I move:
That Seanad Éireann approves the following Order in draft:
Local Government (Reorganisation) Act, 1985 (County Borough of Galway) Order, 1985
a copy of which Order in draft was laid before Seanad Éireann on 6 December, 1985."
Local Government (Reorganisation) Act, 1985 (County Borough of Galway) Order, 1985: Motion.
Galway is an ancient city with a recorded history stretching back almost 1,000 years. In 1984 the city celebrated its quincentennial as a chartered town. To mark the quincentennial and also in recognition of its unique importance as the major urban, cultural and educational centre of the West the Taoiseach announced late last year that the borough of Galway would be established as a county borough. This enhanced status would place it alongside the other four county boroughs of Dublin, Cork, Limerick and Waterford which were established in 1898.
Indeed this is not the first change in status for Galway; town commissioners were established in 1853 and an urban district council had been established by the end of the last century. By an Act of 1937 the urban district was upgraded to borough status. The present change to county borough status therefore marks the culmination of a long process of civic development for the city.
The Local Government (Reorganisation) Act, 1985, enacted earlier this year provided for the establishment of the county borough on a day to be appointed by the Minister. As already announced I propose to fix 1 January 1986 as the day on which the new county borough will come into being. Because the borough was to be upgraded and become a fully autonomous local authority in its own right the 1985 Act broke the electoral link with the county. Thus the city electorate at the local elections held in June last did not participate in the elections to Galway County Council. The 1985 Act also provided that all rights, privileges, powers and duties of the borough corporation would continue to vest in the new county borough corporation and enabled the Minister by order to make such supplementary provisions as necessary to ensure a smooth transition and to deal with any matters arising in relation to the establishment of the county borough. This is the purpose of the draft order now before the House.
Before turning to deal with the various provisions of the draft order I would like to say a few words as regards a related matter. I refer to the extension of the borough boundary. The extension is as agreed between the councils locally and as recommended accordingly by the County and County Borough Electoral Area Boundaries Commission.
The members of both authorities are to be congratulated on their positive and non-contentious approach to this question. The 1985 Act provided that this extension would have effect for electoral purposes on the borough council was accordingly elected in the basis of the enlarged area. I have earlier this week made an order bringing the boundary extension into effect for all purposes from 1 January 1986. A copy of that order has been laid before both Houses. I now turn to the more important provisions of the draft order which is now before the House.
Articles 1 to 3 are standard provisions relating to citation, definitions and commencement.
Article 4 confers a general power on the two local authorities and the Minister to take such actions as are necessary to facilitate the establishment of the county borough.
Article 5 provides that the county council will continue to provide services for the county borough and on the basis of the same financial arrangements as have applied heretofore; provision is also included for revised financial arrangements to be agreed locally. This is the only sensible and practical approach. While the new county borough will, on its establishment, become legally responsible for certain services — e.g. fire, libraries, motor tax — which are at present provided by the county council, obviously it will be impossible to have separate city services in place in all respects on 1 January.
Article 5, therefore makes necessary provision to the effect that the county council will continue to provide services for the city on the existing financial terms, or on new terms to be arranged. It will be a matter for the two councils to decide on the future arrangements for these services. They may well decide that there is mutual benefit in continuing some or all of the combined services but provision is made in article 6 for the city to set up its own services in the matters in question if it decides on that course.
Under article 6 the corporation may at any time in the future, agree with the county council to discontinue shared arrangements in relation to any service. Indeed in the event of disagreement with the county council it may decide to assume responsibility for a service and serve a notice to this effect on the county council. After five years, responsibility for the service in the city would automatically transfer to the corporation. This period of notice is required to allow the county council to adjust their service. I would expect that, in practice, the question of the future arrangement for services which are at present shared will be decided by amicable agreement.
The upgrading to county borough status has financial implications for the revenues and expenditures of both authorities. For the past 100 years both authorities have been wedded together financially, organisationally and administratively. It would be obviously impossible and undesirable to effect a complete separation overnight. To do so would cause major disruption. This holds true in the financial as well as in the service and other areas. The net effect of the upgrading will be that the county council stands to lose revenues previously provided by the borough on a scale which could affect the county council seriously. Obviously, there will be a corresponding gain to the corporation's finances which are in a relatively strong position. It is considered necessary and reasonable that there should be a financial adjustment between the councils in respect of this factor. Article 7 provides for such an adjustment to be worked out locally or, failing local agreement, to be determined by the Minister.
I am very pleased to be in a position to say that I will be making a substantial contribution to this financial settlement by way of additional grant allocation to the county council. The addition will cover 50 per cent of the net cost of the adjustment subject to a maximum amount of £200,000 in 1986. The possibility of additional subvention for a period of years subsequently will be favourably considered: it is recognised that the adverse impact on the county council finances of the upgrading of the city will be a continuing one, though it should be of diminishing significance as the two councils adapt to their new financial frameworks.
I must stress that this commitment to provision of special financial support — and I think the House will agree that it is a generous commitment — is an exceptional gesture complementing the Government's decision that Galway city should have conferred on it the status of a county borough. There is no precedent for such subvention and it will not in itself constitute a precedent in relation to any other adjustments that come about in the course of the local government reform programme, and which are of a different nature.
Article 8 will ensure that the county council will be in a position to prevent any undue financial burden falling on Ballinasloe UDC arising from the upgrading. In fact I understand that such an effect is not anticipated at present and the provision is a contingency one.
The Schedule to the order contains various technical provisions relating primarily to management and various statutory demands. In so far as management is concerned, the 1985 Act provides that joint management would continue. However, under that Act when the present manager ceases to hold office it will be open to both authorities, if they so wish, to discontinue this arrangement. The provisions of the Schedule are supplementary to this and are technically necessary to enable relevant provisions of the County Management Acts to be applied to the situation.
The provision in relation to statutory demands — drainage, arrears of supplementary welfare, malicious injuries — provide in effect for the splitting of such demands between the city and county and on the same financial basis as has applied heretofore. Prior to the upgrading the county council paid for these demands and recovered the corporation's contribution via the county demand.
Galway is the first county borough to be established in almost 100 years. The separation in the city and county is obviously a complex undertaking given the fact that they have been linked for almost a century. Some of the provisions of the order bear witness to this complexity. However, I have no doubt that the transition to county borough will be a smooth one and that the necessary transitional arrangements will be approached by the elected members of both the city and county in the same positive spirit in which they dealt with the boundary extension.
Before finishing I would like to offer my congratulations and good wished to the citizens of Galway and to their representatives on the corporation as the city starts on the next phase of its historical development with an enhanced role and status within the local government system, as from 1 January 1986.
I commend the draft order for the approval of the House.
First, I want to welcome the reorganisation and upgrading of Galway city. It is a very historic occasion for Galway in this their quincentennial year to be upgraded to the status of borough. This is overdue; Galway had all the qualifications for the status of a borough for many years before it was decided to give it official borough status. It has major ports; it has major tourist developments and it has been expanding at a great rate in industry, and it is the main hub of administration and hospital services for the Connacht area. For that reason I welcome its reorganisation and its new status. I want to compliment the many people including officials and representatives who worked together so smoothly to bring about its new officially defined boundaries. That is something which is not easily done in much smaller towns, but there was general agreement here on the definition of its boundaries at the intitial stages and what these articles are doing is bringing into effect the status that we sanctioned in the Bill some months ago.
An injection of £200,000 is mentioned here for the transition period. I want to say to the Minister that I would not wish that there would be any discontinuation of finance for the borough, because it can only live on development and expansion within its own right when it has its own identity. That cannot be brought about without the continuity of finance down the years. During the phasing in and the phasing out of the services as between the county council and the country borough it will require a major injection of capital and a continuity of that until such time as they have their own secretariat and their own offices and have found their own feet as regards the operation of the borough. The most important thing the Minister can give to the borough is continuity of capital until such time as they decide on their own system of financing. I know well that if there is local government reform, like every other municipal authority throughout the State, they will have to dovetail such reform into their organisation. We have not had any major reform but we await a day when this will take place. Most long-sitting representatives of various local authorities will welcome the day when reform will take place and they will be in a position to know their targets and their future.
There is a big difference between local government as we know it and the administration we have at present. From year to year one is awaiting decisions both in budgetary terms and otherwise to see what announcements will be made at the top. One's fate is not certain until those decisions are taken by the Minister for the Environment. The decisions have changed considerably over the years.
Local authorities are in financial chaos at present. They do not know from day to day what their future may be. I would like immediate reform to take place giving to local authorities the status necessary to look after their own affairs with control over housing and all the ancillary services they provide, with a major capital grant coming from the National Exchequer plus service charges that they will introduce within their own local authorities. There is also uncertainty about the charges between any two countries, between one urban council and another and the corporation. The Minister must ensure adequate finance during the interim of the changeover from control by the county council until the borough is fully established, which will take a considerable time. I appeal to the Minister to make the necessary finance available whatever the interim period may be. The Minister mentioned that it is 100 years since we had any upgrading to county borough status in Ireland. There were very few ends to be tied up 100 years ago compared with the amount of legislation that has been brought in during the last 100 years. We have many more services now. The new legislation will require a great deal of hard work by officials to establish themselves as a borough. The co-operation we have seen in the definition of the boundaries will continue in Galway city.
Galway had a very successful quincentennial year this year and they were very privileged to have the President of the United States visiting their city on that occasion. Their quincentennial year was a major success and brought a lot of advantages and recognition to the city. I welcome the establishment of the borough. I congratulate the people of Galway on their new status and I hope they will be much better off as a result of this legislation.
I want to join other Senators who have welcomed this piece of legislation. We appreciate the decision to upgrade the status of Galway city to that of county borough effectively, and we also thank the Minister and his staff for the decision to extend the city boundary. The important points of this legislation deal with the consequences of the adjustments. The adjustments are two, one dealing with the extension, the other dealing with the upgrading of the status of the city. The provision of additional funding that the Minister has announced is very welcome. It is important to bear in mind that when a city like Galway moves from the status it had to the new status that it will now enjoy the adjustment is not one simply of making normal provision, because additional and extra costs are encountered.
Those of us who were on the borough council — some of us for over ten years now — met the Minister and we had made a presentation to him of the case that arises in relation to the adjustment of both the status of the county and the status of the city. From the county perspective the city in a revenue-earning context is removed from them; from the city's point of view the city is extended to areas where there is a reasonable expectation of the provision of urban services. In that regard you cannot simply say that it is a matter of dividing the two local government areas in two and that the financial provisions can automatically be adjusted by an apportionment of the two sets of funds. I pay tribute to the Minister for having met our delegations. We appreciate his provision of an additional sum of money. He says:
I am very pleased to be in a position to say that I will be making a substantial contribution to this financial settlement by way of additional grant allocation to the county council.
This will enable the adjustments to take place without any difficulty that would otherwise be occasioned. I notice that speakers on the other side stressed the significance of this for Galway city. I appreciate that but I think it is very important at this stage that the goodwill which existed at the time of the negotiation of the adjustment between the two separate local authorities be sustained.
I recall participating in the talks between Galway County Council and Galway Corporation and the atmosphere that prevailed was a very constructive one and this additional provision will assist.
A number of problems, however, arise, nearly all of them in relation to finance. A crude way of making the adjustment would have been to reduce the rate support grant that went to the corporation in favour of the county. I am glad that the Minister has not gone for that. Those of us who had been members of both local authorities urged the Minister not to opt for that strategy. One could ask; "Who is the winner in all of this or who is going to gain in all of this?" I am glad the Minister has not gone for the crude calculation either. The fact of the matter is that, while the county in many ways lose a portion of the revenue generating area over which it has authority, the city acquires new responsibilities and so on. This can be managed by negotiation. I hope there will be further consultations between the staff of Galway Corporation and Galway County Council and the Minister to further facilitate the easy transition envisaged in this.
There are two elements on which I wish to conclude. In many ways I welcome the change in status that is involved. It is important that the county is not the loser in all of this. One has to try to see Galway County Council in the position when the city and part of its revenue earning context has been removed from it. At the same time one has to look at it from the perspective of the city. I note that Senator Hussey, as a member of the county council, said that the atmosphere that prevailed at the joint talks between the two local authorities was one that the adjustment should not involve a loss to either local authority.
In that regard the finances of Galway County Council have to be taken into account. In their structural principles they have suffered from about three things. One was that the whole question of financing local authorities, particularly after 1978, meant that the base upon which the allocations were made to them was deficient. Secondly, there is the issue of central responsibilities being allocated to them without revenue earning capacity. This arises all the time, not only for local authorities like Galway County Council but for local authorities in general. From Galway Corporation's point of view, if you are going to speak about a city that has an enhanced status and that has an extended area, you cannot really speak of two tiers of services. People in the total urban area are entitled to expect urban services.
Therefore, in many ways there is something far more substantial involved than the symbolic changing of the status, extension of the city boundary etc. I welcome the Minister's additional provision and thank him for responding generously to the submissions that were made to him by the deputation that came from Galway Corporation and Galway County Council. I hope that talks which will take place in the future will relieve the financial difficulties of both local authorities so as to enable them to function adequately in the future.
I, too, want to welcome the order placed before the House today which puts into effect the upgrading of Galway city to the status of county borough. The people responsible for negotiating this deal, the councillors from the corporation and the county council and, indeed, the officials from both sides deserve our sincere congratulations in coming to an agreement on this very important issue. It is one of the most important issues that the elected representatives of the outgoing corporation and county council have been faced with for over 100 years.
The upgrading to the status of borough council has financial implications for the revenues and expenditures of both authorities. This is where the Government must accept their responsibilities in this regard. There is no reason whatever why Galway County Council or indeed the corporation should suffer a loss in revenue as a result of this upgrading. This is something that was not asked for by either authority. It was given to them by the Government and, accordingly, the Government have a responsibility to meet the financial implications involved.
In his statement this morning the Minister said that the Government are making a contribution which will cover 50 per cent of the net cost of the adjustment subject to a maximum amount of £200,000 in 1986. While we are very happy to get a contribution of £200,000 from the Government for this upgrading, my reading of it is that this will cover only 50 per cent of the cost. I do not think that is good enough. The Government should be responsible for the total loss of revenue caused by this upgrading. I appeal to the Minister to look into this once again to see if he can provide additional money to cover the total cost of the changeover.
I was on the deputation which met the Minister and the worries of members of all political parties were put forward very forcefully. All relevant points were made and a very good case was made by the representatives on the deputation for the provision of additional moneys to both authorities to cover the cost of this adjustment. I hope the Minister will take these matters into account and see to it that neither authority suffers any loss of revenue as a result of this changeover.
This changeover will make a considerable difference, as has been pointed out by Senator Higgins, because the county council will suffer a loss of revenue from the additional areas going into the borough council. Likewise the borough council will have to extend the services which the urban council have at present. That will cost additional money. On both sides there will be a loss. Ballinasloe Urban Council are also worried — I think this has been pointed out to the Minister — that they, too, will be caught up in this situation and that a financial burden will be place upon them at some later date. According to the Minister's statement, this is not anticipated at present; but there is no guarantee that this will not happen in the future.
For that reason we should tread very cautiously here. I know this is a new venture which will have teething problems. It needs the goodwill of the elected representatives and the administrative staff of both councils. I hope they will be able to surmount the problems that this upgrading will create for both authorities. However, I would again stress that it is the Government's responsibility to provide the finance necessary for this upgrading. Since it was the Government who brought this changeover about, I see no reason why they should not be responsible for the full cost.
I welcome the opportunity to participate in this debate and I join with my colleagues in welcoming the conferring of borough status on the historic city of Galway, as the Minister described it in his address to us this morning. Indeed I was pleased, and I am sure many others were, when the Government earlier this year in the course of the presentation of the Local Government (Reorganisation) Act, 1985 indicated their decision to confer borough status on the city of Galway recognising that it was its quincentennial year. The Minister also, in his address to us this morning, referred to the fact that the city of Galway has a proud history stretching back over a thousand years.
The last 100 years has seen various changes in the local administration of Galway city. Galway now joins Dublin, Cork, Limerick and Waterford with borough status. That is a distinction that is long overdue to the city of Galway. Not alone is it a city that is historic and proud of its past and traditions but at present it could be truly said that it is a city that is progressive, expanding and thriving. It is among the most rapidly expanding cities in Ireland if not in Europe. That is a development that is taking place right across the whole range of sectors — commercial, industrial, tourism, fishing and so on.
The celebrations that many of us witnessed last year in Galway were an indication of the pride the people of Galway have in that city and the loyalty they have to it. That loyalty and pride is an example to those in other towns. I have no doubt the new status that has been afforded to Galway will enhance its progress and that the members of the new borough council will have the capacity and commitment to make full use of the new status the city will have.
There are a few other points on which I want to comment. First, I think it is only right that I should join with Senator Hussey and others in complimenting the members of the two authorities in Galway, the corporation and the county council, on the agreement they reached quite successfully in relation to the adjustment of boundaries. There is no doubt this can be a very contentious issue. It is satisfying, and credit is due to everybody involved in ensuring that agreement in relation to boundaries was reached without any major difficulty. We must include in these words of praise the Minister and the officials of his Department because they also had an input and a worthwhile contribution to make to bring about a satisfactory arrangement with regard to what could be a very contentious matter.
In my few years in the Seanad this is the first occasion on which we have had to deal with the conferring of borough status on any town or city. I view with interest what we are doing here because we may well have a development at some stage in the future in my own county with regard to Shannon and there are lessons that can be learned as we proceed here.
Provision has been made here for the orderly transfer of services. Again the people involved are to be complimented on the options they have left themselves in relation to the transfer of services. They may or may not transfer services. They may transfer some services and they may not transfer others. A satisfactory arrangement has been made in relation to the sharing of the cost of the charges for these services. Where there is discontinuation of services by the county council this can be done by way of agreement up to a period of five years. There may well be agreement to continue with some of these services.
The question of compensating the county council for loss of revenue has been referred to. There can be no doubt that the rates from commercial and industrial property in Galway city will constitute a major financial loss to the County Council. While you have to accept that, on the one hand, you have to recognise that the services that have, up to now, been provided by the county council in the Galway city area will no longer be provided by them except on the basis of a charge to the new borough council. Therefore, while there is a loss of revenue on one hand there is also a reduction in the cost of the provision of services. I recognise that one will not match the other. I believe the Minister has accepted this. The provision of a sum of £200,000 in 1986 is a fair attempt to meet the situation that may arise there. I also understand from the Minister's speech that that is a situation that will continue over a period of five years. As I have said, and some of my colleagues have said earlier, the people involved in making this agreement are to be complimented on reaching as satisfactory a decision as possible. This is an example of it. The payment would appear to be reasonable and there is also the question of the level of payment that would cross between the new borough council and the county council.
I notice there is provision, on page 4, that where there is a failure to agree between the new borough council and the county council the amount shall be determined by the Minister. Further on we are informed that:
Any amount as agreed or determined pursuant to subarticle (4) of this article shall be included in the estimates to be adopted by the Corporation and the County Council for the local financial year 1986 and for each subsequent year.
That is fine but it presupposes that the Minister, in the event of disagreement between the two authorities, will have made his determination at that stage. I am sure that has been very well thought out but to me it would appear that looking to 1986, and we are nearly on its doorstep, if there was, for example, failure to agree between the borough council and the county council on the amount, there is no time for the Minister to come in and make the determination so as to have this included in the Estimates for 1986. Therefore, I am questioning the rationale behind this particular claim. There is a further provision which states:
The Minister may, notwithstanding section 9 of the Local Government (Financial Provisions) Act, 1978 (No. 35 of 1978) and section 9 of the Local Government (Financial Provisions) (No. 2) Act, 1983 (No. 21 of 1983), on the request of both authorities, adjust the payment of the grant in relief on rates to give effect, in whole or in part, to an agreement or determination referred to articles (2) and (4) of this Act.
The Minister may act on the request of both authorities. If the request is not made by both authorities, but only by one, can he act?
The question of the Ballinasloe Urban District Council is something which I do not quite understand. I would have thought that the loss of revenue to the county council, which I accept is being made good by the Minister, will, if anything, have the effect of increasing demand in Ballinasloe but I understand the effect is to reduce demand. I am little confused about that.
On page 6, I would like to have clarification on the question of reserved functions. I do not understand the meaning of it, having only read the document last night. Is there a reduction or an extension in relation to reserved functions here as compared with the position that prevails generally in relation to county councils and county and city managers' up to present? What is the necessity for having this provision?
In conclusion, I welcome the conferring of borough status on Galway. I join in congratulating all who were involved in bringing about this successful agreement.
I welcome this and also the co-operation of my colleagues on the other side in watching the clock. I congratulate every person involved. They are my neighbours and for various reasons I would see them as being sensible and doing things right at all times.
Senator Howard mentioned that he had this document last night. Perhaps it is a privilege of being in Government. We were only handed it this morning but perhaps that is a privilege that will be ours in a few months time.
May I clarify that point? It was available in the General Office yesterday and that is where I found it.
These negotiations have gone very well so far. There have been no party politics, just an anxiety to get things done and done quickly for the benefit of both areas. It is a delicate matter to try to draw lines and give new statutory powers to Galway Corporation. I have deep worries about the amount of money the Minister has allocated — £200,000. Of course, a worry for all of us in local government at the moment is finance.
On page 3, the Minister states that for the past 100 years both authorities have been wedded together financially and that to effect complete separation overnight would cause major disruptions. He said that this holds true in the financial as well as the service and other areas and that the net effect of the upgrading will be that the county council stands to lose revenues previously provided by the borough on a scale which could affect the county council seriously. Further on, a figure of £200,000 is mentioned. That is not a sum that will make this a success.
I join with my colleagues in congratulating the Minister, his officials and all the people in Galway who were involved in this. However, if the problem of money arises now, it may not be smooth from now on. It is fine to talk about sharing costs until one has to decide who gets what.
Those are some of the questions that worry me, but I welcome this and wish everybody success. Is it the present county manager who is to oversee this whole reorganisation or is it the Minister and the Department of the Environment who will have the final say if difficulties arise?
Galway is not a neighbouring county of mine, it is some 90 miles away, but I have a daughter in college there. My interest in this is based specifically on the reorganisation of local government. A fellow parishioner of mine, Seamus Keating, is the manager in Galway. If a Tipperary man can manage the affairs of Galway, it is doing very well. He has done a very good job up until now. In fact, all of his family has been associated with local government at many different levels in Tipperary, Cork and Galway.
I did not say he would do it right. I asked who was going to do it?
And I am complimenting him on the job he has done. This is another connection I have with the city of Galway. In regard to our commitment to local government, the Minister has tremendous commitment not alone to local government but to the continuance of the autonomy of local authorities, having been a member himself of a local authority for many years and having started his life working for a local authority. He has had the distinction of contesting more elections in one day than anybody else — county council, urban council, Dáil and European Parliament with four different voting procedures. He was elected to all of them. This must be an indication of his commitment to local authority service. Coincidentally, the Minister's father is a Galway city man and the Minister has family ties with the city at present.
We can be sure that the Minister has a personal commitment to ensure that Galway city's status will be enhanced and that the transition that will take place will be in an orderly fashion. Hence, the Minister's commitment to giving, without precedent, an additional sum of money in 1986 of £200,000, which is to be welcomed. It is inevitable that in the change of status there will be pluses and minuses. For the county council there will obviously be a loss of revenue. The Minister and all of us accept that throughout the country where reorganisation and extension of county boundaries or extension of town boundaries are concerned, a lot of this will take place over the next ten years, that is if local authorities are to effectively perform the role and the functions that they are set up by statute to do and in which members who are elected can perform their duties without undue hindrance.
I know that in my own county there are moves afoot already to extend the borough boundary of Clonmel. Extraordinarily enough, in the last election part of the electoral area of Clonmel was moved in to justify the electoral process in the adjoining electoral area of Cahir, which in my opinion was a backward step because it defeats the object of an extension of the borough boundary for the town which is expanding out in the direction of Cahir. Also now you have people living in one electoral area and working and who up to now have been paying their rates in another area. It is an anomaly that we have to come to grips with.
My interest in speaking on this subject was that this is the first time in a hundred years that we have given improved status to the cities. Galway city, above all cities, deserve this. They proved in 1984, in their special celebrations, presidential visits and everything else that they commanded the respect of all of us and, indeed, throughout the world. I am sure that that occasion will not be forgotten for many years by the citizens of Galway. And now this additional status that has been conferred by the Minister will ensure, I hope, that 1986 for them, will be a happy year.
On 1 January they will have a new year beginning a new status. I hope that the relationship that exists between local authorities, between Galway County Council and now the city borough will be continued because in the process of discussions and negotiations that have gone on in this readjustment, there was tremendous co-operation between local authorities and there is throughout the country to this day a tremendous working relationship between local authorities, particularly with the removal of domestic rates. We have found that some local authorities could not even, with their existing rating system, build houses. You will find the county council stepping into the breach and assisting smaller urban councils to build houses, in spite of the fact that they would be unable to raise a loan themselves to do so.
There has been experience throughout the country that there is tremendous flexibility between local authorities within a county area. I have no doubt that Galway will be no exception to this. The discussions that have gone on in the meantime have proved the ability of the two authorities to work with one another. I am sure that the Minister is open to suggestions as to know how this transfer period can go smoothly. I would ask the Minister coming up to the estimates of local authorities, to be mindful of the problems that we have in local authorities. When domestic rates were abolished we had a certain percentage of taxation, VAT etc. on various commodities to assist in the rates support grants. I would ask the Minister to avail of this oportunity in the position we are in at present in regard to the world energy price situation in which the price of oil is tumbling worldwide. This will be creating benefits to the Irish motorists, and because of the toppling of price rises over the past five months, the consumer has benefited in no small way from the reduction in the price of petrol. I am hopeful that in relation to the continuing reduction in this commodity the Minister would take unto himself some portion of this reduction and redistribute it to local authorities by way of rate support to ensure that essential services are continued by local authorities and that we would be in a position to keep going until such time as the benefits from the farm tax start accruing to local authorities.
Indeed, I know the Minister's commitment to ensure that we have the greatest possible autonomy at local government level. The only way we can do this is to have finances available to ourselves for use at our own discretion. While that transition period is taking place before the benefits of the farm tax, I hope the Minister will seriously look at the rate support grant by way of benefiting from the crisis that has happened on OPEC and in other oil producing nations. I hope that the consumer of that product would not begrudge the Department of the Environment passing some of the benefits in that area on to local authorities and in that way, by indirect taxation, ensuring that local authorities will be able to survive. I commend and congratulate Galway for achieving this status and, indeed, the Minister in his personal commitment and his officials for bringing about this transition by way of mutual agreement between the two authorities.
I thank all the Senators who contributed for their generous remarks on the action of the Government in raising Galway city to county borough status. It was a fitting tribute to the fine celebration of the quincentennial that took place there in 1984. As the capital of the west, it certainly was the best place to receive this honour from Government at this time. I also congratulate the members of Galway Corporation and the Galway County Councils for the amicable arrangements that have so far been entered into and for effecting such a smooth transition. No one has ever said that problems would not arise in the change from county council to borough status and, indeed, some already have and I know, with the good sense of the members in Galway, both local authorities will see to it that they meet successfully the challenges that are there.
As Senator Ferris has said, they have a good administrative team to work with from their county manager and the other officials. We will see that this will be successfully concluded in the months ahead. I accept the concerns which have been voiced about the provision in the draft order for financial adjustment between the county council and the corporation arising from the upgrading of the city to a county borough. This concern has been expressed on all sides and, as I say, I have accepted that, in particular the fact that the corporation will be called upon to make a financial adjustment with the county council. That has been described as unreasonable. I would like to respond to some of those points.
Members of the House will agree that the approach which I have adopted is, indeed, a reasonable one. To begin with, the corporation is in a much healthier financial state than the county council. These are the financial facts of the situation. Secondly, if the county council, will under the arrangements proposed, be at a net loss which is stated to be in the region of £400,000 per annum as a result of the upgrading, the corporation, which is already in a relatively comfortable financial position, stands to gain that £400,000. It is not going back to me in the Department of the Environment. It is not disappearing down one of the black holes that we hear about. The money is going from the county to the city. Also, there are commitments going in that direction as well, which will cost money.
It is not a question that some sleight of hand has been taking place and £400,000 has disappeared. It is definitely a transfer from one direction to the other. The county-at-large-charges will now have to be paid by the county and that means that Galway city will, be relieved of that imposition. Given this situation and the long complicated financial relationship which existed in the past between the borough and the county, it is simply not realistic to argue that the corporation should be allowed to turn its back as it were on the county council. This would be unacceptable and would totally jeopardise the council's financial position. Nevertheless, as I have indicated, I will be making a substantial contribution to the county council, thus reducing by approximately half the amount which should be made up by the corporation. In all the circumstances, and given the limited funds at my disposal and the genuine need of other local authorities — some of whom are in a worse financial situation than the corporation — I am satisfied that the course which I have adopted is a sensible one and strikes a reasonable balance between the interests of the various parties concerned.
Of course, representatives of the corporation can argue that there are special problems and needs in the corporation area and that they need every penny for the services in the city, This, however, is an argument which every local authority in the country can make and, indeed, are making practically every day to me. It is my duty as Minister for the Environment to take an overview of all these competing needs and demands and to somehow match these with the available resources. I feel I have done this in the present case in a way which respects the particular situation in which both the county council and the corporation find themselves.
Senator Howard raised the question of reserved functions. Some of the provisions of the order deal with matters which could give rise to major policy decisions by the corporation and county council. For example, article 5 (3) enables the two local authorities to agree terms and conditions for the provision of a service for the county borough by the county council. This and other similarly important matters will, by virtue of this article, fall to be decided by the elected members of the local authorities. This, therefore, represents an extension of the role of the elected members.
The position of Ballinasloe was raised by Senator Hussey. The county at large charges are levelled over the whole of the administrative county of Galway including the borough and Ballinasloe Urban District Council. When the borough becomes a county borough it will cease to be part of the administrative county of Galway and the county at large charges will then fall to levied on the administrative county exclusive of the former borough area. Ballinasloe Urban District Council will, therefore, be liable for a higher proportion of county at large charges than it is at present, because of offsetting savings on the county at large expenditure resulting from the borough's departure from the administrative county. It is understood that this will not, however, impose an undue additional burden on the urban district. In case such an excessive burden for the urban district council arises at a future stage, the county council will, nevertheless, have the power to reduce any demand for urban charges which it serves on the urban district council after the appointed day, should it be necessary to do so. In practice, it is unlikely that it will be necessary to use this power in the immediate future. It is being included on a purely contingency basis in the order.
Senator Howard raised some doubts as to what might happen in the event of the two authorities failing to agree on an appropriate financial arrangement. He is worried if there would be enough time for me to settle the amount of the adjustment. I just want to make three points here. The estimates period extends up to February next year. It is open to me to extend the estimates period for a further period if a problem arises for Galway. Both authorities have already supplied me with detailed financial information and I have no doubt, if I am called upon to make an adjudication, it will be done very speedily and without any delay. I hope, therefore, we would not have a problem in that area.
The Leas-Chathaoirleach raised the question of who would oversee implementation of the upgrading to the county borough status. This would be a matter for the county manager and for the two local authorities concerned, subject to the provisions of the order under discussion here today and the provisions of the Local Government (Reorganisation) Act, 1985.
In certain circumstances, notably in the event of disagreements arising between the local authorities, the Minister may also be called upon to adjudicate between them. I should also mention that major matters arising for decision will be reserved functions for the purposes of the Managerial Acts and will, therefore, fall to be decided by the elected members.
I think I have dealt with most of the problems that have been raised here today. Behind it all, these concerns were ones dealing with what we hope will be the smooth transfer of the operations of one authority to the other and between both authorities. The financial arrangement which has been arrived at by me should be quite adequate to meet the difficulties of the county council, on the one hand, being compensated for its loss and between the arrangement I have made and what I would hope would be an equally generous response by the newly created borough, so that the County Council will not suffer from this adjustment.
I would like to conclude, therefore, by thanking the Members of the House who contributed to the debate. I accept that I have a particular family connection with the city of Galway. My grandfather came from Annadown, which is outside the city. I am very proud of what has happened to Galway by having the privilege of putting this legislation through both Houses of the Oireachtas. This conferring of county borough status on Galway is something it has deserved for some time. Galway is the first county borough to be established in the present century and fully deserves that new status. It will stand alongside the major cities on an equal footing. I am sure that all Members of the House will wish it well in the future.
Question put and agreed to.