Council to strike 6.5% rate for Derry and Strabane

Derry City and Strabane District Council is expected to strike a rate of 6.5% for the upcoming year.

Derry News understands a majority of councillors voted to push the striking of a rate back to Wednesday, February 14, as opposed to striking it on Friday afternoon (February 9) as had been expected.

Councillors wanted to give various ministers in the new Executive time to respond to requests for meetings, before making any decisions on rates.

It is also understood that the Minister for the Economy, Conor Murphy has agreed to meet councillors regarding expenditure on City of Derry Airport. That meeting is expected to take place on Wednesday morning next.

At the Friday afternoon meeting, Council finalised its response to Department of Finance’s consultation on domestic and non domestic rating revenue raising measures.

Department of Finance and Land and Property Services issued the consultation paper on a number of aspects of domestic and non-domestic rating policy, in November 2023.

Council’s response was discussed and unanimously endorsed by councillors at a special meeting on Friday afternoon.

The consultation, which closes on February 13, is one of a number of ongoing consultations across all Government Departments in respect to revenue raising to support public services, initiated by British Secretary of State Chris Heaton-Harris.

Council disagreed with the potential removal of the maximum capital value cap from the rating system.

The value of homes in the North is currently capped at £400,000 for the purpose of the calculation of rates.
Council argued the removal of this support would create “further wealth disparities” would be created among councils in the North.

Average domestic rateable property values in the North range from £97,000 (Derry City and Strabane District Council) to £148,000 (Ards and North Down Council), with an overall NI average of £122,000.

Ratepayers in less wealthy councils such as Derry and Strabane therefore have to raise significantly higher rates poundages to generate the same levels of rates income as  the more wealthy councils, and provide comparable levels of public services.
Council contended that removal of this relief would further exacerbate these differences.

It estimated, removal of the relief would generate approximately £80,000 of additional District rates income for Derry City and Strabane District Council, whilst the figures in Ards and North Down Council and Belfast City Council would be approximately £1.7m and £2.1m respectively. 

Council contended: “Whilst the additional rates income would be welcomed, it cannot create further disparities in District rates burdens and public service provision between Councils.

“Any removal of reliefs therefore should only be considered in conjunction with a wider review of the rating system in Northern Ireland and its impact on the less wealthy Councils.”

Council also opposed the proposed scrapping of the Early Payment Discount given to ratepayers.

Land and Property Services - which is involved in the collection of rates in the North - had highlighted the fact, from a parity perspective, there was no equivalent discount in Britain, where there are no early payment discounts in terms of Council Tax.

Derry City and Strabane District Council countered by saying “removal of reliefs should only be considered in conjunction with a wider review of the rating system in Northern Ireland”.

Council argued, such a removal would impact on the less wealthy councils.

It also said the landlord allowance of 10% should not be removed from the rating system; industrial derating should not be removed; and freight transport relief should not be removed.

However, Council agreed the student halls of residence exemption should be removed from the rating system, along with the non domestic vacant rating relief.