Deputy Michael Keating was in possession.
Local Government (Financial Provisions) (No. 2) Bill, 1983: Second Stage (Resumed).
Question again proposed: "That the Bill be now read a Second Time."
I should like to add a number of observations to what I said on this Bill last week. Its essential aspect is that it affords, for the first time in any real sense, some degree of discretion to local authorities in relation to means of raising revenue. Some effects of the provisions of the Bill have been either misinterpreted or misrepresented. I submit to the House that, in essence, it is a very positive initiative in so far as it gives back some of the power taken from local authorities over the years.
I know there has been opposition to the Bill on the basis that it is giving to local authorities the power to introduce widescale charges which would be a burden on people. In fairness one must look at the facts. That kind of emotive talk simply is not in line with the true position. Total local authority expenditure for 1983 is of the order of £1,350 million. The total revenue to be raised under the provisions of this Bill will be of the order of £21 million. It is a small price to pay for affording our councillors — and I am sure all of us would agree that by and large they have given the country good service — some degree of autonomy, some degree of responsibility. Accordingly I welcome it without qualification or without equivocation.
I find it extraordinary that Members of this House have apparently changed their minds overnight with regard to this Bill. There is a very strong tradition, if you like, on all sides of this House of giving credit to local councillors and showing them some degree of gratitude for the work they have done. But it would appear from what has been said recently that either we do not have confidence in our councillors — and I do not think that that lack of confidence in them as a body, if it is there, is justified — or else we are simply being deceitful. I do not think there is any essential difference between any of the parties in this House on the measure, or if there is, it is going to be very difficult for the Opposition to explain repeated statements, written and otherwise, that they would introduce such a proposal.
In essence this Bill is a good one because it affords local authorities some modicum of responsibility for their actions. However, in passing, I would like to make a brief plea for a more widescale reform of local government. If I had any regret about the measure it would be that it is not accompanied by some more widespread proposals. Local government in Ireland at present — and many of us who serve or have served on local authorities will readily admit — is neither local nor central. The financing of local authorities around which essentially this Bill revolves is intrinsic to such reform. Therefore, there is some basis for arguing that this proposal, in a sense, is being taken out of context, that it would be better had it been presented in a more comprehensive package of reforms about local government generally. However, I am consoled by the commitments of the present Minister and Minister of State in relation to real, radical and genuine reform of local government. If that reform does not come about gradually we will see more and more centralisation, more and more demoralisation at local level and eventually a local authority structure becoming increasingly irrelevant. It is going in that direction at present. That is the only qualification I would have about it, that it is not part of a package, but that is not a reason for condemning it per se.
We all espouse the cause of local democracy; for example we all assert that people should have more autonomy in relation to their welfare, in relation to events, situations, their environment locally but the structures do not exist by which to bring that about. At present the local authority structure is creaking, it is antediluvian and warrants reform and overhaul. I hope we shall see strong evidence of that within the next 12 months. The local elections next year will afford us an opportunity of having a much more widescale debate in that respect. I would be very pleased indeed if, to some extent, those elections hinged on such proposals for radical reform of local government here.
Until recent times there has been a tendency at local authority level to have some degree of power but without any great degree of responsibility, for example, I always felt uneasy about striking a rate which implicitly meant one was raising taxation without any input or indeed any responsibility for deciding from whom that money was to come or how it was to be raised. The clear implication of the provisions of this Bill — which is very much in line with Government policy nationally and which is commendable in itself — is that from now on, if money is to be raised for certain specific services, then the councillors involved will have to indicate where it is going to come from. And they will have to take the sometimes unpleasant, difficult and politically unpalatable decision to actually levy that charge. That imposition of responsibility, that onus of responsibility is good for us all. It is particularly good for local authorities who up to now had scant responsibility in that area. It will sharpen their reflexes and their sense of responsibility in that respect.
Interestingly enough, despite all the complaints that have emanated from a wide range of sources about the proposals involved, if one reads the literature in relation to the financing of local authorities or to local government reform generally, one will discover that there is a wide range of reference material supporting the concept of this Bill. The Opposition have repeatedly inserted this concept — in White Papers, in 1972, in The Way Forward, which was their policy document in recent elections and, indeed, the former Minister, Deputy R. Burke, in this very House committed his party to the introduction of a Bill to charge local rates. I think he was quite right and all I am asking of them today is to be consistent. I do not deny that they may find that the Bill will have some technical deficiencies from their point of view — I am being a little charitable about that — nor would I deny them the right to visualise, envisage or conjure up some reason for finding a difference with the Government on this Bill. But I should like to think that they would unequivocally restate what has been their policy in recent years and, in a nutshell, that is that the day of the free dinner is gone. From now on people will have to pay for services they get, and not by some kind of illusory, conjuring trick supported by massive foreign borrowing but by paying as we go. That is a good principle. It is a good principle for a child in its upbringing and is a good principle for the way local authorities conduct their affairs.
I have a very high regard for local authorities and for councillors — I suppose I have a vested interest since I have been one since 1974 — but I honestly believe they do very good work. The General Council of County Councils applied themselves to this thorny question of the financing and powers of local authorities. In a report which they published in January 1983 — in which the views of the vast majority of the parties, certainly all the larger parties, in this House were well and adequately represented — they stated clearly their view of what local authority financing should be. I should like to quote from that report where it is said:
As the bulk of the finance is provided and controlled by central Government and as the Local Government (Miscellaneous Provisions) Act 1978 has again controlled the balance being provided from local funds — the cumulative domestic increase allowed has fallen at least 10 per cent behind the rate of inflation and has led to a resulting cutback in the services provided. The conclusion of the White Paper on Local Finance and Taxation was that the power of local authorities to levy and collect rates was the best system available suitable to improvement.
The essence of that is that there is unease among local authorities at the tendency towards central funding which removes from them much of the responsibility and power which they consider should be theirs. The report continued as follows:
The following suggestions are made for that improvement:
1. The elimination of statutory demands placed on councils for items over which they have no control or alternatively the handing over of these functions but also the decisions relating to them to the Local Authorities, with adequate budgetary arrangements to cover these functions independent of other functions of the Council. .bqe
That is a very reasonable demand. It is quite extraordinary to ask local authorities, as has happened in my area, to support financially items such as the Special Criminal Court which is surely a national charge or, in some cases, to support national amenities depending on where the local authority is based. Such charges are more properly in the area of central government funding. The second suggestion in the report was as follows: Charges to be levied for local authority services. For example:
(a) Refuse collection, particularly trade refuse.
(b) Fees for planning applications.
(c) Fees for issuing licences including the issuing of local radio licensing which should be devolved to the local authorities.
(d) Charges for advertising space provided for local authorities.
(e) That rates remissions be carried by the Department of Social Welfare where the relieved are needy persons and by the Department of Industry, Trade and Commerce where the relief is an industrial incentive.
The report also states that there should be charges for water supply in urban areas. That is no more than ridding the country of an anomaly. I speak as someone who represents an intensely urban area but I make no apology whatever for this Bill. The General Council of County Councils earlier this year made it quite clear——
I wish to make it clear that was not adopted by the General Council of County Councils. It was compiled by the executive and circulated to all the local authorities but it was not endorsed by the General Council of County Councils.
The report was issued under the aegis of the general council and the representational nature of the report is not in doubt. It emanated from a process of consultation and deliberation set up by and presided over by the General Council of County Councils. The report was written by one of their members, Seán Fitzpatrick from Mayo. All I can say is that it reflects quite accurately the thinking of county councils generally. It may not have the official stamp of endorsement as yet but I have not seen any reaction from any county council against it. All I am trying to point out is that even those with the unpleasant task of imposing these decisions have said that generally they are good proposals. County councils are composed of sensible people.
This brings me to a major point to which the Opposition have not referred. If we raise revenue in this way clearly that same revenue will not have to be raised in another way. In other words, if we raise the money on the basis of county, one may assume there will be less need to increase taxation or take other measures to make up the shortfall. It is not as if we were adding a burden of taxation: it is simply a different system of raising the same revenue. In 1975 I wrote a paper on local authority financing and in that paper I argued strongly for a more sensitive and more individually considered system of raising such funds. I always felt it anomalous that the rates system which we abolished had no bearing on ability to pay but the tragedy was that when the system was abolished in 1977 we pretended the massive shortfall did not have to be made up. To some extent that is the reason why we, as a country, are bailing water since then and will be doing so for some time.
On the evidence before us it is wrong for the Opposition to cry havoc about this measure. It was their proposal from the beginning. Secondly, with regard to the burden that will fall on people, this has been widely misrepresented by some commentators. However, I would point out it is not an additional burden but it is raising money in a different way which will allow for easing the burden elsewhere. Thirdly, from the evidence available to me in the document I have before me, it is obvious that local authorities do not have any fundamental objection to the proposals we are making. Indeed, if their proposals are endorsed in due course, as I suspect they will be, they will go much further than what is proposed in this Bill. When we consider that we are talking of raising a total sum of £21 million out of a total budget for the local authorities of more than £1,300 million, we will get some idea of the scale and significance of this measure.
Naturally there are concerns and anxieties about any Bill. In some cases the concerns about this measure have been sensible and moderate. I read a submission from the Confederation of Irish Industry which put forward a sensible concern about certain aspects of the Bill and I am sure the Minister will pay attention to that concern. However, I was very unhappy with the tone and content of comments made by ACRA, a body that purports to represent residents associations throughout the country. I discussed this measure with one of their senior officers. I took objection to the fact that their opposition was, in my view, extremely unreasonable, lacked balance and was a calculated provocation to break the law. I do not care about the political cost of standing up to that kind of tactic. All of us in this House have a duty to help and support any institution or organisation involved in legitimate protest, legitimate objection or legitimate concern about measures like this. For example, I think we would have a healthier democracy if we assisted more actively the trade union movement in certain ways. However, the corollary of that is that we should stand up against the kind of tactics which say, "We do not care what the Government introduce. We are not going to pay for this measure and we will get our members to refuse to pay". I am not happy about that. When I discussed the matter with the officer from ACRA it became clear that he had no idea — as none of us has — of what would be the precise charges or where they would fall. That is a matter for local discussion by the local authorities.
I say to ACRA and to other similar organisations that they are doing their members a disservice. At least I am one resident for whom they do not speak when they take instant, Pavlovian-like objection to measures about which they have only the most vague notion. When it comes to inciting people on that basis to break the law, I think they should take stock of themselves. Such an organisation is helping to undermine our institutions. It is doing a disservice to the law-making process. That process is not perfect but it is the only process we have. All of us have certain concerns about it: however, I do not believe we should throw out the system, rather we should try to improve it. I was unhappy with the stand taken by ACRA. I told them so at the time and I am repeating it now. I believe other Members of this House should tell ACRA that that tactic will not work and is irresponsible in the extreme.
Lastly, we have been called to say in this House that none of us wants to impose extra taxes or to be perceived to be imposing extra taxes. I am not sure about that. If a better way of raising funds comes about I have no hesitation in suggesting it and standing over it. Perhaps for too long we have tried to evade our responsibilities in this respect. One reason we are in the difficult economic mess we are in is that four years, with respect to local authorities, central Government shelled out year after year and local authorities had very little awareness in many cases of where the money was coming from. In some cases we could ask questions about the value we were getting for it, but that is another day's discussion. It is an obligation on us all here to say that all we are doing now is introducing a more sensitive measure of raising funds and giving power back to the local authorities. I am quite certain that, given the chance, they will accept it readily and act responsibly when they have it.
Therefore, it will be good for local authorities to have this Bill. The scale of it in financial terms is as yet very small, being something like £21 million out of about £1,350 million. In that context those of us who are unhappy about the Bill in principle — I am not one of them — must keep some scale on their objection to the proposal. Perhaps the fact that we have to go through this tortuous process which arises largely out of the very good decision to abolish rates as we know them — but also out of the reckless and irresponsible evasion of responsibility of doing nothing about replacing that source of revenue by any other means which would have been fairer and more just than the rates system and which would have brought in the same necessary revenues — will bring us to a picture of the Bill if we keep these points in mind.
I congratulate the Minister on his public comments on the Bill. He has made it clear that he does not see this Bill as being on the stocks forever. My view is that no Bill as introduced should be on the stocks forever and that there should be a built-in mechanism for ensuring that all measures are reviewed regularly. The Minister said that he was determined to ensure that there would be an overhaul of local Government functions and structure at an early stage. That is already overdue and I suggest to him that that is a matter of urgency, not because it is about whether there are ten councillors or six councillors here or there, but because local government is an essential part of a democratic system if it is a true local government system that is local in terms of its geographic and other scope and truly governmental in terms of the delegation of powers to the local body. At present it is neither. It is central and it is certainly non-governmental and councillors all over the country are becoming increasingly demoralised by the prospect of being associated with a system which is a charade and a mockery of the two words "local government".
Today and in the days that we have been discussing this Bill much play has been made of the need to give local bodies the powers to raise their own funds and to assume a greater sense of authority over their own affairs. In recent times we have had the introduction of planning charges which in their very principle will do much to discourage people from building their own homes but instead to look towards the local authority to provide them with houses. The SDA loans scheme has been in operation here for many years now and it has been a very useful vehicle to help people to build their own homes, even though at present the amount of money available under this heading is inadequate to help them even to contemplate building for themselves. If the Minister would consider increasing the amount of the loan he would do very much to assist the ailing building industry at this time. The planning charges, introduced at the time they were introduced, will simply be a further disincentive to people to look towards the possibility of providing a home for themselves.
The £1.75 per square metre planning charge for farm buildings and commercial buildings will mean that many of these buildings will either be erected illegally or simply will not be built at all. The expenditure of money on farm buildings has meant a great deal to builders' suppliers down the years. The fact that the Farm Modernisation Scheme has been virtually withdrawn taken in conjunction with this very severe imposition of the planning charge must be viewed as a further disincentive to farmers to undertake the much-needed building of outhouses that are so essential for the future development of agriculture.
Commercial buildings at this time, particularly when we are being told that the proper thing to do is to encourage local entrepreneurs to erect their own buildings and start small industries in their own areas, will not be built due to the planning charge. In the long term planning charges will prove to be selfdefeating and will have a very bad effect on the overall development of the economy.
The local charges proposed in this Bill must be seen in their proper context. They must be seen as the re-introduction of rates. In my county this year we had a shortfall of £275,000. It was proposed in the estimates that £35,000 of that would come from the recently introduced planning charges and £240,000 would be raised by way of water charges. In the county we had just 6,000 homes on the public water supply. As a member of that authority I feel that if the water rate had been opposed those people naturally would feel very much discriminated against. Other people in the community would not be, as it were, contributing anything by way of local charges while people who lived in places like Ardee and the built-up areas in the county would be faced with this proposed charge of £40. I have always felt that the best and most equitable way of local financing is from the national Exchequer. We have had rates in this country before now. They have been abolished and since then, 1977, the Exchequer has financed various local authorities. Inflation has meant that the cost of the provision of services has been much greater than normally it should be. That is not the fault of the method of financing.
If the imposition of these charges proceeds there will be very serious problems in the collection of the money. In the longer term the collection may prove unworkable. People might not avail of the normal range of services that local authorities would provide. Would such people be obliged to pay the local charges? If it is decided that they must pay I foresee tremendous problems for those with responsibility for the collection of this money. People by their very nature will resent being asked to pay for water or refuse collection if they are not availing of them from the local authority. I understood that originally the intention was that the power to impose these charges would be an executive function to be exercised by the county manager without any reference at all to the elected members of the various authorities. If this is the intention of the Bill, the question of giving back more power to county councils in their respective areas sounds very hollow indeed.
I am very worried and frightened at the increasing number of people in County Louth who have been unable to meet their SDA loan repayments to the county council. Is this the tip of the iceberg? Are building societies and other lending institutions who have been making money available for housing encountering the same difficulties with people who have problems meeting the repayments deadline? At this time people cannot afford to pay for services from local authorities. We have been told that there is a waiver scheme to cater for those who might not be able to meet the charges. As a member of a local authority in my own county, I appreciate the difficulties there are with regard to local finance and with the availability of sufficient funds to provide the services annually. Also, as a public representative I appreciate the problems that people have in meeting the day to day demands on their pockets and their difficulties in making ends meet.
Tremendous infrastructural work has been achieved throughout rural areas by the group water schemes and they have engendered great community spirit. People have organised themselves to provide these schemes. However, a considerable amount of work still needs to be done and people who might be tempted to organise schemes in their own areas will be put off by the prospect of having to pay water charges in the future. It would be very unfortunate if this happened, because community spirit should be fostered. I ask the Minister to rethink some of the provisions in the Bill and to make good the shortfall of moneys to Louth County Council and others who are being forced to impose these charges. I make a special appeal to him to make available £240,000 shortfall to Louth County Council. As they have not yet struck a rate, they hope the Minister's attitude will soften towards their dilemma and it would be very much appreciated if he made the money available to them.
I wish to refer to the statutory demands on local authorities. This year in Louth we had a demand from the Office of Public Works for £148,000 for drainage schemes. I am sure that money will be spent wisely but the members have no option in the matter — they simply pay up. This question of accountability is an area which the Minister should look at immediately.
Perhaps what I am going to say now is not relevant to the Bill. However, because of the crisis in the building industry the Minister should seriously consider the possibility of making more money available for individual SDA loans. The sum of £14,000 is simply not enough any more to assist people to buy houses. If the Minister could increase the amount of money made available to an individual to build a house it would act as a great stimulant to the building industry. Hand in hand with that we would have to have an extension of the mortgage subsidy. If there are difficulties with the repayments of the existing SDA loans it is reasonable to assume that there would also be difficulties with new loans. The mortgage subsidy has been a very useful mechanism to reduce the problems people have with their repayments. It is universally recognised that the building industry is seriously in need of a gee-up. If we checked with various local authorities to establish the length of housing lists, in most cases they would not be an accurate reflection of the need or demand for housing. One can appreciate the possibility that exists in this area. There are anything up to 2,000 people on the housing list in my own county.
I appreciate your concern about housing but we have strayed from the Bill.
I was merely taking an opportunity to make a brief reference to these matters. On the overall question of local charges and the serious problems that they will pose for people who have commitments to existing repayments and the normal domestic calls on their salary, it is the worst possible time to impose such charges. Even at this stage, I ask the Minister to reconsider the matter.
The crucial question for local government at present is finance. Our system of local government needs to be properly financed, properly operated and more member orientated. It must enjoy the confidence of the people, particularly of the public representatives. We want real local government, not local administration. Unless the local authorities get a new injection of finance, there can be no progress.
Recently, public representatives appear to have become more aware that the changes which have taken place in past years have eroded their powers in no uncertain way, but have increased the powers of central authority. Both the general councils and the Irish County Council Association have expressed concern at the diminishing role of their members which still continues to diminish.
The present-day local authority is a provider of many services. All these services can be made available to everybody, but must be paid for. It is only right, proper and just that those availing of the services should pay for them, where feasible. The alternative would be to pass the cost back to the general pool of taxation or, as in the past, impose rates. There is no other way in which the money can be found. There is no such thing as a free service. For many years people in remote, and occasionally not so remote, areas have had to pay for services which they do not enjoy. It is hard to question the equity of the principle that people no longer have to contribute to a service for somebody else which they themselves do not have at present and may not have in the future. There is some advantage in the present proposals in that the charge would only arise where the service has been provided.
Every local authority member agrees that over the past 15 years the conditions of our roads have left a lot to be desired but they carry out repairs. In 1978, the domestic rates were abolished and the then Minister of the Environment took upon himself to decide the increase in aggregate expenditure to be allowed to local authorities. For many years this has been a fixed percentage, irrespective of the estimates made out by the county councils. What could one expect after that? Many county councils have the same experience as mine. An increase of 11 per cent on the previous year did not take inflation into account. As a result, all our services deteriorated. Whatever Government are in power should introduce increases and just not talk about them. This is crystal clear from my reading of The Way Forward. It is grossly irresponsible for the Members opposite to be critical of these services and charges. If they are members of local authorities they have to admit that no money is available. It is not right to ask the man who has no water supply, sewerage system or lighting to make his contribution to the national Exchequer to help out somebody with perhaps ten times his income. The last speaker, Deputy Kerr, referred to something which may not have been relevant — group water schemes. I do not see what effect this legislation will have on these schemes. However, I share his view on the cost of these schemes. Seven or eight years ago the contribution to take part in a group scheme was around £50 to £70. Today we speak in terms of £600 or £800. The amount raised in charges will not do any harm to these schemes.
This has been described as rates in by the back door. However, this is a completely different system. Where rates were concerned, irrespective of one's income or of how one utilised one's premises, one paid. There was no escape. Today, under these charges——
You paid whether you had it or not.
How could you pay it if you had not got it?
If you do not utilise the services——
If you do not want water, you do not have to pay for it. You could live without water.
What alternative is there? No member of the Opposition has told us how to raise this money. Local authorities have been starved of money for a number of years. Very little effort was made in the past ten years to finance local authorities. As a result they became redundant.
I cannot speak for cities or urban areas, but I can speak for rural ones. Many people have wrecked their cars on the county roads because adequate money was not made available to repair these roads. Deputy Mac Giolla probably has very little experience of rural Ireland and may never have been down there. I speak for rural Ireland. I have represented the people of my area for the past 24 years on the council.
I saw Deputy Mac Giolla in Donegal. I am sure that I saw him there.
He could have been there, all right. I have sometimes seen Deputy Flynn there, also. It is not realistic to say that these charges should not be imposed. In any literature brought out by Fianna Fáil over the past five years it was always stated that services would have to be paid for. I see Deputy Flynn looking at me. He probably does not remember, but The Way Forward made it very clear that charges would be made. If they were in power today they would do the same thing. It is unrealistic for them to be critical of us for raising money.
Not £40 or £50.
For a person who drinks £40 a year would not buy many pints.
Tell that to a Dublin householder.
Surely charges will not be established on the price of drink.
We will not do that.
Certainly not on the amount of water one drinks.
I would be glad to receive suggestions from across the floor. We will not have any services unless they are paid for. As members of county councils, members opposite must be aware that money is not available.
Reintroduce rates.
Is that what Fianna Fáil would have done?
That is what the Government are doing.
The Deputy to continue without any interruptions.
The hecklers are very good. I enjoy them. They are nice chaps. Can they imagine free gas or free electricity? Of course I should like to be able to say that we will not introduce charges and that everything will be free. But we must pay for the previous Government's policies over the years. They left us on our uppers when they walked out. Deputy Flynn is trying to think of what he will say. He will never deny that it is as a result of the policies his Government pursued that we are forced to raise these charges today.
I have no doubt that Fine Gael will do it but how Labour can live with it is beyond me.
I enjoy the Deputy. He is not taken too seriously.
Nothing the Deputy says would need to be taken too seriously.
As a result of Fianna Fáil policies we had no choice. It annoys me to hear Fianna Fáil being critical of the way we are collecting money. I hope we are able to collect enough money to finance local authorities and take them out of the mess we found them in when we took over. Do not deceive the people. If you were in power——
The Deputy must say that with tongue in cheek.
We do what we think is right in the interests of the nation. I hope Fianna Fáil will be responsible and accept that what is happening is badly needed.
I must protest at the absence of the Minister and the Minister of State for the Environment at a time when they are introducing the most radical change in financing of local authorities. Is it that they are so ashamed of the Bill they are bringing in that they are afraid to come into the House to answer for it?
That is not true.
Why are they not here? It is disgraceful and shows great disrespect for the House that they are not here to answer questions and listen to the comments of Deputies.
If the Deputy says something that was not said before I will make a note of it.
I hope the Deputy will, but they should be here to answer the Bill they are introducing. Perhaps it is significant that they are both Labour Deputies.
It has been said that this Bill reintroduces rates. I do not agree with that. It is far worse. It is the total reverse. Originally when rates were introduced in the last century by the British Government the concept was that the wealthy property owners would pay for the services of the local authorities in order to provide free water services and so on for those who could not afford them. The valuation system became so eroded over the years that rates were inequitable in many cases. They were not based on the value of the property or on the income of the person who was rated.
Rates were abolished. They were objectionable to the vast majority of people as an inequitable form of taxation. The charges being introduced under this Bill are the very reverse of that system. Now people are being asked to pay for services without any reference to the property they own or their income. It will be the same for a person who owns a property valued £10,000 as it will be for a person who owns a property valued £100,000.
It is not the reintroduction of rates because, inequitable as they were, they were far more equitable than this system of charges. Small farmers are excluded from paying rates. The abolition of rates on large farms means that these charges are transferring more of the burden from the already under-taxed farmers to the already over-taxed workers and people living in urban areas. This additional burden is coming at a time when the savage budget has decreased their incomes further through levies, VAT charges on essential goods, reductions in social welfare payments and so on. Their level of income now is much less and charges are much greater. No Labour Deputies have spoken on this or on any of the social welfare financial Bills, perhaps because they have nothing to say.
They are conspicuous by their absence.
From the Fine Gael side the idea is coming across that nothing will be free. There will be no free water supply, medical service, education and so on. We will have to pay for everything. If you cannot pay for it, that is too bad.
You do not get it.
It contains a hardship clause which is a joke. I should like the Minister to explain the word "hardship". Does it mean that one is allowed water when on the point of death, or when does the hardship begin? Is it hardship when one's total resources in any week are not sufficient to cover one's outgoings unless one is prepared to reduce the amount of food on the table or to have less clothes for oneself or one's family? Is it hardship when one is hungry or when one is in rags? There has never been a definition of hardship. What is hardship for one is wealth to another. Therefore, this clause in the Bill is totally inadequate and gives absolute power to the Minister to decide on what constitutes hardship and, consequently, who will have to pay and who will not have to pay. It appears from the comments that have been made so far from the Government benches that hardship will not be a reason for not having to pay. Therefore, if a person is not able to pay for services, they will not be available to him. This is the thinking that has come from the Fine Gael benches.
One would need to be a member of a local authority to understand the provisions of the Bill. Two or three months ago the Minister, without any authority for so doing, sent a circular to local authorities instructing them to impose charges for planning applications, for refuse collection, for water supplies and so on. We in Dublin Corporation were instructed by the Minister to raise £3.1 million by way of the imposition of these various charges though at the time the estimates were being passed by the city council, the manager had no authority to impose these charges. Yet the estimates were passed with a £3.1 million deficit to be raised after the Bill has become law. That was an outrageous imposition on local councillors. In addition, the city manager informed the councillors that there would have to be raised £5 million in order to take account of the cost of collection, the number of people who would not pay or in respect of whom there would be difficulty in collecting payment. These estimates were probably based on the rates situation some years ago. The figures will probably prove to be lower than the estimates. To have to raise £5 million in order to bring in £3.1 million is the worst possible way and the most wasteful way of raising revenue.
Deputy Keating spoke in the harshest terms possible about ACRA's suggestion that people would not pay these charges and he said that this was a provocation to break the law. The residents association were talking of advising people to refuse to pay the levies. If they are doing that they probably took their lead from the IFA and the ICMSA who on two or three occasions have refused successfully to pay levies that were imposed by this House. They refused to pay the 2 per cent levy and also the resource tax. They simply announced that they were telling their members to refuse to pay. This House sanctioned that refusal in May of last year by legislating for the refund of the small amounts which were paid and which totalled £700,000. This was done by way of a special Act. Recently the ICMSA have announced that they will tell their members to burn forms sent by the Revenue Commissioners requesting details of incomes and so on. These are the sort of actions that were not condemned by this House but when ACRA suggest that their members should do the same, that are attacked viciously. What is sauce for the goose should be sauce for the gander. Increasing numbers of people are taking the lead from the farmers' organisations in this regard.
There are different aspects of the proposal to introduce charges in respect of planning. There is one area in which planning applications make big profits for certain people, whether individuals or companies. I refer to situations in which an outline planning permission can increase the value of property by five, six or perhaps ten times. This is an area in which local authorities should charge the cost of processing the planning application and they should be empowered also to impose a percentage charge on the increased value of the property as a result of the planning permission having been obtained. In that way local authorities could bring in more revenue from a capital gain resulting from the local authority having granted planning permission.
The other aspect of planning permissions which local authorities seem to be going after most of all is the ordinary domestic applications in respect of the building of a house or of an extension. These applications are being charged for by local authorities. That is all right so long as the charge remains at some reasonable level, say £10 or £15, but who believes that that will be the case? Once the levies are imposed they will be increased in subsequent budgets. The domestic charges will probably increase at a faster rate than will the commercial charges. Most of the money could be brought in by way of commercial charges if these were imposed in the correct fashion, that is, in the event of a property increasing in value four or five times as a result of a successful planning application, the local authority should take a percentage of the enhanced value by way of a tax.
The other area of planning applications to which local councillors have much objection are the charges for third party objectors. The whole point of the planning laws was to give local people some control over their environment, to be able to make objections to applications which they thought would be destroying a certain view or creating pollution, noise or traffic hazards. Now, however, by ministerial direction under this Bill, third party objectors must pay £30. This is totally against the whole concept of local democracy and of community participation in the development of their environment. They were given such rights under the various Planning Acts.
The Minister has even said that in certain cases local councillors who make objections must also pay. That is total erosion of local democracy despite what we have been told about efforts to enhance the powers of local authorities, and it will increase the sense of frustration and enmity between local people and the local authorities. This Bill reduces the powers of local authorities and the rights of local people right down the line.
However, the provision which is causing most objection to this Bill is that which imposes charges for water services. The total nationwide amount to be raised by these charges is estimated at £23 million. Of course, people in urban areas will be paying the greater part of those charges and therefore will be bearing an increased burden. The concept of free water supplies was expressed in the Public Health (Ireland) Act, 1878, and confirmed by the Local Government (Sanitary Services) Act, 1962. Both Acts should be supplied to Deputies so that we can appropriately see how the Minister proposes to amend those Acts in the Bill.
The concept in the 1878 Act is that water should be supplied free and charged for by rates or some other form of taxation, local or central. The idea was that water should be as free as the air. Perhaps the Minister will think of some method by which air can be charged for. They have a new machine in Japan from which, if you stick your head into a slot, you can breathe free air. Perhaps the Minister may be able to make some money from such a machine.
Water is much more essential for human survival than even food. I am not sure what the record is but I understand one can go 70 or 80 days without food but only ten days without water. Therefore, it must be argued that water is the most important element for sustenance of life.
At this point, I thank the Minister of State for arriving before the end of the debate and I would remind him that in the 1878 Health Act a public duty was imposed to give free water services. In 1983, 105 years later, we are moving away from that concept and giving Fine Gael power to charge for everything — living or dying, you will have to pay for everything. The Minister seems to be leaving again after a short interval, but we hope the views we are expressing will be conveyed to him by his deputy.
This idea of charging for water supplies is a most reactionary one, but the manner in which it is being imposed is still more reactionary, coming from a Department controlled by two Labour Party Ministers, Deputies Spring and Quinn. It is hard to imagine that they would allow such a concept as this to be even suggested in the Cabinet, that £40 or £50 per house would be imposed for supplying water. Can they have any idea of what that will mean in inner cities and suburban areas? It is much worse than rates because it does not relate to size of property or to incomes.
The Minister for the Environment said in Kilkenny the week before last that this would be a temporary measure. He specifically said that it would last for only two years. That was not reported publicly but it was jotted down at the time and reported to me. I was asked to ask the Minister about it and I am now asking him through his deputy if this measure will last only for two years. If that is not so, will the Minister go to Kilkenny and tell them he made a big mistake, that this is not a temporary but a permanent measure? It is important the House should be told this. If this is only a temporary measure that should be inserted somewhere in the Bill and the Minister should be given power to change or to abolish any charges at any time. Once this measure has been passed unamended in this respect the Minister can decree any orders he wishes to make charges for — this, that and the other.
Deputy Keating made the point that this was another way of raising money. He said that if we raise the money in this manner we will not have to raise it in another way. What does he mean by that? Does he mean that if the money is raised by imposing a £40 or £50 charge for a water supply we will not have to raise it by a wealth tax? That is probably his view. The money should be raised by a wealth tax or increasing our capital taxes which have been reduced consistently since 1974. In that year capital taxes amounted to 11.2 per cent of our total revenue but last year they amounted to only 4.7 per cent, almost one-third of what they were in 1974. If the money is raised through wealth tax or capital taxes it will not be necessary to charge for a water supply.
The Minister for the Environment is putting through the most reactionary measure of any of the taxes which have been described by Members on all sides as inequitable. This is the most reactionary measure introduced in the House, worse than the Social Welfare Bill or the Finance Bill, because of the impact it will have on householders who are already pushed to the limit by lower welfare payments and higher taxes. The imposition of a charge for water will be a tremendous burden on them. The Minister should tell the House what he means by hardship and when it occurs.
Mr. Leonard
All members of local authorities are aware of the increased demand for services and the difficulty about financing them. We are concerned about the way the Minister will use the powers in the Bill in future. Will those powers be used annually when the Exchequer grant is being allocated to local authorities? The Minister in future years may substantially reduce the grant to local authorities leaving it to them to raise the remainder of the money they require through charges for services. We are also deeply concerned about the levying of charges and the waiver scheme being executive functions. We have heard of the need for more autonomy for local authorities and to give to local representatives more responsibility in their own affairs but the Minister, instead of indicating a return of powers to local representatives, is seriously curtailing their activities.
Local authorities must also meet the demands of local ACOT committees, the VEC, health boards, maintain courthouses and fund works to be carried out under the direction of the Office of Public Works. Local authorities will have to be relieved of those functions because the money for them must come from local rates. In 1981 local authorities were limited in the increased rates they could strike but the Office of Public Works demanded three times the rate struck for the maintenance of rivers. Fianna Fáil, who were in Government, stepped in and made up the shortfall. At that time we were faced with the situation where a body outside the ambit of the county council was expecting that local authority to contribute more for work on rivers.
It must be remembered that some counties provide fewer services than others. In Cavan and Monaghan most of the water supplies in rural areas, including many villages, come from group water schemes which the councils have not taken over and those schemes are still the responsibility of the committees who initiated the supply. I have no doubt that many people will refuse to pay for the services and cease to use them. On the day Monaghan County Council were increasing the rate to £15.46 in the £ — it went up from £8.77 in the £ over five years — on commercial and industrial premises we met deputations who pointed out that their business had been reduced by between 30 and 50 per cent because their customers were flocking across the Border to buy their requirements. That has changed since due to the difference in currency and not because of any relief from the Government. It was the luck of the game.
Before we introduce these charges we must look at many aspects of the work of local authorities, particularly in regard to housing. Some years ago, when a Coalition Government were in office, the grants for the repair and maintenance of houses were withdrawn. I visited many houses which were built shortly after the Second World War and I was shocked to see their condition. The number of people on our housing list does not give a true picture of the need for houses because new houses will have to be provided for those whose homes are in a bad state of repair as a result of the decision to discontinue housing repair and maintenance grants.
At our estimates meeting we reached a figure of £4.49 for the average weekly rent, much higher than the national average. Massive subsidies have to be provided for local authority rented housing accommodation. We will have to look at the provisions for servicing sites and helping those who want to build their own homes by way of SDA loans. These loans are granted at very attractive terms — 12 per cent plus ½ per cent to meet administration expenses — but many people are unable to meet their loan commitments due to short-time working, redundancies and so on. We have heard many suggestions from Ministers. We have village settlements where local authorities provided land for services. The idea was good but the serviced sites were very expensive with the result that half of the SDA loan of £14,000 was spent on the site and the services. The amount of arrears due on local authority loans is increasing.
Another area which is causing a great deal of concern is the special charges for malicious damages. In my area we have had more than the average amount of malicious damages, some of it politically motivated and these damages were recouped in full from the British authorities, but the normal malicious damages claims, which were not politically motivated, had to be met by the local authority. We have a maximum addition of 20p in the pound in rates to meet legal and other expenses incurred in examining and contesting those claims. In my view the time has come when this will have to be a national charge. None of the Border counties should be saddled with this extra 20p in the pound to meet malicious injuries damages.
If a local authority contest a claim at a cost of £x thousand that money has to be paid by the local authority, but if the technical staff of the local authority agreed to the claim, costs would be lower. Any claims I have seen have been pursued very conscientiously by the county officials who did everything in their power to ensure that the council would not be saddled with additional expense. The Minister should examine the situation. I mentioned this point at an annual county council meeting when we were discussing our contribution to the Office of Public Works and An Foras Forbartha. Both organisations are monitoring the same rivers and streams but for different reasons — the Office of Public Works from a drainage point of view and An Foras Forbartha from the point of view of quality control. In my view there should be co-operation between State agencies. On the Blackwater River within three or four miles there are two separate monitoring stations. Officers from each organisation have to go weekly to these stations to change their charts. At a time of scarce finances there must be more co-operation and integration between Departments. In this way we could probably introduce overall costs.
The local authorities are facing growing problems in the area of environmental protection. Some counties adjoining mine have litter collections for the rural and urban areas, but we have collections only for towns and villages. Despite the introduction of measures to cope with unauthorised dumps we have a very serious situation. Recently our technical staff told us there were 45 unauthorised dumps in our county, but we could not afford to provide a refuse collection service for everyone in the rural areas. Indiscriminate dumping is becoming a very serious problem.
Government allocations to the local improvements scheme are causing great concern. In 1980 we hoped that there would have been a substantial increase in the allocation for the 12 western counties. In 1979 we got £2,750,000 under the local improvements scheme. In 1983, without recognising the fact that the cost of materials doubled, the Minister gave us an allocation of £3 million. He made that allocation for the constituency I represent where there are almost 1,000 applications, and in Monaghan we have a ten-year waiting list. How does the Minister expect to develop resources in an area if there are 1,000 applications? These roads accommodate two, three and sometimes four families. We are talking in terms of 4,000 people. We had hoped for a substantial increase to take account of inflation, but we got only £250,000 in four years.
There are demands on local authorities for payments to regional development organisations. We paid about £5,000 to finance a regional survey. Over the past ten years we seem to have done nothing but carry out surveys. Every State agency must be packed to the brim with reports on examinations and surveys. There should be one survey of each region covering roads, soil, water schemes, and so on. We should have a regional examination of the development potential covering agriculture, tourism, and so on, rather than having this fragmentation year after year.
The cost of maintaining courthouses has been mentioned. This maintenance should be financed by the Department of Justice and not the local authorities. Most local authorities are faced with road structure problems. The problem is to ensure that the road surfaces are usable. We have had a number of very severe winters. About a month ago we had a visit from a European study group. The technical staffs of Monaghan, Cavan, Donegal and Louth County Councils carried out a survey. We were told that about 17 per cent of the road surfaces in Monaghan are seriously deficient. Our allocation at present would cover only 50 per cent of the requirements. Therefore we will have a steady deterioration in our road surfaces. In that county over the next five years we will require £57 million for roads, water supplies and sewerage schemes.
The Minister should pay special attention to the scheme introduced a few years ago when the task force operated through the health boards. That scheme was of terrific benefit. Essential repairs were carried out to the homes of many old people. In some cases major repairs were carried out and sewerage schemes were provided. I understand from a discussion at a health board meeting over the past few days that the money is beginning to run out. I saw many houses where work was done for a very small amount of money through AnCO, or small contractors, or people working under supervision. The repairs carried out on some homes will last for the remainder of the pensioners' lives. Before this, local authorities were building groups of old people's dwellings at a very high cost, roughly £16,000 or £17,000 each.
I appreciate the Deputy's concern about these people, but he has gone a little left of centre of the Bill, and I would be grateful if he would come back to the Bill.
A Leas-Cheann Comhairle, could you indicate to me what the centre of the Bill is?
Mr. Leonard
We have planning costs. We have an increasing number of services. It is important to provide a subvention to ensure that people will erect their own houses instead of the Department of the Environment having to erect them at a very high cost.
In this Bill the Government had a golden opportunity to hand back real power to the elected members of all local authorities. Rates on domestic dwellings were removed and now rates on agricultural land no longer provide a means of raising revenue for local authorities. The Government should have grasped this opportunity. We are now at a crossroads. Somebody said the Minister suggested this could be looked at again in two years' time. Knowing the love local authority officials have for power, I know it will be very hard to break the link. I respect the managers, county secretaries, county engineers and staff, but the slogan should be no taxation without representation. This little country will be the laughing stock of Europe. I wonder what the people who went out from the boreens and out-of-the-way places and the cities to gain the freedom we now enjoy think of the Members of this House. In an indirect way we are giving back power to officialdom, people who are not responsible to anybody, and who have not got to answer to anybody.
Members of local authorities should have sufficient power to operate and do their duty. I am disappointed at the Minister for the Environment who was a member of a local authority for many years. He is introducing this rather shortsighted Bill. This will be regretted in years to come. Local authority staffs will be very slow to relinquish the power they will grasp from this Bill. We should not lose this golden opportunity to give real power to the elected representatives.
I question the Minister's judgment. Does he not trust the ballot box? These people were elected to manage the affairs of their own towns and to decide what should be charged for to provide services. I will not bore the House with the various charges which may be levied by the managers if this Bill is passed. If the Minister does not trust elected representatives this is a sad day for democracy. We have the youngest electorate in Europe. This Bill will discourage young people from getting involved in their own communities and becoming members of their local authorities. They will not play an active part when they see all this officialdom foisted on them. I heard some Members on the other side saying that we have a duty to collect this money. Of course we have. There must be some means provided for collecting money to run the affairs of every county, borough and corporation. We are not so silly as to think that we can pluck millions out of the sky. We are objecting to the manner in which this is being done. It is very unfair to have Government spokesmen saying that power is being given back to the local authorities. That is not what is happening. Power is being given back to county managers who are not responsible to anybody. County managers cannot be questioned about their position unless they abuse the funds of which they are in charge. I appeal to the Minister to look at this matter again before he pushes it through the House.
We talk about an abuse of power. The managers in many counties have abused the power they already have. In some council areas they have jacked up the levy for water connections, sewerage connections, planning applications and development charges. That is only the tip of the iceberg in relation to what they will do when they get this power to impose a levy for all these services. All the local authorities in every party should rebel and suggest that this Bill is scrapped and not accepted by the House. It is complete dictatorship. We might as well be at home looking after our businesses as to go into council meetings like a bunch of turkeys and bow our heads to the managers' requests when they say so and so is the charge. It is a waste of time and public money to have local authorities discuss something over which they have no power and the managers have complete power.
I am disappointed with the Minister. He is a rural man and was a member of a local authority for years. He should not be so shortsighted in his attitude towards this Bill. I would like him to tell us what it will cost to collect the various charges. Will we have another layer of red tape, another layer of appointments which will be non-productive? Any money which we have to spend should be used in creating genuine jobs, not jobs that will take away the few pence left in people's pockets. Will we have another layer of staff officers and every kind of official in local authorities to collect those levies? If that is the case we are making a very dangerous move.
There is very little in the Bill to comment on. It is just giving the authority to county managers to go ahead, charge what they like and we will stand behind them. The county managers are very happy with that because they can sit back and laugh at the local authority members expressing anger about the various charges. The county managers will just stand up and tell them that it is their function and not the function of the county councillors. It is a disgrace to bring this Bill into the House when we are at a crossroads as far as local democracy is concerned. We are handing the little bit of power we had right back to the county managers. The Government are telling the county managers to carry on with the show, that the fellows in the local authorities cannot be trusted.
What will it cost to administer? We hear talk about the scheme that will be brought out in case of hardship. If an old age pensioner has a fire in her chimney she is supposed to pay £25 to have the fire put out. What about the poor lady who cannot afford to pay that charge? Who will decide? Is that another layer of the red tape and form filling that we have had over the years? Application forms for grants and loans are being carried from Cork to Donegal. They are the most travelled documents in Europe. They are carried by civil servants who are responsible to nobody. We talk about the paltry few million pounds we give to people to help them to house themselves. I am sure the senior members of our society, who helped to gain the freedom we now enjoy, are shocked at the way the Members of this House treat the freedom which we have. The way we are carrying on the people who gave their lives to gain our freedom did it in vain. We are not grasping that power and using it for ourselves to help those weaker sections of the community. We are giving an open ticket to county managers who are up on a pedestal. I am not ridiculing county managers. I am ridiculing this House for giving county managers more power than they had. They have sufficient power at the moment.
I seriously appeal to the Minister to think again about this Bill, because if he does not I can see the day coming when he will regret it. We have enough red tape and we will not have any more of it if enough Members of the House do not agree with what is being done in the Bill. I am not here to score political points. I respect the Minister and the position he holds, but I appeal to him to have a little bit of common sense. We have only to cast our minds back to what has happened in local authorities over the year in relation to rates on our houses and rates on our land. We are at a crossroads and something must be done sensibly without any kind of emotion or saying that we will stick in this Bill now, it will do for two years and it can be changed then. Live horse and you will get grass. Let us do it now, especially when it is only a year before we approach local authority elections. It would be a great encouragement to our youth to get involved in local democracy if we do not pass this Bill.
Before Deputy Flynn begins I would like to remind the House that by agreement the Minister is coming in at 6.50 p.m. to conclude the Second Stage.
Not later than 6.50.
Ba mhaith liom cúpla focal a rá maidir leis an mBille Rialtais Áitiuil seo. Ba mhaith liom cur in aghaidh cuid de na rialacha den Bhille.
We have to take this Bill in conjunction with some other measures that have been perpetrated against the general public in the past few months. This is being done in quite a calculated way to so inveigle the minds of the general public that they are not being savaged entirely in relation to what is in the minds of the Coalition Government in beggaring the vast majority of the people, particularly householders. The Bill cannot be taken in isolation. It must be remembered that this is part of the Coalition strategy so far as money matters are concerned during this financial year. We have to realise that the question of prices, VAT increases and all the other delicacies the Coalition found in their hearts to bring against the people in their Budget Statement were followed up shortly afterwards by the Social Welfare Bill. It has been hailed as the most anti-Social Welfare Bill ever moved in this House. It must be to the shame of the minor party in the Coalition Government that they tolerated such a move being made. It brought about a lessening of the standard of living of the people least able to accommodate themselves in the depressing and recessionary period we have experienced for the last couple of years.
The living standards of old age pensioners have been attacked. This coming, amongst other things, from a Labour Party who could not find it in their hearts to give the miserable pittance they are now going to give in the first week in July, at the customary time, namely, April, surely must show that there is no concern about the impact of any measure being introduced by this Coalition Government on the less well off. As far as I am concerned the people under attack are the less well off. This is being done by an uncaring Labour Party as the minor party of the Coalition. The cutbacks in the benefits of that Social Welfare Bill must be incorporated in the arithmetic of all these measures brought forward by the Coalition to deal with what they say are the financial difficulties of the State at present. The position was brought to its climax in the Finance Bill, the necessary legislation to inflict the levies, the residential property tax and the other elements of taxation on the unsuspecting and unfortunate taxpayers and householders.
It is in that context that one must recognise what this Bill is all about — another extension of the moves being made by the Coalition against the ordinary worker, the ordinary occupier of property and it must be resisted in that context. Any of the measures I have mentioned, the budget, the Social Welfare Bill, the Finance Bill or this one, any one in isolation would have put a Government out of office 15 years ago. But it is now being done in a deliberate and calculated way. They are not being brought in in one package. It has been decided that they will be separated in time and effect so that the maximum impact will be over the year as a whole. I resist it for that reason. It is unworthy of the Coalition Government and particularly unworthy of the pseudo-socialists who make up that Government, to allow this kind of provision and others which formed part of the effort to date to be brought against the people.
The Minister for the Environment is a member of the Labour Party. His introductory remarks were short, three pages of the Official Report, but what his speech lacked in length it made up for in implications, those it will have on the hundreds of thousands of people living in this State at present. It vests considerable powers in various people. I am not so sure that such people are either accustomed to or have the competence to accept these powers at present, for reasons I shall give later. As slow as one might be to isolate any section of a Government, one must castigate the Labour Party in this regard. I would have expected this type of legislation, I would have expected some of the monetarist attitudes outlined in some of the provisions this year to date from the Fine Gael Party; one expects that kind of ultra-conservativism from that grouping. But one had come to expect something different when one listened to the pious hopes and platitudes being clap-trapped from the Labour benches, particularly when they were in Opposition, for the past couple of years. According to them they were going to solve all our difficulties, bring a social aspect to our legislation, bring caring and concern to bear on the type of legislation we might be expecting from them. That is why they keep asking: "What were you, Deputy, going to do when you were in Government? Were you not going to do something worse than this?" It is time they ceased that kind of clap-trap. It means simply that they are devoid of any suggestions to put in the place of what we had carefully set down in The Way Forward which would have brought about a happier situation both for the national and local finances. It is time the Government ceased this kind of cat-calling as to what they might or might not have done in the past. Whether or not they realise it an election did take place at the end of last year and by a freak of electoral mishap, we lost.
Were they not lucky they lost?
Yes, we did lose, we will have to accept that. Unfortunately quite a number of people now on the Government benches are not fully aware of the fact that by a mixture of ideologies and of policies they happened to put a document together and sold it to some of their members, and so some of them are in Government. It would be just as well if the majority of them did recognise that that election took place, that they are there and that it is their duty and responsibility to get on with the matter of governing. But they are reneging on that responsibility by continuously harping back on what Fianna Fáil might or might not have done. Of course, in all things in Irish life in the recent past Fianna Fáil have been the baddies and must be pilloried for being the baddies.
It is contended also that if the Coalition partners, the Labour people in particular, had had the opportunity of getting in last year while we were doing something to run the country in a satisfactory manner, they would have altered all of that, they had the list of ingredients, if given the chance, to make this an easy passage for our people. That has been their cry, both individually and collectively, for a long number of years: give us the opportunity and we will do something about it. Lo and behold, what have they done since they came into power? They have perpetrated these evils against the people, by way of taxation, price increases, VAT increases and a whole range of impositions. That is their answer. There are no incentives given to anybody to do anything, no planned programme, no alternative to The Way Forward— our proposed plan — except to paraphrase the best parts of it and to put them across as some of their policy statements. We are still awaiting a planned programme under any Department head from this not useless Coalition but worse than useless. I say that because they are making life hard, hard to the point of breaking for the vast majority of our people, to the point where ordinary people have lost faith and confidence in themselves. As far as I am concerned that is the biggest crime one can commit against any population, that one destroys the confidence of the public to do something for themselves. This is just another instance. It is passed over as a minor instance but it has very big implications for the vast majority of people.
The Minister, introducing the Bill, talked about restoring a proper degree of financial independence to local authorities. Those who have had the honour of serving on local authorities for a number of years recognise that as nonsense. This Bill does not give anybody independence let alone financial independence. When the Minister talks about financial independence does that mean that you can raise any amount of money you like and spend it on any project you like, because that is what independence is all about? I do not remember any single instance where a Minister of the day allowed that kind of financial latitude to Mayo County Council when I served on it for 17 years. There is no independence in that matter at all. There is no administrative independence, no project independance, let alone financial independence attached to any local authority. The only independence allowed as far as project independence is concerned is that in respect of minor schemes like local improvements schemes, minor roads, small amenity schemes during the summer and such like. But, in respect of major road works, members of local authorities have no discretion whatsoever. Department inspectors tell them the corner to be cut, tell them the road width, the alignment and the amount of money they may or may not spend.
The same goes for all the large capital projects such as water, sewerage and so on. They have to wait for the Minister to give his approval and he can be as generous or as ungenerous as he likes. There is no independence for the local authorities and this Bill will not give them any financial independence.
The Minister for the Environment in his speech said that the reason this measure was introduced was that meeting the cost of rates relief was a major demand on the Exchequer. The cat is out of the bag. This proposal is not because of any new-found idealism for local authority autonomy. The Minister has told us that rates relief is too much of a demand on the Exchequer, that it must be met in some other way rather than adding it to the national deficit. It is very important in 1983 that the deficit be kept within the limits set out in the budget. This is one issue on which the Government are determined to hang their hat. The balance of payments and borrowing mean nothing: it does not matter so long as the budget deficit is within the limits outlined in the budget. This will be done irrespective of what hardship has to be suffered by individuals who will have to pay to make that possible for the Coalition. The meeting of rates relief will have to be done by local rates, by charges, fees, licences or other measures. All of this has been accommodated in this short but important Bill so far as fiscal planning is concerned.
One Deputy suggested this would be a temporary measure and I understand this was carried in some section of the press, whether local or national I do not know. Does anyone in his wildest dreams think this will be a temporary measure? How can it be when the Minister in his short statement gives the lie to that? At column 287 of the Official Report of 1 June the Minister said, "We are on the right track". That does not sound temporary to me. He also said the Government were not claiming that all that is needed to be done can be done at once. In other words, the Minister is letting us know that more is in store for the unfortunate householder.
A recent example will convey what I mean. The VAT rate started at a nice low figure but it can be increased depending on the demands that are made. I spoke about this in connection with the new fuel VAT of 5 per cent. This will be an enormous burden on old age pensioners.
How does the Deputy explain his party's decision to abolish the wealth tax?
I am sorry if this is penetrating the socialist heart of the Minister of State. It should penetrate his socialist heart if he had one but he does not have one if he is prepared to stand over this kind of legislation. On Second Stage the Minister said a significant degree of local finance would be necessary henceforth in support of the Exchequer. I hardly think that sounds like a temporary measure.
At column 278 of the Official Report of 1 June the Minister refers to:
...the legal basis for direct charges for services which have always been a feature of local finance and which, over the years, have existed side by side with the rating system.
The Minister is not talking about a temporary arrangement. He is talking about solidifying something which he says has been there during the years and which he now says he will put on the right track. Thus, in the coming years he can increase the charges to deliver to him whatever amount of money is necessary to keep in line with the Department's figures as handed down by the Minister for Finance.
There are some elements of this Bill that are disquieting to say the least. Section 1 deals with the interpretation of words such as "charge", "existing enactment" and "service". The word "premises" might also have been interpreted because it has a direct relevance to certain charges that can be made against premises. For example, section 3 states that "...charges may be made by such an authority in respect of persons, premises or services of different classes or descriptions". It might have been useful if "premises" had been included in the definitions section. Does it mean dwelling houses only or can it be applied to flats or institutions whether private or public? Perhaps the Minister would consider this point.
It is being stated that there will be different charges for different areas but I find this hard to understand. This suggests that different charges could be applied in one part of County Mayo as compared with another part of the county.
We are not applying the charges. The local authorities will do that.
I consider that totally unacceptable. It suggests giving to a county manager a latitude which I do not think should be given to him in such a general way. It will have a major effect on building and development in certain isolated areas. The manager will be able to impose different charges because of the topography or the geography of an area. That will be discriminatory and it should not have been incorporated in the measure.
Reference was made to the difficulty of collection. Two methods of collection come to mind. If it is done by sending out bills, presumably each bill would average out as between 30p and 40p. I do not know of anyone who will respond quickly to the first bill they receive. I presume a few bills will have to be sent——
This is very seditious.
Presumably it will cost a few pounds for each bill. Alternatively, we could have collectors. I have no doubt that many doors will not be opened when they knock on them. The collectors will become better known than the men checking on TV licences. The collectors will have an impossible task in trying to collect the money. The additional cost will have to be considered in the overall cost. The whole thing will be a nonsense Section 6 of the Bill makes provision for payment by instalments. We are entering the realms of fantasy now——
I think we have been there for the past 20 minutes.
The collector arrives at the door and knocks in a nice, tentative way. He is responded to by the housewife and he tells her that he wants the water rent. She will respond, "Certainly, Sir," and I presume he gets £1. "and will you come back next week?". The collector will do his duty 50 times a year at every house in every town in Ireland. People in the gallery are laughing and the Minister of State is laughing——
The question is what are they laughing at?
——because he knows that if you are to collect this money by sending out bills you will get no response so the only other way is to have somebody call for it.
The Table to the Bill provides that two months will be given. Is it two months after the gale day of 1 April or 1 October or will it be two months after each successive contribution towards the total charge? It is a laugh. The whole thing is totally unworkable and the Minister of State knows that. Then he will take to the courts. The courts are so cluttered up at the moment that they cannot deal with existing demands and I presume that these courts will now be asked to hand down judgments on poor individuals who will not be able either to pay the charge or to pay to be represented in the court. Without putting too fine a point on it, the Minister will be laughed out of court.
It seems strange that £65 million can be talked about so glibly as a temporary measure. That is quite a sizeable sum of money in anybody's language. We might as well face up to the fact that this Bill is a form of taxation. It has no recognition at all of the ability of the individual to pay. This must be an inherent fault in the legislation. It is a spending tax and it will affect the poorer classes to a much bigger degree than it will affect others. How could a Labour Minister of State sit there and say to me that this taxation is to be placed on the unsuspecting householder when nothing is stated here about inability to pay except in the clause that says that the manager has the right to waive it? To waive what? This is the hardship clause which in effect means nothing at all. This is under section 5 of the Bill. In regard to people who are in subsidised rented dwellings or who are getting mortgage subsidies from the State to help pay their mortgages, who are unemployed temporarily, short term or whatever, how can the manager not apply section 5? The way this Government are going about business as far as unemployment figures are concerned, there will be nobody left to collect it from anyway and the Minister will have to drag into court those who are willing to pay to get it out of them. The whole thing is ridiculous.
There was no means of assessing what the take would be in any county. Mr. Chairman, you might indicate when I have a few minutes to go. It was just take a figure out of the hat, and the way it was done in County Mayo where the Minister of State is going shortly to open some new urban council houses——
With a degree of trepidation following this contribution.
——was that the manager decided to put £100,000 on Castlebar and Ballina. He took 2,000 houses in the town and multiplied it by 50. There was no recognition whatsoever of how many might or might not pay, what the shortfall might be, the administration costs, collectors' fees or whatever. It was just a multiplier system. That is how much thought was put into this legislation. If it is not collected and if there is a shortfall at the end of this year from all the towns throughout the country, I presume that next year the manager as part of his executive function will have to increase the charge not just to cover next year's charges but also to take recognition of the outstanding debt——
I remind the Deputy that he has five minutes.
——and the debit balance which would have accrued. As I understand it, everything not said to be reserved must be an executive function, so I take it that as it is not stated specifically here it must be an executive function. That leads me to show up further the lie in part of what the Minister stated in his opening speech. I quote from the Official Report of 1 June 1983, column 275, Volume 343:
The basic responsibility for deciding on the amount to be raised by charges will fall to be exercised by the council members....
I do not see that to be the case.
It is.
It is an executive function, and I will tell the House why. If the members of a council at a meeting duly convened for the purpose of formulating these charges decide to chop the charge, the manager says that he requires £50 — whether he can get it or not is another story — and the members decide that they will not allow so much money. The manager then says that he cannot run the services and asks where he is to get the extra money. The members say that they will not give it to him anyway, and the charge is formulated at the level the members require. According to this Bill, in the next week the manager by his own executive function can levy the charge whether the members like it or not. That is what "executive function" means. That is not written in but it must be implied in the language of this Bill in that everything that is not reserved must be executive. This is only a sop generated by the Coalition partners in an effort to fob off on the councillors that some kind of new financial independence is being bestowed on them. Nothing whatsoever is being bestowed on them. The manager will decide what the charge will be and whether they can place the charge at any level they require.
I resist particularly section 7 which provides for the setting off of unpaid charges against some sums due by an individual or individuals or for taxing the occupiers of certain premises against the sums due on foot of these charges. What if there is a dispute regarding the charges, the occupier or who the official occupier of the property is? What if there is a dispute with the manager about the type of service being granted or the capacity of the service which the occupier says he requires and is not getting from the authority? What if the requirements of the individual are not being met in the simple instance where the water pressure is not up to the householder's requirements? I understand that this Bill allows the manager to differentiate the amount of charges to individual householders. Many people live at the top of a number of little hills where the pressure is not too strong, and I presume there will be a pro rata de-scaling of the charge to accommodate their requirements.
The whole concept is daft. It has not been thought out clearly. It has been thought out purely as a means of getting £65 million by hook or by crook to accommodate the fiscal policies of this Government. I say to the Minister of State as a Labour Minister of State supporting this Bill, that it is a further example of antisocial legislation being moved against the householders and the less well off of this community. He should be ashamed of promoting this legislation. It will be impossible to implement it. It will be administratively impossible and cost more by way of collection than it will eventually bring in. The sooner the Government withdraw it the better.
I have one question which perhaps the Minister would answer. Recently at a meeting of Cork Corporation on estimates members of the council decided by a majority vote to reject the manager's request to put a charge on the collection of refuse and the supply of water. What is the position now? Can the manager override a majority ruling of the members of Cork Corporation?
I should like to reply to all the points that have been made. Having been impressed by the flights of oratory of Deputy Flynn, I cannot avoid making the observation that the Irish playwright and dramatist, John Millington Synge, is now running the risk of being turned into an acrid social historian, so far did Deputy Flynn stray from the realities of local government, including that of his own county, and from the powers contained in this Bill.
We are standardising and bringing into this part of the 20th century the powers of all local authorities, urban and rural, particularly the powers they have to charge for services. A large number of anomalies followed the abolition of domestic rates in 1977-78. Deputy Molloy, in reply to my interjection and quoting me somewhat out of context, referred to the point I made in the debate in 1978 that, with the abolition of domestic rates, water charges were made in rural areas but there were no charges for water in urban areas.
The Minister wanted to abolish them.
I wanted to standardise them at that time because, as Deputy Molloy knows, about 30 per cent of the urban population while living in towns are outside the functional areas of those towns and were subject to water charges following the piecemeal abandonment of legislation at that time.
Very few of them had piped water.
That is not the case, but we can come back to that on Committee Stage, if Deputy Molloy wishes. We are trying to get a standard provision and general enabling legislation to allow local authorities to charge for services.
Is this a temporary measure?
We are giving a formal commitment to review this legislation within a period of two years and, subject to the views of the House and the way in which it is considered to be operating, we can make whatever changes the House feels are necessary at that time. If it is the majority view of the House that the making of charges should be a reserved function, then under existing legislation, as Deputy Molloy knows from his tenure in the Custom House, the Minister for the Environment now has the power to designate those functions of a local authority which could be considered to be reserved functions. So we do not even need legislation in two years' time to transfer the powers that the manager will have as executive functions under this legislation.
The Minister should come clean.
If Deputy Molloy will allow me to make my contribution I shall try to clarify some of the misconceptions that the other side of the House have in relation to the operation of local authorities in general. I am not surprised that they have misconceptions because the systematic undermining and destruction that Fianna Fáil have visited upon local authorities over the last 25 years is such that it takes more than six or seven months to repair the damage. Specifically on the question of review, in two years' time or thereabouts, subject to the majority views of this House, we will review how this legislation is in operation. It is our clear intention that the managers of every local authority will work in co-operation with their local members, and I will come to the point raised by Deputy Wyse in the context of Cork Corporation. If it is the view of the House that it should be a reserved function, we have the powers under existing legislation to transfer from the managers this executive function to the elected members.
I want to put on record what powers the elected members have in relation to the whole question of local charges and local finances. At present the striking of a rate is the reserved function of the local elected members of a county council or rating authority. The striking of a rate is done in conjunction with the estimates and, as most Deputies who are members of local authorities are aware, there are two basic votes, usually taken together, in each fiscal year for a local authority. The first is the fixing of the estimate and the second is the striking of the rate. Perhaps Deputy Flynn's absence from Mayo County Council has distorted his understanding of these matters but no doubt he is aware that, for the first time since 1978, local authorities this year have the power in respect of commercial premises to fix whatever rate they choose, a power that was taken away from them by Fianna Fáil and given back to them by this administration in less than four months in office.
That is another example of trying to get more cash.
The truth sometimes hurts and Deputy Flynn will get a bellyful of it now. This is the first removal of the shackles that were put on local authorities by Fianna Fáil when they abolished rates and the ham-fisted way in which they brought in the Local Government (Financial Provisions) Act, 1978. Every local authority was in credit and paying their way in 1977-78 when the 1978 Bill was put through this House by the majority Fianna Fáil Government. Now the reverse is the case. All local authorities are heading towards bankruptcy unless there is a major change in the system of operation of local authority finances.
The House, perhaps unintentionally, has been repeatedly misled by members of the Fianna Fáil Party when they talk about the need to raise £65 million by local charges. That is not the case. The charges referred to in this legislation are not expected to bring in much more than approximately £20 million, which must be set against a figure of £1,000 million or thereabouts, which has been made available through general taxation to local authorities throughout the country for the operation of their current account services. We are talking in terms of 2 per cent of the requirements of local authorities, not the extraordinary draconian amount of money which Fianna Fáil Deputies pretend it is.
Deputy Flynn talked about this taxation starting off at a low base but inevitably being expanded and increased, because in his experience taxation is inevitably increased and never abolished. I retain the memory of not just Deputy Flynn cheering on this side of the House but of every other Fianna Fáil Deputy cheering when their colleague, Deputy Colley, announced in his budget speech of 1978 that he was abolishing the wealth tax. I recall the cheers at the Fianna Fáil Ard Fheis when the climb down in relation to the farmers' resource tax was signalled on the platform and not, where it should have been heard, in this democratic assembly but at the gathering of muintir na hÉireann, as Deputy Tunney referred to them at the last Fianna Fáil Ard Fheis. There are historic precedents for the abolition of taxes but Fianna Fáil do not want to talk about them, because in both instances they referred to a benefit being conferred on the wealthy and not on the needy. Indeed, if the farmers were paying their full share of local community taxation some of the enormous difficulties that local authorities are experiencing, including County Louth to which Deputy Kirk referred, would not be so acute as they are.
I hope the Minister will be making the money available to us.
I hope the Fianna Fáil Party in opposition recognise the extraordinary mess we have inherited. These charges must be seen by elected members in the context of the striking of the rate and the estimates prepared by the manager. The real power is vested in the local authority member who can decide the overall amount to be raised by the manager.
The Minister knows that that is not correct. It depends on the direct grant that is obtained from the Department.
Debate adjourned.