Michael Brennan (Progressive Democrats)

I second the motion. As Senator Dardis has set out the issues mentioned in the motion at length, I intend to dedicate my time to the specific subject of large development levies and special development levies imposed by local authorities. I wish to make clear the Progressive Democrats' view that planning authorities should ensure that developers make an appropriate contribution towards the costs of public infrastructure and facilities.

Our development contribution system was revised with cross-party support via the Planning and Development Act 2000. The objective was a new and more transparent system. Under section 48 of the Act, planning authorities must draw up a development contribution scheme in respect of public infrastructure and facilities provided by, or on behalf of, the local authority that benefit development in the area. I draw attention to the words "in the area" and will refer to this point later.

With regard to the issue of transparency, the new development charges scheme was intended to ensure that the long-standing practice of levying development contributions to fund local authority infrastructure and facilities — for example, community areas and recreation — is implemented in a more transparent and consistent way across the country. The Progressive Democrats put down today's motion because of genuine concern that transparency and consistency are not absolute by any means.

It is worth noting the view of the then Minister in February 2004 that "it is not anticipated that the contributions levied will unduly affect the price of houses, new industrial and commercial development or new agricultural developments". Again, there is concern that this anticipation has not been met. Development charges, as intended, are desirable and, indeed, necessary. The funds raised by local authorities through development contributions are substantial. In 2005, for example, they were €12 million in Limerick county, €18 million in Kildare, €30 million in Wexford, €38 million in Cork county and a massive €50 million in Fingal. In addition, city councils collected €89 million and town councils collected €54 million.

These substantial sums are intended to be part of a consistent, transparent and dedicated system. It is intended that the €500 million collected in 2005 would not, for example, be spent on schemes or works that already come under schemes funded from the Exchequer and would not be spent on schemes or works outside of the area in which it was collected. There are two main points, what the moneys are spent on and where they are spent.

For the purpose of illustration, I will use the example of the national water services investment programme. This programme consists of 900 projects and is funded to the value of €5.1 billion. It is a national scheme introduced by the Minister which we applaud and wish well. National taxation funds the national scheme, and rightly so. Why is it that local authorities receive approval for water schemes under this programme but moneys received under the development contribution system are used to part fund them? That is contrary to the intention.

Moneys received under the development contribution system are not intended to be spent on works prioritised by the local authority and subsequently approved by the Minister and the Department of the Environment, Heritage and Local Government under the national water services investment programme. The Minister and the Department cannot walk away from their specific responsibility to implement the national water services investment programme.

The new development contribution system introduced under the 2000 Act to provide consistency and transparency has, in fact, created a system of what may be described as "law unto itself". Local authorities can decide when, how much of and how the gains are to be spent, regardless of the Minister's intention. There must be an immediate and annual audit of the collection and spending of development and special development levies by each local authority. In the interests of transparency and value for money to the electorate and our communities, whom the scheme was intended to benefit in the provision of facilities, there must also be an immediate and annual audit of schemes approved under the water services investment programme.

The Minister or Department cannot simply say that this is a national scheme. Local authorities are using funds from the development contribution system for water treatment works. Meanwhile, a person who pays into the development contribution system finds the infrastructure and facilities their money was to be used for are lacking.

The list of projects this money is intended for is quite explicit. The money is to be spent on the provision of open spaces, recreational facilities, community facilities, bus corridors and infrastructure to facilitate public transport and so forth in the area in which it is collected. It is not for water schemes that are already covered by a national programme and are located miles away. Under Part 3, section 28(7) of the Planning and Development Act 2000, local authorities setting their development contribution schemes shall have regard to any recommendations made by the Minister. Subsection (8) states that "following the consideration of the manager's report, and having had regard to any recommendations made by the Minister, the planning authority shall make the scheme". The Progressive Democrats' call for an audit of development contribution schemes is to improve the system in how moneys are collected, spent and co-ordinated to improve the facilities and services delivered to communities. It is not a blame-game.

The new development charges scheme intended to ensure the long-standing practice of levying development contributions to fund local authority infrastructure, was implemented in a more transparent and consistent way. It is well-publicised that the levying of development charges is inconsistent. Business groups in particular have raised concerns about development contribution schemes differing considerably across local authority areas. Despite the desire for consistency, it is not the Department that sets the level of contributions on how local authorities calculate the charges. Each local authority decides itself.

As a result, consistency and uniformity is lost. Consider the charge for a 200 sq.m. development. According to one source, in Dublin city the charge in 2005 was €23,000, €16,000 in south Dublin, and €1,300 in Galway city. While this is a serious issue for businesses they have active interest groups to put their case. Our motion is more concerned with the concerns of the public. For example, the choice and location of services for consumers is likely to be affected by this variation. It is bound to influence where businesses locate, where services are provided to the public and where jobs are located.

What are the Minister's views on this issue? Is he satisfied that the intended level of transparency and consistency is being delivered by the development contributions scheme, as implemented by local authorities. I thank the Minister for coming to the House to outline his views on these three significant issues — management companies, potential conflict of interest and development levies. I have focused on the development charge element of the motion. Senator Morrissey will speak further regarding management companies. As Senator Dardis stated, the motion is being moved in response to genuine concern among the public about these issues. We owe it to the public to outline what steps are being taken to address that concern.