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A number of organisations, including The Women’s Institute, have been left off a list of charities that will trigger a temporary exemption from the crippling ‘rain tax’. The policy has been implemented by troubled water company United Utilities, which Ofwat has publically criticised for incompetence in its introduction of the crippling ‘rain tax’. The company has been forced to suspend ‘rain tax’ bills for some charitable buildings while spin doctors try to sell the increased bills as a good thing. Writing to the Village Hall Association, United Utilities confirmed that buildings which will benefit from a twelve month suspension of the ‘rain tax’ this year are: Faith buildings - registered under the Places of Worship Registration Act 1855 Community amateur sports clubs - registered under Schedule 18 to the Finance Act 2002 with HM Revenue and Customs (HMRC) Also included are any premises used by Scouts, Guides, Cubs, Beavers, Brownies, Rainbows Peter Osborne, Public Affairs Manager for United Utilities, told the Village Hall Association, “Whilst I appreciate that some charitable halls may also face a large increase in their charges, unless the premises can be placed into one of the above categories, unfortunately they will not be included within the review of the implementation for the site area charge.” A spokesperson from DontDrainus.org said, “United Utilities still claim the drain on charities, churches and clubs is fair. But they have an odd understanding of the word fair: We have United Utilities and Ofwat deciding which charities are in and which are out-how is this fair? We have community buildings in Knutsford, Cheshire, facing new bills of £10,896 a year, 20 times as much as a nearby Rolls-Royce showroom-how is this fair? We see big business ‘rain tax’ bills dropping by £100 million, while churches, clubs and charities see their bills going up by £100 million -how is this fair? Even the Head of Ofwat has admitted that his own church would struggle to pay £8,000 a year ‘rain tax’. “The suspension of the ‘rain tax’ is just a PR exercise, in twelve months it will be back and the £100 million a year drain will continue. Two years a go this problem did not exist-everything worked well, no one was complaining. The solution is very simple-in 2000 the Government told Ofwat that churches, charities and clubs should not be billed as if they were factories, Ofwat need to follow this guidance and instruct water companies to apply a broad permanent exemption, as we used to have, or the Government need to review the charging mechanism with serious consideration given to regulations that would introduce a charity band or the return to rateable value charging for churches, clubs and charities.” Campaign A Downing Street petition against the ‘rain tax’ is currently the most popular with over 41,000 signatures. DontDrainUs.org launched a campaign in late January. Its website (www.dontdrainus.org) includes video, news and images of the following activities: Driving a giant anti-‘rain tax’ poster lorry onto United Utilities HQ in Warrington Held a protest outside Rolls Royce in Knutsford Sent umbrellas to Gordon Brown, Hilary Benn, the head of ofwat/ water companies Released a variety of campaign posters The Church of England voted unanimously to ask the Government to scrap the ‘rain tax’ against churches, charities and clubs. In a debate, at which the Archbishop of York spoke, the governing body of the Church called for minsters to insist that Ofwat follow guidance given in 2000 making clear that charities, churches and clubs should not be charged on the same scale as factories and other commercial buildings. The Scouts Association have an anti ‘rain tax’ campaign running. Background In early 2008 Ofwat (the government watchdog for the water industry) and the Consumer Council for Water convinced four water companies to change the basis of charging for the processing of rain water. Non domestic properties would now be charged on the size of their site area instead of the rateable value of the property. Churches, charities and clubs, which often had a zero rateable value, suddenly found themselves on the same scales as large multimillion pound companies. Bills went from virtually nothing to £100 million a year.
The change was introduced without consultation or consideration of its effects. Some charities may be forced to close, affecting many vulnerable and elderly people and communities.
The burden has therefore been shifted from users with high rateable values and low areas, such as high street retailers, to organisations with low rateable values and high surface areas. Half of the charge relates to the collection of water from the general highways i.e. nothing to do with premises.
This therefore puts us in the same category as businesses, but they are able to pass on costs to their customers and are more easily able to reduce other costs. In 2000, the government itself said that it would be inappropriate to charge all non-household customers as if they were businesses.
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St Ann’s Hospice, in Greater Manchester, recently identified that the new charges would pay for ten days worth of care to dying patients. What the drain will costThe ‘rain tax’ is expected to cost the Church of England over £15 million a year, plus a further £10 million as churches employ professional services to appeal the initial bills. This is equivalent to the Church of England being permanently drained of the resources to employ 375 clergy (a loss of 10 clergy in every diocese), or being unable to support 3,000 community groups, or 7,500 pensioner lunch clubs, or the loss of 357 Church School teachers*. Larger churches will see their bills rise from £140 to £8,000 and Cathedrals will pay between £5,000 and £71,000 a year. The Scouts Association estimates the total drain from the pockets of children into the pockets of water companies to be around £1.5 million. Many small voluntary sports clubs are reporting similar increases to church bills, ranging from 100 to 1,400%, in the United Utilities region. The total annual cost to the not for profit sector of churches, charities and clubs is believed by many to be over £100 million a year. |
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