Olivia Mitchell (Dublin South, Fine Gael) | Oireachtas source

For as long as I have been involved in politics we have been talking about political reform, and recently I have heard people talk about so-called real political reform. I believe this Bill is genuinely reforming from a structural and administrative perspective and from a functional perspective. Local authority members are getting more powers, which will challenge them but will forge a real connection between those who are elected and the citizens they serve. Too often in the past when we reformed local government, it was all about structures, including changes to boundaries, numbers of local authority members and so on. As a result over the years, local government has failed to deliver on its full potential.

I am a former local authority member, as many of us are. I still firmly believe that it is at local level that genuine quality-of-life changes can be achieved. The lack of reserved functions and financial dependence on central government has meant that local government has been a creature of central government in many ways, implementing policies dictated by Government to a level dictated by the finances available to it.

I agree with the previous speaker that it is to the credit of local authorities and good managers over the years that we have achieved so much. It is only when one goes abroad and sees other local authorities at work that we really appreciate the services we get from our local authorities and their members. It is not always true that the far-off hills are greener. No one - least of all the elected local authority members - believes things could not be done better or that local government could not be more efficient and responsive to the citizens it serves. I believe the Bill will go a long way to achieving that and will certainly improve on the present situation.

While there has been some upset at the abolition of town councils, they were no longer appropriate either geographically or functionally and could not play the role originally envisaged for them. Their replacement with municipal districts will result in towns getting a more effective and efficient service, and achieve enhanced priority in the overall county council setting.

I have a quibble with one structural change which I believe is superfluous and unnecessarily expensive - the increase in the number of local authority members in Dublin. While I appreciate the intention is to achieve equity in the ratio of local authority members to population as between Dublin and other parts of the country, I do not believe it is necessary. Despite having much bigger populations, the Dublin local authorities areas are geographically much smaller and are very homogeneous, which often does not apply in counties elsewhere in the country where there is a mix of towns, cities and villages. They have a greater diversity of issues to deal with, quite apart from having geographically bigger areas.

Nevertheless I accept that the greatly reduced number of structures and the overall reduction in representation is to be welcomed. It will reduce costs and will achieve more focused representation for the people being served.

I am pleased about the greater economic roles that local authorities are to have for the areas they serve.

The dissolution of the city and county enterprise boards and their amalgamation into the local authority is the right thing to do. The councils will now have their own local economic plans, local community development committees and one-stop shops. Local authorities are far better informed about local conditions and they should be able not only to give the services in but to shape the economic life of the areas that they serve. We will see how it works out but it has the potential to give better service.

The Minister, Deputy Hogan, said that he had great hopes for the local property tax adding that under the new regime elected members will have an important role in determining the appropriate level of the tax with discretion to increase or decrease the rate by up to 15%. That is incorrect. We are told councillors will have the power to vary the amount but they certainly will not have the power to determine the appropriate level of the tax. The level of the tax is and always will be, under this system, determined solely by the property market. That has always been the basis of my complaint about the tax and I want to reiterate that.

In every other country in the world the level of local property tax is determined by the cost of local services and within the area big properties pay more than small ones but our system completely ignores the cost of local services such that in some counties the take from the local property tax would be only a minute percentage of the cost of local services whereas in Dublin it will be a great deal more. In my own local authority the level of property tax at an estimated €52 million - if it is like last year and it will be - is almost exactly twice the cost of services, twice what the council got from the local government fund. This results in Dublin households, and similarly those in other cities, not only paying more than anywhere else but paying more than is necessary. To mollify the Dublin citizens the promise was made that 80% of what was collected would be kept and spent locally and that from 2015 councils could vary the charge up or down by 15%. It is very disappointing to hear now that the 80% will not be introduced in 2014. Perhaps the intention is to introduce it in 2015 but it does raise questions about the long-term intention and if the power to vary charges will ever really exist because councils cannot vary what they do not get in the first place.

Varying the tax by 15% is only meaningful to councils if they also determine the overall level of tax. Already the value of houses in Dublin has risen by 12.5%. By the time people revalue their properties in 2016, if the current trend continues their value could be to 40% higher than it is now. For Dubliners this tax will always be onerous and unfair if we continue to calculate it as we do. Citizens might, however, feel slightly less aggrieved if the 80% promise were kept, if most of the money they were paying was being kept to be spent locally. That promise has to be kept because not only will it encourage accountability of councils and councillors to their citizens but the ability to vary the tax depends on getting the money in first place.

I understand it is the intention that the local government fund will be more or less what it was last year although people have paid huge sums to the Government in property tax on the assumption that they were getting it back. Varying the tax really matters in Dublin. It does not matter in some counties. Deputy Brown was worried that councillors would put it up willy-nilly if they were short of a few bob but putting up the tax in some counties by 15% would be so negligible that it would not be worth doing. It certainly will not bother the citizens because many citizens in many council areas will pay only €90 a year. To vary that by 15% will make a difference of only €13.50, which will not be of any consequence, but it matters in Dublin. If somebody pays €900 in property tax the ability to vary and reduce that by 15% really does matter. It also matters to the local authority if it wants to increase or decrease its revenue by 15%. It would be a significant sum of money.

We have made a promise and it is vital that we keep it, to keep faith with the citizens but also to show that the Minister placed a high value on forging the connection between the people who pay the taxes and the people who deliver the service. That is the essence of good local government. If this deal is to deliver what the Minister hopes it is important that at the Cabinet table he makes the point that the 80% promise must be kept.

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