Local Government Bill 2013: Second Stage (Resumed)

Question again proposed: "That the Bill be now read a Second Time."

The matters that have been raised in this debate have been noted and I would like to thank Deputies who made contributions on Second Stage of this Bill and Members generally for their attendance over the course of the debate. It is important that a major legislative provision like this, which is all about strengthening the democratic process, should receive the fullest possible consideration by elected representatives.

Local government reform has been the subject of extensive debate and numerous studies, reports and policy documents over many years from the Green Paper on Local Government, through the local government efficiency review, and in the context of the alignment of community and local development. Following the publication last year of the reform action programme, a specific structured process was put in place to engage the local authority members' associations in the local government reform implementation process. On behalf of my colleague, the Minister for the Environment, Community and Local Government, Deputy Hogan, I would like to record appreciation for the positive engagement on the part of the members' associations which has helped to inform the provisions included in the Bill.

I will now address some of the important points raised by Deputies during the course of this debate. It has been suggested that the dissolution of town councils is anti­democratic or in some way takes local government further away from the communities it is supposed to serve. Despite the good work undertaken by some town councils, the 19th century model that some want to hold on to is not a good model of democratic representation, with town councillors accounting for 46% of all councillors but representing only 14% of the population. That 14% has double representation, at both town council and city or county level, while people outside of those areas have no sub-county representation, and this is true even for some very large population centres which have grown up in recent years. This lack of equity in representation is also a feature at county level - as the recent report of the Local Electoral Area Boundary Committee found - with counties like Leitrim having one councillor per 1,445 population, while in some Dublin authorities the figure is one councillor to over 10,000 population. The Bill will reduce these inequities very substantially.

As well as inequitable representation, the existing town and county council system gives rise to much duplication of functions and other distortions. An example of this duplication is that in Tipperary, with a population of just under 160,000 there are nine local authorities involving nine sets of elections, nine annual budgets, nine sets of commercial rates, nine annual audits, nine annual reports, nine corporate plans and nine development plans. These nine authorities also engage in other duplicate political and administrative processes, not least through a network of committees and subsidiary bodies. These will be replaced by a unified local authority structure with five municipal districts all working in harmony for the welfare of the community.

This situation exists to varying degrees across the country, placing unwarranted demands on limited resources. It is clear that the current arrangements cannot continue and, on behalf of this Government, I am grateful for the support of colleagues from all sides of the House on this point. While on the subject of Tipperary, I am glad to report to the House that the Minister has just signed orders to give effect to a single management structure across North and South Tipperary County Councils, with Mr. Joe MacGrath having dual responsibility. This will enable the full integration of management, structures and staff units to proceed in preparation for full merger in mid-2014. The mergers in Limerick, Tipperary and Waterford, which have been proceeding at a practical level, are a key element in the strengthening of local government structures under the Bill.

The Government is also anxious to reassure colleagues like Deputy Stanley that this reform programme is not simply to cut the number of councillors but to strengthen the system. Contrary to some suggestions, it is not sustainable, administratively or financially, to establish new town councils to address gaps in representation.

Not only would this approach exclude rural areas, it would mean hundreds more councillors, more duplication and more administrative overheads while not addressing the fundamental questions of weak functions and even greater dilution of resources. This Bill will introduce a more equitable, representative and accountable system of governance within counties which will bring county council decision making closer to all communities. It will do so with minimal bureaucratic overheads using existing organisational resources, eliminating duplicate processes and integrating administrative functions. To those Deputies who have rightly pointed out the good work done by many town councils, I would say that there is no reason the strengths and qualities of these councils cannot be extended beyond the "town walls", as it were, to embrace the wider hinterlands of the towns which are linked to them for a range of social, commercial, educational, employment and other purposes.

I am also heartened by the recent support of the Council of Europe for the reform programme. Some people have misleadingly tried to suggest that it criticised the current Bill. Last month, the Congress of Local and Regional Authorities adopted its report on local democracy in Ireland which specifically welcomed the action programme with a clear endorsement of the structural changes at sub-county level. It recommended that the programme be implemented rapidly with a view to addressing weaknesses which it identified and which have been fully acknowledged by the Minister.

One of the main objectives of the reform programme is to address the marginalisation of local government which has built up over time mainly, though not exclusively, under Fianna Fáil-led Governments. This cannot be turned around instantly. Massive devolution cannot happen overnight and it would by unrealistic and counter-productive to give the impression that it could. Rather, this Government is setting out a realistic and progressive pathway to more far-reaching development of local government in Ireland to ensure that it takes its place as the primary vehicle of governance and public service at local level. That said, the Bill will bring about a number of major advances in decentralising power even in the short term. I have already mentioned that the new municipal district system will give effect to the devolution of functions within counties. At a broader level, one of the most negative developments for local government in recent decades was the way in which local development functions were located largely outside of local government. This Bill is reversing that trend of bypassing local government by providing for the alignment of local and community development with local government through the establishment of new local community development committees bringing these functions into a single coherent framework within the local government system. The legislation will also provide for enhancement of the role of local government in economic development both at regional and local authority level. The main provisions for this purpose will be incorporated on Committee Stage and the operation of the new local enterprise offices will be a core element of the local authority economic development role.

However, the greatest long-term significance of the reform programme is that by strengthening and modernising its structures, operations, governance and funding, local government will have the capacity and credibility to take on a much wider role in the future. During its relatively short term, the Fine Gael-led Government in the mid-1990s produced two reports on devolution. Fianna Fáil subsequently enacted a provision to devolve functions but, unfortunately, never used it. This Bill provides for the extension of this existing provision to include functions of State bodies as well as Departments. The Minister has also advised of his intention to put in place an agreement with Government colleagues on arrangements to local government-proof any proposals in respect of new functions or services at local level, which will ensure that local government must be considered the default service provider at local level. This will ensure that future policy decisions adhere to the core vision of the action programme for effective local government.

This Government is also undoing the removal of local financial autonomy by giving local authorities a spread of 30% discretion in local property tax from 2015, the most important boost for local democracy in many decades. This and other reforms will also mean that the new cohort of local authority members to be elected in May 2014 will carry a much greater level of accountability and responsibility. This will pose a challenge but it will also enhance their standing greatly and in turn should cause national politicians to concentrate more on the national mandate they are primarily elected to deliver on rather than looking over the shoulders of local councillors or indeed spending weekends in local premises listening to local representations.

I know colleagues such as Deputies Ellis and Fleming have raised concerns about the responsibility for the water and road networks being outside of the local government system. As is the case in many other countries, aspects of these functions need greater scale, resources, expertise and regional or national co-ordination. However, local authorities will continue to play a crucial role in these areas at local level. Moreover, an objective of this reform programme is to reposition local government better in the context of these changes by ensuring that functions that are largely local in character are assigned to them giving them the capacity to be the primary vehicle of governance and public service at local level, particularly in terms of leadership of community and economic development.

Some Deputies raised issues about the need to ensure that local authorities remain financially viable into the future. This Government contends that this Bill, in conjunction with other recent legislation, builds a better system for the management and oversight of local authority finances. In the first instance, the budgetary development process at both county and district levels will be much more inclusive - linking budgets and expenditure in a meaningful way at all levels, including at municipal district level. Some Deputies have asked the question - what is financial oversight without adequate funding? - and again we would highlight the value of the local property tax in this regard.

The Bill makes a clearer link between the choices the council makes in terms of financial commitments and the resources available to meet these commitments. Every citizen will now have a much clearer vested interest in the financial well-being of their local authority because they are paying a direct annual tax to fund that local authority. This will help transform local financial decision making by making elected members more accountable to the communities they serve and giving local taxpayers the ultimate oversight role in respect of local authority performance.

The Bill has a number of provisions which strengthen the policy setting, oversight and financial decision-making role of the elected members. Members will have clearer responsibility to set policy and oversee its implementation by the chief executive and staff and there will be clear arrangements for the provision of information and advice to elected members in both the plenary council and other formations like committees. Monthly management reports will be prepared and presented to the elected members on both the delivery of programmes mandated by the members and those arising from the executive functions assigned to the chief executive. These measures are key elements in rebalancing the relationship between the manager, who will be renamed the chief executive, and the elected members. Deputy Clare Daly misses the point when she sees little that is positive in these changes. The new title reflects a meaningful change in the relationship and is very much part of an emphasis on democratic accountability and a move away from the perceived imbalance in the traditional role of the manager.

Elected members will have a stronger legal basis to take greater control of the affairs of their councils and I can assure Deputies Stanley, Barry and McLellan that the Minister is actively working with the representative associations in support of their efforts to merge into one body that can provide greater supports to elected members in their policy-making role and to facilitate their engagement with policy formation at national level. There will be a strengthened corporate policy group or CPG with guaranteed representation by the leaders of the political parties and representation of each municipal district.

Deputy Murphy has suggested that the inclusion of political leaders in the CPG might be anti-democratic, but the Government is satisfied that a broad-based membership, with all main political groupings actively working together to oversee and manage the affairs of the council, will bring useful benefits and a better focus to the deliberations of the council. SPCs will also be empowered to request the attendance of public bodies at their meetings, so as to be better informed in the preparation of policy. These provisions will all be put in place in parallel with the establishment of the new national oversight and audit commission which will bring an added dimension of independent scrutiny to local government performance, without increasing central government control.

On the issue of changes in the provision for refund of commercial rates in the event that a property is unoccupied, rather than the anti-business measure as suggested by some Deputies, the intention is to create a further incentive to bring under-utilised commercial property back into productive use. There might be circumstances where property owners intentionally keep premises vacant rather that lower rent expectations, which impacts normal market forces and disadvantages prospective business occupiers. Vacant properties are also beneficiaries of local authority services such as pavement improvement, street cleaning, street lighting and so forth, so it is only fair and proper that owners of vacant properties should make a contribution, although less than the owners of occupied properties, to the cost of providing these services.

However, the Minister, Deputy Hogan, has indicated that this provision will be considered further to ensure that no unintended negative consequences arise. At present, consideration is being given to the provision of greater local authority discretion on whether to change from the current position, which would enable the authorities to take account of local economic factors.

There have been suggestions that the Bill further delays the establishment of a directly elected mayor of Dublin. Perhaps some Deputies see themselves in the job. The Government is satisfied that it is taking the correct approach to this matter. At the Minister's request, the Lord Mayor of Dublin has convened a special forum of the elected members of the four local authorities to consider the options for the introduction of a directly elected mayor for the Dublin metropolitan area. The Lord Mayor has undertaken, together with the forum, to provide a report to the Minister by the end of the year. The objective of the forum is to provide a basis for the four Dublin authorities to pass a common resolution in time for the local elections next May.

We are fully supportive of the efforts towards the evolution of a political consensus, but the key point is that this Government is not going to prejudge the outcome of those considerations and instead will allow the people of Dublin, who will be directly affected by the change, to take the decision on the establishment of an office, or otherwise, through a plebiscite in 2014. We are equally determined that this decision will be taken on the basis of proper analysis and awareness of all the implications, positive and negative, particularly with regard to local government structures and functions in Dublin and cost.

The Government is greatly encouraged by the interest taken by Deputies in this matter. There will be the opportunity for further engagement with Members on Committee and Report Stages as we work through and finalise the important reforms contained in the Bill. This is an important opportunity for Deputies on all sides to work together to move past the outdated structures and practices of the current system and build a meaningful local government that is more effective and more responsive to the needs of our citizens and communities. While some of the debate has focused on the structures we are removing, the Bill is not about breaking down but about building up local government so it offers meaningful local democracy, provides the services that are needed by our communities in an efficient and effective way and is transparent, accountable and fit for purpose in today's Ireland, not the Ireland of 100 or more years ago. Finally, I take this opportunity to thank all the Deputies for their contributions, which will be reflected on as part of our consideration of amendments for later Stages.

Question put.

In accordance with the Order of the Dáil today, the division is postponed until immediately after the Order of Business on Tuesday, 19 November 2013.