Oireachtas Joint and Select Committees
Tuesday, 6 July 2021
Joint Oireachtas Committee on Housing, Planning and Local Government
Proposed Changes to Local Property Tax: Discussion
I welcome Members and witnesses to this meeting of the Joint Committee on Housing, Local Government and Heritage, at which we will be discussing the proposed changes to local property tax, LPT. We are joined by Ms Anne Marie Walshe from the tax division of the Department of Finance and Dr. Keith Walsh from the statistics and economic research branch of Revenue, who has responsibility for local property tax evaluation modelling. The briefing from the Department of Finance has been circulated to members. For members' information, we had sought witnesses from the Department of Housing, Local Government and Heritage as well, because of their role in respect of local property tax. Unfortunately, there was nobody available from the Department at short notice. We will, therefore, have a further session with officials from that Department.
The format of the meeting will be that I will first ask the witnesses for their opening statements and this will be followed by questions from members. Deputy Mitchell is substituting for Deputy Ó Broin for part of the meeting.
I will read the note on privilege. Members attending remotely from within the Leinster House are protected by absolute privilege in respect of the presentations they make to the committee. This means that they have an absolute defence against any defamation action for anything they say during the meeting. However, they are expected not to abuse this privilege. It is my duty as Chair to ensure that this privilege is not abused. I remind members of the constitutional requirement that they must be physically present in the confines of the place where Parliament has chosen to sit, namely, the Convention Centre Dublin or Leinster House. I ask members to identify themselves when speaking and to they confirm that they are within the confines of the Convention Centre Dublin or Leinster House.
For witnesses attending remotely, there are some limitations to parliamentary privilege. As such, they may not benefit from the same level of immunity from legal proceedings as a person who is physically present. The opening statement submitted to the committee will be published on the committee's website after this meeting. I invite Ms Walshe to make her opening statement.
Ms Anne Marie Walshe:
I thank the Chairman for the invitation to appear before the committee and for the opportunity to discuss the proposed changes to the LPT and answer any questions the committee may have on those changes. I am joined by Keith Walsh from the statistics and economic research branch of Revenue.
At the outset, I would like to clarify that the Department of Finance has responsibility for the policy and legislation for the LPT, which, as you know, is collected by Revenue. It is then paid into the Local Government Fund and does not form part of Exchequer receipts. Distribution of the LPT yield and matters associated with local government funding arise from Government decisions sponsored by the Minister for Housing, Local Government and Heritage. I am not in a position to discuss these. What I can do is provide a brief outline of the LPT and the proposed changes to the tax. The committee may wish to note that the Minister for Finance, Deputy Donohoe, is scheduled to meet the Joint Committee on Finance, Public Expenditure and Reform, and Taoiseach for pre-legislative scrutiny of the general scheme of the finance (local property tax) (amendment) Bill 2021 tomorrow, 7 July 2021.
The LPT was introduced in 2013 under the Finance (Local Property Tax) Act 2012 to provide a stable funding base for the local authority sector and broaden the base for taxation in a manner that does not directly impact on employment. The tax has yielded approximately €3.6 billion since 2013. The LPT is currently based on the property values that obtained on 1 May 2013. Revaluation of properties has been deferred on three occasions, namely, 2016, 2019 and 2020, which means that the LPT liabilities are still based on 2013 valuations. This has resulted in a situation whereby it has not been possible to bring new properties into scope. Properties built since 2013 are excluded from the tax.
There have been two reviews of the tax since its introduction: the Thornhill review of the LPT in 2015; and the interdepartmental review of the LPT published in 2019. The 2019 review was conducted by an interdepartmental working group, chaired by the Department of Finance and consisting of senior officials from this Department, the Departments of the Taoiseach, Public Expenditure and Reform and Housing, Planning and Local Government and the Office of the Revenue Commissioners. Both of these reports considered, in particular, the effects of changes in property prices since 2013 on LPT liabilities and the impact of these on taxpayers’ liabilities following revaluation of their properties. The 2019 review considered a number of methods or scenarios for collecting LPT liabilities with a view to achieving relative stability in LPT liabilities for taxpayers following revaluation of properties.
Earlier this year, the Minister asked us to consider options for the reform of the tax in the context of the programme for Government commitment to bring forward legislation in respect of the LPT on the basis of fairness and the fact that most homeowners will face no increase in their LPT liability, and to bring new homes that are currently exempt from the tax into the system. Our starting point for this work was the scenarios considered under the 2019 review. These scenario analyses were based on a data set assembled by the Revenue Commissioners from the property price register combined with Central Statistics Office, CSO, and Revenue data and Department of Finance forecasts.
I should note that the analyses can provide only a broad picture of the estimated effects on taxpayers. They are based on economic modelling and the predicted outcomes can offer only indicative rather than guaranteed outcomes. A key challenge encountered during both the work on the 2019 review and the more recent analysis is the significant variation of property price increases geographically and, in particular, the uneven pace and rate of increases in residential property values throughout the country since the original valuation on 1 May 2013. Following extensive engagement at both official and political level, the Government agreed on a modified version of scenario 5 of the 2019 LPT report as the basis for the calculation of future LPT liabilities. A general scheme of a Bill which provides for this approach, as well as other amendments to the tax, was published on 2 June 2021.
The original scenario 5 as proposed by the interdepartmental group increases all of the valuation band thresholds by 80%, based on the expected average property price between 2013 and end 2019, as estimated at the time of 2019 review.
The midpoint of each band increases correspondingly and the rate is reduced to leave the liability in each band unchanged. The widening of bands provides a smoothing effect whereby the probability of a taxpayer moving bands is reduced.
The approach outlined in the general scheme of the finance (local property tax) (amendment) Bill 2021 maintains the number of bands at 20, which are widened by 75%, a lower rate is applied and the current rate structure is maintained. However, to mitigate the effects of the changes for lower value homes, bands 1 and 2 are fixed. Band 1 is values up to €200,000 and, band 2, from €200,001 to €262,500, with the LPT charge for these bands fixed at the current rates of €90 and €225, respectively. This results in the vast majority of properties currently in band 1 remaining in the new band 1 and continuing to pay the same amount. A higher midpoint rate will be applied to properties above €1.05 million for values which will fall in bands 12-19 and a third higher rate will be introduced for properties valued above €1.75 million. These fall into band 20.
Other changes proposed to the tax include that all new residential properties built between valuation dates will be brought within the tax and retrospectively valued as if they had existed on the preceding valuation date. Property valuations will be reviewed every four years rather than every three years as at present. The income thresholds for LPT deferrals will be increased to €18,000 for a single owner and €30,000 for a couple in line with the recommendation of the 2019 review. The rate of interest on deferred LPT will be reduced from 4% to 3%. From inception, the LPT has been underpinned by the principle that keeping the number of exemptions low helps to keep the tax rate low for those who are liable to pay it. The exemptions for first-time buyers and homes in unfinished estates will be allowed to lapse and the exemption in respect of pyrite-damaged properties will be phased out. A new exemption is being introduced for homes in Mayo and Donegal damaged through the use of defective concrete blocks in their construction.
The yield for 2022 under the revaluation approach as outlined and set out in the general scheme of the Bill is provisionally estimated to be €560 million, but before any local adjustment factors are applied. As LPT remains a self-assessment tax, the final actual yield will be determined by the valuations returned by property owners.
Finally, while not a matter directly for the legislation or the Department of Finance, the Minister for Housing, Local Government and Heritage, Deputy Darragh O'Brien, and his colleague, the Minister for Public Expenditure and Reform, Deputy Michael McGrath, felt it was important to address the third element of the programme for Government commitment in the Government decision. This part of the commitment is to discontinue the equalisation contribution from local authorities and allow all local authorities retain 100% of the LPT that is collected in their local authority area. Local authority allocations are decided in advance of collection, based on estimated yield in individual areas for the following year. Therefore, as this is a valuation year, this process and the local adjustment factor decisions this year will, of necessity, take place before local authorities receive the up to date information on the expected LPT yield in their areas following the revaluation, as well as the addition of new properties to the LPT system. In light of this, the Department of Housing, Local Government and Heritage advises that it is intended to retain the 80-20 model for the 2022 process and to move to the 100% local retention model from 2023. This will mean that local authorities and the Exchequer will have the benefit of the post-revaluation information to inform these decisions. I am happy to take any questions that the committee may have on LPT.
That is fine. As mentioned by Ms Walshe, the distribution of the LPT yield and matters associated with local government funding arise from Government decisions sponsored by the Minister for Housing, Local Government and Heritage and so it is probably not for the Department of Finance to discuss those issues. If, however, members do wish to put down questions for the Department, the committee secretariat will forward them to it. The Department has undertaken to give us a briefing on this matter and those questions can be added to it. The first speaker is Deputy McAuliffe.
I thank the witnesses for being with, particularly so soon after the Government announcement on this issue. As the Fianna Fáil spokesperson on local government, I have received numerous queries, as, I am sure, have other members, from councillors throughout the country with regard to how this will be implemented. I am conscious that some of my questions may be relevant to the Department of Housing, Local Government and Heritage but I will do my best limit them to the witnesses' areas of expertise. I would appreciate any responses they can offer.
The modelling is interesting. It is the only way of predicting what the changes will be. Taking the first category of those with properties valued at under €100,000 who pay €90 as an example, what will be the change for them?
My second question relates to the collection process. We are continuing with the self-assessment model. I dealt with a huge volume of queries in respect of the initial system under which people were required to make suggested valuations. In many cases, the latter did not match the value of the properties and appeals were required. The valuation process for the new estates will be a tricky process in that they may contain many properties built at the same time and, as such, there will be no comparator. I ask the witnesses to elaborate on that process. The idea of suggested valuations should be avoided. While it did not mislead people, it led to people paying more than they should have paid.
My third question relates to the period of notification for the Revenue. This poses a real challenge for local authority members in that they must notify Revenue in September, even though local authorities do not have clarity on their budgets until October or November. This allows councillors a free vote on the LPT and means that they do not have to contemplate the implications this will have for those budgets. I urge Revenue to look at that again. There is a political accountability issue here. Councillors welcome that local authorities will be able to retain 100% of the LPT collected in their area. That is important. However, councillors are telling me that they are terrified there will be a repeat of what happened previously, that is, the LPT will replace existing grants. This will be new money and the Department will have to give new money to local authorities that do not take in LPT funding. What increase in funding is available as a result of the decision to retain 100% in some counties and to, therefore, top up the local government fund in other counties?
Ms Anne Marie Walshe:
I will try my best. Dr. Walsh may wish to come on some of the Revenue points. In terms of the charges for band 1 properties, as outlined currently band 1 properties are valued between €1 and €100,000. That band is being expanded to up to €200,000. We have been working off average property price increases of in the region of 75%. Properties that have increased by more than 75% in value will remain in band 1 once the value is up to €200,000. The charge attached to the band remains the same at €90. For most people in this band the liability will remain at €90.
On the collection process, as outlined by the Deputy it is a self-assessment process. Revenue has proposed suggested valuations because it does not have other data to work on. It is for the property owner to amend or return what he or she believes an appropriate valuation for his or her property. That is how the system is designed to work.
On the period of notification, I appreciate that it does put councils in a particularly difficult position for this year. Revenue tried to provide information on the projected 2021 yield and some projections in respect of the 2022 yield.
We and the Department of Housing, Local Government and Heritage have always been aware that this will be challenging when conducting evaluations. Until we get the data, it is difficult to make a decision.
Regarding retention and funding, as outlined, our Department does not have a role in that. The Department of Housing, Local Government and Heritage has indicated that it should be able to implement this decision in an Exchequer-neutral manner. As I outlined, that is a matter for the Department and its Minister.
Would Ms Walshe accept that, for an onlooker, it seems impossible that it can be done in an Exchequer-neutral manner? We are saying to local authorities that they can retain 100% of what is collected. As a result of the latter, other local authorities will not be able to benefit from redistribution and will require additional funding for the promise to be true. Is Ms Walshe suggesting that it will come from within the existing budget of the Department of Housing, Local Government and Heritage?
Surely if there is extra spending, it will go back to the Department of Finance for any increase in the budget. In making the decision to retain 100%, which is welcome, surely there was some modelling on the financial impact that it would have on the overall budget of the Department of Housing, Local Government and Heritage and on the Exchequer?
Ms Anne Marie Walshe:
Any modelling would have been done by the Department of Housing, Local Government and Heritage, with the Department of Public Expenditure and Reform, which would have responsibility for the Exchequer allocation from the Department of Finance. I am sorry that I am not able to shed any more light on it.
I thank the witnesses for attending. I have a number of questions. In 2021, Cork City Council will pay €985,000 in LPT for social housing that it council owns. It paid €600,000 last year. All local authorities are paying LPT on social housing. The money that is being collected from people who pay LPT is being taken out of local properties. This means that there is a shortage of money that should be spent on services - parks, playgrounds, public lighting, traffic cameras and so on - by local authorities. Will this be addressed in the final version of the Bill? I do not believe it is right that local authorities are being stiffed of this funding? Will it be addressed in the Bill?
What negative effect will revaluations have? Will they affect Cork City Council or any other local authorities that are now paying extra LPT? I appreciate the position regarding the minimum bands. Even though the bands are widening, the amount will stay the same. Surely that will have an effect on local authorities, which will be obliged to pay additional money.
How many local authorities will lose funding as a result of every local authority keeping 100%? What budget stream will be put in place to ensure that those local authorities will be able to pay for and supply the services they need to?
Ms Anne Marie Walshe:
I think so. I will try my best to answer on the basis of what I heard. Regarding local authority housing and the payment of LPT, under the legislation, the liability for local authority housing falls in band 1. If it is a local authority social housing unit, it is charged at the €90 rate. This will remain unchanged under the Bill. With respect to the impact of the revaluation and the loss of funding, I refer to my earlier point about how the yield is to be distributed and that how 100% retention works at local authority level is a matter for the Department of Housing, Local Government and Heritage.
So there is nothing in this Bill for local authorities. They will continue to pay LPT on social housing. Ms Walshe stated that the band for all social housing is the bottom band. With the addition of more social housing, that will mean a higher cost to local authorities. Is anything being done to offset the additional cost that local authorities will have as a result of additional social housing coming into the stock?
Ms Anne Marie Walshe:
The only change that might be relevant to the Deputy's questions is that where local authorities lease social housing under long-term arrangements, the lessor or owner of the property will remain the liable person. LPT liability will not be on the local authority in those issues. We are retaining the status quofor other local authority housing, which remains in band 1.
I thank the witnesses for attending. They mentioned a €100,000 band, which has now been increased to €200,000. Will they expand on the position regarding bands 2 and 3? With the supply and demand for houses in towns, cities and rural areas, you cannot get a proper valuation for a house at present. Since there are such supply-and-demand issues, the prices of houses can fluctuate. We have seen houses that would have had a value of €200,000 or €250,000 last year, which are going for €400,000 this year. People are fighting each other to try to get houses. Auctioneers have been on television saying that there is a lack of supply. The second a house comes up, many people try to buy it. Many people try to buy turnkey housing because at least they can go to their mortgage providers and have one payment. The current prices do not reflect the prices over a period. We have seen changes as a result of supply-and-demand issues and Covid. We have also seen an increase in the prices of houses due to the price of materials. There has been an increase from €120 per square foot to €165 or €170 per square foot in rural areas because of a lack of materials and an increase in the price of materials.
How do we get an actual price on property to cover this when the market is fluctuating so much at the moment?
I am delighted to see the LPT will be 100% retained within the local authorities. In my case that is Limerick City and County Council. The officials said earlier they cannot discuss or answer how it is going to be distributed so I will take that up with the Minister with responsibility for housing, although I am happy it is being held on to. I ask the officials to answer first on the bands that are there and how we are going to get a valuation on properties with the fluctuating prices.
Ms Anne Marie Walshe:
Band 1 will be from €1 to €200,000 which is up from €1 to €100,000. Band 2 is fixed between €200,000 and €262,500. Bands 3 to 11 are in jumps of €87,500 which represents a 75% increase on the €50,000 band threshold that was there before. Band 3 will be for values between €262,501 and €350,000. Band 4 will be €350,000 and €437,500, and so on. On the fluctuations in the valuations, the valuations for the LPT is at a point in time. The valuation date will be 1 November of this year. Revenue provides guidance to assist property owners in arriving at the appropriate valuation band for their property rather than a precise value.
Dr. Keith Walsh:
If Ms Walshe does not mind, I will comment on the issue of valuations. Deputy O'Donoghue made a very good point that in normal times it is fair to say the value of properties that are being bought and sold on the market are probably a reasonable indicator of the overall stock of properties in the country. However, when we have quite exceptional market conditions, as we have had over the last few months, the properties that are selling are probably less of an indicator of what the underlying value is. As Ms Walshe said, and as the Deputy may remember from 2013, when we were asking people to value their properties then, Revenue provided a lot of valuation guidance to make it as easy as possible for people to self-assess the value of their home. This time around we are starting to put in place plans to do the same thing. We will put a lot of data and as much information as we can out there and make it available to people. When we are preparing that valuation guidance and trying to look at average prices in any particular area in the country, what we will not be doing is over-relying or relying too heavily on the more recent values because, as the Deputy said, they are not necessarily reflective of the underlying market conditions. They are reflective of a bidding war for a particular property in a market of very constrained supply. What we will be trying to do is to make valuation guidance available but that guidance will not be too heavily weighted towards the recent high trend in property sales.
From a rural point of view, we have looked at this recently. I know the officials are trying to give average prices. I have seen prices recently going from €200,000 to €350,000. The problem is there are people in our areas who will sell their houses and move on but if that reflects on an area and there are people there who want to stay where they are it has automatically increased the price of their properties. Many people are trying to move now because they are getting exorbitant prices for their houses and they are resolving to move and sell their houses. That is what I am seeing is the trend at the moment. However, the people who are living there will now have the aftermath of people selling their houses because they are getting stupid prices. It is going to reflect on the prices for people who are there already and want to stay there because it is their lifetime home. They are going to be caught in the middle with the high prices because of the fluctuations. That is what we need to address.
Dr. Keith Walsh:
That is a really fair point. To stress again, obviously this is a self-assessment tax and everyone is responsible for valuing their own property. I fully accept it is difficult if you are trying to put a value on your property and you see a property down the road which was listed for a certain price and then there was a bidding war, with the final sale price coming in as double that. That final sales value, the double value, is not necessarily what I would expect to see on an LPT return. Again, I accept this is very difficult but I hope people will be able to look at their local area and be area to try to judge, at least to some extent, what properties have sold, which ones' prices might have been inflated and maybe what the true underlying value is. As I said, in the guidance we will put out over the next few months, we will try to address this as best we can to help property owners as best we can.
Ms Anne Marie Walshe:
Yes, that is correct. These are average prices. However, as I outlined, geographically one would not see 75% consistently across individual areas or by house type and that. That was the real challenge, namely, the variation in the pace and rate of change across the whole property stock.
We move to a Green Party slot which I am going to take. When property tax was introduced, along with the Local Government Reform Act 2014, county councils were split up into municipal districts, or that was my experience in County Wicklow anyway. There was often conversation in council chambers about how there has been more money spent in one district than in another and that it is easy to estimate because one can work out the spend per head in each district. However, a question was raised about whether we could work out what the collection rate and value of the property tax raised per district is. I made inquiries to the Department at that time and was told that was not possible to do. Is that now possible? Can Revenue or the Department of Finance work out the property tax raised per municipal district?
Dr. Keith Walsh:
I will take that if it is okay. I remember the Chairman's query, or certainly one of that nature, coming in. At the moment it is not possible to break down the information we have to that granular level. One of the things we are hoping to do - and just to manage expectations I should say this is something we are hoping to do maybe after the next revaluation period - is to use the revaluation as an opportunity to collect much more information on Eircode postcodes. Obviously we have addresses of all the properties on the LPT register and we will get them updated as necessary over the next while. We have postcodes for some properties. We hope to use the LPT return to increase the number of postcodes we have on our records for properties. That is important in relation to the Chairman's question because when we have a postcode that allows us, from an analysis point of view, to get a very precise location on the property. If we get a reasonably high coverage of postcodes and a reasonably good idea of where all properties are in the country on a very precise basis then it might be possible to do what the Chairman is looking for. I am hopeful we will have more of the sort of information he is looking for but as of right now we do not have that ability.
Let us say councillors take the decision raise taxes, which is not often an easy one as nobody likes to do it and it is often unpopular but if we are going to provide more local services it is the wise thing to do. I would often have spoken in favour of minor rises in the LPT when I was a councillor because I could see the value it brought in general across the county. The provision of services tends to provide greater value across a wider cohort of society than reducing property tax which puts the benefit onto the wealthier property owners, so it is progressive in that way. If a council takes a decision to raise property tax by 5%, 10% or 15%, the following year it resets back to the original figure and the council must go through that again in order, almost, to remain static. Has that been addressed in this new LPT Bill? I used to call it the local adjustment factor reset.
Ms Anne Marie Walshe:
I will take that question. There have been no changes other than to retain that provision whereby the local adjustment factor is a matter for the council. My understanding, that might be confirmed by the Department of Housing, Local Government and Heritage, is that these are done by circulars and regulations from that Department, rather than through primary legislation.
I thank Ms Walshe and will take that matter up with the Department. Let us consider a case where two houses are side by side and each is valued in or around €400,000, which would put them in band 4. If one of those houses does an extensive two-storey extension, including another bedroom or two, the valuation of that property will increase. Will that result in a higher property tax?
LPT is for the provision of local services. If somebody carries out renovations, either energy retrofits to their house or adds an extension and improves the value of the property on the site, he or she will end up paying a higher property tax. That does not make sense to me. Perhaps Dr. Walsh will answer that question. Has any consideration been given to site value tax whereby the sites are the taxable entity, rather than the valuation of what actually sits on a site?
Dr. Keith Walsh:
To add to Ms Walshe's answer, the date of the extension work in the example the Chairman mentioned is important. Property owners will be asked to put a value on their property on 1 November this year. That valuation will be the basis for property tax over the next four years. At the moment, all properties are taxed on their value as of 1 May 2013. If those two properties in the Chairman's example are side by side and neither had an extension on 1 May 2013, they would have the same value for the purposes of LPT. If one has put on an extension in the period since 1 May 2013, the value will not have updated until the new valuation period from 1 November this year. Additions or amendments to houses do not impact on the valuation until the next valuation period comes in.
From a Revenue perspective, I cannot comment on a site value tax. I do not know if Ms Walshe wants to say anything about that.
Ms Anne Marie Walshe:
The concept of site value tax or alternative valuation was considered by the Thornhill review. The recommendation in that review was that market value was more easily understood and that the practical difficulties in moving from one basis to another did not make for a compelling case at that time. The Government accepted that recommendation. The recently established commission on taxation and welfare will, as part of its terms of reference, be examining site value tax among other issues relating to housing policy.
I thank our guests for coming before the committee. I have a few brief questions that may be better directed to representatives of the Department of Housing, Local Government and Heritage. The clerk might take note of some of the questions if our guests cannot answer them.
My first question relates to the councils. The councils are going to be raising their own revenue which makes it inevitable that councils will be forced to keep the higher rate of property tax. That will have a negative impact on the people within that local authority area. Is it the belief of the Department of Finance that LPT should be the main funder of local government in the future?
I understand 100% of property tax will be retained locally from 2023 onwards. Am I correct in that? Looking at the funding raised across different councils, how will the shortfall be met? That question may not be answerable by our guests.
Is there any estimated figure for the properties that have been excluded from property tax since 2013? If there is, would our guests have a regional breakdown of the local authorities concerned?
While I welcome the exemption for those affected by pyrite and mica, there are apartment blocks across the State with fire and safety issues and structural problems. Is there a case to be made for their exemption from the property tax?
Ms Anne Marie Walshe:
On local government funding, LPT is designed to be a stable source of funding. Whether it is the main funding source is more a matter for my colleagues in the Department of Housing, Local Government and Heritage and the Department of Public Expenditure and Reform. There is a range of other income sources for councils, as the committee is well aware. I cannot comment any further on that question.
As I explained, the difficulty in moving to the 100% local retention earlier than 2023 is that we need clear visibility of the 2022 yield, following the revaluation and the bringing in of new properties into the tax. Our understanding is that the Minister for Housing, Local Government and Heritage and the Minister for Public Expenditure and Reform and their Departments will work to bring that in as part of the 2023 and 2024 budgetary process. Any shortfall for local authorities is to be met from Exchequer funding. As outlined earlier, I cannot comment any further on that matter.
We estimate that just over 100,000 additional properties will be brought into the charge for LPT following revaluation.
The Deputy also asked about exemptions. Our starting point is always that the number of exemptions will be kept as limited as possible to make it fair for those who are paying the tax. The more people who are exempted, the more the people who are paying have to pay. That is our starting point in considering any additional exemptions. There is no case being made at the moment for further exemptions.
If that case were to be made, would it be considered? I know we are concentrating on properties with pyrite and mica but there are many estates with structural issues. Are we open to a case being made for those property owners?
Dr. Keith Walsh:
We have a breakdown, though I stress it is estimated.
The list I have in front of me indicates that there are approximately 9,000 in Dublin City Council, 7,500 in Fingal and 6,000 in South Dublin County Council. Rather than reading out the whole table, it would make sense for me to provide the list to the committee afterwards.
I return to the three issues I mentioned earlier, namely, valuation, notification and budgetary impacts. On the issue of valuation, which may be more for Dr. Walsh, what he seems to have said in the course of the meeting is that Revenue will again recommend the fee. I do not know how it is calculated but, if I remember correctly, it was sort of an average within the electoral district. My concern in that regard, which I wish to put on the record, is that this led to a significant number of people having incorrect valuations. It would be better to recommend that people consult the property price register than to recommend a figure. That would provide a more accurate representation of what valuations are, and they could be directly comparable and verifiable. The experience I have had is that, in recommending a figure, the Revenue misled many people. There was no property price register at the time. For new homes in particular, which will be very difficult for Revenue to estimate, there is a need to refer people to the property price register rather than recommending a rate.
My second point is also for Dr. Walsh, although Ms Walshe responded on it previously. The notification period does not relate to revaluation; it relates to the process each year whereby councils must notify Revenue by a date in September in order that they can operationalise that change or variation in LPT. That forces councils into having two budget days. It is like the Minister for Public Expenditure and Reform delivering a national budget two months after the Minister for Finance does so or deciding to increase or reduce taxes and then, two months later, deciding how to spend that money. If at all possible, Revenue needs to consider that because it reduces local authority accountability because the decision to reduce or increase taxes and the decision to spend the income are completely separate. That is not good for local democracy. There is no certainty at that point in respect of what the Department will do in the context of its other funding streams. As such, decisions are being made in a vacuum.
I return to the overall budgetary impact. When the interdepartmental group was meeting and discussing these issues, the decision to retain 100% was described as a cost-neutral one. It may be cost neutral for the Department of Housing, Local Government and Heritage but it cannot be cost neutral in the context of the Local Government Fund. Did the interdepartmental group put a figure on how much that decision to retain 100% would cost the Local Government Fund? If less funding is going in, that is a known quantity. How much will it be and by how much will the Local Government Fund need to be topped up? No matter whether that is done by the Department of Housing, Local Government and Heritage or the Department of Finance as part of an overall budget, we should know the figure.
Dr. Keith Walsh:
I will try to answer the Deputy's first two questions. Ms Walshe might then come in on his final question.
On the issue of valuations, obviously, Revenue does not know the value of every property in the country. The person best placed to assess the value of a house is the homeowner, although I fully accept that doing so is particularly challenging in the context of the current timelines. However, we will be sending out a Revenue estimate with the returns in the coming months. We have to send it out with the returns because it has a particular function if a person does not file a return and give us a self-assessed estimate of the valuation. We need a basis on which to engage with the property owner and that is what the Revenue estimate provides. As well as including the Revenue estimate in the letters, we will be issuing valuation guidance. We are hoping to make it even easier to use and even more helpful than it was last time. As the Deputy mentioned, on the previous occasion we provided averages in the context of electoral districts. This time, we are hoping to provide an average in each property's small area, which is much closer to an average for the neighbourhood. I accept the Deputy's concern on this issue. Although the Revenue estimate has to be included in the letters, we will be stressing as much as we can in all of our communications regarding LPT that it is a self-assessment tax and that it is the responsibility of the property owner to value his or her property. There is no penalty or influence discerned from a Revenue point of view if a person comes back to us with a valuation that is different from that sent to him or her. It is interesting to consider the example of 2013. Approximately 40% of people stayed with the estimate provided by Revenue but approximately 60% changed it. I accept that there is a communications exercise here, and we will be stressing this point again. The vast majority of people change the valuation estimate, however. I expect that many of the 40% of people who stayed with the estimate believed it was accurate. We will be stressing all the way through that this is a self-assessment tax and we will try to provide as much guidance as we can for people to value their home.
On the question regarding the notification period for local authorities, we have had a significant amount of engagement with the Department of Housing, Local Government and Heritage on this issue through several years. Outside the revaluation year, that is, in a normal year in the context of the LPT, we try to give a little more leeway. However, the timelines are very tight even in a normal year because we have several processes that we need to run through by the end of the year. These relate to the payment methods people select and such issues and we need to get them in place well in advance of the end of the year which is why we have the notification period that comes in at the end of September or in early October. We recognise that bringing forward to August that notification period for a revaluation year just adds to the challenge but, unfortunately, on the Revenue side we have to try to administer the tax and prepare and issue returns, whether by post or electronically, and get them back and then put in place all the payment instructions we receive and ensure we are in a position to collect the tax from 1 January onwards as well as getting the revaluation for the property on 1 November. We had no alternative but to push that revaluation notification date back-----
Dr. Keith Walsh:
We have been engaging with the Department of Housing, Local Government and Heritage in the past month or so and have been providing briefing information as best we can to help local authorities to make those decisions. Any information that we can provide has already been given to local authorities via the Department. I cannot locate the exact date right now.
Ms Anne Marie Walshe:
I am trying to find the date. I may be able to get if for the Deputy before the end of the session. My apologies.
On the Deputy's question relating to the Exchequer impact of the changes, I do not have the figures provided by the Department of Housing, Local Government and Heritage. It is primarily a matter for the Department. I draw the attention of the Deputy to the fact that in the review of the LPT published in 2019, there is a table which sets out the Exchequer impact of the various scenarios. The proposed methodology is a modification of scenario 5. There will be some changes to it, but, under scenario 5, the additional Exchequer impact for 100% retention would be €92 million.
The Deputy is just out of time. If it is helpful, the date that was indicated to me was 31 August 2021 because the deadline for notification of local adjustment factor and variation decisions to the Revenue Commissioners.
I thank Deputy McAuliffe and Ms Walshe. I will move to the second Green Party slot and take it myself. I was out canvassing recently at a beautiful Victorian red-bricked terraced house in Dublin Bay South. A couple of pension age on a fixed low income life there. What is available to a couple in that situation, where the property is of high value but the income is not of that high value? What options are available to people in that situation to defer payment?
If one comes in under those thresholds, one can defer payment. Is there an interest to be paid on that deferred payment? We have lost Ms Walshe. I will put a question to Dr. Walsh on how one works out the valuation. I believe the original figure was 0.8% of the median valuation. Was that how it was worked out originally or how the Revenue Commissioners would have worked out how much one had to pay?
Dr. Keith Walsh:
The LPT rate is charged on the middle point of a valuation band. If one takes the current banding structure and one's property was valued at €120,000, that would fall within the property tax band of €100,000 to €150,000. The property tax for everyone in that band is charged based on the middle point in that band, which is €125,000 and then it is the LPT rate, the 0.18% of €125,000. What is happening with the revaluation process is that the bands are being widened by 75%, but with, as Ms Walshe stated, some differences for the first couple of bands. That structure still applies whereby the middle point of the new bands is where the property tax would apply. A lower rate than the current one would apply there.
Thank you, Dr. Walsh. I will refer back to the questions Deputy McAuliffe raised on the valuations. It is a self-assessed valuation. Whatever I have had my property valued at for the past four or five years and whatever I have been paying, now that will be increased by approximately 75%, so I will still remain within that same valuation. If, however, I believe my property has gone above or below that valuation, it is up to me to return that information to the Revenue Commissioners. Do the Revenue Commissioners have any way to verify if somebody indicates a property value close to the actual property value?
Dr. Keith Walsh:
Yes. As Ms Walshe outlined, the valuation bands are all being increased by 75%. What that means is that if somebody's property has gone up in value, the closer the property is to a 75% increase since 1 May 2013, the less likely the person is to change bands - to increase a band and pay more tax or to decrease a band and pay less tax. That 75% is calibrated on the overall average property price increase over the past seven or eight years. As I mentioned earlier, we are trying not to weight it too heavily to reflect some of the bigger increases we have seen because of the restricted supply in the last while. If somebody is looking for a guide as to whether his or her property is going to face a higher or lower LPT bill or to stay roughly the same, the closer the person is to a 75% increase since 2013 is as good a guide as possible. One can look at the CSO property price indexes. The CSO produces about 11 property price indexes for different parts of the country, and those vary between 64% and 93% or 95%.
On the second part of the question as to whether the Revenue Commissioners can verify, we do not have a database somewhere in the background of how much everybody's property is worth. LPT would otherwise have been a much simpler exercise if we had. If we knew the values of properties, we could just tell people and that would make it much easier. We do not have that. However, it is a self-assessment tax. We have a very strong presumption of honesty on the part of the taxpayer. We believe the majority of taxpayers are doing their best to be compliant and to value their property as accurately as they can. On the types of analysis we would do to identify the very small minority of people who may have been non-compliant, there are two main checks we build into that. One is that we would do some analysis to look at properties around an individual property, looking at particular areas of the country to see if there might be a really big outlier. If it is a housing estate and most of the properties in that housing estate are valued at between €400,000 and €450,000, but there is one that has come in at €100,000, that is the type of outlier we might look at. There may well be justified reasons for that type of outlier. Perhaps it is a smaller property, it might be at the end of the road or whatever. Our compliance approach in those types of cases is that we engage with the property owner, ask how he or she valued the house, why he or she valued the house at that level and then take it from there.
The other check we have in the background is through the stamp duty system. If a property sells, we will get the value of the property at the time it sells. Let us say a property is valued for LPT on 1 November this year at, for example, €200,000 and then it sells a year hence for €400,000 or €500,000. We accept that within a certain margin property prices are probably going to increase over the next while, but if a property went up by a huge amount in a short space of time, that might be indicative that it might have been undervalued for the purposes of LPT. Again, however, in that situation our approach would be to ask the property owner for the basis of the value. We would very much rely on that assumption that people are being honest and making their best efforts to value their tax, but we have options there in respect of compliance.
I apologise for being late. I thank the witnesses for the opening statement, which I have read. When reviewing this tax, and a proposed change was long overdue, the principles of fairness and limiting increases or trying to achieve no increase for homeowners were very important. To address the fairness, it was important that the new homes that had been exempted be brought in. That was a significant point of concern. I wish to ask about the widening of the bands and the reviewing of the rates every four years. I understand that the objective is to create more certainty for homeowners and to create greater harmony. I would appreciate if the witnesses could confirm that.
I also note that it is proposed to increase the income levels for people who qualify to defer the LPT.
That is important. Most people do not want to have to defer a debt but some people, from a financial perspective, genuinely have to. The increase in those income levels, therefore, is welcome. One question that is regularly asked relates to how or why a greater emphasis is not given to the actual income in each household. Will our guests talk to that and to the rationale behind it? I thank them for attending.
Dr. Keith Walsh:
I am not sure whether Ms Walshe has dropped out of the meeting, but I will try to answer the Senator's questions as best I can in the meantime. As the Senator noted, the bands have been widened by 75%, which matches the average property price increase from 1 May 2013, the beginning of the current valuation period, to the present day. As I said in response to Deputy McAuliffe, that 75% is an average for the country as a whole. The closer a property is to that average, the less likely the owner is to see an increase or a decrease in the property tax bill. Obviously, the 75% is an average and there will be many properties close to the average, but there will likewise be many that are not especially close to it. That is the nature of the very varied property stock throughout the country.
It is probably very welcome for everyone - Revenue and property owners - that the valuation period is reverting to four years. When property tax was introduced, although I am open to correction on this, I think the initial idea was to have a three- or four-year valuation period, but that period has been extended a couple of times and it is now the case that properties have been valued at the 1 May 2013 values for eight years. Unfortunately, that creates a number of inequalities and challenges within the system. One relates to the properties that were outside of the property net as long as the current valuation period existed, which will be included in the new valuation period, while the other concerns a matter I discussed earlier in response to the Chairman. Many people will have amended or extended their house, in various ways, over the current valuation period, and the longer that period goes on, the more of those kinds of extensions and enhancements on houses there will be. Until there is a revaluation, those changes will not be incorporated in the valuation. The best example given earlier was that there could be two houses side by side that were valued the same in 2013 but even though one might since have installed a massive extension, with gold-plated taps and so on, the two owners will still pay the same property tax. The four-year period has many benefits in regard to fairness.
The Senator went on to ask about the income thresholds for deferral. I do not know a great deal about this area, to be honest, but as Ms Walshe mentioned, the legislation will bring forward an increase in the thresholds for that, to €18,000 for an individual and to €35,000 or €36,000 for a couple. There is an attempt, therefore, to make allowances. The increases are based on an analysis of changes in incomes, particularly at the lower end of the income distribution over the period since the thresholds were first introduced.
Obviously, this has to be legislated for. Is it anticipated by the Department that the changes will be introduced in 2023? I presume the increases in the deferral income thresholds are being benchmarked against social welfare income payments. Is that the case?
Dr. Keith Walsh:
I think the answer to the second question is "Yes" but I am not familiar with the details of it and do not want to mislead the Senator. On the first question, the changes are going to come in from 2022, so we will ask people to make a return and put a value on their property by 1 November 2021. That will then become the LPT valuation date for the next period, namely, that of 2022 to 2025, inclusive.
I apologise for joining the meeting late. I do not know many people who have installed gold-plated taps, but I take Dr. Walsh's point in the round. It is welcome that we are moving towards a four-year review and that we set in stone that it is what it is, with no delays for any reason. The change in the bands, in order to mitigate any increase, is very welcome also. Bringing estates that were not being accounted for into the LPT is important because there is a fundamental unfairness, particularly where new estates have been built alongside existing estates. In many cases, estates began construction but have not been completed, and ultimately the new units, as they were completed over recent years, have not been levied with property tax. I welcome those changes.
I would like further clarity on the deferral issue. I appreciate that Dr. Walsh does not have the information to hand but if he could write to the committee after the meeting, that would be useful. It is an issue I come across quite often in my representations, where somebody, often an older person, will apply for a grant and need to have his or her LPT affairs in order. For whatever reason, mainly relating to income, such people may have been unable to do that. The deferral mechanism is important and I would welcome some clarity on it.
On the final issue, I seek our guests' opinions, but if they do not wish to give one, that is fine. What are their views on allowing local authorities to have flexibility over and above the 15% that is currently in place?
Dr. Keith Walsh:
From a Revenue point of view, I will take up the Senator's offer not to give an opinion on that issue, I am afraid. I note that Ms Walshe has rejoined the meeting, although I am not sure whether she caught the questions. I think she will be able to address the main points about the conditions for deferrals, but if not, we will revert to the committee on the issue. If it is useful, I might provide some information I have to hand in order that Ms Walshe will have an opportunity to think about her response. At the moment, there are about 44,000 properties for which a deferral is in operation. The vast majority of those - 43,000 - concern the income threshold, although there are other reasons for which deferrals can be sought. Most people who have a claim on a deferral have cited the income threshold.
I am not sure whether Ms Walshe or Dr. Walsh wishes to take this question. What are their opinions on the Grant Thornton report on LPT and its possible alternatives? Are there better alternatives to LPT that would provide funding for local government? Deputy Doherty, Sinn Féin's finance spokesperson, and our wider party have advocated that a wealth tax would be a more equitable measure. As was noted, some people defer the payment of LPT because of an inability to pay it.
It does not take account of people's ability to pay the tax. A wealth tax would probably be more equitable. Have the witnesses any thoughts on that?
Ms Walshe said that 44,000 people defer payment. Some 43,000 deferrals related to income. Does that deferral build up constantly over the years? Surely that has a negative effect on people? They are running up a bill which they are unable to pay.
Ms Anne Marie Walshe:
Regarding alternatives, the Thornhill review looked at different ways of taxing property and agreed that a local property tax based on market value was most appropriate. I mentioned the commission on taxation and welfare. It has specific terms of reference related to housing policy and taxation of housing, including looking at site value tax and examining alternatives. We have a number of wealth taxes, including capital gains tax and property tax. They tend to be taxes on assets rather than income. We already have a progressive income tax system. We have no specific proposals to change the system. LPT has a high compliance rate. It is relatively simple and well understood. There are no immediate plans to change it. The programme for Government commitment is to reform the tax and provides that most homeowners will not face an increase. The Minister has done his best to deliver on that. It brings in the houses that were falling outside the tax.
Ms Walshe made the point that the vast majority of people have complied. I have been contacted by constituents in Glanmire, Togher and Blarney and, specifically, Kerry Pike, where more than 90% of people are compliant and pay the tax but cannot get action in respect of footpaths, public lighting or amenities. What rights do residents who pay their LPT have in areas which do not get from local authorities the services they should get? Dr. Walsh stated that in 2013, 60% of people did not go with the valuations that the Revenue Commissioners provided. How many of those people increased their valuations and how many reduced them?
The Department states that this will be cost neutral. When I was a councillor in Cork city, approximately one third of councils got enough money to meet their budgetary needs, a third were under budget and a third were over-budget. What funding stream is there for people who are under budget so that they do not lose out on services and are supported by the Government? If this is cost neutral, that means someone will lose if everyone retains 100% of the LPT.
Ms Anne Marie Walshe:
On the linking of LPT to improved or increased services, the local government sector is primarily a matter for the Department of Housing, Local Government and Heritage. However, the local authority performance indicator report is published annually by the National Oversight and Audit Commission, which provides independent oversight of the sector. Its report presents the performance of local authorities in a wide range of services. The report, which is a matter for the Department of Housing, Local Government and Heritage, outlines how local authorities continue to deliver on their performance and efficiency targets. Perhaps that provides a route to look into the issues raised.
Regarding retention, how the budgetary process will be worked out and how local authorities secure funding is a matter to be worked on bilaterally by the Departments of Housing, Local Government and Heritage and Public Expenditure and Reform as part of the normal Estimates and budgetary processes. It is not a matter for the Department of Finance and is not covered by the proposed legislation.
Dr. Keith Walsh:
To answer the question on the change of valuation bands, I have the figures here. Some 43% of property owners stuck with the valuation that we provided them. The other 57% either increased or decreased it. Of that 57%, 41% returned a lower valuation and 16% returned a higher valuation.
I apologise for coming in late. I thank the Department for the briefing. I have some context for my question. Our policy has consistently proposed that we replace the LPT with a site value tax, which we believe addresses various issues such as poor usage of land and land hoarding. It will incentivise land and property improvement, which ultimately increases the provision of housing and reduces homelessness. Another benefit of this model is that it is also easier to administer than the LPT since land values are generally static. Properties can come and go over time and tend to have a certain lifespan, but the land is there until the planet is gone. Has the Department of Finance engaged with the Department of Housing, Local Government and Heritage about the possibility of introducing a site value tax?
Ms Anne Marie Walshe:
As I previously outlined, the site value tax is covered by one of the terms of reference for the commission on taxation and welfare. It is specifically looking at the role of site value tax as part of wider housing and taxation policy. The Department considered an alternative model in the context of the Thornhill review of the tax.
I have one final question. I omitted to ask it earlier. It relates to an issue which has always been a bugbear for councillors. I spent 11 years on Waterford City and County Council. The timing of when the local property tax notification has to go to Revenue does not correlate with the local authority budget process. It is a separate meeting which has to take place a month ahead of the annual budget for the council. That has an impact since you are shooting blind at that point because you are some way from knowing the outturn figures from the end of the year.
Is there capacity to move the period, given that it is now a well-established practice? I appreciate that when we set this up, we needed ample time to notify homeowners and so on. Now that is a well-established practice, could we consider moving forward the notification period by three weeks to bring it in line with many local authority budgets and at least give local authorities the option of incorporating that decision into the overall budgetary decision? Having one independent of the other does not make sense. It does a disservice to councillors throughout the country to ask them to make blind decisions on property tax and whether to increase it or decrease it, as the case may be, without knowing the parameters of their own budget three weeks later.
Dr. Keith Walsh:
I will try to answer that. We are very much aware that this is a challenging process from the point of view of local authorities, and we have engaged with the Department of Housing, Local Government and Housing to try to find a better option or to streamline the processes. The timelines are very tight on our side, given the number of things we need to do between September or October and the end of the year such as getting returns to people, after which they will need to revert to us and notify whether they are changing their payment method. For whatever their payment method is, we need to set that up and to send instructions to banks regarding direct debits or to employers regarding reductions from salaries. That all has to be done and in place before January, given that the collection of the tax begins then. We have considered this and it is difficult to see where we can make additional allowances or space.
It is an issue that we consider regularly, although it is complicated even further in a revaluation year, when there is an additional process and the valuation of properties has to be complete by 1 November, so the valuation has to be done in advance of that. That is why, as we discussed earlier, the notification date for local authorities in a revaluation year is brought forward to August. We appreciate that that causes problems and is difficult, but it is not something we are doing for no reason. It is because we have a series of processes we need to run through and get into place before the end of the year to ensure that collection will happen from 1 January.
I appreciate that but we might take the two issues separately. I accept that the revaluation point is different, but in the main, it is a very frustrating and unworkable position for local authorities to be faced with making decisions without knowing the parameters of their budgets. I ask the Department to reconsider all its processes. Even a three-week period would make a considerable difference. Local authorities can split the difference and they have flexibility to move their budgetary processes as well. If some compromise could be found, it would make this a more workable scenario for local authorities throughout the country, particularly as we are looking to empower local authorities further. This is a bugbear of every councillor in the country.
I completely agree, as, I think, the rest of the committee would. I appreciate that Dr. Walsh indicated that the Department has considered this but it is a big issue that restricts the capacity of local authorities.
I support the comments of the Acting Chairman, Senator Cummins and Deputy McAuliffe. All of us can agree about the pressure this puts on local authorities and councillors trying to bring forward budgets when they are trying to make decisions. This year that will be in August. Something has to be done to give local authorities some flexibility. They must balance their books every year, but it is difficult to balance a budget in a vacuum or to make an estimate. Something has to be done and this will have to be reconsidered.
Derelict or vacant properties can, by their nature, be undervalued by their owners. In fact, because they are derelict or vacant, they may not have the same value as similar properties next to them. In considering those valuations, does the Department consider the valuation of the average property price in that area or of the derelict property itself? A person who owns such a property might leave it derelict if he or she does not intend to sell it because it will keep the property price low. That might be an issue for the Department to consider.
Before our guests respond to Deputy Gould, I have a related question. LPT, as the Deputy noted, has in some respects been manipulated for a certain advantage. Has consideration been given to adding a multiplier to act as a penalty on certain residential properties being left vacant? There is a particular issue in Dublin city whereby newly built properties, built for rental purposes and held by investment funds, are lying vacant during a housing crisis caused by a lack of both supply and affordability. While there is a vacant site tax, there is not a vacant residential property tax. Has the Department examined using LPT to apply a penalty to discourage that type of vacancy?
Dr. Keith Walsh:
I might try to answer those questions, particularly as I think Ms Walshe may have been disconnected again. As an important clarification on the notification date for local authorities, my understanding is that the Bill being brought forward will push back by a few weeks the valuation date for the non-revaluation years, from the end of September to mid-October, which I hope will be of some assistance to local authorities and may alleviate some of those issues. It does not get around the fact that revaluation year involves a particular set of circumstances, and that has to work to an earlier deadline in August. It is proposed in the general scheme to push that back, so that will give a bit more leeway.
On vacant properties, LPT in the current valuation scenario will continue to be based on that value of the property which does not take into account whether the property is vacant. We are asking people to put a value on their property as they expect it to be on 1 November 2021, taking into account whatever condition in which they expect it to be on that date. Whether it is vacant will not impact on that.
Nevertheless, our proposal for this year is that we are going to use the revaluation exercise and the sending-out of returns to collect a bit more information on the number of vacant properties out there. As I am sure members will be well aware, there is, perhaps, confusing evidence regarding exactly how many properties are vacant and how many of them are holiday homes versus those that have been vacant for longer term or shorter term reasons. We will use the revaluation exercise to collect more information on how many properties are vacant or unoccupied on 1 November and the reason for that vacancy. I stress that that will be for purely statistical information purposes. We are not in any way proposing, and there are no plans at the moment, to vary the charge for LPT based on whether a property is occupied.
Dr. Keith Walsh:
That is really a question for the Department rather than for Revenue. We are responsible for administering and implementing the tax.
What we are trying to do through this revaluation exercise is collect information. I do not want to speak for the Department but the information that exists at the moment is not very clear. There are some high estimates of the number of vacant properties which I think dates back to the most recent census, five years ago. Other estimates have been produced since then that suggest lower levels of vacancy. The idea of gathering information on the current level of vacancy is probably a good first step to potentially expanding the tax or modifying it in terms of vacancies. I stress that is not what we are doing at the moment. We are collecting information on vacancy and occupancy. There are no plans at the moment to vary the tax on vacancy or occupancy.
I thank Dr. Walsh. I do not see any other members indicating. Ms Walshe's connection has failed and, as a result, she will be unable to answer the questions that have been posed. I suggest to Deputy Gould and Senator Cummins that we might talk to the Chairman and agree that the committee raise the issues relating to the timing relating to the information it is necessary for local authorities to have for the purposes of drawing up their budgets. We should also address the issues that have been raised in the context of vacancy. There is a consensus on that issue among members and perhaps we should address it in private session at our next meeting.
I thank Dr. Walsh for his participation, which has been helpful and useful, and Ms Walshe, in her absence. I also thank the members.