Dáil debates

Thursday, 23 July 2020

Ceisteanna - Questions - Ceisteanna ar Sonraíodh Uain Dóibh - Priority Questions

Local Authority Funding

10:40 am

Photo of Eoin Ó BroinEoin Ó Broin (Dublin Mid West, Sinn Fein)
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5. To ask the Minister for Housing, Planning, and Local Government the estimated rates and non-rates funding shortfall for local authorities in 2020; and if he will fully meet this shortfall in order that local authorities do not have to cut staff or services due to the loss of income during the Covid-19 pandemic. [17910/20]

Photo of Denise MitchellDenise Mitchell (Dublin Bay North, Sinn Fein)
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In March, the Minister took the decision to freeze rates for businesses. From March to June, rates were waived entirely. This was welcome but it was only an interim measure. How will the shortfalls for the remainder of this year be addressed?

Photo of Peter BurkePeter Burke (Longford-Westmeath, Fine Gael)
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In order to support the local government sector, my Department continues to keep local authority income, expenditure and cash flow under review and is working with all local authorities on all issues arising in the context of the Covid-19 public health emergency.

While the County and City Management Association has estimated the loss of non-rates income for 2020 to be in the region of €91 million, it is not possible to accurately calculate the loss of income from commercial rates for all of 2020 at this stage due to the range of payment plans available to ratepayers and the variety of payment patterns among ratepayers of different sectors.

As the Deputy will be aware, earlier this year a waiver of commercial rates for a three-month period from 27 March 2020 was announced for all businesses that had been forced to close due to public health requirements. I assure her that the Department and I are absolutely committed to supporting local authorities in every possibly way during the Covid-19 emergency. I am determined that there will be no loss of staff or services in local authority areas due to loss of income.

Against this background, my Department has been working with colleagues in the Department of Public Expenditure and Reform on a package of support measures for businesses and local authorities which will address the treatment of commercial rates until the end of September. This will be undertaken in the context of the July stimulus package. This package will be considered by the Government this afternoon and an announcement will follow shortly.

Photo of Denise MitchellDenise Mitchell (Dublin Bay North, Sinn Fein)
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I thank the Minister of State for his response. I, too, am concerned about the estimated deficit of €90 million predicted by the County and City Management Association. The Minister of State does not need to be told that huge holes will have to be plugged if services are to continue effectively and if the councils are to avoid any staff cuts. Funding is required in three areas, namely, the revenue usually raised through rates, non-rates revenue and moneys for Covid-19-related expenses, which I understand will amount to millions of euro. Can the Minister of State commit to addressing that?

Photo of Peter BurkePeter Burke (Longford-Westmeath, Fine Gael)
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I assure the Deputy that the Department is working very hard and liaising with local authorities on a daily basis to measure the funding deficit and plan the July stimulus, which will be announced later today. Rates account for approximately 30% of local authorities' income on average. Goods and services account for in the region of 28% of their income, a sum of €1.5 billion nationally. We have been very clear that the July stimulus package must be of the appropriate scale and must reach businesses in a timely fashion. In regard to rates and the funding of local authorities, it is clear that the quickest way to get cash to businesses is to refrain from taking it away in the first instance. That has been the trajectory of the Government from the start. We will keep in touch with local authorities and I am confident that we will see a very strong and robust response from the Government this afternoon.

Photo of Denise MitchellDenise Mitchell (Dublin Bay North, Sinn Fein)
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I thank the Minister of State. I am sure the city and county managers and local councillors from all parties and none are disappointed by his response. They need absolute certainty. I will give the Minister of State an example of the financial impact Covid-19 has had on Dublin City Council alone. Dublin City Council faces €41 million in additional costs due to Covid-19. It has experienced a loss of non-rates income of €32 million. The Minister of State will agree that this is a really serious situation. Communities and people throughout the State rely heavily on services provided by their local councils. We must ensure that there are no cuts to services in our communities or staff numbers. This matter must be addressed urgently.

Photo of Peter BurkePeter Burke (Longford-Westmeath, Fine Gael)
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I am a little perplexed by the Deputy's comments. I have been very clear that certainty will be provided by the Government later today. Our response will be of scale. I said very clearly in my initial reply that there will be no cuts to local authority staff or services. I made that absolutely crystal clear. I also made it very clear that the components of today's stimulus package aimed at local authorities will be of scale and will be timely. I have been absolutely clear that the Department is liaising with local authorities to fill this gap and that we will come back this afternoon with clear certainty in terms of the trajectory to get through this pandemic. We will provide certainty for all local authorities. The Government has been to the forefront in supporting businesses throughout this pandemic. It has gone far beyond the effort made in other jurisdictions. That will continue to be the case. This stimulus package will be of the scale required to get our economy going again and to support all our small businesses.