Phil Hogan (Carlow-Kilkenny, Fine Gael) | Oireachtas source

Allowing a municipal district to vary the rate could result in many distortions. The council varies by plus or minus 15% and if the municipal district varied by a further percentage, it would result in greatly diminished yields. I understand the importance of local authorities having reserved functions allowing them to vary this rate. However, the same people at the municipal district level will attend the plenary session of the council. They are not different people. Many people do not understand that or do not want to. The municipal district councils have a say in budgets and financial matters, and they have a say in proposals to be made. They are the same people who will be present at the plenary session of the council where many of these matters will be decided.

There will be a single rating authority and a single valuation list with one single unified annual rate on valuation, ARV. It is the intention that the new structure of local government, including the establishment of municipal districts, will provide a coherent approach to rates and charges countywide having regard to funding requirements of each municipal district.

I do not propose to accept amendments Nos. 37 and 38 relating to large commercial entities. Rates are levied on the independent valuations applied by the Valuation Office. The proposal set out in the amendments tabled by Deputies Cowen and Stanley would result in a significant change in the operation of the rating system and would threaten the principle of equity on which both the rating and valuation systems are placed. A system that must have regard to economic factors on an ongoing basis could be considered under the Valuation Act. Local authorities need to have certainty regarding the funding of local government. It is not appropriate to use economic factors alone as a basis for increasing or decreasing these funding opportunities for local government. We need to have a stable basis for funding local government.

Amendments Nos. 39 and 40 propose to provide that the base year adjustments should be agreed with the municipal district members in the area where the base year adjustment is to apply. It is likely the boundaries of the new municipal districts will differ from the former rating authority areas or specified areas. Therefore, this proposal may not be practical in that context.

My amendment No. 41, however, seeks to ensure that municipal district members are consulted annually on the determination of the base year adjustment to be applied. The amendment ensures that where an area of a former rating authority is included in a municipal district, the municipal district members are to be consulted on the base year adjustment to apply there.