Victor Boyhan (Independent)
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The Minister of State, Deputy Cummins, is very welcome. He is no stranger to this House. I thank him for coming here because this Commencement matter is particularly important to his portfolio and area of expertise. This Commencement matter is in the name of Senator Seán Kyne and it relates to the recategorisation of Galway City Council from a tier 5 to a tier 4 local authority.

Seán Kyne (Fine Gael)
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Cuirim fáilte roimh an Aire Stáit, an Teachta Cummins. The Minister of State is welcome. First, I thank the Cathaoirleach’s office for choosing this Commencement matter. I thank the Minister of State, Deputy Cummins, for coming in. It is good to see the Minister of State with responsibility for the topic present.

I am raising this Commencement matter regarding funding for Galway City Council. In doing so, I am conscious of the continuous efforts being made by my colleagues on Galway City Council, including Councillors Frank Fahy, Eddie Hoare, Clodagh Higgins and Shane Forde, three of whom are former mayors of the city. We have had meetings and regular briefings with the management team of Galway City Council and with this year’s mayor, Councillor Mike Cubbard, as well as with the previous mayor, Councillor Peter Keane, where we met the manager. We have a new CEO, Mr. Leonard Cleary, who has come in since the baseline funding was decided by the Government a number of years ago.

Galway city is short-changed by being ranked as a tier 5 authority for funding. By being ranked alongside the smaller rural counties with a low population, Galway city is denied the funding it requires and deserves as a regional capital. Galway city’s population stands at 90,000 in 2025. That is not the full picture, however. During the autumn, winter and spring, some 30,000 students attend its two universities and in summer, it welcomes some two million tourists. It could be argued that there is a daily population of approximately 130,000 when workers coming into the city from the outskirts are taken into account as well.

Galway is a regional capital. It provides all the services of a regional capital to its hinterland of more than half a million citizens. Its four hospitals cater for thousands of patients weekly and its colleges educate each successive generation, yet it is funded as if it is the smallest of local authorities. Galway is a world hub for the medical device industry, with thousands of jobs and cutting-edge innovation. It is a tech hub with amazing new start-ups and spin-outs from our universities, but it is funded with no recognition of the achievements and needs this involves.

There is a huge need for investment in Galway city. We need transport infrastructure of all types to relieve the traffic gridlock experienced daily. We need public and private housing and the services that surround those provisions. We need all the other services involved in building sustainable communities, such as playgrounds, community centres, sports facilities, walking and cycling routes and everything that is needed to create a sustainable living city, yet we are funded at the lowest level.

Teastaíonn tuilleadh maoinithe do Chomhairle Cathrach na Gaillimhe. Tá an struchtúr atá leagtha amach ag an Roinn tithíochta agus rialtais áitiúil, ina bhfuil an comhairle cathrach i sraith 5, mífhéaráilte. Iarraim ar an Roinn Comhairle Cathrach na Gaillimhe a athrú go sraith 4. Tá an comhairle cathrach sa ghrúpa céanna le comhairlí beaga faoin tuath. Níl sé seo ceart do phríomhchathair an iarthair a bhfuil daonra de 90,000 aici, chomh maith le 30,000 mac léinn sa bhreis ag freastal ar an dhá ollscoil gach lá. Freisin, tá ceithre ospidéal sa chathair a fhreastalaíonn ar an gcathair, contae agus réigiún. Mar sin, tá a lán daoine ag úsáid seirbhísí sa chathair chuile lá.

Galway is the regional capital and it is not being funded as such. Its services cater not only for the environs of a relatively small, designated city but also for the greater region, both in the county and throughout Connacht. That needs to be reflected in the baseline funding it receives. Changes were made and agreed to a number of years ago and I appreciate that. That decision predates the present CEO, however, who has indicated that, on a population basis in particular, it reflects just the population of the city rather than the population it caters for on a daily basis, which includes some of the county and the region. That is the main issue that needs to be taken into account. I am not trying to take from any other local authority. Rather, I seek to ensure Galway city gets what it deserves in the context of what it does for the area and region.

Victor Boyhan (Independent)
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Before I call the Minister of State to respond, I welcome the three guests of the Minister of State, Deputy Mary Butler, who are present. I apologise for cutting across the Minister of State.

John Cummins (Waterford, Fine Gael)
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That is no problem. I certainly welcome our guests, especially if they are from Waterford as guests of the Minister of State.

Victor Boyhan (Independent)
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That is why I thought I would give you the heads up.

John Cummins (Waterford, Fine Gael)
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They are more than welcome to the Chamber. I thank Senator Kyne for outlining the position as he sees it regarding funding for Galway City Council.I know the Senator is a strong advocate for his area and that he will continue to fight for increased funding. It is important for me to clarify at the outset that the characterisation of Galway City Council as a tier 5 local authority refers specifically to the size of the local authority. It does not actually reflect the funding mechanism for the local authority. Dublin City Council, for example, is categorised as a tier 1 local authority because of the scale of the authority itself. It is not in any way linked to the funding the authority may receive. In other words, a simple reclassification of Galway City Council from a tier 5 to tier 4 local authority would not have any effect on the funding of the authority itself, which is actually determined by a range of other factors. It would be the incorrect classification based on its size.

The funding system for local authorities is a complex one. Authorities derive their income from a variety of sources including commercial rates, charges for goods and services, local property tax, as well as funding from Government Departments and other bodies. Central Government funding of local authorities similarly presents a complex picture, with transfers, both current and capital, coming from a wide range of Departments and offices for a variety of purposes. In 2023, funding from central government to local authorities totalled around €6.7 billion. Across all schemes and funding sources, my Department provided €69.6 million in 2022 to Galway City Council, €79.8 million in 2023, and €93.3 million in 2024.

As previously stated, there is no tiered funding system in place and the criteria for the distribution of this funding varies by scheme, depending on the scheme in question. Central government funding has traditionally provided non-programme funding to local authorities in the form of an annual contribution towards meeting the costs of providing a reasonable level of service in their area. Up until 2014, this was in the form of a general purpose grant, and from 2015 onwards, it was replaced by the local property tax, LPT, which were linked in the most part to the general purpose grant. It is important to note that while the LPT is an important source of own-use funding it was just 6% of the overall current income of the sector in 2023. Annual funding allocations from the LPT are decided in accordance with Government-approved distribution policies and are based on estimates of the yield and the baselines in individual local authority areas. Under the LPT allocation model, every local authority has a minimum level of funding available to it known as the baseline. A review of these baselines was completed by a working group in 2023, and it identified that the baseline funding of some authorities needed adjustment according to the criteria of population, area, local income, deprivation and achievement of national policy priorities. The Government agreed that these adjustments be applied and, furthermore, that every local authority would receive a minimum increase of at least €1.5 million, which Galway City Council benefited from. There will be a review every five years in this respect. I will go into a few more figures in my follow-up response.

Seán Kyne (Fine Gael)
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I thank the Minster of State for the reply but the baseline figures are, presumably, determined by population.

John Cummins (Waterford, Fine Gael)
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It is one factor.

Seán Kyne (Fine Gael)
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It is one factor but it is an important factor and is the basis of the argument here, which is that it does not cater for the role of Galway city as a regional capital. It relates only to the population living in the city and not the population that it serves, many of whom are from the county, and the many who come for healthcare from Mayo or Donegal who also use the roads and the services. That is the whole point. I do not think it relates to the actual role that Galway city has as a regional capital. This is why I believe the model is flawed. I know from experience in Galway County Council as well that the Minister of State's Department was unable to actually explain how the baselines were derived or what the model was that made it up. How does the Minister of State rely on figures without having the backup data for how those figures for funding were arrived at, which is the case going back over 20 years?

John Cummins (Waterford, Fine Gael)
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The review of the baselines looked at a number of factors and population was just one of them. Other factors included local income, deprivation and achieving national policy priorities.It is important to say that Galway City Council has benefited and will benefit into next year. It will receive an additional €1 million from an increase in the LPT baseline, while €1.1 million of the surplus the local authority generates will be retained by it. The authority will increase its variation as well, as it did for 2025. That enables it to have €1.6 million over and above its base. There is significant benefit derived from the changes this year and into 2026.

I take the Senator's points on board but the tiering designation piece has no impact whatsoever on the baselines. It is not a factor for consideration. I take on board the other points the Senator raised on the additional catchment that is captured, but obviously that is captured in Galway County Council's allocation as well in terms of LPT.

Victor Boyhan (Independent)
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I thank the Minister of State for that comprehensive response and I thank Senator Kyne for raising the issue.