Eamon Gilmore (Dún Laoghaire, Labour)

The Labour Party is generally supportive of this Bill, but I very much regret the fact that we are being asked to pass it into law in about an hour's time because many aspects of it require teasing out in a normal Committee Stage discussion. There are three essential elements to the Bill — the establishment of the business improvement districts and the procedures in that regard; changes in the rating and valuation system for new businesses; and the amendment the Minister is introducing in respect of audit committees in local authorities.

In so far as the Bill is primarily concerned with rates and levies being paid by businesses to local authorities for certain services, the legislation requires a greater deal of discussion than it will get today. Frankly, the Government is being disrespectful to the business community, which is now the only section of Irish society to pay rates to local authorities. It makes a very substantial contribution to the finances of local government. As a matter of respect, while I appreciate that their representatives have been involved in consultation and that the chambers of commerce are broadly supportive of the legislation, a Bill dealing with a charging and levying regime for business deserves more consideration in this House than being rushed through the week before Christmas without a proper Committee Stage discussion.

I would like to have seen a number of areas teased out in a proper Committee Stage discussion. One of the proposals for the adoption of the BID scheme, for example, is that it should be done by one third of the membership of the local authority. I do not know where that threshold came from, but it is an area I would like teased out. It seems a low threshold for such a serous proposal.

There is an inconsistency as regards the provisions on the plebiscite and the way in which the levy is to be applied.

My understanding of section 129G(4) is that where there is multiple occupancy of a premises, there will be only one vote. Consequently, ratepayers who occupy part of such building will be obliged to agree among themselves how the vote is to be passed, even though the building might contain a number of separate rateable businesses. However, when it comes to applying the levy, the businesses will each be levied separately. This seems inconsistent and I would have liked Members to have teased out this issue.

The levy will apply on a majority basis. Businesses in a particular district will vote for it and it will then apply to everyone. While I appreciate that the majority rules, I would have liked some discussion as to what might happen in a case where a significant minority might be opposed to it, but is faced with being levied for it. In particular, I would have liked this issue to have been teased out in respect of circumstances in which the district might involve dominant businesses and in which pressure might be applied to businesses.

I also would have liked to have teased out questions regarding circumstances in which the Bill might be used for purposes for which it was not intended. The Minister's presentation stated it is for the upgrading of areas, by providing car parking or general improvements. I put the following scenario, with which Deputy Cuffe is familiar, to the Minister. At present, a proposal for a local area plan in Stillorgan is being prepared by the local authority. Much of the old shopping centre in Stillorgan and adjoining properties have been bought by a single developer who proposes to carry out his own local area plan. What in this Bill can prevent the following scenario? A developer who owns all the properties and who represents a majority of the ratepayers involved, proposes a BID scheme. He or she then begins to create what effectively would be a local area plan, using the BID scheme as a back door method for so doing. This matter should also have been teased out. I know of many other cases, such as redevelopments of shopping centres, which can be quite controversial in a locality. How can one avoid the BID formula being misused in such a manner?

What becomes of people who are not ratepayers? I cite Dún Laoghaire as an example. A significant number of people live in the town, whose interests as to what might happen to the town may not always coincide with what is being advocated by business in the town. All Members know of the conflicts that can arise in respect of matters such as car parking arrangements, traffic management, deliveries, the physical appearance of a town and similar issues, in which businesses may have one view while local residents might have another. Under this formula, businesses obviously will have a vote on BID schemes because they will pay for it and will have the clout. However, the only recourse for those who have lived in the town all their lives and who may have a different view would be to try to persuade members of the local authority not to proceed with the scheme.

How will one ensure the BID levy will not act as a substitute for rates? It is interesting that currently businesses are the only part of the economy that pay rates to local authorities. This is a formula in which a new voluntary rate, if I may put it that way, will be added to businesses. What safeguards exist to ensure businesses' payments under a BID schemes will not be used to provide services that local authorities should have provided from the rates the former have already paid?

I am concerned in respect of the provision for a local authority clawback in section 129K(6) which states: "The rating authority may recover from the BID fund all reasonable costs it incurs in performing functions related to the BID scheme". I wish to hear more regarding how one could prevent a local authority from getting greedy and taking too much back from the BID fund. Moreover, there is a lack of clarity regarding the role of councillors and local authority officials on such boards. The Minister's contribution noted they will be present as policymakers and as guardians of the public interest. However, my understanding is that under the Bill, they will be directors of the company and will have obligations, as company directors, under company law which may not always coincide or rest easily with their functions as guardians of the public interest. To whom will they owe their loyalty? Are they, as company directors, required to comply with one set of rules and, as public representatives, to comply with a different set or to serve a different master? There is a lack of clarity in this respect that must be dealt with.

The formulae for the changing of rates and of the valuation system also requires more time to be teased out than is available this evening. On the Order of Business, I drew attention to the rather complex algebra, to which Members are being invited to give approval, to give effect to the new rating regimes and to the limits on valuations and on rating payments. Such subjects require some time to ascertain exactly what is meant. For example, at some point all Members as legislators will be asked what is the liability for rates on a business in a particular set of circumstances. Members are not being provided with an opportunity to have this issue elucidated and explained as it should be. Rushing the Bill through in such a short time is no way to make law governing rates and valuations of businesses.

The Minister has tabled an amendment in respect of audit committees for local authorities. This morning, I read in a newspaper that this constitutes a new venture on the Minister's part and that the idea to have independent auditing and evaluation of local government financing is new. However, it is nothing of the sort as section 122 of the Local Government Act 2001 already provided for the establishment of audit committees in local authorities.

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