Seanad debates
Tuesday, 27 June 2023
Nithe i dtosach suíonna - Commencement Matters
Local Authorities
12:30 pm
Eileen Flynn (Independent)
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The Minister of State is very welcome to the House.
Fiona O'Loughlin (Fianna Fail)
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I thank the Cathaoirleach for selecting this Commencement matter. It is an important one. Last Friday, we had the Kildare County Council AGM and I was very glad to be there to see my friend and colleague, Councillor Daragh Fitzpatrick, take the position as first citizen. I congratulate him and wish him well in the year ahead.
The previous day, Kildare County Council launched its 2022 annual report. I can honestly attest, as a former member of Kildare County Council and a former mayor, to how diligently and how hard both the staff and the elected members work to deliver for all the communities and towns within Kildare. The annual report gave a very important overview of the council's programme of work delivered in 2022 and many significant and important projects and milestones were advanced by Kildare County Council. There were grants to many different businesses to support different areas of business development such as start-up expansion and export marketing and funding for the Athy food, drink and skills innovation hub, which will act as a home for our county-wide food cluster and education hub and manufacturing space. That is hugely important and we look forward to it. On the housing front, Kildare County Council reached its target of 372 new homes, in addition to 261 new homes through a social leasing programme and significantly increased expenditure on housing grants programmes. Some 75% of the work has been completed on the Athy distributor road and of course there is the maintenance of roads and footpaths and the provision of litter and amenity services. I could go on.
It is very clear that Kildare County Council, under the leadership of our new CEO, Sonya Kavanagh, her team and our councillor colleagues are delivering for their communities but they are doing this from a position of relative financial weakness when compared with all other local authorities. Population, as we know, is a key demand driver for all local authority services, from planning to housing, from libraries to fire services, from recreation to roads and across all services.Over the past 30 years, Kildare's population has doubled and increased by just over twice the national rate. However, when it comes to funding, Kildare County Council is not getting its fair share. I thank Ms Fiona Millane, acting head of finance in Kildare County Council, for sharing figures with me. When we compare statistics, Kildare is fifth out of 31 local authorities in terms of population. It is seventh of 31 for local property tax, LPT, generation. It is tenth out of 31 for overall budget but it is 31st out of 31 for expenditure per capita. In terms of the overall budget, that is shocking.
In 2022, the average spend per head of population nationally was €1,078, while in Kildare, it was €715. Kildare residents pay more than €21 million in LPT, the seventh highest figure in the country. The scale of the underfunding is such that in order for Kildare to have the same per capitaexpenditure levels as the local authority that is next in line, at 30th of the 31 local authorities, there would need to be an uplift of more than €5.4 million in funding. To have the same expenditure levels as the local authorities in 28th and 29th places would require an uplift of more than €26 million.
Kildare is a blossoming county which the Minister of State knows well. Our communities are bursting at the seams. Recent data from the Central Statistics Office, CSO, show that we have one of the highest rates of population increases in the country, at 11.4%. We are seeing towns such as Newbridge, Kildare, Kilcullen, Monasterevin, Rathangan and many others growing and attracting huge inward population growth. We are welcoming a lot of people from the Dublin area who have been priced out but we need to get the support we deserve.
Malcolm Noonan (Carlow-Kilkenny, Green Party)
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I thank the Senator for raising this issue in a Commencement matter. Kildare is a county I am very familiar with as I have strong family connections there. The Department acknowledges the funding pressures on local authorities generally. I also acknowledge some of the innovative work and funding the Senator outlined. Kildare County Council continues to do exceptional work.
As committed to in the Programme for Government: Our Shared Future, the move to 100% retention of the LPT has taken place in 2023. All equalisation funds are now met by the Exchequer, ensuring that all authorities receive, at a minimum, an amount equivalent to their baseline. In addition, the move to a 100% local retention model will lead to an increased surplus for those authorities, including Kildare County Council, with LPT income above their funding baseline. These authorities shall now retain a greater proportion of that surplus for their own use in 2023, an increase from 20% of the overall yield to 22.5% in 2023. The remainder of the increased surplus will be used to self-fund housing, roads or other services in the local area.
As the Senator may be aware, all local authorities have the opportunity to increase or decrease their base rate of LPT by up to 15%. The Minister and I acknowledge the elected members of Kildare County Council for taking the decision to increase this rate by 10% for 2023 and 2024. This upward variation will lead to almost €2.3 million of extra income for 2023 alone, which will be of great assistance in what is a challenging financial time ahead. This brings Kildare's total LPT allocation in 2023 for its own use to €19.3 million. The remaining €6.2 million of the allocation will be used to self-fund housing services in the local area.
The Government is making a significant contribution of €481.3 million in 2023 to support the local government sector. A large portion of this figure, €287.2 million, will go towards assisting local authorities with the cumulative impacts on pay costs arising from national pay agreements and the unwinding of the financial emergency measures in public interest, FEMPI, legislation. This allocation, which has seen an increase of €77.6 million from 2022, will ensure the sector will have the necessary human resources to perform their functions and provide essential public services to our citizens - in excess of 1,000 services in fact. These services that local authorities provide are increasing year on year and that is what we want to achieve. We want to devolve more power to local authorities.
Kildare County Council received €5.9 million towards increased payroll costs for 2022 and will receive €8.2 million for this purpose in 2023. The Minister and I are very aware of the current financial environment in which local authorities are operating and, in recognition of the ongoing pressures, additional support of €60 million has been secured to assist the sector in 2023. The purpose of this additional funding will be to assist Kildare County Council and other local authorities in meeting the increasing costs, and in particular increasing energy costs, involved in providing a wider range of services. Kildare County Council has been provisionally allocated €2.5 million in this regard.
I will come back with a supplementary answer in respect of the other points raised.
Fiona O'Loughlin (Fianna Fail)
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I thank the Minister of State for his response. The fact that our expenditure per capitais at the level it is in Kildare is simply unacceptable. As many in this House will be aware, I regularly raise the issue of the infrastructural deficits we have in south Kildare, such as that relating to the second bridge for Newbridge. We have a huge issue as regards traffic management and congestion, the root cause of which is the single bridge crossing the River Liffey. We have significant school place pressures at second level that are now starting at primary level and a lack of basic community infrastructure, such as playgrounds and other amenities. We are one of the fastest growing populations with the lowest expenditureper capita. That figure will only get worse as time goes on.
The Minister of State mentioned that Kildare County Council has been provisionally allocated an extra €2.5 million. That still means we are placed 31 out of 31 local authorities by a gap of €2.5 million compared with the county next to us. The Department is doing nothing to even the playing field for Kildare. I hope that the Minister of State will have more and better news for Kildare in his concluding remarks.
Malcolm Noonan (Carlow-Kilkenny, Green Party)
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I will conclude by referring to the Government's support for Kildare, in particular since 2020. Across all schemes and funding sources, my Department provided €151.7 million in 2020, €155.9 million in 2021 and €164.9 million in 2022 to Kildare County Council. Included in this is the unprecedented level of support provided by central government to local authorities during 2020 and 2021, rightly so, in respect of the Covid-19 pandemic.
In 2023, a working group was set up to carry out a comprehensive review of the local property tax baselines. This group included elected and executive representation from the local government sector. My Department has engaged with key stakeholders in the course of this review. Submissions were invited for consideration from other interested parties. The work of this group recently concluded and the recommendations are currently being considered by the Minister. It is intended, subject to the agreement of the Minister, to apply the recommendations to the 2024 LPT allocations. The review took into account the overall funding position of all local authorities and included consideration of the ability of each authority to raise income locally, along with the main drivers of expenditure, such as area and population, as the Senator rightly pointed out.
I disagree that the Government is not doing anything. The Government is working with local authorities to try to equalise and ensure that local government, including Kildare County Council, is adequately funded to carry out the vital work it does.