Tony McLoughlin (Sligo-North Leitrim, Fine Gael)

I welcome the opportunity to speak on the Bill. Up to February of this year, I had been a member of Sligo County Council and Sligo Borough Council since 1974, which by anyone's standards is a long period of local representation and gives me a deep understanding and considerable experience of local government.

Many of the people who have served with me will say raising finance within local government and at the same time providing services is always a difficult balancing act. In 1978, when the then Fianna Fáil Government abolished rates, it stripped many local decision makers of the revenue raising power they had at local level. As a member of Sligo County Council at that time, I recognised that this political stroke would have a lasting impact. The lack of a local or property tax was identified by the troika and the continuation of a tax system that is over-reliant on personal tax is not sustainable, hence we are here debating this proposed household charge.

Between 2000 and 2007 local authorities were awash with funding from development charges and a central Government grant that ensured any thoughts of how local government would in some way self-finance were never on the radar or in the mind of a dutiful environment Minister - what a pity. If the Minister, Deputy Hogan's predecessors, including former Ministers, Mr. Noel Dempsey, Mr. Martin Cullen and Mr. Dick Roche, were to propose this type of charge, given the then economic boom, they would have found it a lot easier to sell it to the general public. While I am sure it was on their mind, I am also sure the then Taoiseach, Mr. Ahern, would have sent them to Brussels, Siberia or some other location as he feared his ambition to serve longer in office than Mr. de Valera would be thwarted. It is now much more difficult to introduce this Bill in a time of economic difficulty for so many people.

The Society of Chartered Surveyors Ireland has stated that the proposed household charge announced as part of budget 2012 will provide local government with "a more stable and sustainable source of income" than that provided previously by stamp duty. I welcome this statement from an organisation which is independent of Government and recognises the true worth of local government becoming self-financing, where possible. Some local authorities will raise funding through a number of locally based charges, including this proposal, metered water, second home taxes, motor tax, development charges and house rentals. Surely this is the model of funding to which we should all aspire so that, eventually, taxpayers' money currently funding the general purpose grant can be used for other sectors badly in need of funding, including health and education.

Many of the speakers on the other side of the House will level the usual criticism of these measures, namely, that introducing any charge or local tax is not welcome. However, we must look beyond this time to five or ten years hence when, hopefully, we will be in a better place financially. Our aspiration is to ensure that the local authorities are well placed to provide better local services and more of an all-round community and economic programme for local areas, properly funded and not reliant on the general purpose grant. In better times to come, hopefully, the State can reduce the tax reliance on the income of the lower paid, take more of them out of the tax net and allow young people who are not homeowners the chance to get a start in life.

Sinn Féin spokesperson, Deputy Ó Snodaigh, has stated on his website that by choosing to impose sweeping flat rate taxes on everyone, the Government is abandoning its pre and post-election promises to protect the most vulnerable and families on low incomes. I take issue with this statement on the basis that the opposite is the case. This proposal was part of the EU-IMF agreement imposed on Ireland and legally signed up to. The Bill will provide protection to many who are on mortgage interest supplement, who are residents of local authority housing or who live in certain unfinished estates. These are protected in the Minister, Deputy Hogan's, Bill.

As I stated earlier, it is incumbent on the Government and future Governments to continue to form a fair and equitable tax system. In time, when this interim household charge is developed into an equitable property tax-----

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