Vol. 572 No. 5
1 Mr. Allen asked the Minister for the Environment Heritage and Local Government the position regarding the discussions that have taken place with each local authority regarding the implementation of benchmarking; and if he has indicated to each local authority that his Department will fund the cost implications of the benchmarking award. [23690/03]
Local authorities fund their expenditure, including expenditure on pay, from a variety of sources, including specific State grants, commercial rates, rents, fees and charges for services and general purpose grants from the local government fund. The issue of benchmarking costs, as with all other current expenditure demands, will fall to be dealt with by local authorities in the context of their annual budgetary process. The amount available from the local government fund will be settled in the context of my Department's Estimates of expenditure for 2004, and I will advise local authorities of their general purpose allocations for 2004 as soon as possible.
Benchmarking costs were among issues discussed at a meeting I attended with the County and City Managers Association in May 2003.
Does the Minister agree that the cost to local authorities will be between €160 mill ion and €200 million? Does he agree that Dublin City Council will face a bill of about €20 million; Cork County Council, about €8 million, and Cork City Council, about €4 million? Is he serious in suggesting that local authorities should fund this enormous financial burden from their own resources? Does he agree that there is only one way around the problem, namely, that local authorities increase charges for refuse collection and development and substantially increase commercial rates, cut services or jobs? What other formula is available to meet the enormous bill if he reneges on funding local authorities for a deal done at national level in which they had no input?
I might agree with the Deputy's first assertion but certainly not his second point. As he well knows, local authority funds come from many sources. In 2004 total expenditure on local authorities will be of the order of €3.4 billion on the current side. We must put costs to local authorities in context. The figure I have for next year is about €140 million. While we should not argue the point, that is the more accurate figure. Local authority managers and many councillors have obviously raised the issue with me. I have no doubt that it is a challenge to the local authority system. I am involved in the Estimates process and will see what the outcome is in the weeks ahead. As soon as we have agreement, I will obviously let the local authorities know the position with regard to assisting them in the normal way to meet all of their costs as much as I can, particularly through the local government fund, which, as the Deputy knows, is the main source of funding from the State for local government. As he is well aware, the fund has increased over the last four to five years by almost 95%, a massive increase. The fund is a key element of the way in which local authorities find the resources to spend on important issues and projects. I reiterate that current expenditure for local authorities next year is nearly €3.5 billion, of which, I believe, around 40% goes on wages and salaries.
Does the Minister agree that we have 1.28 million households and that the cost of benchmarking will impose a minimum cost of around €125 on each one if it is passed on to them? Will he confirm that he has suggested to the managers of local authorities that they increase development charges on house construction at the planning stage and that there is a proposal to introduce a development charge of anything between €4,000 and €10,000 per house? Does he agree that, if this is correct, it will be passed on to house purchasers and an enormous burden on those struggling to buy their first home?
I can say absolutely to the Deputy that I have not told the local authorities under any heading how they should raise money to pay for benchmarking. That is entirely a matter for each local authority in its own area, and they have all sorts of options open to them. The second issue which the Deputy raises concerns the planning Acts. It is right – something I believed the House would support – that services being provided by the State and public sector through local authorities for developers should reflect the true costs. Equally, there is an onus on developers to work with local authorities to ensure good community facilities are also capable of being provided. One of the arguments we have had in this House for many years concerns the mistakes made in the 1970s and 1980s, when we built huge estates with no supporting infrastructure, particularly of the community kind. Each local authority will examine this in its own way. They are all engaged in it. Obviously, there must be fairness and reality in whatever charges are made but some of the figures I have seen in the newspapers are incorrect in that local authorities have very substantial charges, fees and levies when granting planning permission. The figures are being correlated to produce one total but people are ignoring the fact that almost all of it is probably charged under different headings.
