Eoin Ó Broin (Dublin Mid West, Sinn Fein) | Oireachtas source

In common with other colleagues, I welcome the Bill. While its provisions are limited, they are broadly very sensible and Sinn Féin, like others, will be supporting the legislation. On one of the most obvious areas, the idea people could not pay their rates in instalments made no sense. Like others, when I was on a council, I was trying to negotiate for an individual ratepayer who was trying to do the right thing and keep his staff in employment, as well as being rates-compliant. The fact one could not negotiate that kind of agreement was something that needed to be rectified.

The alleviation schemes are most welcome. There are local authorities that had previously found very ingenious ways of introducing what were effectively alleviation schemes. They did so legally but they had to go through a certain amount of policy and legislative subterfuge, which was never the ideal situation, as I know from having been on one such local authority and having been involved in designing the scheme. The fact local authorities and municipal districts will have the power to try to make sensible interventions, particularly to try to boost parts of their constituencies that have less economic activity or parts of towns that are experiencing lack of regeneration, is welcome.

The difficulty, of course, is there could potentially be a loss of revenue for the local authority and, therefore, it is important to acknowledge that while it is a valuable power, it comes at a cost. This will need to be teased through by the local authorities and it may limit its applicability in certain areas. Nonetheless, it is very welcome.

The one provision I do not understand is in section 5 in regard to the ministerial limit on the annual rate on valuation, ARV. In his concluding remarks, perhaps the Minister of State could talk us through its logic. While I am not arguing for local authorities to be reckless or to have excessive increases in the annual rates, if elected members are given the democratic power to make those decisions, I am not sure I am comfortable with the idea of a Minister having the right to intervene and, for example, to set limits or seek to lower that rate. I certainly would need some persuasion before I would be willing to support it.

I listened with interest to Deputy Cassells's proposals for amendments and, on the basis of what he said, a number of them seem very sensible. Subject to viewing them, I believe they certainly could win our support. While it is not a proposed amendment but an issue Deputy Cassells raised, I would sound a warning in regard to the issue of taking power from local authorities and giving it to Revenue. It is not that Revenue is better at collecting money but that it has much stronger powers. If we give those stronger powers to another body, clearly it would be able to get a higher collection rate. I am not at all arguing that local authorities should be soft on non-payment. However, during the height of the recession, particularly in the west, individual local authorities and rates officers in local authorities made very sensible, pragmatic calls that were about saving jobs. It was not that they were saying they would not collect the rates. However, if pushing the rates at a particular point in time would have resulted in the loss of two, three or four jobs in a small village or rural area, they did the sensible thing. One of the values of local authorities having the appropriate powers is that they are often better placed to make some of those difficult, more nuanced calls than a centralised authority. I am not arguing with the Deputy; it is just that I think there are two parts to this story of which we need to be mindful. However, I would not necessarily be against local authorities having greater powers, which would allow them the discretion to decide when best to use them.

One of the frustrating things when we were dealing with the pre-legislative scrutiny of this Bill was the separation of, as it was then, the Commissioner of Valuation, the ARV legislation and collections for the local authorities. It is not that I would want in any way for us to interfere in the independence of the commissioner but we could not even have a joined-up policy discussion on legislative reform or policy reform. The decision to move the Valuation Office into the Department is eminently sensible. Of course, it begs the question as to when we actually can have that joined-up, broader discussion around the interaction between the two areas.

Let us be very clear. Any change to the valuation system has a knock-on effect on the revenue coming in to local authorities. It would be very easy for Opposition Members to come to the House, although thankfully no one has done it, to just demand that we have some easing of the revenue base for businesses without acknowledging this would have a significant knock-on effect on the local authorities. It would not just affect their current revenue. The great thing about the rates is they are consistent and not subject to the ebbs and flows of the economic cycle, and they give a level of certainty to the local authorities. While this is one of the difficulties for small struggling businesses, it is of value. However, we need to have that joined-up discussion.

I agree with Deputy Casey that the valuation process is complex. I spent quite a lot of time with two senior officers from the Valuation Office when we were doing the pre-legislative scrutiny of this Bill just to understand it. I am not stupid and while I am not the smartest person in the world, I can get my head around concepts. However, it took me a long time to really understand it and I still do not fully understand the variances between town centre and out-of-town and so on. The thing that catches people out when the valuations happen is the interaction between the setting of the rates and the valuation. The data the Valuation Office was giving me at the time showed that when a revaluation was done, the majority of ratepayers remained roughly the same but there were two groups of people at either end - the winners and the losers - and it is almost the same percentage in every valuation after ten years or more. While the winners are very happy and do not say anything, some of the losers lose very significantly. From the information I have, it is not that there are more losers in some counties than in others and it seems to be relatively consistent. However, we need to have a significant look at how that interacts and whether there are mechanisms for reducing the number of losers, particularly losers whose business is put into some level of jeopardy. I would be open to ways of thinking about that.

Part of our problem is the long gap between the valuations, so the more frequently they could happen, the easier the system. However, that has significant revenue implications in terms of staffing and resourcing, and while the Valuation Office was working very hard to get through its schedule, it will be 2021 or 2022 before it will have the full State-wide valuation done. We would not even have had a five-year cycle when people would be valued again, so there will still be a long delay, which is a problem.

We need to revisit the valuation criteria for town centres and out-of-town shopping districts because there is clearly an inequity. This refers to the points made by a number of Fianna Fáil Deputies about the difficulties of town centre businesses for which the rates are much more expensive. While I accept the Minister of State said the rates might be a smaller portion compared to other things, it can often be the thing that tips them over the edge or convinces a prospective small business person to locate in a particular location or not. This is an issue worth looking at.

In conclusion, we will be supporting the Bill bar that one section, subject to the Minister of State's response. I would like to see a grounded and joined-up discussion in the housing committee within the next six months, which the committee would certainly facilitate, where we would bring in the Minister and the staff but also the Valuation Office to start that broader conversation. I will be honest. Many of us will complain that the system as it stands is not fit for purpose but none of us have the solution. In fairness to the Deputies who have spoken, they made sensible proposals. Nonetheless, nobody has worked out a system whereby we marry the needs of the local authority to the needs of business, particularly small, struggling businesses.

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