Changes made by the Scottish Government that will affect your Business Water Charges
Some of your bill is calculated using the Rateable Value for your property recorded by the Central Market Agency. This value is out of date and does not reflect your property’s actual Rateable Value, which was updated on 1st April 2017. The Scottish Government has said that, from 1st April 2018, water charges are to be calculated using the most current Rateable Value.
This will mean higher bills for some and lower bills for others, without increasing the overall revenue for water suppliers.
To allow businesses time to adapt, the change will be gradually phased-in over a three-year period so that from 1st April 2020, all charges will be calculated using your most current Rateable Value.
Scottish Government’s letter to businesses:
(Click to download/enlarge for mobile viewing.)
What this means for you?
We’ve listed the FAQs prepared by the Scottish Government. Should you need more information on this change then their website address is www.mygov.scot/unmeasured-water-and-sewerage-charges.
FAQs from the Scottish Government’s website:
Water, sewerage and drainage charges are payable by occupiers of non-household properties (also known as non-domestic premises) which are connected whether directly or indirectly to public networks. Unmeasured charges, such as property and roads drainage, are calculated by reference to Rateable Values.
What is Changing?
From the 1 April 2018, the Rateable Values most recently assigned by the Assessor will be used to calculate unmeasured water and sewerage charges. Currently historic Rateable Values are used. For most non-household customers, these are different to those in the current valuation roll and that are used to calculate Business Rates.
What are the Unmeasured Charges?
Unmeasured charges are those that are not calculated by reference to a meter. In Scotland, all non-household drainage charges are calculated on an unmeasured basis and are calculated by reference to a property’s Rateable Value. In addition, some non-household customers will pay water and sewerage charges by reference to the property’s Rateable Value where Scottish Water has been unable to install a meter.
When will the Changes take Effect?
The Rateable Values most recently assigned by the Assessor will be used from 1 April 2018. This means that in 2018, the water industry will use the Rateable Values assigned to premises as part of the 2017 Rates Revaluation.
Will there be transition arrangements?
Yes. Transition arrangements will cover the years 2018-19 and 2019-20. From 1 April 2020, all non-household customers will be charged based on their current Rateable Value (the 2017 Rateable Value) and the same poundage rates (pence per pound).
Why is this Change Happening?
The Water Industry currently uses historic Rateable Values to calculate unmeasured charges. The Rateable Values date back when to the property was built (or last modified) or 1995, whichever is the most recent date. This means that there can be significant differences between the amounts charged for properties with the same Rateable Value in the current valuation roll. The Government recognises that this situation is unfair.
Will Scottish Water get more money?
No. This is not a revenue raising measure for Scottish Water. This means that increases in charges for some non-household customers will be offset by reductions for others.
Will the Poundage (Pence in the Pound) change?
Yes. To ensure this is not a revenue raising measure, the poundage rates for all services that use Rateable Values as part of the calculation will change. Based on initial calculations made using the 2010 Rateable Values, we expect that property and roads drainage poundage rates will decrease by around 30%. This means that non-household customers that see their Rateable Value (as used by the water industry) increase by less than 40% should benefit from lower water industry charges.
Who will lose and who will Gain from this measure?
Calculations made using the 2010 Rateable Values show that 57% of non-household customers could see a decrease in their bills. 43% could see an increase. Those who will see the biggest increases are likely to be those for whom a very dated Rateable Value is being used by the water industry.
Why are drainage changes not calculated by reference to surface area?
The Government recognises that a number of responses to its recent consultation noted that property drainage charges should reflect the impermeable surface areas owned/occupied by each business. It has asked the water industry to carry out a Review by 2021 into the costs, impacts and benefits of moving to a surface area calculations.
More information can be found on the Scottish Government’s website: www.gov.scot/Topics/Business-Industry/waterindustryscot/SWI-1/charges. If you have questions about your bill or your meter, please contact your Licensed Provider.