I propose to take Questions Nos. 37 and 41 together.
I assume that the questions refer to general purpose grants from the local government fund. The two principal sources of revenue for the local government fund are the proceeds of motor tax and income from the household charge. The Local Government (Household Charge) Act 2011 provides that income from the household charge is to be paid into the local government fund. The proceeds from the household charge are being redistributed on an equalised basis to local authorities within the context of the annual allocations of general purpose grants.
General purpose grants contribute towards meeting the reasonable cost to local authorities of providing services to their customers. Some €651 million in general purpose grants had been allocated to local authorities for 2012. It has been necessary for me to withhold general purpose grant funding to local authorities in the third quarter of this year in light of the level of compliance so far this year with the household charge.
It is estimated that there are some 1.6 million residential properties liable for the household charge. As such, if collected in full, the household charge has the potential to raise €160 million annually. As of 14 of September, some €103 million had been collected nationally. A total of €15,695,292 was withheld from the quarter 3 general purpose grant payment. For county and city councils, this represented a reduction of between 1% and 3% of the total general purpose grant allocation for 2012.
I am keeping the income generated from the household charge under constant review. However, it is up to individual local authorities to address any potential funding shortfalls arising from non-compliance with the legislation and to pursue those who may have a liability and initiate court proceedings where it is considered appropriate. It is a matter for the authorities to use their local knowledge to follow-up on non-compliant households in order to maximise collection of the charge. Data-sharing exercises are also underway centrally in accordance with section 14 of the Local Government (Household Charge) Act 2011 and it is intended that data will be used from sources such as the non-principal private residence charge, NPPR, Property Registration Authority, PRA, Private Residential Tenancies Board, PRTB, ESB networks and other Departments, namely, the Department of Social Protection and Revenue Commissioners, to identify households that may be liable to pay the household charge.
I wish to emphasise that local authorities can progressively recoup their original general purpose grant allocation through improved household charge compliance. The final amount of general purpose grants available for 2012 will be revisited and reviewed in the final quarter of the year to take account of the then financial position, including progress on securing an increased household charge yield. I am confident that the level of general purpose grants, together with other Government grants and subsidies and income raised from local sources, is appropriate to meet the costs of providing a reasonable level of local authority services to communities.