As Deputy Cowen is not yet present, we will move to Question No. 2 and come back to No. 1.
Priority Questions
Social and Affordable Housing Provision
Eoin Ó Broin
Question:2. Deputy Eoin Ó Broin asked the Minister for Housing, Planning and Local Government the target number of affordable units (details supplied) to be delivered in 2018 via the local infrastructure housing activation fund, LIHAF, Home Building Finance Ireland, HBFI, and the forthcoming affordable housing scheme. [45427/17]
This question centres on the need for affordable housing. There seems to be confusion about what we mean. Affordable housing means housing that is available to purchase for families on gross incomes of between €45,000 and €75,000. That means houses for sale at somewhere between €173,000 and €288,000, including deposits. How many units in that price bracket will be available next year as a result of the budget 2018 measures?
The overall aim of LIHAF is to increase housing supply by removing infrastructural obstacles that were preventing the development of key sites.
A total of 34 projects received preliminary approval in March 2017 and 22 of those have now received final approval. I will be publishing details of these projects shortly. I expect the remaining projects to be considered and approved, if appropriate, in the coming weeks. In any event, all projects have been allowed to proceed to design phase in advance of such approval.
LIHAF has a five-year delivery timeline out to 2021. With most of the infrastructure expected to reach construction phase in 2018, I expect a gradual increase in housing delivery during 2018, with significant increases in the following years as the infrastructure is built, with all of the projected housing, up to 23,000 units if all projects are approved, being delivered by the end of 2021.
Based on current prices in the areas where projects are being advanced, many of the projects outside Dublin will have housing available in the price bracket identified by the Deputy. In Dublin, it is expected that there will be supply of starter two-bedroom apartments and houses at prices under €320,000, with the quantum of these units dependent on the housing mix granted in the planning permissions. Final sales prices will also be dependent on changes in house prices over the intervening period until the homes are delivered.
In many of the projects, local authorities will aggregate LIHAF deductions to provide more affordable housing, under qualifying criteria to be set in line with national policy, which I will be announcing in the coming weeks. Of course, there will also be a social housing dividend from all of the LIHAF sites, together with additional social and affordable housing from the State-owned sites.
In order to make further progress in providing specific affordable housing in price ranges that meet the challenges for those with modest incomes, as part of budget 2018, I announced that a new fund of €25 million will be provided, over 2018 and 2019, to unlock local authority-owned land specifically for the delivery of affordable housing. My Department is currently drawing up the criteria for access to this scheme, which will be announced in the coming weeks.
I thank the Minister for the information, none of which, of course, answered the question, which asks for the number of units that would be within that affordable bracket. In fact, when the Minister talks about the bands identified by me, he did not use the bands I just read out - €173,000 to €288,000 - but, rather, the bands he provided in a reply to a parliamentary question I tabled last week. According to that reply, none of the LIHAF units in Dublin would be anywhere close to the top end of the affordable band of €288,000. The prices outside Dublin will probably range from €260,000 upwards.
My question is very simple. The Minister keeps telling us that affordable housing will be delivered. He has told us about the extra €50 million for LIHAF and the €750 million for this new funding vehicle. He has not yet explained how the €25 million over two years will work. However, I suspect it is something like the Ó Cualann project. How many units priced between €170,000 and €280,000 will be available for people to buy next year with funding supported by the State? If the Minister cannot answer at this point, he should just tell us he cannot do so and indicate when he expects to be able to give us that information.
A number of measures have been put in place to try to help affordability in terms of the cost of building or in the context of the ability to rent or buy on the tenant's side. I refer, for example, to the An Bord Pleanála fast-track process, the help-to-buy scheme - which was put in place for that reason, the rent pressure zones and recent changes to the apartment guidelines that are coming on stream. Some of the schemes in Dublin that will be released under LIHAF 1 and LIHAF 2 - which was also announced in the budget, with an additional €50 million in funding - will see homes coming in under the €320,000 price that I mentioned in my initial reply. A number of projects outside Dublin will have houses and apartments for sale or to rent in the price bracket to which the Deputy referred. Therefore, we will be able to bring on stream affordable housing by using the LIHAF finding in particular.
The question also mentions HBFI and the forthcoming affordable housing scheme. Legislation will need to be introduced to put HBFI in place. We are talking about that agency being in a position to provide financing in the course of next year. Depending on what sites it is financing and how quickly it can deliver those, a very small number of new houses may actually be built in 2018, followed by a complete ramping up of supply in 2019.
I will be announcing the criteria for accessing the €25 million affordability scheme for 2018 and 2019 in the coming weeks. We will work with the local authorities on the sites that will be suitable. The housing bodies will then work with us using models such as that relating to the Ó Cualann project, the representatives of which have shared their learning with the Department, to decide where those houses will be located. Again, the important thing is to get those agreements in place and to commence construction. If we can do it under the rapid-build framework, we can do it within six months. At this point, I cannot give the Deputy an exact figure for the number units to be constructed using the €25 million fund.
There is real confusion here. Housing units at €320,000, €310,000 or €300,000 are not affordable either in or outside of Dublin. I say that because it is only possible to borrow 3.5 times gross household income under the Central Bank's mortgage lending rules. The people who need affordable housing are on incomes of between €45,000 and €75,000. The band of properties for those people are valued at between €170,000 and €288,000. The Minister seems to be suggesting there may be - possibly outside Dublin, possibly through LIHAF, possibly through the new housing finance initiative - some properties at the very top end of that; although he cannot confirm that yet. There has to be a spread of properties in the range between €170,000 and €288,000 next year, the following year and the year after that. I am not hearing that, either in what the Minister has said today or what he said previously.
There is no confusion at all. Under LIHAF 1 and LIHAF 2, depending on the scheme, there will be a cost reduction per unit across the site. Under other schemes there will be affordability, there will be ring-fencing of a certain number of units and affordability criteria will be put in place. If it is the affordable-to-buy scenario, there will be a greater reduction in the market price; if it is an affordable-to-rent model like some of the schemes in, for example, Cork, rent coupons will be given to help people to access that.
Two people on average annual earnings as per the CSO figures can get a mortgage on a home costing €290,000. I have said that a number of the sites in Dublin will have houses or two-bedroom apartments coming in at under €320,000. I will be publishing the data on the 22 projects shortly. The Deputy will be able to see the type of house prices in those schemes outside Dublin. Many of them will come into the price bracket to which he referred.
We will now take Question No. 1.
Social and Affordable Housing
Barry Cowen
Question:1. Deputy Barry Cowen asked the Minister for Housing, Planning and Local Government his plans to address the finding of the European Committee of Social Rights that Ireland has substandard social housing conditions; and if he will make a statement on the matter. [45567/17]
I thank the Acting Chairman for allowing this question now.
While we are all aware of the Government's failure in recent years to meet its social housing targets with 135,000 people languishing on waiting lists, this week we learned that the European Committee of Social Rights has indicated that the Government has violated its charter and that local authorities had failed to "ensure the right to housing of an adequate standard for a not insignificant number of families". The committee found that "the Government has failed to take sufficient and timely measures to ensure the right to housing of an adequate standard for a not insignificant number of families living in local authority housing and therefore holds that there is a violation of article 16". What is the Minister's response to this? How will he seek to redress it? What provisions has he made in the context of the recent budget in order for an audit or a planned increase of the available funds for local authorities to address this properly?
The decision on the complaint to the European Committee of Social Rights by the International Federation for Human Rights regarding social housing issues has just very recently been notified to the Government. It is appropriate that we now study the report and identify the responses required.
For quite a number of the points of the complaint, as lodged, the committee found there were no violations. That said, we take seriously those other aspects on which the complaint was upheld.
One of the findings of the report was in relation to the conditions in a number of social housing areas, with Dolphin House and St. Teresa's Gardens in Dublin specifically cited. I accept the committee’s findings based on the conditions that prevailed at the time of the various studies that supported the complaint. It is important to note, however, that we now have multimillion euro regeneration programmes well under way at both these locations and, when completed, they will result in vastly improved living conditions for the residents there.
There are other aspects of the committee's findings that I will be studying over the coming weeks and my Department will be responding to the committee shortly. We respect the role of the European Committee of Social Rights and while it is important to note those aspects of the complaint where no violations were found, we will also consider carefully those aspects of the complaint that the committee upheld.
I would have thought the violation was plain and obvious. That being the case, what timeframe has the Government put in place to address this issue? For example, is the Minister considering establishing an independent complaints commission whereby local authority tenants will have access to independent assessment of their complaint regarding violation? Many local authorities are placed in an unfortunate predicament because they do not have the funding available to them to address many of these issues. What budgetary measures has the Minister taken or will he take in light of this in order for this issue to be addressed? It is bad enough to try to deal with the failure to meet the targets for the provision of social housing. We now have this issue on the table which needs to be addressed. We need to hear from Government a clear pathway as to how it might be addressed, the way it is being dealt with and a copy of the Minister's response to the European charter.
It is important to note that in approximately four cases no violations were found. That is in the correspondence. I will not repeat what those were but in terms of the timelines and in so far as our response is concerned, my Department is in the process of drafting it in conjunction with the Department of Foreign Affairs and Trade. A written response will be made available by 21 November. There will then be an initial discussion of the decision and Ireland's response, which is scheduled to take place in Strasbourg on 28 November. This initial consideration of the matter will be undertaken by a rapporteur group of the committee of Ministers. It will not be in public, but we are not contesting the findings where they have been made and recommended.
In so far as the funding that has been made available, if we look at the voids programme, for example, and the remediation programme, approximately 7,330 social housing homes were refurbished by local authorities in the period 2014 to 2016. We have an energy efficient programme and between 2013 and 2016, the period in which the complaint was first made, funding of €107 million went into that programme, which saw 58,000 social homes upgraded in that same period. We also have a preventative maintenance programme and all local authorities which have not already done so are to undertake stock condition surveys in respect of their social housing stock. This will commence in the fourth quarter of this year to be completed by the fourth quarter of next year. On the basis of what we get back from those surveys, we will know how to move on from there. Also, as I cited in my initial response, a multimillion euro investment programme is going into regeneration of a number of sites.
The voids programme and the retrofit programme, commendable as they both were, are separate from this issue. The final part of the Minister's answer paints a clearer picture in so far as he said there is an ongoing survey or audit of existing stock. When will that be with the Minister? That having been identified, has he increased the allocation to local authorities for ongoing maintenance programmes and to what extent has he done so? Will he make public the findings of the audit and allow us scrutinise it to ensure that the relevant funding, if it is being increased, will be adequate? As I said, it is putting local authorities in an unfortunate predicament in so far as they do not have the available funds to address many of these issues. Now that this has been found, it could lead to other cases being taken, which might have greater repercussions.
It is important to note that these are legacy issues. The case was taken in 2014 and in the period since then, a huge amount of money has been invested and will continue to be invested by local authorities to make sure they are retrofitting stock and bringing stock up to the proper standards. All Deputies get representations from our constituents who live in social housing as to the standard of that housing, be it regarding problems with ventilation, draughts, mould and so on. We need to make sure that the local authorities respond to those adequately and sufficiently. We will respond to this and we will detail all of the things we are doing where those complaints were upheld.
On the point the Deputy made about an independent complaints procedure for local authority tenants, that is something that is worth discussing in greater detail to see if a mechanism can be put in place to allow that to happen. In so far as this audit is concerned in terms of what needs to happen, that will commence in the fourth quarter of this year and the local authorities across the country will complete that work over the course of next year.
Homelessness Strategy
Barry Cowen
Question:3. Deputy Barry Cowen asked the Minister for Housing, Planning and Local Government the allocation of additional funding to homelessness services announced in budget 2018; if he has revised targets for reducing the number of homeless families and children; and if he will make a statement on the matter. [45568/17]
In light of the extra €18 million made available in the budget for homeless provision and funding for the homeless to assist in finding solutions to this issue, will the Minister now revise the targets he had set, and can he made them public?
Budget 2018 provides for an allocation of €116 million for homeless services, which is an additional €18 million, or 18%, on this year's provision of roughly €98 million, and a 66% increase on the 2016 provision of €70 million.
The long-term solution to the current homelessness challenge is to increase the supply of homes. Accordingly, the Rebuilding Ireland - Action Plan for Housing and Homelessness is designed to accelerate all types of housing supply; in particular, it seeks to increase the delivery of social housing by 50,000 units over the period to 2021.
Working within this plan, it is intended that the long-term housing needs of households in emergency accommodation will be met through a range of social housing supports such as the enhanced housing assistance payment, HAP, scheme and general social housing allocations. Notwithstanding the significant level of homelessness presentations, considerable progress is being made on securing accommodation solutions for homeless households. In 2016, over 3,000 sustainable exits from homelessness into independent tenancies were achieved. During the first half of 2017, the rate of progress increased, with over 2,000 such exits being achieved. This level of activity, which has continued in recent months, has resulted in the number of homeless families in emergency accommodation in Dublin falling for a second successive month in September, for the first time in three years.
To mitigate the issues associated with homeless families accommodated in inappropriate temporary arrangements, housing authorities are pursuing a range of new supported temporary accommodation initiatives, referred to as family hubs. These will continue to offer much better family living arrangements while more permanent housing solutions are arranged for the families concerned.
To be more specific, has the Government adjusted its targets for eradicating homelessness arising from the allocations made in the budget and, if so, what are they? Are all families removed from hotels and bed and breakfast accommodation in keeping with 1 July target? Where do we stand on that, or what revision of that target has been set based on the improvements that will accrue based on the increase in funding, as given in this year's budget?
I advise the Deputy that we released the homeless figures for September earlier this evening. In Dublin, for the second month in a row, and this is the first time this has happened in three years, we are exiting more families into secure and sustainable homes than are entering our emergency accommodation services.
All the three categories of homelessness - adults, child and family - are up on the previous month. The Minister should tell the truth.
That is the truth.
The truth is that all three categories are up.
That is exactly the truth. For the first time in three years, and for two months in a row, we are exiting more families into secure accommodation than are entering our emergency accommodation.
The September figures for all three categories are up on August.
That is the case for August and September. This is welcome progress. I know it is too slow and that we need to do more. The Government recognises that, and that is why we have increased our funding for homelessness services next year. We have also increased our HAP supports for next year, as committed to in the budget for 2018. There are still 690 families in hotels. Any one family in a hotel or bed and breakfast accommodation is one too many but that figure is significantly down on the high point that was reached in March earlier this year when 871 families were in hotels and bed and breakfast accommodation. That is a 20% decrease in the number of families in hotels. We are working with all stakeholders to ensure that these numbers reduce further over the coming months.
Regarding targets for next year, we have five new family hubs in Dublin and a further three new hubs in Limerick and Cork coming on board for our expanding homeless accommodation programme by the end of the year. That will look after at least 180 families in this first response of accommodation as we move them into more secure accommodation. We are developing out a programme for more hubs next year to help these families while we are building more houses and finding more HAP solutions for them.
Again, I will try to be specific to ensure that people can plainly understand where we are at or what progress is being made or likely to be made. The Minister said more homeless families are exiting homelessness and I do not doubt that, but as Deputy Ó Broin alluded to, unfortunately, the figures are up. Based on the increase towards addressing this issue made in the budget, has the Minister adjusted his targets? I acknowledge the five new hubs in Dublin and the three in Limerick and the other solutions in the form of hubs that other local authorities may find in the coming months. Purely based on the Minister meeting his line Minister in the Department of Finance and the increase in the allocation towards the provision of funding to help to eradicate this issue, does that mean the Minister adjusted his figures downwards?
Either it does or it does not. If it does not, let us hear it.
To clarify, nationally the number of families accessing emergency accommodation services is up, with 89 presentations in September nationally, but the overall trend is also downward. The rate of increase between July and September of 1.8% nationally is much lower than the average for the previous three months, 4.8%, and the similar period last year. This year, every working day of the week, 80 new tenancies will be supported through social housing supports. Next year, that target increases to 98. We have the increase in family hubs as I discussed. The Deputy mentioned the target for getting families out of hotels and bed and breakfast accommodation. That was not achieved in the middle of the summer and I recognise that. The target still remains to look after each one of those families in every hotel and bed and breakfast, and get them into a hub as a first, temporary response, into HAP-supported accommodation or into a new home. That is our target. I cannot give the Deputy a definite deadline as to when we will actually meet that target because we are talking about individual families. We have to be sensitive to their needs. We have to work as best we can with the services to make sure that we are compassionate and can find them secure and sustainable homes that meet those needs.
Social and Affordable Housing Data
Mattie McGrath
Question:4. Deputy Mattie McGrath asked the Minister for Housing, Planning and Local Government the number of social housing units that have been moved to build and completed in County Tipperary in each of the years 2012 to 2016. [45538/17]
I want to ask the Minister of State if he can tell us the number of social housing units that were planned, designed, commenced and completed in the years 2012 to 2016. It is a bit of a mystery. I would appreciate if the Minister of State could give me some information.
Given the constraints on resources in the years following the economic downturn, the local authority house building programme had to be reduced dramatically. This was evident in all local authority areas, including in Tipperary, where just 11 social houses were constructed by the council in the period 2012 to 2016. The focus in recent years has, instead, been more on achieving good-value acquisitions, with €6.7 million provided to Tipperary County Council in 2016 alone to fund 50 acquisitions, and a further €8 million provided so far this year for 60 acquisitions. An additional €1.5 million has been provided to support approved housing body activity in the same period.
The roll-out of the housing assistance payment, HAP, has also been of central importance to local authorities in meeting housing need, with over 900 households in Tipperary supported under the scheme last year and more than 700 supported so far in 2017. The refurbishment of vacant social housing stock has also been a priority and funding of over €3 million has been provided to Tipperary to return 200 vacant social houses to use between 2014 and 2016, with a further 58 units targeted this year but not yet completed.
Under Rebuilding Ireland, priority has been attached to achieving a very significant increase and acceleration in social housing construction. This is evident in the most recent status report, which showed more than 700 sites and approximately 11,000 new social homes at various stages of progress nationally. This status report includes 25 projects in Tipperary which, collectively, will deliver over 200 new homes for people on the county's waiting list at an estimated cost of almost €30 million. In addition, since the end of the second quarter, further projects involving the construction of 62 additional new social homes at Thurles - a site I visited myself - Nenagh, Fethard and Clonmel have been approved, supported by an additional €9.8 million.
My Department will continue to engage actively with Tipperary County Council to deliver social housing through all available avenues, with a particular emphasis on additional construction projects. The Deputy has raised this issue with me a few times. There is no shortage of money when it comes to Tipperary's plans. We have asked the local authority there to bring forward an increased pipeline and an increased number of projects and we will address the funding with it as we go along with that. We are keen to work with the local authority to increase this supply of housing.
The genie is out of the bottle, I think, if there is no shortage of money. Did I hear the Minister of State right? How many houses did he say were built from 2011 to 2016?
There were 11 houses built.
Only 11, in the years 2011 to 2016. This gives the total-----
This is not new information.
The Minister of State has been telling us about Rebuilding Ireland and many other projects. The former Minister, Deputy Kelly was too when he was in place. We are sick of announcements. This is the problem. How could we have a homelessness crisis improved if we are not building houses? The local authority built houses from the 1930s to the 1990s and right into the millennium. Nothing at all is happening - 11 houses, that is one and a half houses per year. That is ridiculous. We knew that but the Government was telling us the council was getting this amount of money and there was this announcement. The council was saying it had not got the money. The drawings were gone up and so on. There is nothing happening. No wonder we have a housing crisis. This is replicated up and down the country. I cannot believe it. I can believe it because I cannot see the houses.
The Government was then using the people who get ESB connections for their figures and we all knew that was not the right barometer. It could be a business premises that had closed and was being reconnected. It could be a house that was sold or anything. The Government was trying to cod the people. It is codding nobody except itself. It should be level with the people and tell the truth that it is not building the houses, it has lost the will to build them and the local authorities have lost the will and have not the money to build them, or they have not got the experts there.
Before the Deputy gets carried away-----
I am not carried away at all.
We have been through these matters before endless times. There is no hiding figures and no codding anybody whatsoever. We are very straight with the figures. I gave the Deputy the figures for the years prior to the start of the Action Plan for Housing and Homelessness. I can give him the figures for the time since then. At this stage, the pipeline of projects is over 244 for Tipperary. I am very clear. I am asking the Deputy, his councillors and the local authorities to bring forward more proposals and we will fund them. I cannot be any clearer with the Deputy on that. I told him months ago that the funding is there for more projects for Tipperary.
In the plans put forward for 2015 to 2017, Tipperary was given a target to achieve 832 homes. It was given a budget of €57.1 million to achieve that. That is the money Tipperary was given to spend on housing and so far it has reached about 715 homes under that target and we expect it to reach the 832 units before the end of the year because that is the target set out. We will do all we can to work with the local authorities in the months ahead to achieve that. The funding set aside is for a combination of bringing back in voids, acquiring vacant properties, acquisitions and so on, as well as building new houses, and that is what has been achieved so far. The local authority is short of its target but we expect it to reach it in the months ahead.
I am mystified. There is only one way to sort this out, which is for the Minister of State, myself and any other Members of the Oireachtas who so wish should sit down with the county manager. We are being told one thing. The Minister of State is saying the county council is being flooded with money and is not building. He cannot blame the council for everything. The council is under fierce pressure with the homelessness crisis and dealing with HAP. There are voids all over the place. They have been there for five and six years and the same is true in the Minister of State's county too. There is a lot of dysfunctionality somewhere in the system. Money is being announced. If that money is not drawn down, does it go back to the Department? There are many questions I would like to ask.
Just 11 houses in that number of years is crazy. Everyone can see that. That is why we have the housing crisis. It is replicated up and down the country. There is something wrong. I have asked the former Minister, Deputy Coveney, the Minister of State and other Ministers with responsibility for housing to bring in the county managers and ask them to explain. I do not mean like calling the banks for tea and sweet cake. The Government should just say we want action here. We want the people housed. We want some kind of functionality in the building industry and the knock-on effect on the economy as well, apart altogether from the unfortunate people waiting for houses for 12 and 15 years. There are over 3,000 people waiting in Tipperary, approved applicants, not to mention all the people who are not approved. This is crazy.
We put all our eggs in one basket with the HAP and the rent allowance and no building. We need a building stock because we will end up with no stock at all if we do not have a building stock. I am asking the Minister of State to get a date for the county manager and director of services for housing in order that we can meet in the Minister of State's office here in Dublin and have some answer to the question, not the Minister of State telling me one thing here and them throwing something else around in Tipperary. Dúirt bean liom go ndúirt bean léi go raibh fear i dTiobraid Árainn a bhfuil póca ina léine aige. This is what is going on - a fudge up and down the country. Around the seven different offices of the Department around the country they go, around to Castlebar, around the merry-go-round, pushing paper.
There is no fudge here. The facts and the figures are published every month on the website. The Deputy can see them. We have engaged with Tipperary County Council on a regular basis and will do that even more, directly with the county manager. I have met the Deputy and his councillors down there twice myself. The Minister, Deputy Eoghan Murphy, has been down there too. We want to engage with the Deputy. Tipperary County Council has brought forward a number of plans, over 25 projects, that were not there a year ago and are there now to build houses in the course of 2018 and we want to see that happening and we want to see more of it. We have been very clear umpteen times to all local authority managers, councillors and so on that the money is there to support this activity and we want to do more of it and increase the pipeline. There is a pipeline of projects across the country of over 11,000 houses on 700 sites. We want to at least treble that. That includes Tipperary and we will work with the Deputy on that.
In respect of the voids, in case the Deputy has any doubts, over 7,000 voids were brought back into use before 2017. By the end of 2017, over 8,400 houses that were empty and unused - social houses - will be back in use. It is good progress. It should never have happened in the first place but we are bringing them back into play. It is taxpayers' money well spent bringing them back into use. That is the figure. It is factual. We do not make the figures up. They are there for the Deputy to track every month.
Property Tax Administration
Catherine Murphy
Question:5. Deputy Catherine Murphy asked the Minister for Housing, Planning and Local Government if a recent analysis has been carried out in respect of the baselines set for local authorities in the context of local property tax; if so, the person or body that conducted it; if it will be published; and if he will make a statement on the matter. [45091/17]
The recent focus on the local property tax relates to the proposed 2019 revaluation and the potential for a shock in terms of increases. This question is about the baselines that are set for each local authority, which are based on historical data and, as such, work to the disadvantage of areas that are growing in population; whether any analysis has been carried in this regard and, if so, if it is feeding into the cross-departmental group.
Local retention of local property tax, LPT, commenced in 2015 and is now established as an alternative and essential source of funding for the local government sector, thereby reducing reliance on central funding. The Government decided that 80% of the estimated LPT liability in each local authority area for a given year is retained in that area to fund public services, notwithstanding any local variation decisions. The remaining 20% of LPT is redistributed to provide equalisation funding to those local authorities that have lower property tax bases due to the variance in property values and density across the State. This reflects the fact that local authorities vary significantly in terms of size, population, public service demands, infrastructure and income sources.
In accordance with decisions taken by the Government regarding the distribution of local property tax, every local authority has a minimum level of funding available to it known as the baseline. There are variances across the country in terms of LPT levels but it is important that all local authorities receive at least this baseline level of funding to ensure they can deliver services. Following consideration by my Department, the baseline was last revised in respect of the 2017 local property tax allocations. For 2017 onwards, an adjustment was made to the baseline of each local authority to include an additional amount equivalent to the pension-related deduction, PRD, income retained by local authorities in 2014. This administrative arrangement was designed to reduce the risk to local government funding that would otherwise arise from declining PRD income from 2016 onwards. Therefore, the baseline is currently linked to previous general purpose grant amounts and the level of pension-related deductions retained by local authorities in 2014.
The Department of Finance has overall responsibility for LPT policy and accordingly, questions around such policies are primarily a matter for my colleague, the Minister for Finance. My Department remains focused on the resource needs of all local authorities. The issue of baselines is one that is raised a great deal with Department officials when they visit local authorities. Most local authorities are happy with the change made in regard to the pension-related deduction. We have given a commitment to analyse ongoing costs and funding issues for local authorities into the future as more money becomes available through our current and capital budgets.
I will try to illustrate my point. Taking the two counties of Wicklow and Mayo, the population of Wicklow is greater than that of Mayo by 12,000. The baseline for Wicklow is €6.84 million and the baseline for Mayo is €17 million, even though the population of Mayo is smaller. The overall spend in Mayo when everything is taken into consideration is €125 million. In Wicklow, it is €91 million. This means the larger populated area has the smaller amount of funding. These baselines date back to the needs and resources model of 2001 and have only been tweaked since. I am aware of the change that occurred last year in regard to the pension-related deduction. It was not about addressing the baselines in the sense I am talking about. Unless population changes matter, growing areas will lose out in terms of the opportunity cost in respect of services that they should be providing. This will result in significant resentments. I ask the Minister of State to ensure this issue is looked at in the context of any review.
In regard to the local property tax, this tax essentially was a replacement for the general purposes grants. There was an expectation that it would be an addition to the general purposes grants but people are now twigging that is not the case. The baseline issue is an important issue, particularly for growing areas.
The baseline figures being used date back to 2005 rather than 2001. It is based on the 2005 assessment of the various services and income and expenditure as well. The Deputy is right that since then they have only been tweaked on a plus or minus basis every year thereafter. As the Deputy knows, the original needs resource model was cumbersome to manage and it did not always prove economical to gather all of the relevant data. The issue of the funding requirements of local authorities is an ongoing one for the Department. The Deputy will be familiar with the requirements of the local authority in her area, as I am familiar with the needs of the local authority in my county. There is increased pressure on services when there is an increase in population. Local authorities currently do a lot more than they did previously. The local property tax is only part of the funding provided to local authorities. They also get other funding.
In regard to Mayo versus Wicklow, this is not only about population size. Counties vary greatly in geographical size as well, which must also be taken into account in the context of the running of a county. I apologise but I cannot recall the Deputy's third question.
I have done a thorough analysis on this issue. Although I used the example of counties Wicklow and Mayo, if one matches counties of similar size, the same profile occurs in relation to growing areas. The 2005 figures were taken from the 2001 data and they were only marginally changed. I have the data for each year from 2001 onwards. The issue is that when the needs and resources model was brought in, a commitment was given that no county would lose out under the new funding mechanism. The problem is that growing areas will always lose out in that environment. A local authority which had a large staff and assets such as libraries or swimming pools at that point could count them as a need but the capacity to develop new services or grow the workforce was not factored into how the metric worked. There is a significant fault at the heart of this funding model, which if not reviewed will work to the disadvantage of some areas. The operation of the equalisation fund means counties that are growing are paying in more and more, which means the baseline will work to their disadvantage in terms of discretionary spend. I ask the Minister of State to ensure this is specifically looked at.
We are constantly looking at the funding situation of all local authorities. We are very conscious of the great differences between them. In accordance with Government decisions on local retention of the local property tax, certain local authorities with large property bases receive additional income from the local property tax compared with their baseline. The Government decided that these local authorities would use this surplus funding in two ways: a proportion of it would be available for their own use and the remainder to fund some services in the housing and roads areas. This process is known as self-funding, replacing central executive funding as well. Approximately €108 million from the local property tax is supporting housing and road services in 2018. We do allow for this in the counties that are growing quicker than others in terms of their property base.
On the Deputy's statement earlier that people are beginning to realise that the local property tax is being used to plug a gap, people were always aware of what it was to be used for. I repeatedly said that it was a great shame that the local property tax was introduced at a time when resources nationally had to be cut across the board. There is great benefit in having a local property tax, although people do not see that at this point because of the timing of its introduction. As things improve, they will be able to link improvements to it. In the early years, it was used to plug the gap in national funding. There is no denying of this and it is a great shame. One of my first suggestions on being elected to this House was that we should bring in a local property tax. At that stage, Bertie Ahern and others were focused on tax reductions without putting in place a local property tax. They should have done a combination of both. We would be in a much better place had we done that. We are now trying to correct the situation and local property tax plays a major part in that regard.