Dáil Éireann Debate, Thursday - 1 May 2014
18. Deputy Barry Cowen asked the Minister for the Environment, Community and Local Government if local authorities will receive 80% of the local property tax in 2015; and if he will make a statement on the matter. [19552/14]
Amharc ar fhreagraThe Government has indicated an intention to move to 80% retention of all Local Property Tax receipts within the local authority area where the tax is raised.
This year, the establishment of Irish Water presents local government with significant organisational and financial challenges. Service provision responsibilities are moving from the local authorities to Irish Water, infrastructure is being transferred, financing arrangements have altered and local authorities are operating on behalf of Irish Water under Service Level Agreements. These changes must be managed.
In this context, it was necessary to defer defining a certain proportion of the proceeds of the Local Property Tax to be retained in each local authority for 2014.
In 2015, in addition to the changes in water services funding, local authorities will be required to implement changes to their budget process arising from EU obligations, which will require them to prepare draft budget strategies by the end of September 2014. Together, these are significant changes to the current local government funding model and it is essential that the impacts are fully assessed and that the effect on overall Exchequer funding is managed appropriately.
I expect the Local Property Tax to have multiple benefits, including a more sustainable and resilient system of funding for local authorities and, therefore, a sounder financial footing for the provision of essential local services; greater local scope for financial decision-making concerning service provision; and a strengthening of democracy at local level with a more active relationship between local authorities and local electorates. A stronger democratic relationship and clearer lines of accountability can only have a beneficial impact on service provision from the perspective of the service user.
My Department will continue to work with local authorities to ensure that they have an appropriate level of information, including in relation to LPT retention, to facilitate their budget process for 2015.
