Pat Deering (Carlow-Kilkenny, Fine Gael)

Like previous speakers, I am glad to have the opportunity to speak on the motion. The issue of rates affects everybody. Before we move on, we must assess where the problem began. Like Deputy Ann Phelan, I was amazed yesterday to hear my constituency colleague, Deputy John McGuinness, trying to remember when the problem began - he thought it was the 1970s. To remind him, it was 1977 when the big problem began with the removal of rates from ordinary houses, and it has not been addressed since.

Amazingly, at that time we transferred the payment of rates to 20% of the ratepayers, which is a serious problem. After 14 years of Fianna Fáil Government, none of the problems have been addressed. To listen to the hypocrisy of Fianna Fáil Members speaking about rates, one would think this problem only began on 9 March 2011, not 1977.

Local authority funding is essential. Deputy Ann Phelan referred to the conditions last winter and the previous winter when we were all in serious trouble trying to get around in the ice and snow. Where was our first port of call? It was the local authority. If the local authorities are not funded properly, we will not be able to go down that road. Some 29% of local authority funding comes from ratepayers, which is a large proportion, and the rest comes from a block grant from central Government.

Deputy Niall Collins in his speech yesterday lamented the fact that Fianna Fáil had been in Government for 25 years over recent decades. The local government block grant is also important in the funding of local government which is important in a democracy. Any discussion on local rates must take place in conjunction with the reform of local government, but nothing has happened in this regard during the past 30 to 40 years.

I believe in the concept of sharing services and systems and co-operation between local authorities, which is important. County Carlow which has a population of approximately 55,000 has three local authorities, Carlow County Council, Carlow Town Council and Bagnelstown Town Council. This is ridiculous and the issue needs to be addressed shortly. I commend the Minister for his approach to try to rationalise services for the benefit of all concerned.

It is important to understand the more we reduce rates, the more bigger companies benefit, as opposed to smaller companies. For example, a 1% rate reduction in County Carlow could mean a €5,000 reduction in rates for a big company per year, whereas it might only mean a €50 reduction for a small company, which would be minuscule and of no benefit. A 1% rate reduction in County Carlow would mean a loss of revenue of €50,000 for Carlow County Council. Such a loss would equate to the salary saved by the sacking of a member of the outdoor staff in the county council, which staff provide a valuable service for the community.

The Minister is on the right road to local government reform and it is important that we continue on that road. More has happened in the past few months than in the past 25 years. I have a few ideas that may be of benefit to the Minister when he is considering matters. There could be sliding scales of rates, whereby bigger companies would pay more and smaller companies would pay less. We could introduce incentives for ratepayers, whereby a company which took on an employee would receive a rate rebate; such a measure would help to create employment.

I compliment the Minister on his reform agenda and wish him the best of luck in the future.

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