Phil Hogan (Carlow-Kilkenny, Fine Gael) | Oireachtas source

The Senator's is correct to suggest that Cabinet reshuffles are above my pay grade. My colleagues and I are acutely aware of the pressures on businesses at this time, especially outside the major urban areas. The decline in business activity in our city centres, rural towns and villages has meant that many businesses have been unable to survive the downturn in economic activity, resulting in increasing numbers of shop closures and vacant units in town centres in particular. Local authorities are under a statutory obligation to levy rates on any property used for commercial purposes in accordance with the details entered in the valuation lists prepared by the independent Commissioner of Valuation under the Valuation Act 2001. The levying and collection of rates are matters for each local authority.

Local authorities have been asked by my Department to exercise restraint and, where possible, to reduce commercial rates and local charges for 2014. They have responded well to such requests in recent years, and in 2013, a total of 87 out of the 88 rating authorities either reduced their annual rate on valuation or kept it as it was. It appears that a similarly restrained approach has been adopted by local authorities in this year's local authority budgets.

The reorganisation of local governance structures, which I set out in my policy programme, Putting People First, has been given legislative effect by the Local Government Reform Act 2014. A key objective of the reform programme is to reduce the burden on ratepayers and taxpayers generally by reducing cost and maximising efficiency. While the determination of the annual rate on valuation, ARV, will continue to be a reserved function of the new authorities, I am determined that these savings should be passed on to ratepayers in the form of lower charges.

The Act contains several rating provisions that form part of the Government's commitment to economic stimulation. One such provision is the removal of the commercial rates liability that is placed on new occupiers of properties for up to two years of outstanding rates of the previous occupier. I have also provided discretion to local authorities to vary the rate of vacancy refunds to apply in their administrative areas, thus allowing councillors to respond to local circumstances. The timing of the commencement of these provisions is being considered in the context of the timetable for commencement of provisions in the Act generally.

Specific reference was made to a rates discount. Under the provisions of the Local Government (Rates) Act 1970, a rating authority may make and carry out a scheme providing for the waiver by the authority of all or a portion of commercial rates due by ratepayers in respect of a specified class or classes of property. The making of such a scheme is subject to the consent of the Minister for the Environment, Community and Local Government. Any application received for a rate waiver scheme is carefully considered. However, in considering any application, it should be borne in mind that if an authority gives a waiver of rates for one class of ratepayer, the forgone amount must be made up in another area. In other words, there must be a balance. Moreover, the introduction of a waiver scheme could further increase costs on the part of businesses not in the scheme, since it is likely that they would be required to make up the cost.

I will continue to keep the approach to rates by local authorities under active review and I am determined that every avenue will be pursued to optimise efficiency and contain costs in the local government sector to allow for commercial rates to be reduced if the councillors decide to do so.