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Local Authority Funding

Dáil Éireann Debate, Tuesday - 13 November 2012

Tuesday, 13 November 2012

Ceisteanna (470)

Terence Flanagan

Ceist:

470. Deputy Terence Flanagan asked the Minister for the Environment, Community and Local Government his views on cuts to funding to local authorities in 2012; if he will protect local authority funding in Budget 2013; and if he will make a statement on the matter. [50111/12]

Amharc ar fhreagra

Freagraí scríofa

I assume that the Question refers 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 the 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 re-distributed 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 €651m in general purpose grants had been allocated to local authorities for 2012. It has been necessary for me to reduce general purpose grant funding to local authorities in the third quarter of this year in light of the level of compliance with the household charge.

It is estimated that there are some 1.6 million residential properties potentially liable for the household charge. As such, if collected in full, the household charge has the potential to raise €160 million annually. As of 9 November 2012 some €109m 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 and those local authorities that achieve a collection rate of 65% or above will suffer no further reduction in their general purpose grant allocation for 2012.

In line with previous years, it is my intention to inform local authorities of their 2013 general purpose grant allocations following the announcement of Budget 2013. I will seek to contribute to the general purpose funding of local authorities to the maximum extent possible, having regard to the current pressures on the public finances and motor tax income.

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