Phil Hogan (Carlow-Kilkenny, Fine Gael)
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I welcome the opportunity to discuss local government reform and I thank Senators for finding time for this matter on today's schedule of business. I make clear at the outset that I will not announce details of a reform programme today for two very good reasons, namely, proposals, other than those already announced, have not yet been decided and it would be pointless, and disrespectful, if I were to march in here and simply inform the House that various decisions had been made. I suggest that we use the time available to allow Senators to put forward well-informed, practical proposals to improve the local government system. Since most of them are elected by local authority members, there could hardly be a more suitable opportunity for the Seanad to show that it can make a substantial contribution to policy formulation.

I may not be in a position to announce details today but I can help to set the context of the debate by addressing some fundamental issues on local government and local government reform, the rationale for it and what we hope to achieve. I have heard questions recently in the context of proposals for local government funding along the lines of "What are local authorities for?" and "Why do we need a local government tier?" I would expect robust, realistic and insightful answers on this from the Members of a House that is partly a product of local government. I wish to share some thoughts on these fundamental questions - our vision for local government, the direction it should take, the principles we are following in considering changes, the reforms needed to achieve the objectives of local government and the main components I envisage in respect of the reform programme.

There is no doubt that some functions are better performed through central or regional organisations for reasons of scale, resources, expertise or those of a strategic nature. This is why certain environmental and infrastructural responsibilities have moved to national agencies over the years. Such a move is now proposed in the area of water. In theory, the services that local authorities currently provide could perhaps be delivered by staff employed by central organisations. However, the bulk of local authority services are genuinely local in character and there is nothing to suggest that they could be delivered more effectively by centralised agencies. On the contrary, locally-based decision making is good for local and central government. It enables better consideration to be given to local needs and priorities and can lead to improved performance and initiative by virtue of fostering a greater sense of local ownership, commitment, responsibility and accountability. Moreover, delegation to local level relieves central government of unnecessary involvement in local affairs. This enables it to focus on national issues, as well as avoiding the sort of duplication that can arise where centralised management is obliged to supervise local delivery.

Local authorities are not just service providers. They have a mandate to promote the welfare of communities and support national objectives. A local tier of public representation is considered an essential feature of most, if not all, democracies and in Ireland it has specific constitutional status. It is logical that this elective representational element of local government should be combined with, and exercise oversight of, the service delivery aspect. To achieve the objectives of good local government - as distinct from local administration - two key characteristics must be present: effective and accountable democratic representation; and operational efficiency and value for money in the local authority functions of service provision, regulation and development. The overall strategic aim of local government reform must be to enhance both of these elements. They are not incompatible: in fact, both are essential. To achieve the objectives of good local government, the system must promote effectiveness, accountability and efficiency through its structures, organisation, functions, operations and financial arrangements. These key elements will be addressed. The policy proposals I intend to bring to Government shortly will, in particular, feature two main strands of reform, namely, strengthening local government structures - generally at regional, county and sub-county levels - and expansion of the role of local government.

The core element of the local government system is the county or the city and we have already taken decisions to strengthen this key component by way of unification of local government structures in Limerick and Tipperary and consideration of the position in Waterford. The forthcoming submission to Government will build on these developments and outline proposals for the other levels in order to achieve a stronger, more cohesive and efficient overall system that will be well equipped to address future challenges and take on new roles. Without devaluing the work of the members and staff of town councils, we must honestly acknowledge that the sub-county level has become an increasingly marginalised element of the local government system, with problems of weakness, duplication and inconsistency. Some previous proposals for sub-county reform have been somewhat crude and lacking in imagination. Equally, defenders of the status quo have tended to keep their heads in the sand. I intend to propose changes which, if accepted by Government, can produce a modern, comprehensive and meaningful system of municipal governance within each county that will be based on principles of subsidiarity, democratic accountability and operational cohesiveness.

Compared with town authorities, regional structures are relatively new to the Irish local government landscape but they have not, to date, made a significant impact. There are many reasons for this including the lack of regional identity, difficulty in determining areas that make sense for different purposes, vagueness of role and a lack of clarity and rigour surrounding concepts such as regional policy. In recent times the regional planning guidelines process has become increasingly effective. The evidence of success in this context encourages me to try to build on this and make a further effort to develop a meaningful and effective regional component in the Irish local government system. The reform proposals to Government will, therefore, incorporate what will, in effect, be a relaunch of the regional dimension. This will involve rationalisation of structures, updating and clarification of functions and a focus on robust strategic planning in which all relevant agencies and authorities will be required to participate fully in the development of strategies and in ensuring that these are carried through and implemented in all sectors and areas.

An effective funding system, related to a local funding base and incorporating local decision making and accountability, is regarded worldwide as a crucial element of good local government. With less than half of local government funding for current services in Ireland coming from local funding sources and most capital funding coming from central funds, there is a democratic deficit in the relationship between responsibility for local service planning and delivery and the provision of the associated funds. All major reviews and assessment of local government reform over many years have pointed to the need to widen the local funding base through mechanisms which would provide discretion to locally elected representatives while making them more responsible and accountable for overall funding provision.

I will bring forward proposals later this year for a more comprehensive and equitable valuation-based property tax to replace the household charge which is aimed at providing a stable and sustainable source of funding, with increased local financial responsibility. Given the local nature of property, the link between community location and service demand and provision and the potential to provide for local discretion and accountability, a property tax is uniquely appropriate as the principal source of sustainable funding for local government. The introduction of a property tax will deal conclusively with this essential element of local government reform. It is clear that greater financial independence and responsibility are essential to the development of a stronger, more efficient, mature, accountable and self-reliant system of local government whose relationship with national Government will no longer be characterised primarily by dependency, lobbying and centralised control.

The operational element of local government is being addressed, particularly through the implementation of the local government efficiency review recommendations. This is proceeding under the aegis of an implementation group, with the focus initially on prioritised implementation by the local government sector in areas which offer significant potential for early savings such as procurement, ICT, HR and shared services. The implementation group's interim report will be completed shortly, with the incorporation of specific information on savings and delivery times. Significant efficiencies are also being achieved through implementation of the Croke Park agreement in the local government sector which has, for example, seen a reduction of more than 7,500 staff since 2008.

A further major determinant of an effective system of local government is the nature and extent of its powers and functions. Local government in Ireland has a much narrower focus of functions than in most states. This statement has been repeated so often that it is in danger of being taken for granted as something naturally Irish - like damp weather or good hurling. I do not think it makes any sense to have a system of 124 local and regional authorities, almost 1,700 elected councillors and more than 29,000 staff performing a relatively limited range of functions and excluded from many decisions affecting their areas and the delivery of various public services locally which in most countries are core functions of the local government system. If we are to retain a system of local government - I think I have demonstrated that there is a compelling rationale for this - it cannot possibly be sensible to continue under-utilising its potential to the degree that successive Governments have allowed for decades. What is more, we simply cannot afford to do so in the economic circumstances visited on us.

The failure to capitalise fully on the potential of local government is something I am determined to begin to address, but I recognise it will take time to turn things around. Previous devolution programmes were unrealistically ambitious and did not start from the right place. I acknowledge that local government in Ireland has a credibility problem and inherent weaknesses. For example, how could a structural framework set down in the 19th century be expected to support efficient operations in the 21st century? How could a funding base that has been undermined significantly since the late 1970s promote mature, self-reliant local government? This is why we are front-loading structural and financial reform and operational efficiency measures.

I also want to begin the process of strengthening and widening the functions of local government by bringing forward specific proposals for additional local authority responsibilities. In the short term I see scope for widening the role of local authorities from three sources, in particular: an enhanced and more explicit role in economic development and enterprise support; involvement in community and local development, particularly in the context of the alignment of local and community development with the local government system; and the identification of specific functions capable of devolution from central level to local government in the short term.

While a more far-reaching extension of the local government role into the type of areas within its remit in many other countries such as transport, education and the police is likely to be a relatively long-term project, the programme for Government contains a clear commitment to the devolution of much greater decision-making powers to local level. In this context, I have asked all Government colleagues to undertake a serious examination of the functions and services of Departments and related agencies to identify matters responsibility for which could potentially be devolved to local government. Proposals emerging from this initiative will be reflected in the forthcoming submission to the Government. Responsibility for the delivery of most services within the Department's remit already rests with local authorities and various requirements for specific approval have been dispensed with or relaxed during the years. However, an examination is being carried out to identify any possible remaining potential for further delegation of responsibility to local level.

Economic issues must be at the top of the agenda not only because of the scale of the economic challenges that face us but also because progress on all objectives across our society depends critically on economic success. I believe the capacity for local government to promote economic development is significant and this is also reflected in the programme for Government. Most local authorities already play a substantial role, alongside national and regional agencies, in economic development and promoting or marketing their areas as locations for tourism, investment and enterprise. Their planning and infrastructure functions have a significant influence on economic development and every business in an area inevitably has dealings with its local authority. There is a need to define a clearer, more explicit and consistent role for local government in economic development and enterprise promotion. An important element of the reform policies I will bring to the Government shortly will be proposals for all local authorities to perform an enhanced economic role building on current best practice, working with relevant national agencies, linked with other relevant local authority functions, and taking account of other current developments, particularly the process to align local government and local development.

I am very keen to build on the role played by local government in local and community development, which incorporates economic and social elements. I recognise the value to communities of the work of local development bodies; they bring important qualities to the development of urban and rural areas. I am convinced these qualities can be combined more effectively with the resources and the democratic mandate of local government to ensure the greatest possible level of efficiency and effectiveness in the various publicly funded local development programmes. A steering group is examining the alignment between local government and the various local development programmes and I will have its final report soon. The aim will be to achieve the best possible customer service and value for money in local development programmes, with a focus on ensuring effective front-line services for those who need them most.

The policy proposals I hope to bring to the Government will, in tandem with other work that is proceeding, add up to a wide-ranging programme of reform dealing with the core issues of local government structures, functions, funding and operations. As implementation of these proposals proceeds, further aspects of the system will be looked at such as governance, ethics, local and central government relationships, civic leadership and public participation in local government. The overall outcome should be a local government system that is more responsible and self-reliant and performs a central role in the economic and social affairs of the nation, just as local government does in most European states.

Mary White (Fianna Fail)
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I thank the Minister for his visionary speech which offers optimism in terms of the future role of local authorities. I agree with him that an opportunistic policy decision was made in 1977 to abolish rates. As he stated, this has made local authorities increasingly dependent on central government in pleading for funding. It has seriously weakened the role of local authority members.

The reason the Minister is in the House today is that last week we met Councillor Hugh McElvaney, chairman of the Local Authority Members Association, LAMA; Councillor Noel Bourke, its general secretary, and other members. Councillor Enda McGloin from County Leitrim made a superb presentation on what he believed the role of local authority members should be and what they were seeking. Many Senators attended the meeting and there is cross-party agreement today.

David Cullinane (Sinn Fein)
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Not on every issue.

Mary White (Fianna Fail)
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No, but we want to see the role of local authority members being enhanced.

When I sought election to the Seanad in 2002, I was not a member of a local authority, but I had been on the national executive of Fianna Fáil. During that election campaign I saw what local authority members did, and their role in communities is seriously underestimated. Having travelled throughout the country and been elected to the Seanad three times, I am aware of how local authority members keep communities together, particularly in rural areas. Those who write off their contribution to society or the political system do not know what they are talking about. The same is being said about the Seanad, that it does nothing. In my experience, anyone elected or re-elected to a local authority is working hard. One may be elected once, but one will not be re-elected without doing the work. I am very impressed by local authority members.

Local authority members are experts on issues to do with sewerage, housing and recycling. In economic times such as these, to which the Minister referred, their importance is evident. We cannot underestimate their impact in communities. They are the gateway to and backbone of our democracy and severely under-appreciated. They are the backbone of the local government system.

Local elections take place every five years and every resident over the age of 18 is entitled to be registered as a local government elector. It is tremendous also that people who are not citizens of Ireland are allowed vote in the local elections, which means that nationals and non-nationals have a voice.

Speaking on behalf of Local Authority Members Association, LAMA, members last week I stated that this has to be properly funded. I support a property tax and over the years I have supported the call that people should be charged for water. It is a scarce resource in the world. This money should be given to the local authorities. The local authority members should have control over it and power over what they do in their areas. We read regularly in the newspapers about what people in local authorities are doing in Europe. It is sad to see what has happened in our local authorities in that they do not have the control and the input into what is happening in their immediate local areas.

There is talk of reducing the number of councils but there is an increased number of people in many communities. According to the Central Statistics Office, County Laois recorded the strongest population growth in 2011 with an increase of 20% in just five years.

There should be better public relations in terms of the role of county councillors. Their voice must be heard and they need to be revered. I know from travelling throughout the country non-stop keeping in touch with my electorate the fantastic work county councillors do in their communities. They should be properly funded and have back-up research and resources to do a good job.

I thank the Minister for coming to the House and for his visionary speech. Our Leader, Senator Maurice Cummins, is an outstanding Leader of this Chamber. He is excellent, and we very much appreciate the innovations he has made in his efforts to retain the Seanad.

Caít Keane (Fine Gael)
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I welcome the Minister and particularly his statement which will go down in history as setting the context for the reform of local government. The Minister has not yet made the announcement but in the context he has set I look forward to hearing it when it is made.

I welcome Councillor Enda McGloin to the Chamber who is a member of the executive of LAMA and who was in the AV room last week putting forward some valuable suggestions. I hope we will be able to facilitate the LAMA delegation in the environment committee as requested.

I have been listening to discussions on local government reform for more than 20 years since being elected to local government, and even longer than that. In the lifetime of the previous Government we had a Green Paper, discussions mostly on directly elected mayors, an OECD report, the McCarthy report, a Commission on Taxation review and the Local Government Efficiency Review Group. The Minister will correct me if I am wrong but I understand the Minister intends bringing forward a White Paper. If that is the case, when does he intend to publish that? The local elections will be in the not too distant future and it is important that we have certainty as soon as possible.

At the outset we must ask what we want from our system of local government. I want to see a system based on strong local democracy, community spirit and citizen empowerment allied to an effective and cost efficient service delivery. We must ensure that in creating an efficient system of local administration we do not wipe out local democracy and good local government.

What we have seen to date on any type of reform or pursuit of an agenda over the years has been an agenda of reductionism as opposed to real reform. We have had tinkering with local government and no real attempt to reform it. We have seen powers and functions removed from local authorities. Certain functions are best administered centrally but central Government is not best equipped to grasp the inimitable conditions of each locality. It is preferable for local government to carry out that job because locally elected institutions employing their own specialist staff are better placed to understand and interpret the conditions and the needs of local communities.

The over-centralisation of government here is inefficient and fundamentally incompatible with a healthy Republic. I did not make up that statement. It is from the new politics document issued by our party. The Minister probably had a part in composing it and from what he said earlier I believe he is living up to that statement of empowering the citizen. I commend our party on that statement. We believe there must be a shift of power from the centre to the citizen to create a strong, vibrant civil society and from what the Minister has said to date that is what he intends to do.

I have listened to the Minister speak on numerous occasions since he took up office. The last time I heard him speak on reform was at the LAMA seminar where his statement was very welcome. The previous Minister for local government, Mr. John Gormley, stated that we need to ensure greater connection between local government and local people. That was a fine sentiment but he failed to follow it up with any action. He published a Green Paper but nothing happened after that. This Minister intends to do business and I look forward to him delivering on that.

In general, national politicians have not taken any lead on local government reform. Speaking at the Association of Municipal Authorities of Ireland, AMAI, conference three years ago, Dr. Aodh Quinlivan from UCC stated that national politicians have shown a lack of respect for local government and local democracy. He said that national government's main concern is preserving power at the central level and continuing with an intensely centralised model which is suffocating local government. That must change and from what the Minister stated in this document, I know he is of like mind.

As I stated when I spoke on the issue of local government reform in the House on 18 January, having spent 20 years working at local government level I feel an onus, in serving the people who elected me, to enunciate again that reform of local government should be used, in the first instance, for the devolution of functions to local level.

The Minister mentioned town councils. That area needs review but I do not agree with the McCarthy report from 2009 which recommended that all town councils be abolished. That has been supported by the AMAI, LAMA and ACC. I am aware that the Minister intends to make some changes. Changes must be made but functions must be streamlined. We must acknowledge the strength and benefits of municipal governments and local democracy representation but we must also ensure value for money and efficiency in administration and operational procedures. I mentioned the devolution and expansion of the role of local government. I have seen the part local government can play in local democracy.

The Minister made three points on 18 January in reply to a question from me on clarifying and enhancing the role of local government in economic development and enterprise support. I welcome that statement. We met representatives of the Irish Local Development Network yesterday evening and I look forward to the report of the steering group. Does the Minister have any idea when the report of the steering group will be published?

We must keep in mind the principle of subsidiarity. The European charter of local self-government, to which we are a signatory, states that local self-government denotes the right and ability of local authority to regulate and manage a substantial share of the authorities. We must keep in mind subsidiarity, democracy, accountability and responsibility.

I say to all councillors - and I was once a councillor - that with powers come responsibility. The Minister spoke about the disconnect between fund-raising and the way local government was denuded from the late 1970s on but councillors are to blame also. All councillors must keep in mind that with powers come responsibilities and every councillor must be prepared to take powers if they are given them and use them appropriately.

Fiach MacConghail (Independent)
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Fáilte isteach, Minister, go dtí an Seanad. Unlike previous speakers I have no mandate in that I was nominated by the Taoiseach but this debate offers me an opportunity to learn about and understand the idea of local government reform. I have some experience in that I am a political scientist by training and have spent some time on a series of citizens' projects.

The Minister made a very good speech. This debate gives all of us with our different backgrounds an opportunity to contribute and inform and to be briefed by the Minister but also to put some ideas to him. The Minister suggested that he has an enormous task. He must take his time with it. There are many elements to it and I might highlight some those tensions and, hopefully, support him in the forthcoming terms.

It has been a busy week for the Minister. Tomorrow is an historic day for him also in that he will introduce the Second Stage of the Electoral (Amendment)(Political Funding) Bill. I acknowledge that it is all happening in the Seanad.

Last year I spent two months travelling the country and attending meetings on participatory democracy. I was chair of We the Citizens, a non-political party group which set out to prove that citizens who participate in a deliberative way can effect change and contribute in a greater and more profound way to the political system. We proved that a citizen's voice, through a citizens assembly model, can make a difference and contribute to a shift in our political culture and participation. I know through the programme for Government that there are strong policy areas on how to enhance the way citizens should participate in society and politics. I look forward to the debate today and tomorrow in which I believe the Seanad can come up with strong and important ideas to support this aspect of the programme for Government. What I have learned from We the Citizens and what I heard at every public meeting throughout Ireland is the hunger and willingness of citizens to get more involved in local democracy. Voting is not enough. What happens in between elections is what we are trying to resolve and discuss today, namely, how to increase participation and trust between the institutions and our citizens in this republic. Irish citizens have started to expect more from democracy and want to take part. Deliberative democracy at a local level can work and the more citizens who are involved in local decision making, the healthier our political culture will be.

We the Citizens proved conclusively that citizens can understand and take tough decisions if they have all the information and facts at their disposal and that this strengthens the political system and enhances our democracy at both a local and national level. That is what I would like to see as a result of local government reform. Profound reform at local level will liberate reform at Oireachtas level. If we devolve more power and decision making to local level, the Dáil and the Seanad will enhance their role as the policy making and legislative forums that they set out to be.

I will not go into detail today on the various bodies and histories of recommendations on local government reform over the years but I would like acknowledge the excellent work and convey my thanks to the Oireachtas Library and Research Service in briefing me well on this. Regarding the programme for Government, the following three sources have had some influence on Government thinking: the Green Paper on Local Government Reform in 2008, the McCarthy report in 2009 and the Local Government Efficiency Review Group of 2010. I understand, and the Minister indicated in his speech, that he has set up an implementation group and is awaiting its recommendations. In what timeframe might that happen? Will that process result in a White Paper and, if so, how would it be disseminated?

The great challenge facing the Minister and all legislators in the Oireachtas is how measures to enhance democracy and decentralise power can best be implemented in the context of cost-saving steps which will undoubtedly be implemented. How can we reconcile the following three objectives of the Minister's local reform agenda, namely, cost savings, to increase the efficiency of services and to devolve power to the citizens? They are not mutually exclusive of each other but cost savings could make local government more remote from the people and amalgamations could be more expensive.

The four areas of reform, the first of which is to rebalance power within local government in favour of elected representatives. We could and probably should discuss this at length in this House and we could have a full day discussion on that area alone in terms of directly elected majors, the proposal to replace managers with CEOs and how this would relate to increased powers of councillors. A second area of reform is to devolve power from central government to local government. How many tiers should there be, how should it work and should it be across county council boundaries or county boundaries? The third area of reform is to create greater efficiencies and save costs, and the fourth area of reform is to enhance ways for citizens to participate. The deliberate budgeting process in Recife in Brazil is a great example of this where nearly 20% of the adult population was involved in some way in the 2009 budgeting process. Its impact in that region of Brazil has been significant in terms of influencing the direction of public expenditure, some €220 million over ten years, as well as broadening and deepening democratic processes every day. These four categories of reform are all linked. We need to achieve them in tandem and to have a debate that would include the citizens whom ultimately it will serve and protect.

There can be tensions between these goals. A critical question when considering the Government's policy is how well the policies increasing efficiencies fit with the Government's policy to reorganise local governance structures fundamentally to allow for devolution of much greater decision making. Can we save money by sharing costs - the Minister touched on this - such as ICT, audit committees and human resource services but devolve increased power and responsibility to the local areas in the categories of budgeting, raising taxes, housing and roads?

According to an excellent research paper, Is big really so efficient? Investigating assumptions concerning local government reform and amalgamation, by Mark Callanan, Ronan Murphy and Aodh Quinlivan, a wonderful paper that I urge all Members to read, we in Ireland are deeply wedded to the view that bigger is better, or a more specific variance is that bigger is cheaper, means improved services and is more efficient. These have been assumptions underpinning recent proposals for public sector reorganisation and reform with the suggestion that a larger organisational structure will cost less, lead to better services for citizens and ultimately be more efficient. Rather than being expressed openly, these assumptions frequently exist as an implicit rationale behind changes that are usually labelled as rationalisations of structures.

Another myth or issue that has been raised is that Ireland has too many local authorities, particularly too many city and county councils - we have 34. Research undertaken and mentioned in the paper to which I referred shows that we are way down the league table when it comes to our having a close relationship with citizens. France, Switzerland, Austria, the United States, Germany, Canada, Finland, Poland, Belgium, Denmark, Sweden and Portugal all have much closer links to citizens that we do. We should investigate how we could improve that. We are more remote from our citizens than we think. Therefore, the notion that amalgamations might be the answer to greater connections and more efficiencies might not be true. One of the glaring facts I discovered in my research and interest in this area is the lack of evidence and data in support of proposals that a smaller number of larger local authorities would yield improvements savings and efficiencies.

David Cullinane (Sinn Fein)
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Hear, hear.

Fiach MacConghail (Independent)
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That is not to say I am in favour of not amalgamating them but we should investigate it further.

According to the research paper I cited, bigger is not necessarily better and it is often sometimes worse. There is a weak relationship between population size and costs and service levels and efficiency. We cannot take it for granted, therefore, that by becoming larger, local authorities in Ireland would yield improvements.

One of the learnings we discovered at our regional meetings of We the Citizens was that citizens want local politics to be more local and for them to have a greater understanding and a stake in it. Raising local taxes and spending them locally was mentioned and discussed. Whatever reform the Oireachtas and Government come up with, this will be the crucial one. How can central government let go and devolve its power and revenue raising powers to local level? Participants in citizens assemblies were asked this question and were asked regarding the role of TDs, who they should be, what they should do and how they should represent citizens. The citizens assembly in June was asked to comment on the statement, "The ability of TDs to provide local service is strength", and the results of that were to place more weight after debate and the deliberative process on national legislative and policy and less on local service. The results showed a further marked and statistically significantly decrease in support for the statement. In other words, citizens understood that local politics, if more empowered and more enhanced, works better.

It is clear that the opportunity to discuss local government reform is an opportunity to evaluate our whole political culture and democracy. I look forward to engaging with the Minister in detail during this term of the Oireachtas. I urge him to include the voices of our citizens in any consultation on reform.

Denis Landy (Labour)
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I welcome the Minister to the House. He is welcome. I have no doubt he intends to move this process forward and I look forward to his deliberations. We have had a number of conversations on this issue in recent months.

Town local governments should be a fundamental tier of local democracy. Reform should place town local government at the core of the system and bring local government closer to communities. The intention should not be to abolish local government but to strengthen it. Reform must be based on a bottom-up approach. Local government needs to be less dependent budgetarily on central government, and a model of county and municipal government can advance the objective of operational efficiency and representational effectiveness. All those statements are ones the Minister made in a number of speeches he gave in recent months. I commend him on that. He has at heart a desire to reform local government. The question is how we approach that.

Currently, local government is being strangled to death by central government. Unless the grip is removed and oxygen is supplied urgently, local government will die. We have gone down a one way street in local government for the past ten to 15 years. The challenge for the Minister is to turn the vehicle of local government around and drive it back up that street. We have seen the powers of local government removed in the areas of health, education, waste management, roads, water, funding and so forth. Are we going to reform by returning some of these powers along with giving new powers or will we reform by a reduction in powers?

Reduction has been tried across Europe. The previous speaker spoke about some instances. I will give the Minister some statistics. In the 1970s in Britain, for example, there were 1,300 local authority units and there are now 361; in Wales there were 45 but now there are 32; in Scotland there were 65 and there are now 32. In Northern Ireland it was proposed on two occasions to reduce the number of local government units from 26 to 11. Strangely, Sinn Féin did not support that. It wanted the number reduced to seven. No decision has yet been made there. In all instances where the number of units has been reduced it has not been proved conclusively that they are more efficient. The previous speaker referred to the document "Is big really so efficient? Investigating assumptions concerning local government reform and amalgamation." It should be read by every Senator who has an interest in this subject.

International experience shows that what is happening across Europe, excluding Great Britain, is the opposite to what is happening in Ireland. In Norway, which has the same population as Ireland, there are 430 municipalities. In Croatia, which has a similar population, there are 420. The powers of local government across Europe are completely different from those of local government in this country. Local government has more meaning. I served for six and a half years on the Committee of the Regions, which is the local government arm of the European project, and I saw at first hand the power and autonomy of local government across European countries. In fact, some of my colleagues in the Socialist group were gobsmacked when we discussed how little power Irish local representatives have.

I cannot agree with the Minister's comment on town councils. There is nothing to support it. He said that town councils are currently inefficient. His exact words were: "we must honestly acknowledge that the sub-county level has become an increasingly marginalised element of the local government system, with problems of weakness, duplication and inconsistency". I put it to the Minister that town local government is far more efficient than the current country structure. I ask him to conduct a little research in his Department on figures that were produced on the provision of housing in County Kildare in recent years. They show that Kildare County Council was six times less efficient than Athy Town Council in the provision of housing.

Democracy carries out a business but it is not a business. I urge the Minister to remember that. I wish him well in his deliberations. There is much work to be done but I believe that if we work together, we can find a better local government system for this country.

David Cullinane (Sinn Fein)
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I welcome the Minister back to the House. He mentioned good hurling earlier. I believe he has a chance to score a goal and not, as previous Ministers have done, take the point or, worse, put the sliotar wide.

Phil Hogan (Carlow-Kilkenny, Fine Gael)
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We will look after that in Kilkenny.

Denis Landy (Labour)
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There are a couple of good hurlers coming through in Ferrybank.

David Cullinane (Sinn Fein)
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I ask the Minister to be radical and bold in terms of genuine reform. I welcome much of the Minister's speech but, as previous speakers have said, we have been talking about local government reform for up to 30 years, and there have been many fine speeches. There was, for example, a White Paper on directly elected mayors from the previous Government. Where will that fit in with the Minister's proposals?

This should not be about cutting numbers or reducing the number of local elected representatives simply to save money. The key issue is the power and functions of local government and the services it can provide to local communities. In being radical the Minister should examine the areas of health, education and enterprise. He mentioned an enhanced and more explicit role for local government in economic development and enterprise support. That is important. The Minister might have seen the recent IDA figures, broken down on a county basis, and unfortunately the Minister's county, Kilkenny, fared badly, as did Wexford and Waterford. We must ensure there is balanced regional development. I would support any changes in structures relating to regional development, but the enterprise agencies must be included in that and be part of whatever reforms are being considered.

I must raise the potential merger of Waterford city and county councils. There is genuine fear about how that will play out. There is constructive criticism from many people. Waterford city is the gateway city of the south east. There is a real fear that in any potential merger, its gateway status could be diluted or lost. Those authorities also have an extensive history. Waterford Corporation and Waterford City Council have a deep association with Waterford city. One option the Minister could consider is the expansion of Waterford city out to areas in, for example, Ferrybank. There is a need to consider expanding the city in an efficient way to ensure it has proper services for the people in the area.

I urge the Minister to be bold and brave with local government reform. He should not play it safe nor put the sliotar wide of the bar. The Minister should score the goal when he has the opportunity to do so. If he does that, he will get the support of people throughout the country.

Phil Hogan (Carlow-Kilkenny, Fine Gael)
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We had to look after Ferrybank when the Waterford crowd would not do it.

Jillian van Turnhout (Independent)
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That concludes the first round. Does the Minister wish to respond now? That will be followed by another round of questions.

Phil Hogan (Carlow-Kilkenny, Fine Gael)
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I thank the Senators for their constructive contributions.

Jillian van Turnhout (Independent)
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To clarify, there will be further questions after this round.

Phil Hogan (Carlow-Kilkenny, Fine Gael)
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I will wait to respond then.

Jillian van Turnhout (Independent)
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The next speakers will have one minute each.

Paul Bradford (Fine Gael)
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I welcome the Minister. I apologise for missing his presentation but I have read it. I respect the fact that no significant announcements are due to be made today. We have debated the structures of local government previously. Is the Minister giving any consideration to the concept that was discussed and agreed by all the parties approximately 20 years ago, that is, the concept of a district council which would expand on the current town council and enhance the population base served by the council? It was designed at the time to have powers devolved from the county council to the district council. It is a concept of local government which I believe was recommended by the Barrington report. My recollection is that every political party supported the concept back in 1991 but the report still rests in the Oireachtas Library. Is it back on the agenda for consideration?

Labhrás Ó Murchú (Fianna Fail)
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I thank the Minister for his presentation. It might be somewhat slack on detail but he sent many positive messages regarding the importance of local authorities. There are a number of words the Minister should consider. Identity is very important so perhaps the Minister would comment on it. Community is also important, and the Minister referred to it a number of times in his contribution. There is also accessibility where the members are concerned, value for money and accountability.

I recall an article written for The Irish Times by the editor of the Financial Times some time ago in which he made a comparison between small and big, which is a factor in the issue before us. He made a reference to Cashel and Dublin and said Cashel was a city when Dublin was a black pool. That refers back to identity. Cashel got its charter from King William on the bridge of Golden. The idea of a town council being abolished and not keeping identity and closeness to the people in mind would be wrong in itself. I hope, when it comes to town councils, that we will not put a brush across all of them, as that would undermine and send the wrong message to communities.

I ask the Minister to comment on the issue of achieving value for money where there is a partnership between the local community and the local authority. I have seen many projects which involved partnerships. If there were no partnerships, we would not get value for money.

Catherine Noone (Fine Gael)
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Will the quotas, in their current format, apply to local elections beyond 2016? Parties, including Fine Gael, intend to apply their own mechanisms to local election quotas in 2014. Will there be official quotas in 2019 and beyond?

Terry Leyden (Fianna Fail)
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I welcome the Minister and thank him for coming. I also thank Senator Mary White for proposing that this debate be held and the Leader of the House for agreeing to it. This is a helpful debate.

While I accept that the Minister cannot give the full details of the reform proposals, he has given a good account of the overall scheme of things. He has enormous personal experience having been a member of Kilkenny County Council, a Senator, a Deputy and a Minister. He brings considerable knowledge to the job.

The non-principal private residence, NPPR, tax is bringing in an enormous amount of money. It brings in approximately €800,000 to Roscommon County Council, for example. The amoney does not come to local authorities directly but in the form of a grant. With the introduction of the new household charge of €100, people are starting to realise that they are also liable for the €200 second home tax. "Amnesty" may not be the proper word to use for what I suggest. Could people who have not registered for the NPPR tax now make an arrangement with their local authority to pay the outstanding tax but not the punitive penalties? As some are not in a position to pay, there should be a hardship clause in this regard. The Minister makes a fair point on the NPPR tax. I know local authorities have discretion in dealing with individual cases.

Jimmy Harte (Labour)
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I agree with Senator Terry Leyden's point on the NPPR tax.

My family association with local government in Lifford and Strabane dates back more than 100 years. There is a massive local government tradition in County Donegal which I would like to see maintained. Does the Minister have a view as to how Donegal County Council and local councils will be following the review?

Terry Leyden (Fianna Fail)
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We might see a young lady from a Polish group running in Letterkenny.

Jimmy Harte (Labour)
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I do not know what the Senator means.

Mary White (Fianna Fail)
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I wish to raise two issues, the first of which is the role of politicians on State boards and the vital role of democratically elected local authority members on new boards such as the new replacement for the VEC. Councillors can contribute enormously to these boards by bringing forward policies and structures. When I was elected to the Seanad, I was obliged to stand down as a member of Bord Bia. I could not understand this because I had been able to make contributions on the needs of small business and deliver changes to what Bord Bia was doing. Is it feared that a politician who is a member of a State board will do something scandalous?

Second, there must be a pension safety net for councillors who lose their seats on local authorities after giving years of service to their local communities. It is crazy that they are left without after all the work they have done in their communities.

I thank the Minister for coming to the House for this debate.

James Heffernan (Labour)
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I thank the Minister for his presentation and recent visit to County Limerick. I was not there to meet him, for which I hope he accepts my apology.

The Minister has said there are two distinct elements to local government, the first being effective and accountable democratic representation. From my colleagues I understand that in County Donegal there are 65 town and county councillors and that in County Wexford there are 61. In Limerick, as a result of the amalgamation, there are only 17 in the city and 28 in the county, making a total of 45. The Minister might take account of this when drafting legislation to deal with the amalgamation. Does he have any idea when we will see that legislation? I know of people who are wondering about changes to boundaries and such like. I ask the Minister to clarify that matter.

Paschal Mooney (Fianna Fail)
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The Minister will be aware that last Sunday a prominent journalist in an equally prominent Sunday newspaper rubbished the proposals made in the submission of the Local Authority Members Association, LAMA, and, to add insult to injury, went on to quote an unnamed source in the Minister's Department saying the Minister would give short shrift to any of the proposals. I hope the Minister will have some comments to make on this insulting remark. It may be an indication of the media perception of the role and functions of local government. I am heartened, however, by the Minister's contribution to this debate.

Caít Keane (Fine Gael)
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It was an unnamed source.

Paschal Mooney (Fianna Fail)
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I think the Senator and I agree that it was not in the best interests of local government.

Caít Keane (Fine Gael)
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It is the principle of the thing.

Paschal Mooney (Fianna Fail)
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Yes. Let us not be semantic.

In the context of the Minister's contribution and his outline of a vision, he asked Senators for specific proposals or insights into local government, which is what we rely on to be elected. I am heartened by the fact that he is not being specific about any reduction of local government, but I appreciate that in the current economic climate there will be some meaningful reforms. In the proposals he will bring forward to expand the role of local authority members I ask him to take into account that we have, in the post-Soviet era, the most centralised form of government in the entire European Union and beyond. I hope, as a reforming Minister and someone who served in this House with great distinction - I had the pleasure of serving with him - and who has been a member of a local authority he will be a crusading Minister when it comes to local government reform. We are fortunate that he is in this position and I look forward to seeing his proposals. I hope everything he does will enhance local government and give more functions and powers to it rather than, as has been the trend for decades, centralise government even further. I appreciate the necessity for him to consider a regional structure, particularly when it comes to the provision of infrastructure, but I hope his proposals will enhance the role of local government rather than that of central government.

Denis Landy (Labour)
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I am so enthused by this subject that I wish to speak again. A review of the Constitution, in which local government is clearly mentioned, is proposed. Will the Minister await its outcome before his final deliberations on his proposals for local government reform? Does the Minister intend to drive on ahead of that review? Will the Minister consider in any proposed legislation setting out a clear role for central and local government along the lines suggested by Senator Mooney?

I met the Minister this time last year on my way to a point to point meeting in Bennettsbridge. He was driving with Councillor Billy Ireland attending clinics. We met on a country road and the Minister was driving too fast, as I recall, because he nearly hit me Will the Minister consider setting out a clear role for practitioners at central government level to outline the duties of both local representatives and Members of Parliament?

Maurice Cummins (Fine Gael)
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There is a need for clarity on the position of county and city enterprise boards and LEADER programmes and so on. They should be an integral part of the local government structure. There seems to be a lack of clarity as to whether this will be introduced by the Minister's Department or the Department of Jobs, Enterprise and Innovation. It should remain under the remit of local government. Perhaps the Minister could throw some light on the position.

Michael D'Arcy (Fine Gael)
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Has any thought been given to the demographic considerations? There is a significant disparity between some county councils. I use the example of County Leitrim with a population of approximately 30,000 which has 22 county councillors and County Wexford with a population of 145,000 with 21 members. In the case of Dáil representation, there can be a discrepancy of 20,000 to 30,000 population between seats. Has this been considered or is it part of the process?

Jillian van Turnhout (Independent)
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As there are no further speakers I invite the Minister to reply.

Phil Hogan (Carlow-Kilkenny, Fine Gael)
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I thank the Senators for their constructive contributions. This is an opportunity for people to indicate to me their views on how local government should be reformed. I realise full well the sentiments as expressed by Senators in that a considerable amount of paperwork has been produced over many years but very little action. I hope they will see some change in that attitude and that the strength and purpose of local government and the delivery of local services will be centre stage in any particular policy announcement. I believe fundamentally in local government as a vehicle to deliver local services. I am engaging with my Government colleagues to establish which functions of Departments and agencies can be better and more usefully, efficiently and effectively deployed at local level. I would welcome more support from some Departments in this regard as these are often reluctant to give way on issues and on some functions that are more clearly and effectively-----

Denis Landy (Labour)
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Would the Minister like to tell us?

Phil Hogan (Carlow-Kilkenny, Fine Gael)
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I do not regard this particular policy proposal as a White Paper but rather an action plan. We have enough documents in the Department. I am anxious to make the announcement as soon as possible about whatever is ready and I will put those proposals to Government as soon as possible. Equally, I wish to do so when I am ready and when I am of the view we have the appropriate co-operation, buy-in from Departments and some measure of agreement on what services can be more appropriately delivered at local level.

I do not subscribe to the abolitionist mentality of the McCarthy report. Reform is not a question of abolition but rather a case of putting new and more effective arrangements in place. In reply to Senator Landy, I did not say that town councils were inefficient. If he reads carefully he will see what I said.

Denis Landy (Labour)
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I heard what the Minister said

Jillian van Turnhout (Independent)
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The Minister, without interruption.

Phil Hogan (Carlow-Kilkenny, Fine Gael)
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The defensive attitude will not work with me. Everything will have to be justified as to what is appropriate. We cannot have structures in place on paper and in theory because they must also have a practical application and function. That will be the ultimate situation.

I established the local development alignment group to bring together many of the activities in communities which are outside the remit of local government. The allocation of moneys by Departments to various groups and entities outside the democratic process is not right and is neither appropriate nor accountable. There must be greater oversight and accountability, through the democratically elected representatives, for what goes on in every community.

Paschal Mooney (Fianna Fail)
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I hope that includes some European money as well.

Phil Hogan (Carlow-Kilkenny, Fine Gael)
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In the next few weeks I will have completed the work of the local development alignment group to see what measures can be put in place as part of the local government package to bring community and local government closer together.

Senator Mac Conghail referred to citizens' participation. Proposals to allow greater active participation by the public and communities will be developed. I do not expect I will be able to develop all aspects of what should be delivered for local government all at once. We will move with whatever is ready. Many of my predecessors wanted to have everything ready and decided upon in terms of all facets of local government reform, with the result that nothing was done because they ran out of time. A phased approach is required. If nine or ten items on the agenda are ready to go by March or April, we will go with them. Any issues requiring further thought or work can be added at a later stage. I see this as a phased approach between now and the local elections in 2014 and culminating by 1 July 2014, when the term of office of the next local authority membership begins. I am looking at structures and at functions and also the manner in which as many functions as possible can be devolved from central to local government. We must get the financing right as there is no point in having functions if there is not the wherewithal and the operational capacity to find the money to implement the policies and deliver the services.

I am looking at a rebalancing of power towards members and away from management.

Mary White (Fianna Fail)
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Hear, hear.

Phil Hogan (Carlow-Kilkenny, Fine Gael)
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This will be examined in the context of the governance aspects of the reform programme. This may take a little longer than the structural reform but between now and 2014, a fundamental rebalancing will see county and city managers being chief executive officers of the members who are directly elected by the people.

The question is asked whether big equals efficient. Cost savings have to be made in the current climate but this is not the only reason for mergers. The objective for mergers is to strengthen local government, of which Limerick is a good example. Local government was dying in Limerick city and to a greater extent than in the county. Limerick city centre was certainly undergoing a lot of economic difficulties and there was a lack of joined-up thinking and response from the local authority structures. County Limerick was pulling away some business opportunities from Limerick city and the cohesive approach of having a strong regional growth centre like Limerick county was putting the city centre under pressure. We all know that if a town centre is under pressure, this has a significant impact on the aesthetics of the place, the footfall, the business community and the dynamic of the city or the town in question. I do not want to go down the road of having a local authority at every crossroads, such as they have in France with 37,000 local authorities. It is a huge country but I do not believe that is an appropriate model. I think we can develop a structure that will take account of the principles referred to by Senator Landy such as sub-county municipal units that will provide local representation as close as possible to the citizen without duplication and a multitude of local authorities. Norway has been mentioned. Oslo and other cities have been mentioned in terms of local government structures. They have done many mergers in recent years and included the hinterland. I am not opposed in principle to a directly elected mayor but, equally, it is not a priority. It is an expensive process.

Paschal Mooney (Fianna Fail)
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With no power.

Phil Hogan (Carlow-Kilkenny, Fine Gael)
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The original proposal from the former Minister, Mr. John Gormley, had an additional layer of local government called "directly elected mayor". I am not in favour of that.

Mary White (Fianna Fail)
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It was not thought out.

Phil Hogan (Carlow-Kilkenny, Fine Gael)
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The cost was €8 million to which we cannot subscribe at present. We do not need additional structures.

I assure Senator David Cullinane that the gateway of Waterford will not be diluted with or without Ferrybank. It will be protected and strengthened and its city status will be maintained. I agree with Senator Ó Murchú on the issue of identify. As a county colours person, like me, I am sure he appreciates that, in terms of identity and community, both of which are important concepts. They enable people to gravitate towards a local identity and community. Equally I want to ensure that community and local government structures work together. Whether it is in the arts, or cultural field, local government has a responsibility and a role in developing and enhancing them and in securing some funds to ensure expansion. Identity and community involvement is important. I set up the alignment group to ascertain how we could get community and local government working closer together. Many programmes could be delivered if they worked together. EU funding, which is available, cannot be drawn down given that they are not working together. I am trying to address that issue and get local authorities more involved in heritage and the conservation aspects of village renewal. These projects could be developed by existing local government staff if the money was available. Community groups and local government should work more closely together to achieve the objective of delivering on the rural development programme.

Senator James Heffernan asked a couple of questions on the implementation programme in Limerick. I will have a report from the Brosnan implementation group at the end of March which will set out the process of implementation of a number of those proposals. Legislation will be required, which I expect to be before the House by the end of June, to give effect to some of the proposals in Tipperary, Limerick and other areas, if appropriate. On the issue of boundaries, local elected members are concerned about where they will stand.

Terry Leyden (Fianna Fail)
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That is correct.

Phil Hogan (Carlow-Kilkenny, Fine Gael)
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I will give them plenty of time in order that they may have the appropriate locations from which to request a mandate from the people. They will have 17 or 18 months notice of where they will stand in the forthcoming local elections.

I expect to address local government reform in the next term rather than wait for constitutional conventions to report. I will do my utmost to set out the distinctive role of local government and how it should deliver local services through its local elected members and how it differs from central government. I will err on the side of maximum devolution of responsibility and function to local government.

I agree with Senator Maurice Cummins that clarity is needed in respect of enterprise function and microenterprise. The Government will make a decision next week or the following week on where county and city enterprise boards fit in and their relationship with local government. They are with Enterprise Ireland which has a role in terms of policy and funds county and city enterprise boards but has a client list. Through the business support units across the range of agencies, Departments and local government, we are anxious to give local authorities an opportunity to assist an individual who has an idea to bring that idea to fruition. We are anxious to assist with planning and identification of a site or a premises that may be appropriate to the scale of employment. Two or three people with an idea at local level can often get lost in the maze of agencies. The IDA and Enterprise Ireland deal with more advanced projects and endeavour to get opportunities for exports markets. What is lacking is support for the person who has an idea and wishes to get going in a rural area and whose idea may develop into a bigger opportunity for that business. Clarity on that issue is required and I hope it will be available in the next week or two.

Senator D'Arcy made a valid point on the number of councillors per population and how it varies in different parts of the country. For example, Carlow which has a significantly lower population than Wexford has more councillors than Wexford. Those issues will be addressed in the context of the boundary commission to be established for the local elections. A base level of representation is needed in the smaller counties and there is the geography dimension. Wexford is probably entitled to more representation given that it has a significant population to represent. Meath is another large county.

Senator Paul Bradford mentioned devolution from county council to sub-county. I agree with that. The new arrangements, on which we are working, will concentrate on giving the town and the area more autonomy and support in terms of function than at present. The municipal government structures, on which we are working, will have dedicated responsibilities and autonomy at local level. With regard to the local development plan, what would anybody in the northern part of a county understand about a local area plan in the southern part of the county? These decisions have to be made as close as possible to the citizen and elected members. That is only one example of what functions could be applied around a municipal government system that would make sense.

Cork is a large county. I am sure many have been asked in Mitchelstown to make decisions about Bantry and Skibbereen in the past. That is not fair because of the pressures it imposes but it is equally unfair to the local knowledge and nuances that would be required to implement an appropriate plan in an area that is a distance away from elected representatives.

I agree with Senator Paschal Mooney that we have a soviet system at national and local level, perhaps, where the level of centralisation is far too unhealthy for democracy and where citizens participation has contributed to providing some balance, rather than the membership of the local government or the membership of the Oireachtas. This issue needs to be addressed. Equally the power vested in officialdom in local government is not healthy in terms of local democracy. This has contributed to many people not participating at election time, and not standing for election across the spectrum of socio-economic and business groups to give a more holistic representation.

Paschal Mooney (Fianna Fail)
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They have more power outside.

Phil Hogan (Carlow-Kilkenny, Fine Gael)
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If people see that they have power to implement decisions at local authority level, more people will be interested in participation. At present, that is not the case.

I hope that by the 2014 local elections people will see I am serious about giving more power, and with power comes responsibility. Equally they may have to make tough decisions. However, that is the essence of what we all do every day. That is not the case at local level because they do not have sufficient powers to make those tough decisions.

Paschal Mooney (Fianna Fail)
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Start with the county managers Act.

Phil Hogan (Carlow-Kilkenny, Fine Gael)
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The process will start at the 2014 local elections with a rebalancing of power to councillors, more accountability, more alignment between local elected members in community groups and a better system of local government that will attract more people to participate either by being elected to the local authority or participating, through the community sector, in enhancing the economic and social community projects that are badly needed. This would have the effect of creating employment opportunities locally and delivering local services as close as possible to the citizen, with the maximum financial autonomy. That is my objective.