Micheál Carrigy (Fine Gael)
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I welcome the Minister of State. I am back here for the fifth year in a row, with the same request for funding from the Department to cover the loss of rates revenue at Lough Ree power station. As the Minister of State knows, Lough Ree power station in Lanesborough - similarly to Shannonbridge in County Offaly - was due to close in 2027. However, both plants closed in 2020, seven years earlier than expected. The rates base of Lough Ree power station for Longford County Council is €1.25 million. A recommendation from the just transition commissioner stated:

It would be extremely unfair in circumstances over which these local authorities had no responsibility and for a decision which was not expected until 2027 that they should be burdened with this sudden loss. I recommend that an urgent engagement takes place with the Chief Executives of the councils concerned with the funding Departments so that a suitable emergency arrangement can be agreed to alleviate the rate losses over the period 2021 to 2026.

No agreement has been put in place for that whole period. Every year there is uncertainty in the local authority regarding this funding. We are now at the time when budgets and figures are being put together for 2025 and the council has no confirmation of guarantees that the funding will be in place. Every year since 2020 I have come here to try highlight this issue and to make sure the council can get the funding put in place so that it can put proper budgets together for the year ahead. This will allow it to ensure that it is in a position to service whatever capital projects need to be done. More importantly, there are a significant number of projects in the various communities throughout the county. When I was a member of Longford County Council, we were the first local authority, ahead of the 2019 local elections, to take a decision to increase the LPT charge by 15%.It was the first county to do so. Why did we do it? It was because we wanted to get projects into our county. Funding streams were available. The council had to pay a 10% contribution towards these grants. We felt that by doing so we could ring-fence that money solely for those projects. That is what we did at the time and we have got significant multiples of millions of euro in grants from the European Regional Development Fund, ERDF, CLÁR, the outdoor recreation infrastructure scheme, ORIS, and all the various town and village schemes that have been put in place, especially by Department of Rural and Community Development. Every part of our county - every town, village and community - has benefited from it, but we cannot plan ahead to be able to service the loans we have taken out to get the moneys for those projects without some certainty. I do not understand why, every year, we have to come begging to get this money and are sometimes told in late October that the money is in place while budgets are finalised in October, as we all know, in every local authority. I want certainty for 2025 to 2026 at a minimum and then we would look at a system where perhaps there would be a sliding reduction of those rates. They would be tapered off over a number of years. As a small county, €1.2 million is actually 15% of Longford's rate base. We cannot take a hit like that. If we are to provide proper services, whether library or fire services, we have to service loans with those significant grants. I want guarantees that funding will be in place for the next few years.

Kieran O'Donnell (Limerick City, Fine Gael)
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I am taking this matter on behalf of the Minister, Deputy Darragh O’Brien. I thank the Senator for giving me the opportunity to outline today the funding and Government support for local authorities, with particular reference to Longford County Council.

The Minister acknowledges the current financial environment in which all local authorities, including Longford County Council, are operating, but specifically the negative impact on the commercial rates income caused by the closure of Lough Ree power station in Longford. It is recognised that the now closed power station was the single largest ratepayer in the county and accounted for approximately 15% of the commercial rates in 2019. To alleviate the negative impact of the closure, the Department has provided compensatory funding to the local authority at a cost of €1.4 million in 2021 and €1.3 million in 2022 and again in 2023. The Minister is pleased to confirm that this arrangement will continue in 2024, with support of €1.3 million being secured for this year. However, it should be noted that any allocations from the Local Government Fund can only be confirmed annually as part of the Estimates process. That said, it is intended that a similar allocation will be sought in the Estimates for 2025 and 2026.

The Government continues to make significant contributions to the local government sector each year, with €466.2 million secured for 2024 from the Local Government Fund. A large portion of this figure, €331.5 million, will go towards assisting local authorities with the cumulative effect on pay costs arising from the previous Building Momentum pay agreement and the most recent national pay agreements. This allocation will ensure that the sector will have the necessary resources, in terms of people, to perform its functions and provide essential public services to our citizens, which are in excess of 1,000 services.

Longford County Council received €3.1 million in 2023, with a provisional allocation of €3.47 million assigned for 2024. The 2024 allocation is to further increase following the most recently ratified pay agreements. The local property tax allocation to Longford for 2024 will be €10.7 million and this will include €8.26 million of equalisation funding from the Exchequer. It should be noted that following the LPT baseline review, Longford’s baseline has increased by €1.5 million to €10.4 million. All local authorities have the opportunity to increase or decrease their basic rate of LPT by up to 15%, as Senator Carrigy stated. The Minister would like to acknowledge the elected members of Longford County Council for taking the decision to increase this rate by 15% for 2023 and 2024. This upward variation on what is a relatively low base will lead to more than €300,000 in extra income for 2024, which will be of great assistance during the year.

The Minister is very aware of the financial challenges facing the sector and, in recognition of the ongoing pressures, additional support of €60 million was secured to assist the sector in 2023. The purpose of this additional funding was to assist Longford County Council and other local authorities in meeting the increasing costs, in particular increased energy costs, involved in providing a wide range of services. Longford County Council received €660,000 in this regard.

Micheál Carrigy (Fine Gael)
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I thank the Minister of State for his positive reply and the commitment that the funding will be in the Estimates for 2025 and 2026. Am I correct that the figure will be similar to the €1.2 million provided in 2023 and 2024, respectively? Will he confirm that for me? I would appreciate it.

Kieran O'Donnell (Limerick City, Fine Gael)
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I will conclude by referring to the Government supports to Longford since 2020. Across all schemes and funding sources, the Department provided €30.7 million in 2020, €48.5 million 2021, €36 million in 2022 and €52.9 million in 2023 to Longford County Council. Included in this is the unprecedented level of support provided by central government to local authorities during 2020 and 2021 in respect of the Covid-19 pandemic. A review of the LPT was completed by a working group in 2023 and the baseline for 2024 has been adjusted in accordance with the recommendation of this group. Furthermore, funding was secured to ensure that each local authority received a baseline increase of at least €1.5 million. As a result, Longford County Council's baseline increased from €8.9 million to €10.4 million in 2024.

On the Senator's specific question regarding the loss of commercial rates with the closure of Lough Ree power station, it should be noted that any allocation from the Local Government Fund can only be confirmed annually as part of the Estimates process. That said, it is intended that a similar allocation will be sought in the Estimates for 2025 and 2026.

Fiona O'Loughlin (Fianna Fail)
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I thank the Minister of State. Now we-----

Kieran O'Donnell (Limerick City, Fine Gael)
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To conclude, the purpose of this interim funding is to alleviate the unprecedented and unexpected loss of commercial rates in the period to the end of 2026, in line with the recommendation of the just transition commissioner. I have been assured that the Department will continue to engage with Longford County Council in this regard.