New Rates - Analysis of the Pain by Esmond Birnie
“The house price “hot spots” (say, South Belfast, Lisburn and North Down) face big hikes in charges under the new rates. This is because the new bills will be roughly 0.6 per cent of the assessed sales prices (in January 2005). Until now this has been a theoretical problem but during this week (Tuesday) householders in South Belfast will be receiving their official house price assessments through the post.
Every South Belfast Ward bar Shaftesbury faces an increase in the average bill (in the case of Malone it almost doubles, in the case of Stranmillis it goes up by two-thirds). In every Ward except one well over half of families will face increases.
The new system is packed high with anomalies. Two families, in otherwise very similar circumstances (same income and similar house size) will face very different rates bills according to whether they live in a low or high house price area (compare South Belfast with, say, Strabane).
Northern Ireland’s total rates bill will tend to grow strongly over time not because we are necessarily using more local services but as our house prices (continue to) catch up on the historically higher levels in England.
We will face more and more hard cases posed by asset rich but cash poor individuals, e.g. a pensioner living by themselves in, say, Stranmillis on a low fixed income will now face a bill of several £ 1000s. How will they pay, will they be forced to sell a home they have lived in for decades?
The underlying problem is the philosophy of the new rates. These are no longer, in any sense, a charge for use of local services (bins, street cleansing, swimming pools). They are in no way tied to a real ability to pay. What the new rates are, and they have been introduced and designed during a period when local democratic control has been missing, is regional wealth tax in disguise”.