It’s clear that Galway County Council has been underfunded for over 20 years. I again raised this with the Department and Minister Malcolm Noonan responded.
The Minister of State is welcome. I thank the Office of the Cathaoirleach for choosing this matter.
We debated this topic when sittings were taking place in the convention centre. In that context, I may be making the same speech several years later on funding issues relating to Galway County Council. Most of us are former members of local authorities. We know the range of services that they provide. These services, which relate to road maintenance, hedge cutting, community wardens, housing maintenance, planning enforcement, active travel applications, graveyards, community funding, economic development units, fire and emergency services, piers and harbours, broadband officers and the area for which the Minister of State has responsibility, namely, heritage, are very important. I listed many of the services that local authorities provide, but that list is not all-inclusive.
Galway has had a funding shortfall not for a few years but for a few decades. My colleagues from Galway and I had a meeting with officials from the Department of Housing, Planning, Community and Local Government in 2016 . The officials admitted that there was a funding shortfall in Galway compared with other counties that dated back to the late 1990s. They stated that the solution was the review of the local property tax, LPT. They said it was very difficult to do something in isolation for one local authority if it was not going to be done for all.
Since then, we have had numerous allocations to local authorities based on Covid and higher energy costs. I welcome all of these. Last year, Galway received €1.7 million of the €61 million made available to cover increased energy costs. It also received an additional €8.16 million for pay and pensions, including in respect of the new public sector pay deal. It received €2.755 million in recognition of its lower funding base. In previous years, it received one-off payments of €600,000 and €1 million when Deputy John Paul Phelan was Minister of State. These were welcome, but they were only an attempt to plug a massive hole in the finances of Galway County Council.
Without significant uplift under the review of the LPT, Galway will continue to suffer in the context of its ability to deliver the projects for which there is State funding, including those relating to active travel and the public realm. These are measures of which all local authorities, including Galway, want to be able to deliver more. There is funding under the rural regeneration and development fund. There is also active travel funding. Galway County Council does tremendous work with the resources it has but it needs more engineers, architects and planners to be able to deliver. Planning staff are under enormous pressure. The number of files they have to deal with compared with colleagues in Mayo and other places is large. It is unfair on them and on the services they are trying to provide for people in Galway.
While the provision of €1 million here or €3 million there is welcome, we need massive investment in Galway to bring it up to a level comparable with other counties. All of the figures have been provided to the Department. These are figures on per capita spend in Galway versus in other local authority areas on housing and the provision of other services. We need a major uplift on the baseline funding rate for Galway County Council.
Minister of State at the Department of Housing, Local Government and Heritage (Deputy Malcolm Noonan)
I thank the Senator for giving me the opportunity to outline today the position on the LPT baseline review, which is an important piece of work that will be progressed in the Department this year. The LPT was introduced to provide a stable and sustainable funding base for the local authority sector, providing greater levels of connection between local revenue and associated expenditure decisions. LPT allocations to local authorities for 2023 amount to €609.9 million. This figure includes the Exchequer contribution to equalisation funding of €118 million. Galway County Council’s allocation for 2023 is €14.5 million.
The revaluation of the LPT was undertaken by the Revenue Commissioners in November 2021. This revaluation has led to changes to the individual yield in each local authority area. However, the overall yield has only marginally increased. Only eight local authorities have seen an increase in yield, while the remaining authorities have seen a reduction in LPT yield.
In line with the commitment in the programme for government, the LPT allocation mechanism for 2023 has been changed to allow for 100% of the estimated yield to be retained locally within the local authority area where it is collected. This is being done on the basis that those counties with an LPT yield lower than their baseline, which includes Galway County Council, will continue to be supported via annual equalisation funding. This will ensure that all authorities continue to receive, at a minimum, an amount equivalent to their baseline. All equalisation funding will now be met by the Exchequer, which requires an increase in such funding from €34.3 million in 2022 to €118 million in 2023. This is a significant level of support for the local government sector from Government in recognition of the additional work burden on local authorities, as Senator Kyne quite rightly outlined.
As previously indicated by the Minister for Housing, Local Government and Heritage, a review of the baseline funding of local authorities is under way. The Minister is committed to completing this review in time for 2024 LPT allocations. Officials from the Department are establishing a working group that will include key stakeholders from the local government sector. It is acknowledged that the circumstances of local authorities vary considerably from one another in terms of geographic area, population, population density, service needs, and, indeed, the ability to raise their own income locally. Therefore, it is intended that the members of this group will represent differing perspectives across the sector. It is acknowledged that factors such as population have shifted considerably in recent years and that a review of the funding baselines is now required. Updated census data will be used, and previous reviews and studies of local authority baseline funding will be assessed and considered. The process will include consultation with representatives of our locally elected council members and other relevant stakeholders.
Across all schemes and funding sources, the Department provided €82.9 million in 2020, €85.9 million in 2021 and €83.3 million in 2022 to Galway County Council. Included in this is the unprecedented level of support provided by central government to local authorities during the Covid-19 pandemic. This included additional one-off allocations to Galway County Council to assist with funding pressures amounting to €1 million in 2020 and €600,000 in 2021. There is also a similar allocation for 2023, provisionally in the amount of €2.75 million.
The Department acknowledges the current financial environment in which all local authorities, including Galway County Council, are operating and the pressures facing them in respect of general inflation and higher costs. In 2023, the Government will make the significant contribution of €481 million to support local authorities. A large portion of this figure, €287.2 million, will go towards assisting local authorities with the cumulative effect of pay costs arising from the national pay agreements and the unwinding of the financial emergency measures in the public interest legislation.
Galway County Council will receive €8.1 million in this regard. Furthermore, additional support of €60 million has been secured to assist with rising energy costs in 2023, which includes an allocation of €1.7 million for Galway County Council. These allocations will help ensure that all local authorities, including Galway County Council, have the necessary resources to perform their functions in 2023.
I will make a supplementary response.
Senator Seán Kyne
I thank the Minister of State for his reply. I acknowledge the supports that have been provided but they are not enough. They are way short of the mark. The funding allocated from budget 2022 and to Galway County Council works out at €802 per capita, which is the second lowest per capita figure. Kildare County Council is the lowest and Meath County Council is just above that. Per capita funding for Limerick City and County Council stands at €4,886 and for Dublin City Council it is €2,038. Galway is way off the mark in terms of what the people of the county deserve.
Galway is the second largest county in the country. As with all counties, the population is growing. I welcome the review of the baseline funding but we have heard since 2016 that there will be a review that will help Galway. We need that assistance now. At every meeting we have with the executive, the same overriding issue arises, namely, the funding inequality and shortfall for Galway County Council.
Deputy Malcolm Noonan
I will give a quick list of all the additional work that local authorities are doing, including in areas such as active travel, town centre first, the expansion of services around arts and culture, social inclusion, integration and local community development committees, LCDCs. These are all extra services provided by local authorities and a welcome increase in their range of functions, which I am sure all elected members would welcome.
The Department and Government have provided extra planning staff to deal with the planning the Senator mentioned earlier. We are providing biodiversity officers. Next week, we will announce additional conservation officers and vacancy officers as part of the town centre first policy. Additional resources are being plugged into all of our local authorities and are critically important. That is recognition of the important work done by councils.
I hope the baseline review will produce proposals that will help the long-term financial viability of Galway County Council and all local authorities. In the longer term we need to look at broadening the income base of councils and there are many innovative ways of doing so. The Minister of State, Deputy O’Donnell, the Minister, Deputy Darragh O’Brien, and I are very much committed to the local government sector. Galway continues to do extremely well, not just through the funding provided but also the resources provided to the community.