr Danczuk said: “I’m constantly hearing stories like this and small shops should not be fighting off court threats from a company that has done no work to merit them demanding £500 from a business rates discount they had nothing to do with. It’s scandalous.”

One small business owner who has received demands from RVA told Rochdale’s MP that he was getting calls every day demanding payment.

“They were very persistent in getting me to sign the contract in the first place and they told me I had nothing to lose as I would only have to pay if they were successful,” he said. “Now they are demanding £500 plus VAT for rate relief that was awarded by Government. I refused to pay because they have not done anything to deserve payment and now they are calling me every day about this bill.”

Mr Danczuk has subsequently written to the Chancellor and the Minister for Employment Relations and Consumer Affairs about the actions of RVA and said ministers needed to send out a strong message.

“They need to take action,” he said. “Because business rates are such a big overhead now many small companies are desperate to try and get them reduced and an industry of unscrupulous businesses have sprung up realising that they can prey on desperate traders. It’s clear to me that small businesses need more protection.”

In a lengthy statement responding to Mr Danczuk's allegations, RVA said they were contacted by Radio 4 who stated that they had two cases of clients that had issues and that Mr Danczuk would be making a statement relating to these clients.

The spokesperson for RVA said: "Despite our request we were not given the details of the clients to allow RVA to investigate these individual cases.

"RVA have subsequently identified the two cases, neither of which are for £500 + VAT as has been stated. In one case we have discovered an error in our processing which means we are happy to cancel the invoice. In the other case we are in no doubt that the RVA have obtained the reduction referred to on behalf of the client and that we have issued legal proceeding for recovery of the outstanding debt.

"Danczuk states he has had several complaints nationwide and we would invite him to share these with RVA in order that they can also be investigated. With instruction to RVA for some 20,000 properties in the UK we are always reviewing our systems and procedures to ensure we meet our contractual and client needs.

"RVA, at its own cost and risk, review all aspects of rating from incorrect Valuation Office Assessments which can include, but not limited to, incorrect measurements, tonal value, change in circumstances and numerous other legitimate grounds for appeal. We can also identify any of the numerous potential reliefs that are available to commercial properties as well as investigating credit balances held by local government, which amounts to hundreds of millions nationwide which local government fail to rebate.

"Like most commercial companies we do have clients that fail to pay their debts that fall due under the terms and conditions of the contract that both parties have entered into and regrettably when all other avenues have failed we are left with no other alternative than to instigate legal proceedings for recovery of those debts in line with our agreement.

"Danczuk also states that he believes businesses are put under pressure which again we vehemently reject, and our seven day cooling off period supports this.

"We also take issue with Danczuk referring to upfront fees in excess of £800. RVA operate on a No Win No Fee basis for over 95% of its clients and where a client pays an upfront fee, this is £150 or less and is designed so that the client can take an element of our costs for a reduced fee contract.

"It is widely recognised that the business rates systems has significant flaws and the onus is on the property owner or tenant to challenge and ensure that this tax is correct. RVA, like others, provide the detailed knowledge required to do this and we are contracted and engaged to do exactly that by our clients."