Catherine Connolly (Galway West, Independent)
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The matter being raised my colleagues and I is the urgent need to provide adequate funding and resources to both local authorities in Galway. I will not voice my opinion but refer to the interim reports from the expert group whose recommendation on the amalgamation of the authorities the Minister of State, Deputy Phelan, accepted, although he failed examine the recommendations to increase staffing and resources, which are a prerequisite before doing anything else. The report in June 2017 refers to the local authorities being significantly under-resourced and resources being significantly reduced by between 20% and 35% from 2008 levels. The April 2018 interim report of the expert advisory group has only nine pages but attention is repeatedly called to the underfunding. It states: "We believe it is now all the more urgent..." and refers to underfunding of Galway local authorities in comparison with other local authorities. It recommends. "that the existing deficiencies in respect of both the human and financial resources be expeditiously resolved as an essential prerequisite to the amalgamation process", on page 3. On page 9, the expert group highlights that based on the evidence considered by the group "the current level of human and financial resources available to both Galway City and County Councils falls short...".

There are many more such instances. The Minister of State should leave my opinion out of this and acknowledge what the expert group is saying in the review.

Michael Fitzmaurice (Roscommon-Galway, Independent)
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In the peripheral areas and municipal districts in County Galway, which Deputies Ó Cuív and Eugene Murphy represent along with me, there is a great shortage of staff. Second, there is a shortage of funding. This has a knock-on effect. I thank the Minister of State for the meeting last week but there is fear in the rural areas on the periphery. Galway borders probably six counties and there is a feeling of being left out in those areas. Galway has one twentieth of the roads in Ireland and we must ensure proper funding is provided both for Galway County Council and outside it so services can be delivered to those areas as soon as possible.

Éamon Ó Cuív (Galway West, Fianna Fail)
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The stark nature of the funding is outlined in the report of the expert advisory group set up by the Government. It says that if the city and county councils are amalgamated the average funding will be €738 per capitaas compared to €1,000 per capitacurrently. That means that Galway will be €300 multiplied by approximately 300,000 short every year. I will let the Minister of State do the basic mathematics.

The letter provided with the executive summary at the beginning of the report states that the amalgamation the group recommends must be preceded by addressing the deficiencies in both human and financial resources noted by it. We are asking the Minister of State to follow what is in his report and sort out the money. We will talk about the other issues again.

John Paul Phelan (Carlow-Kilkenny, Fine Gael)
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I thank the Deputies for raising this issue. Deputy Connolly was probably attending the Committee of Public Accounts meeting last week when the Galway Deputies, and some strays from Roscommon, attended a meeting about the Local Government Bill 2018. It particularly focused on funding but also dealt with other issues. I have held this office for a little more than a year and the funding measures relating to the Galway County Council have been raised on many occasions by Members of both Houses.

The funding system that applies to local authorities is complex, as authorities derive their income from a variety of sources, including commercial rates, charges for goods and services and funding from the Government. Local authorities vary significantly in size, population, public service demands and infrastructure. It is not possible to compare absolute levels of funding received in local authority areas as to do so would not take account of the significant differences between them. Government funding of local authorities similarly presents a complex picture, with transfers coming from a wide range of Departments and offices and not solely from the Department of Housing, Planning and Local Government. Most of the funding sourced from the Government and provided to local authorities must be used for specified purposes and services. In 2017, funding from Government sources to local authorities totalled more than €2.66 billion.

My Department has a wide agenda, including the targeted provision of a range of necessary housing supports. To deliver on this agenda, the Department allocates significant resources to local authorities and channels local property tax receipts to those authorities, the use of which is largely at the discretion of individual authorities. Funding from the Department to Galway City Council totalled €18.6 million in 2016, €25.7 million in 2017 and €22.3 million to date in 2018. In the case of Galway County Council, a total of €71.8 million was provided in 2016, €86.2 million was provided in 2017 and €87.8 million has been provided to date in 2018. This must be recognised as significant funding. I work closely with all local authorities to ensure the local government sector generally, and local authorities individually, have the financial wherewithal to meet existing and emerging challenges. In doing so, I must operate within the parameters of the national fiscal and budgetary situation and competing priorities.

Local property tax, LPT, payments replaced general purpose grants in 2015. The role of local authorities in deciding the local adjustment factor for LPT, up to 15% annually, is vital. The decision provides an important connection between local revenue raising and local expenditure. While Galway County Council increased the LPT by 10% for 2018, by not doing so for 2019 the council has forgone €2 million of additional revenue for 2019. The adoption of a balanced budget is probably the single most important duty that the elected members are called upon to carry out each year. To achieve that balance, the members must make informed and necessary choices to balance the level of service provision with the available income, prioritising as necessary. Galway City Council adopted its budget for 2019 last week and the county council is scheduled to hold its budget meeting next Friday.

A review was established to examine local authority baseline funding more generally and to develop a methodology for distributing any available additional funding to achieve a greater balance and equity of funding outcomes. This work is almost complete and I will provide further information in due course. Separately, the expert advisory group on local government arrangements in Galway, in its report in April this year, recommended that ahead of the amalgamation of Galway city and county councils existing deficiencies in respect of both human and financial resources be expeditiously resolved as an essential prerequisite to the amalgamation process. Both the city and county chief executives participated in the group and endorsed its recommendations. My Department is currently engaged with Galway County Council with regard to additional funding, which was discussed at the meeting last week, and will continue to engage constructively in that process over the coming weeks.

Catherine Connolly (Galway West, Independent)
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6 o’clock

I welcome constructive engagement at any level but at this stage we need action. It was the Government's own expert group and it is acting on a recommendation that asked for a transition director. It did not ask for a joint CEO. The Minister of State is acting on that but he is not acting on the clear findings that both local authorities have been significantly underfunded since 2008. As public representatives, we are in receipt of constant representations on this matter.

Éamon Ó Cuív (Galway West, Fianna Fail)
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I put it to the Minister of State that the report quite clearly says the amalgamation "must be preceded by the addressing of the existing deficiency in respect of both the human and financial resources..." as noted by the group. The chairman made it clear what he meant when he said "the relative revenue underfunding must be addressed in the first instance". The report states that we are €70 million short every year and recommends that this issue be addressed first, and then we can talk about the rest.

Michael Fitzmaurice (Roscommon-Galway, Independent)
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As other Deputies pointed out, the serious gap in funding has been acknowledged in this report. People are reasonable and, in fairness to them, every Deputy here is reasonable. This is the one thing we need and it must be worked on. We cannot put the cart before the horse. We have to make sure that we do this right. Galway deserves to be treated well. There are three counties on the bottom of the scale and Galway is one of them. With regard to the Bill, and for the benefit of trying to get agreement with everyone, the funding is the first issue that must be addressed. We need to get this sorted. The funding was the major problem for many years. The Deputies here are willing to work with the Minister of State, but that has to be done.

John Paul Phelan (Carlow-Kilkenny, Fine Gael)
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Deputy Connolly and other Deputies referred to staff numbers. I believe the Deputy quoted a reduction of between 20% and 30% in staff numbers in the Galway councils since 2008. There is not a local authority in the State that has not had a 20% reduction in staff members since 2008. There might be an issue in Galway about the increase in numbers since, such as in the last year or two. I do not have those figures on projected increases in staff numbers but I will try to ascertain them. The local authority sector was decimated by the downturn as funding was decreased. The recruitment embargo in the public sector also had a huge effect on local authorities across the State, not least in Galway.

The proposal to have a joint chief executive stems completely from what happened in similar merges in Tipperary, Limerick and Waterford. The first step in the process, before the merger had even begun, was to appoint a joint chief executive. We will endeavour, with the Oireachtas Members who represent Galway and with the Galway councils' management, to ensure there is a cash injection for Galway on the basis of reform. The discretionary fund that is available to anyone in my position is tiny. Despite the fact local government annual budgets amount to anywhere in the region of €4 billion, discretionary funds for the Ministers are very small and are ring-fenced for advancing reform in the local government sector.

I acknowledge that Galway's municipal district structure is weaker because the funding issue has been an overhang for years. I put it to Deputy Ó Cuív that it was an overhang when he was in government also, and it was not resolved. It did not just appear in recent years. It has been exacerbated by the downturn, which exacerbated everything with regard to funding. I acknowledge and accept that in order for a merger to happen the funding issue has to be addressed. We will address it by short-term funding in Galway and by the adjustments to the baseline. The fundamental problem in Galway is the baseline figure. The model that is used currently has 100 individual variables. Shortly we will propose a much more streamlined baseline calculation mechanism for local government funding.