Submission to consultation on Local Property Tax adjustment, 26th August 2014

Dear Sir/Madam,

Thank you for the opportunity to make a submission addressing the potential effects of varying the basic rate of the Local Property Tax.

I have spoken to many people in the Carrigaline – Ballincollig constituency both when canvassing before the local elections in May and since.  Many have expressed strong opinions on Local Property Tax.

The general feedback I have received from so many of the residents of the Carrigaline – Ballincollig constituency that people are happy to fund local authority services.  They like Cork County Council, their own local authority, to deliver the essential services they rely on.  They regard these services as primarily including water provision, wastewater treatment, roads provision and maintenance, waste collection and treatment, grasscutting and general landscape maintenance.

However, now so many of these services are now being delivered by private contractors.  The local authority refuse collection service has been sold off.  Although civic amenity sites are still run by Cork County Council, high gate fees are charged, even for recycling.  The government has amended legislation such that each household must pay directly for water and wastewater services.

People understand that they pay for roads maintenance through motor tax.  The County Council no longer carries out grasscutting and maintenance in estates – residents pay for this themselves.  The County Council maintains road verges but requires landowners to maintain hedgerows.

Former Minister Phil Hogan explained that the purpose of the Local Property Tax is to provide “sounder financial footing for the provision of local services”.  But people express extreme frustration that they cannot see any return from the Local Property Tax for what have traditionally been regarded as the primary local authority services.

So many people have illustrated the difficulty they have in making ends meet.  The cost of living increases, they are increasingly charged for services and utilities whilst wages have not increased commensurately.  Eurostat measures statistics across Europe.  Its quality of life analysis tells us that the percentage of Irish people in arrears from 2003 is 23.6%, i.e. 12% higher than the average across the 28 Member States.  This indicates that people are genuinely financially struggling.  Financial difficulties are further illustrated in that Eurostat measures 56.4% of Ireland’s population as being unable to face unexpected financial expenses.  This is more than half the people of Ireland.  By comparison, the average figure in the original 15 EU Member States is 36.3%, while the average across all 28 EU Member States is 40.3%.

What is perhaps most telling about these figures is that they are regarded as quality of life measures.  The financial worries experienced by more than 50% of Irish people are such that their quality of life is affected.

Local Property Tax is a charge on the market value of residential properties.  These are homes, many of which are mortgaged from a bank or similar lending institution.  Many people are paying a monthly contribution to a mortgage which is based on a historical value far in excess of the value of the property.  They pay interest to the lending institution at a rate which, over the lifetime of the mortgage, can double the cost of the property.  Local Property Tax is yet another penalty for the price of wanting a home.  The money the householder uses to pay the Local Property Tax is take-home pay, already taxed by government.  In other words, it is earned income which is doubly charged.

Former Minister Phil Hogan was again quoted as saying that Local Property Tax is a “more sustainable and resilient form of funding for local authorities”.  The final affront was surely experienced last year when those who paid Local Property Tax on the promise of its being delivered to their local authorities found that it was retained by government for the establishment of Irish Water.  This was one blow too many, particularly when most people are conscious that they already pay for water and wastewater services through income tax.  So the Local Property Tax, already regarded as unjust by many householders and paid in the assumption that it would deliver better local services, was retained to set up a company the primary function of which is to charge for yet another service that people are already paying for.

I sincerely ask Cork County Council to reduce the Local Property Tax by 15% in this year’s budget.  This reduction would:

  • free up additional money in the community, thereby stimulating local economies and helping local business
  • acknowledge that people of County Cork already pay directly for so many of the services previously delivered by Cork County Council
  • acknowledge that the money paid by the people of County Cork in Local Property Tax last year was diverted to facilitate a system of direct payment for water and wastewater services when people understand that they already pay for water and wastewater services through income tax
  • reduce stress and improve quality of life for so many living in County Cork.

Yours faithfully,
Marcia D’Alton
Member, Cork County Council

Mobile: 085 – 7333852
Twitter: @marciadalton