Mr. John O'Sullivan:

I thank the Chairman for the opportunity to make these opening remarks. On the last occasion the Valuation Office appeared before the committee, in October 2011, two particular areas of concern were discussed. These areas were, various shortcomings in the financial controls and governance arrangements in the Valuation Office in 2010 and the pace at which the office was conducting the national revaluation programme.

In regard to the financial control issues, significant progress has been made in implementing the necessary measures to address the shortcomings. A number of these are set out in the progress report provided to the committee in January 2012 and in the updating document we have now provided.

The committee is aware that conducting a national revaluation programme has been Government policy since the enactment of the Valuation Act 2001. After a very slow start, the Valuation Office has achieved considerable momentum in the programme over the past two years. The current position is that the programmes for three authorities in Dublin are complete. Revaluation of the three Waterford rating authorities and Dublin City Council will be concluded by December 2013. This landmark will increase the amount of the revalued commercial valuation base in monetary terms, to over 50%. Work in regard to the two Limerick authorities is well under way and we have also initiated the statutory consultation process from which orders for the revaluation of an additional five authorities can be expected imminently.

The case for conducting a national revaluation programme is compelling. The rental values of individual properties and categories of property change over time as a result of differential shifts between categories and locations. Apart from the rating authorities that have been revalued to date, commercial rates in all other areas are, at present, based on valuations which reflect market conditions and relativities prevailing in 1988. The only comprehensive way to address this is through a revaluation programme from which some ratepayers will obtain a reduction, while, inevitably, others will experience an increase.

The committee will already be aware of the efforts which have been under way to accelerate the national revaluation programme. This requires a multifaceted approach from the staff and management of the Valuation Office. We have concentrated on bringing about improvements in how we organise and carry out our work, using a wider range of data sources to inform or validate our valuations, and developing innovative approaches to valuation, including proposals which require legislation.

The proposals set out in the Valuation (Amendment) (No. 2) Bill 2012 will, when implemented, provide an important set of additional measures to expedite the programme. The Bill provides the legislative basis for carrying out revaluations using self-assessment by ratepayers and for the delivery of elements of the valuation process by external contractors. We have already developed our plans so that we can pilot these approaches, following enactment of the legislation. The Bill also provides for streamlining of the current legislation, including the appeals process, and for the wider application of statistical information, as is the case in other countries.

The Government has decided to proceed with the merger of the Property Registration Authority, the Valuation Office and Ordinance Survey Ireland. A project board, comprising senior officials from the three parent Departments and the chief executive officers of the three organisations directly affected by the merger, has been established recently to oversee the process. This development is likely to have an important impact on how the Valuation Office conducts its business in the future. In summary, the past two years have been very significant for the Valuation Office, and we can point to substantial progress on several fronts. However, much remains to be done and there are many challenges ahead.