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Local Authority Funding

Dáil Éireann Debate, Wednesday - 25 November 2020

Wednesday, 25 November 2020

Questions (75)

Richard O'Donoghue

Question:

75. Deputy Richard O'Donoghue asked the Minister for Housing, Local Government and Heritage the reason funding for local government within his Department has reduced from €787 million in 2020 to €225 million in 2021; and if he will make a statement on the matter. [39026/20]

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Written answers

The original 2020 Estimate provision of €787.377m in my Department’s Vote under Programme C – Local Government, included €600m provided under the Government’s July Stimulus package to fund the cost of a waiver of commercial rates for six months for eligible businesses. However, further to a Supplementary Estimate and the waiver extension announced in October, a further €300m has been allocated. This brings to €900m the financial support to fund the cost of a waiver of commercial rates in 2020, which is an unprecedented measure that offers support to businesses and certainty to local authorities.

In Estimate 2021 the provision for Programme C - Local Government amounts to €225.119m. When account is taken of the unique circumstances of the COVID-19 supports provided to the sector in 2020 this represents an increase of 20% on the 2019 provision of €187.377m. This increase arises mainly from the contribution towards increased pay and pension costs resulting from the unwinding of the Financial Emergency Measures in the Public Interest (FEMPI) legislation and relating to the Public Sector Stability Agreement, which as increased from €109.6m to €130.3m.

The local authority budget process for 2021 is now underway. In that context, Minister O'Brien and I recently wrote to each local authority to advise that, in light of the fact that the future trajectory of Covid-19 is unclear, it is not currently possible for Government to make open-ended commitments in respect of commercial rates or other income pressures that may arise in 2021. This is reflected in the figures referred to in the question. However, as has been the case since the outset of the Covid-19 pandemic, my Department will continue to engage regularly and constructively with the local government sector and with individual local authorities on the financial impacts of the pandemic and other matters arising.

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