Local Authority Funding

Dáil Éireann Debate, Wednesday - 21 November 2012

Wednesday, 21 November 2012

Questions (161, 162)

Joan Collins

Question:

161. Deputy Joan Collins asked the Minister for the Environment, Community and Local Government if his attention has been drawn to the fact a letter of the 2 November 2012 to the Sligo County Manager, his Department indicated that it was willing to provide approval for the conversion of Sligo County Council’s existing €7.5 million overdraft on its revenue account to a term loan; if his attention has been drawn to the fact that the Sligo County Manager told the meeting of Sligo County Council on the 5 of November that the Council would seek the €7.5 million loan from the Housing Finance Agency; if his attention has been drawn to the fact that the HFA’s function is to advance loan finance to local authorities and the voluntary housing sector to be used by them for purposes authorised by the Housing Acts, 1966-2009, and the Agency is also empowered to lend funds to local authorities for water, waste and environmental capital projects under the terms of the Housing (Miscellaneous Provisions) Act, 2002; if it is a function of the HFA to lend funds to local authorities to reduce or replace overdrafts on revenue accounts; if the HFA is empowered to lend funds to local authorities to reduce or replace overdrafts on revenue accounts; and if he will make a statement on the matter. [51752/12]

Joan Collins

Question:

162. Deputy Joan Collins asked the Minister for the Environment, Community and Local Government if his attention has been drawn to the fact that Sligo Council’s overall Revenue Account Debt at the end of 2011 was €12.9 million and that the Council’s Capital Debt was €73 million and that the Council’s revenue account debt continues to increase; if his attention has been drawn to the fact that the Councils bank refused to increase the Councils overdraft above €7.5 million despite the fact that his Department gave approval for €11 million earlier in 2012; his views on whether Sligo County Council has failed to address, during the course of 2012, the difficulties that arose as a result of councillors adopting the Council’s 2012 budget which was recommended by the County Manager; and if he will make a statement on the matter. [51753/12]

Written answers

Minister for the Environment, Community and Local Government

I propose to take Questions Nos. 161 and 162 together.

The Housing Finance Agency plc. is a company limited by shares promoted by the Minister for the Environment, Community and Local Government under the terms of the Housing Finance Agency Act 1981 and incorporated on 8 February 1982. The principal objectives of the Agency are:

- To advance funds to local authorities and approved housing bodies to be used by them for any purpose authorised by the Housing Acts; and,

- To borrow and raise money for these purposes.

Under section 11 of the Housing (Miscellaneous Provisions) Act 2009 the provision of ancillary services is included amongst the functions of local authorities, as housing authorities. Ancillary services are defined to include, inter alia, roads, shops, facilities for the benefit of the community, playgrounds, places of recreation, parks, allotments, and other such works and services as will, in the opinion of the housing authority, serve a beneficial purpose either in connection with the requirements of the households for which the dwellings provided or in connection with the requirements of other households.

I conveyed sanction to Sligo County Council on 8 November 2012, in accordance with Section 106 of the Local Government Act 2001, for the borrowing of €7.5 million by way of a term loan. The Council’s overdraft borrowing limit was revised to €4 million in conjunction with this sanction.

The loan provides the means for the Council to reduce its overall debt levels and ensure that its cash flow position is such that it can continue to provide services, including those considered ancillary under the Housing (s Miscellaneous Provisions) Act 2009.

The requirement for Sligo County Council to continue to deal in a prudent manner r with its finances, to find expenditure savings and efficiencies, particularly in the context of its 2013 budget, and to deal with the accumulated revenue deficit, remains.