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Local Authority Funding

Dáil Éireann Debate, Thursday - 23 July 2020

Thursday, 23 July 2020

Questions (12)

Johnny Guirke

Question:

12. Deputy Johnny Guirke asked the Minister for Housing, Planning and Local Government the reason Meath County Council is historically the lowest funded local authority per head of population; and if he will bring funding for the local authority up to the national average. [17615/20]

View answer

Oral answers (8 contributions)

I congratulate the Minister and the Minister of State, Deputy Peter Burke, on their appointments and I wish them the best of luck.

Why is Meath County Council historically the lowest funded local authority per head of population in the country? Will the Minister bring local government funding for the County of Meath up to the national average?

I thank the Deputy for his kind words.

The Programme for Government – Our Shared Future sets out a range of actions that relate to local authority funding, including a commitment to review how commercial rates will be treated for the remainder of 2020. The programme also commits to bringing forward legislation for the local property tax, LPT, on the basis of fairness and where most home owners will face no increase. It also states that those counties with a lower LPT base will be adjusted via an annual national equalisation fund paid from the Exchequer, as is currently the case.

My officials are considering these commitments and will work with key stakeholders, including drawing on the work of the local government funding - baseline - review group, as necessary. This process will give the opportunity to address any historical anomalies in local authority areas that may exist, including in County Meath.

Notwithstanding the particular challenges that individual authorities face, all local authorities are experiencing financial challenges as a result of Covid-19. In order to support the local government sector generally, my Department continues to keep local authority income, expenditure and cash flow under review and will continue to work with all local authorities on both collective and individual issues that arise, including those issues as referred to by the Deputy that face Meath County Council.

My officials are happy to work with Meath County Council, on any financial issues that may be arising. Looking at the trajectory of funding over the past number of years from 2016 to 2019, Meath County Council has experienced an increase of 130%.

The Government is very clear about this emergency. There will be an announcement later today as to how we will further support local authorities and give them certainty that neither their services nor their staff will be cut.

I thank the Minister for of State for his reply. I have a local government funding review here submitted by Meath County Council in 2018. The figures from that are that Meath County Council is losing out to the tune of €72 million per year by not getting its fair share of local government funding. At the moment we are getting 61% of the national average. According to figures from 2018, for example, in housing and building, we are getting 45% of the national average; on roads, transport and safety, 90%; on environmental services, 48%; recreation and amenities, 43%; development management, 62%; agriculture, health and welfare, 53%; and miscellaneous services, 77%, which is an average of 61%. These are staggering figures for our county.

Meath County Council receives €537 per head of population compared to the national average of €875. One can imagine the effect that this is having on a population of 200,000 plus and on services such as roads, footpaths, public lighting, libraries, playgrounds, recreational centres and so on. Will the Minister of State address the inequalities in funding?

Many measures can be used to measure the funding local authorities receive. On population size, this can be a crude instrument to determine what level of funding is delivered. As I said, the increase to Meath County Council since 2016 is very clear. Other avenues are available to, and are at the disposal of, the local authority to increase funding. One key issue is if the local authority takes a decision to vary its local property tax rate. If Meath County Council had raised the local property tax rate by 15% over the past six years, it would have brought in an extra €2.6 million to the fund.

We should look at the return on investment that some local authorities can get. An example is Longford, which is my constituency. It increased its local property tax which gave it access to huge funding streams from central government through the urban and rural regeneration funds.

Let me tell the Minister of State what the property tax has done for Meath. When former Minister, Phil Hogan, brought in the local property tax, he said local authorities were going to keep 80% of it. He did not say he was going to do away with every other Government grant that the local authority was getting. The people of Meath paid an additional €18 million in property tax but their services have not been increased by one cent because every other Government grant was taken away.

In 1996 the population of Meath was 110,000 people while today it is more than 200,000. This is the highest rate of population growth in the State since 1996. Expenditure per person is an agreed standard for measuring the level of service a local authority can provide. Meath County Council is under significant pressure to meet the service delivery needs of the population. How can Meath County Council deliver the services needed in the county with 61% of the national average funding from central government funds or a shortfall of €72 million per year? I am asking the Minister of State to bring local government funding for County Meath up to the national average.

I believe Deputy Ruairí Ó Murchú wants to come in on this question.

I raise the issue of underfunding of Louth County Council, in particular.

I note that the Minister of State, Deputy Burke, spoke about the local property tax, but at this point if we were to increase it by 10% to 15%, we would deal only with the cost of the land banks in County Louth that were bought under instruction from Government around 2006 and 2007 in many cases. We are talking around about 50 acres. Some of these land banks have been dealt with but a significant amount are left. Last year, Louth County Council spent about €1 million to service the debt. We need the Government to meet with Louth County Council, with elected representatives and with the executive about putting solutions in place that deal with the substantial unit cost of these lands. Some of them would be perfect for affordable and social housing and affordable cost rental. We need these meetings and solutions to occur as quickly as possible.

With regard to the local property tax, it is incorrect and not factual to say that all other grants were removed from local authorities. Record streams of funding are now available to local authorities through urban and rural regeneration funds and various grants, including equalisation funds for local authorities that are short. By raising the property tax in County Longford, the council got access to multimillion euro funding. One has to examine the responsibility of councillors. With regard to Meath County Council, it is clear that there has been a 130% increase in what it has access to from central Government since 2016. A significant funding stream is available to local authorities. It is not correct to use a crude instrument such as population to determine and measure how local authorities are funded. We can all pick various metrics as it suits us to try to argue our case, but we in the Department have to be fair and ensure that local authorities are fully funded. I have given a commitment about the July stimulus package, with the Minister, Deputy Darragh O'Brien, that it will be of scale and timely, and that it will respond to the challenge that local authorities face to ensure that they will not lose services or staff. I have been clear about that this morning. We also need to ensure that we support our local authorities. I will not be found wanting in that regard and nor will the Government.

Written Answers are published on the Oireachtas website.
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