Barry Cowen (Laois-Offaly, Fianna Fail) | Oireachtas source

I thank the Minister of State for her response and colleagues for their contributions. I acknowledge that the Minister of State empathises with the grave difficulties being faced by local authorities throughout the country and the reality of the decimation and continued dilapidation of towns both small and large. I also acknowledge the manner in which she has taken on board her responsibilities, particularly in regard to planning and the initiatives taken in respect of development levies. Many local authorities are revising those levies downwards, as one would expect, in order to incentivise development in their towns and counties. I agree with the points the Minister of State made in regard to retail guidelines and spatial strategies, with a focus on the gearing of development into town centres, not only from a residential and commercial perspective but also in terms of the cultural aspects referred to by several speakers.

I ask the Minister of State to reconsider her stance in regard to the introduction of surcharges for out of town centre developments similar to those introduced in Northern Ireland and Britain in April last year. Those types of charges could function as an effective funding mechanism to offset the costs of such proposals as I have mentioned to seek to incentivise town centres. Rather than placing the onus of responsibility solely on local authorities, it is incumbent on the Government to facilitate local authorities, by way of legislation if necessary, in seeking to introduce any such surcharges.

In regard to commercial rates, all speakers acknowledged the great weight and burden faced by retailers and businesses in town centres for some years now. The Minister of State mentioned that local authorities have reduced their rates. I accept that they have done so in so far as they can, despite the revenue-raising constraints under which they are operating. Most of us in this House have sat through council estimates meetings, which are due to take place in the coming weeks. While commercial rents have come down by as much as 60% to 80% in many towns, rates, on the other hand, have come down by only 4% or 5% at best. That in no way amounts to addressing the hardship that exists. The only revaluation process that is under way at this time is in Dublin. Moreover, I understand some 9,000 appeals are logjammed in the system. The demand notes applicable to those appeals are enforceable on 1 January, but there has been no communication as to whether individual appeals have been accepted or if the process is still ongoing. The demands will remain in place on 1 January. The number of appeals would serve in itself to indicate that the valuations being struck are not reflective of market realties.

The time has come to overhaul the system. It is too easy to fall into the mantra of accepting rates as an annual means of revenue collection on the part of local authorities without recognising the effects this is having on local businesses. Any overhaul must be cognisant of the commercial rents applying in the areas in which rates are being levied, the turnover applicable to the retailer or business in question and the ability to pay factor. These issues should be at the core of an overhaul of the system. Slight amendments to the Valuation Act every five or six years are no longer acceptable. We are all aware of the crisis that is the dilapidation of town centres throughout the State. We can play the blame game regarding the role of all parties at local, regional and national level in terms of the manner in which development took place outside of town centres. I hold my hand up in that regard. There was an expectation that populations would increase in many areas. I mentioned earlier that the percentage living in urban areas has increased from 42% to 62% in the past 60 years. It will not, however, continue to increase at that pace into the future. Hence the need for a rebalancing that would address the grave difficulties that exist from a commercial rates perspective.

I hoped the Minister of State would address the issue of upward-only rent reviews. Her party made a very strong commitment to the electorate before the last election to bring forward legislation to bring that practice to an end. We have since been informed that the legal advice is that it is not possible to do so constitutionally. I do not know what legal advice the Labour Party was receiving before the election and what legal advice it has received since. Notwithstanding that anomaly, I do accept the bona fides of the argument that there is a legal impediment in this regard. Setting aside the failure of several referendums brought forward by the Government, this is a commitment the Minister of State and her colleagues must honour. We would have no difficulty in supporting an amendment to the Constitution, if such was considered necessary, in order to bring forward the legislation necessary to honour that commitment.

There is an expectation on the part of many businesses and retailers, by virtue of the mantra emanating from Government, that the property tax will ease the burden on local businesses in terms of the payments made to local authorities on a regular basis. Unfortunately, that is not and cannot be true, as we will see at the estimates meetings in the coming weeks and this time next year. The property tax, we are told, is replacing the local government fund. The Government, however, has committed to allowing only 80% of what is collected to go back to local government. That in itself comprises a reduction, and will be seen to be a reduction, on what was available under the local government fund last year and the year before. How then can it be construed that the burden on local businesses arising from commitments to local authorities will be reduced? It will not.

I hoped the Minister of State might have acknowledged in her reply the position of those local authority areas that will become municipal authorities under the legislation we will be discussing on Committee Stage in the coming weeks and whose valuation rate is, in some cases, 30% less than the county rate. All the Minister of State has said in this regard is that she has informed the councils that they may bring the rates to parity over the next ten years. I defy her to name one municipal authority area in which this will result in a reduction in rates; on the contrary, it will generally mean an increase. I had an interesting discussion with a delegation from the Association of Municipal Authorities of Ireland during the week.

A town council in Donegal is 29% below the county rate so it is facing a 29% increase over the next three to ten years, depending on how its estimates are determined in the coming weeks.

Finally, I acknowledge the Minister's contention that the local government legislation and the establishment of municipal districts will allow those fora to carry out many of the suggestions I have made today, and which the Minister has acknowledged are required. That is fine. I hope that on Committee Stage of that legislation we will be able to tease out exactly what functions and fund-raising powers those municipal districts will have, as distinct from their county counterparts. Only then will I be convinced that the potential exists for those fora, authorities or districts. The body has yet to be called a "council" and that worries me because there are financial implications. However, only then will we be able to tease out the teeth they will have and their opportunities or prospects of addressing some of the issues I raised today.

I accept the Minister's right to reject the Bill, although I do not agree with her action. I hope that, having not taken the opportunity at this juncture, the Minister or some of her colleagues in the Government might comment on the proposals regarding out-of-town developments and the surcharge. Similarly, a mechanism is required through which the Government should examine the issue of alcohol pricing in many of these multiples. They are contributing to the demise of many pubs in town centres, where alcohol consumption could be protected by the relevant licence holders. That is not the case now, with people doing this at home and so forth.

See this speech in context