Fergus O'Dowd (Louth, Fine Gael)

The introduction of the household charge must be seen as a further step to place the funding of local authorities on a relatively stable local basis. A proper broadening of the revenue base for local government will be the result of the household charge and the subsequent full property tax.

In this country, local authorities are responsible for certain services and that is where the money raised from the charges will be spent. They include fire and emergency services, maintenance and cleaning of streets, street lighting, planning and development services, public parks, libraries, open spaces and leisure facilities. Those are essential local services which benefit all members of the public, including business, and are often taken for granted. We expect to have streets lit at night and to have open spaces and playgrounds in which children can play and enjoy themselves.

In common with all levels of Government, the financial position of local authorities remain under significant pressure. At the same time, as part of the efforts to close the gap between income and expenditure in the public finances, Exchequer funding of the day-to-day activities of local authorities cannot be immune and, accordingly, the 2012 Exchequer allocation was reduced by €164 million compared to 2011. Income from the household charge is, therefore, critical in ensuring that local authorities have the necessary resources to continue to deliver services to their communities. However, within the constraints of introducing a relatively modest charge of broad application, the household charge sought to be as equitable as possible through specific provisions for exemptions and waivers in order to exclude those households in particular difficulty from the ambit of the charge. I appreciate that even at €100, the charge is not welcome to people, especially those in difficult circumstances. Members on all sides of the House understand and appreciate the difficulty the charge causes for many. There is no doubt that it causes difficulty for people. However, it is a necessary contribution to the funding of the State, which is spending more than it is raising. Also, given the absence of a tax on residential property, it is a major gap with which we must deal.

As there is no existing database of liable residential property ownership in the State, bills or invoices cannot issue. In this regard, the charge has been made a self-assessment measure and it is for the owners of residential property to assess whether they are liable to pay the charge. These arrangements are modelled largely on those applying to the €200 charge on non-principal private residences. As of 15 June 2012, just under 960,000 residential properties had registered for the charge. That in itself is a mark of the progress of the measure and that the necessity of it is recognised by the broad majority of the population. Given the absence of any comprehensive tax on domestic property in more than 30 years and the fact that the State does not have a comprehensive database from which to work, this is significant progress in only a five and half month period. More than 17,200 properties were registered for a waiver on the same date. While 1 January is the liability date, actual payment of the charge was possible up to and including 31 March 2012. Therefore, late payment fees and interest only apply if the charge was not paid in respect of a liable property after the three-month period. Payment by instalments could be made at the time to assist homeowners with the additional cost. Significant efforts were made to ensure that property owners were aware of the household charge. We are all aware of the debate in the public domain in that regard.

County and city councils have delegated their functions in administering the charge to the Local Government Management Agency, LGMA, which is collecting the charge on a shared services basis for all local authorities.

See this speech in context