Dáil Éireann debate -
Thursday, 2 Dec 1999

Vol. 512 No. 2

Written Answers. - Motor Taxation.

Jan O'Sullivan

Question:

127 Ms O'Sullivan asked the Minister for the Environment and Local Government the projected increase in revenue from motor taxation from 1998 to 1999; the system put in place to transfer this revenue to local authorities; and if he will make a statement on the matter. [25768/99]

Jan O'Sullivan

Question:

129 Ms O'Sullivan asked the Minister for the Environment and Local Government the system which has been adopted to ring-fence motor tax income to finance local authorities; the overall percentage increase allocated to local authorities from this source for 2000; the method of equalisation adopted; and if he will make a statement on the matter. [25737/99]

Minister for the Environment and Local Government (Mr. Dempsey)

I propose to take Questions Nos. 127 and 129 together.

The local government fund was established on 1 January, 1999. In accordance with the Local Government Act, 1998, it is financed by an exchequer contribution and motor tax receipts and driver licensing fees and is to be used solely for local government and local government related expenditure purposes. The fund was established to provide local authorities with increased resources for general discretionary expenditure and non-national road spending. The projected increase in revenue from motor taxation and driver licensing fees, net of running costs, from 1998 to 1999 is £48 million, 15.6%. The recently announced allocations to local authorities for general expenditure during 2000 consist of a standard increase of 4% on 1999 allocations together with a further provision in respect of specific demands faced by local authorities. These allocations of £339.3 million are 4.8% higher than the corresponding 1999 allocations. A further allocation to local authorities from the local government fund in respect of non-national roads during 2000 will be announced shortly.

Currently, allocations from the local government fund broadly reflect the existing and historic patterns of local authority expenditure. A major step towards a more equitable system of financial allocations to local authorities will be taken during the coming year with the introduction of a distribution model based on a comprehensive analysis of local authority needs and resources. This initial model will be further refined over time and will provide the basis for future allocations from the local government fund.