Niall Collins (Limerick County, Fianna Fail) | Oireachtas source

I thank our guests. I will pick up on a number of points. There are more local government charges than just commercial rates, as we know, and we should keep that in the back of our minds. Water and wastewater charges are a significant source of revenue for local authorities and, as such, are charges to business in the main. They seem to increase annually without any debate or fuss. This points to the lack of transparency within the whole local government sector in how its cost base is rolled up as regards its budgeting process. It is regrettable that a drama is made of the budgeting process of local authorities in a number of meetings which is then played out in the local media. It is my experience of being a member of a local authority that no proper analysis is carried out of the cost base of local authorities. There was certainly no such analysis during my time on a local authority. Then the management would present a draft budget and the wastewater charge and the commercial rates would happen to square the circle, which is very unfair on business because they seem to carry the extra burden every year without any appreciable increase in the service they receive or indeed any transparency, as has been highlighted.

Another dimension concerns the development contribution schemes each local authority has, whereby it charges different rates depending on the sector to build or expand, in this case, business. Some local authorities are charging multiples of other local authorities' rates. The rate, for example, in Limerick for manufacturing is €50 per square metre but next door in Kerry it is €12 per square metre. That is less than a quarter the rate charged in Limerick. Again, there is no proper justification or analysis as to why different rates pertain in different local authority areas, which presents challenges for business.

I have a number of questions. We are all in one way or another saying the same thing and we are all having a bit of a moan. The question is, how does one properly and sustainably fund local authorities? What will the new model be if we want to pare it all back, as Mr. Burke said, strip it all back and start from scratch? As the people who represent all the different sectors of business, I am asking the witnesses what is the Holy Grail when it comes to reinventing the wheel. Is it ultimately a turnover-based system? Is that really what we are saying commercial rates should move to? Every business will want to see a drop in its commercial rates. Business people want to drive down the cost of doing business, which is an understandable goal. Where would the witnesses raise the revenue to plug the difference? Are they talking about increasing local property tax, LPT, or moving away from other areas of core business that the local authorities are doing? What are their suggestions in this regard? I ask them to address these two key questions. What is their preferred model, which would suit all the different sectors - the hospitality sector, manufacturing, technology, pharma, small business, the pubs, the self-employed and so on? I do not know whether we can have different systems of rates for different sectors. If it is to be a commercial rate plan, it will have to have some degree of uniformity.