John Kelly (Labour)
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I welcome the Minister to the House and thank him for his recent visit to Ballaghaderreen. He was well received by the Western Development Commission. When one is the bearer of good news, one is much appreciated. I thank the Minister for visiting the fire station and recognising the memorial on display for the firemen who died in the events of 11 September 2001.

The issue I want to discuss concerns the non-principal private residence charge, introduced by the last Government. When it was introduced, it was not meant to cover circumstances it is covering at present. There are thousands of small shops, businesses and pubs throughout the country whose owners were led to believe in 2009 that if they paid rates, they would not have to pay the second home property tax. Since the recent debate on the household charge, many shop owners and small businesses have been asking questions, on foot of their uncertainty, as to whether they are liable for the €200 charge. When they made contact with the local authorities, they were told they do not owe €800 but as much as €2,200 because of the accumulation of interest and penalties. In most cases, the people affected are shopowners who have built a house in the country and who have paid the property charge on that house. All they are left with is unused overhead accommodation. I have no issue with cases where overhead accommodation has been converted to apartments and flats that are being rented out. One should be liable in that instance. In many cases, however, the premises are just disused accommodation. Naturally, it cannot be rateable property because most businesses are already stretched paying rates for the downstairs parts of the buildings. People certainly cannot afford to have the whole property attracting rates. In most of these cases, access to the overhead accommodation is through the shop. How such a property can be considered a second property has me baffled. In many cases, most of the owners cannot afford to do up the properties to rent them.

Many may reluctantly pay the second home property tax, bearing in mind that they never believed they were liable in the first instance. I ask for an amnesty in respect of the interest and penalties for those who did not realise they were liable in the first place. I am not asking for an amnesty for those who simply will not pay. There are many genuine cases, however.

In 2009 and 2010, county council staff were not always sufficiently educated on the second home property tax. In many cases, they told business people such as those I described that they were not liable. Naturally enough, they did not pay as a consequence. I am familiar with one such case, that of a publican who lives in the country some two miles from her pub. I brought this matter to her attention during the week and she could not believe what I was suggesting.

Could the Minister not give control back to county councils such that they could account for genuine cases where people did not realise they were liable for the charge? The councils, in such cases, could collect the €800, which is vital, as opposed to expecting people to pay €2,200, which they simply do not have and will not pay. Will the Minister organise an amnesty in this case? I ask him to amend the legislation to account for ratepayers. At present, there is no exemption for ratepayers listed. It was never meant to be the case that the scenario I describe would arise. The Minister is a fair man and I expect him to give me a fair response.

Phil Hogan (Carlow-Kilkenny, Fine Gael)
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I thank the Senator for raising this important matter for debate. The Local Government (Charges) Act 2009, as amended, broadened the revenue base of local authorities by introducing a charge on non-principal private residences. The charge is set at €200 and liability for it falls, in the main, on owners of rental, holiday and vacant properties. The charge on non-principal private residences, since its introduction in 2009, has contributed €218 million to the financing of vital local authority services, including fire and emergency services, planning and development services, the maintenance and cleaning of streets, street lighting, public parks, libraries, open spaces and leisure facilities.

There is no obligation on local authorities to issue notifications or invoices regarding the charge. It involves self-assessment. Nationwide advertising has taken place each year since the introduction of the charge in 2009 to ensure general awareness of the charge and the liability dates, and this has been successful. In tandem, local authorities have undertaken their own advertising campaigns locally. Communications have also been issued to persons who paid the charge in respect of previous years reminding them of their possible liability for the charge.

Significant efforts are being made to ensure property owners are aware of the charge and the liability dates. However, the charge is based on self-assessment principles and it is a matter for persons with a liability to pay the charge by the due date to avoid late payment fees. Payment of the charge within the three month period ending on 30 June discharges the liability to the charge and ensures late payment fees do not arise.

The Act places the charge on non-principal private residences under the care and management of the local authorities, and its application in particular circumstances is a matter for the relevant local authority. Interpretation of the legislation is a matter for legal advice in individual cases and ultimately a matter for the courts. This is not what Senator Kelly is contemplating.

I have no proposals to provide an amnesty from payment of the non-principal private residence charge. I issued guidelines to local authorities on 14 March on the operation of the care and management provisions of the Local Government (Charges) Act 2009 in the context of individual situations where genuine hardship in having to discharge a liability in a single payment can be demonstrated. In such cases the guidelines are set out and the modality has been agreed for local authorities to enter into payment arrangements for the discharge of outstanding liabilities in instalments over a specified period of time. The local authorities already have information that can stop the clock on the payment of interest and fees. A person can pay the original amount and enter into an arrangement to pay the remainder by instalments. Each county and city manager has been asked to do this in as simple a format as possible.

Providing clarity regarding liability for the second home charge is ultimately a matter for the local authority manager. The Act is specific in putting the onus for care and management on the local authority manager to allow discretion where there are genuine cases. If the property is not habitable, there is no liability, but this must be proved to the satisfaction of the local authority manager. I ask the Senator if he is aware of genuine cases to discuss them with the local authority manager. There is also flexibility in the payment arrangements, but I am not in a position to grant an amnesty.

John Kelly (Labour)
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I appreciate the Minister's efforts on 14 March to make things a little easier for people. In fairness, I would not have thought many of the people who find themselves in this position would know this facility was available to them and I would be glad to announce it. I would like the Minister, however, to consider an amendment to the legislation in the longer term. The property being habitable is the core of the issue. It might be habitable if an investment was made. In the case of the small shop, where the accommodation cannot be accessed unless a person goes through the shop, it could be considered habitable.

Phil Hogan (Carlow-Kilkenny, Fine Gael)
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For the purposes of the owner.

Terry Brennan (Fine Gael)
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We cannot rehearse the debate.

John Kelly (Labour)
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My point is that it cannot be considered to be a second property for rental purposes because it cannot be accessed without going through the shop. I know the Minister is a fair man and that this is a common-sense issue, but the Government would be doing itself a favour in cleaning up another mess left by the last Government. I appreciate the response and thank the Minister for his efforts so far. Perhaps we might revisit the issue on another day.

Phil Hogan (Carlow-Kilkenny, Fine Gael)
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In the case mentioned it could be interpreted that the property is not habitable on the basis that access is only possible with the assistance of the owner of the property who happens to be a shopkeeper. If that information was brought to the attention of the local manager, the case could be made. Local authority managers are fair-minded people and if a genuine case is made, I am sure they will look at it in keeping with the spirit of the legislation. All of the anomalies will not be resolved until we have a fully fledged property tax regime in place in 2013. I am not in a position to solve these difficulties in 2012 and must leave it in the care and management of the local authority manager to exercise common sense in dealing with genuine cases.