Deputy Treacy was in possession.
Local Government (Financial Provisions) Bill, 1977: Committee and Final Stages (Resumed).
SECTION 10 (Resumed).
Question again proposed: "That section 10, as amended, stand part of the Bill."
(Cavan-Monaghan): Beginning at 6.30 p.m. today we passed Supplementary Estimates amounting to approximately £70 million in about a minute without discussion. We are now moving to what must be the Final Stages of the Local Government (Financial Provisions) Bill, 1977, a Bill which will revolutionise the whole structure of local government as we know it. This Bill was introduced in this House on 14 December 1977 and we must now conclude it by 9.30 p.m. tonight as I understand the order of the House. There has not been much time devoted to this Bill. It got a Second Reading and we have not spent very long on Committee Stage having regard to the type of Bill it is and what is involved. It is regrettable that the Government did not order this Bill in a more orderly way so as to give the House time to discuss it and put the Minister in the position that he could, if he wanted to, put down amendments on Report Stage after having heard the views of this side of the House on it. This is a type of Bill which does not lend itself to amendments from the Opposition because they are ruled out of order either because they are imposing or could impose a charge on the Exchequer or because they do not come within the principle of the Bill as introduced. That is a pity, and I am not going to labour this question any further beyond saying that it is all the more reprehensible when you are dealing with a Government who have a majority of over 20 seats. It terrifies one to see £70 million in Estimates put through on the nod and in the same evening a Bill having such far-reaching effects as this Bill has on local government being put through all its Stages in an hour and a half.
When we last discussed this measure we were dealing with section 10. Briefly, that is the section which enables the Minister to limit the amount of the rate in the £ which any local authority or rating authority may strike. It is the section which deems the maximum increase permitted to be the rate struck if the rate struck exceeds the maximum permitted and in that way it ignores the local authorities. Since we discussed this Bill last week the Minister has announced that this year the maximum permitted increase in the rate over last year will be 10 per cent. I think 10p in the £ was announced over the radio and in today's newspapers. That is an example of the type of blanket restriction imposed on a local authority. I put it to the Minister that in arriving at a 10 per cent increase this year he did not go through the various local authorities, authority by authority, and discuss with them their permitted requirements for this year. It would be a miracle if the same permitted increase would be the amount necessary to service all the local authorities in the country. Speaking on the Bill last week the Minister pointed out that the 11 per cent increase permitted by him last year was more than enough in 16 cases and that in fact 16 local authorities did not see fit to strike a rate in the £ as high as 11 per cent over the previous year. That demonstrates that local authorities can be relied upon to strike a reasonable rate that will be sufficient for their needs and nothing more. I said earlier today on an Estimate that the Minister did not tell us of the number of local authorities who are under pressure for more money and have not enough money because of the 11 per cent last year.
Other sections of this Bill, particularly the next section, 11, are equally objectionable if not more so and we have to spend some time dealing with that. I want to summarise what I have to say on section 10 by stating that it is a section which is going to be operated by the Minister, as we have seen, in a blanket fashion without any regard to the individuality of the local authorities concerned. It is a section that will impose severe restrictions and hardships on various county councils and local authorities. The Minister in his announcement today said that due to buoyancy in revenue—from rates presumably—this will be effectively an increase of something like 13 per cent rather than 10 per cent.
I would like to know how that buoyancy is arrived at. We had a long discussion here today under another section as to whether the people who applied for an apportionment of a valuation would have their valuation increased. The Minister assured us that there was no danger of that. Since then I have been speaking to someone who has a mixed hereditament consisting of a business and a dwelling and I am told that without any request from the occupier of that mixed hereditament it was revised, presumably last year, and the residential portion of it separately valued and the business portion of it very substantially increased. That is probably where some of the buoyancy is coming from and as the years go on we will have more of that and we will find out by way of parliamentary questions and otherwise the effect of that. The Minister said that this section was necessary to protect the taxpayer, the ratepayer and the Exchequer. He must mean that it is necessary to protect these people from the local authority.
In conclusion, I want to go on record as saying that the whole history of local authorities is that they have behaved in a reasonable way. I want to emphasise that whenever councils were dissolved and councillors removed from office this was done because they had not struck a sufficiently high rate and not because they had struck an excessive rate, and that was only on very rare occasions.
Secondly, the Minister has told us that these 16 councils, including two in my own constituency, did not take up his offer of an 11 per cent increase last year. I say that is abundant evidence that there is not likely to be any abuse but it seems to me that this intervention by the Minister for the Environment and his colleague, the Minister for Finance, in the affairs of local authorities and saying, without any effort to find out what is a reasonable budget, that they can have 10 per cent this year and take it or leave it, or they can have 11 per cent next year and can take it or leave it, is simply reducing the whole independence and discretion of local government. It is really abolishing local government and centralising in the Custom House the last important function of local councils. It is doing a bad day's work for the system of local government that we have enjoyed here since the end of the last century. There is no discretion being left to to them; no real function has been left to the authorities. Already as a result of last year's operation we see county roads being run down, as I mentioned earlier today. We will have a further run down in county roads this year. The scavenging and refuse collections will suffer. Many other services will be hit and curtailed as a result of this measure. I just wonder how the local representatives will react to this when we come to next year's elections. Really the only function now left to the local authority seems to be the renaming of streets and townlands and giving some advice on the development plan.
Time is obviously going to be restricted on the rest of this debate but I would just briefly remind the Minister of a number of questions I raised the last time we were talking about this section. Rather than making any further points I would be interested to hear the Minister's reply to these questions. The most relevant one at this stage is the legal interpretation of the word "duty" in the context of paragraph (e) of section 10 (3).
I just want to make a couple of points on section 10. I will not dwell too long on the fact that the section is clearly giving to the Minister powers which most of us fear and which many of the Minister's colleagues fear may be abused. I do not suspect that anyone particularly wants to whittle away the power of local authorities but I am struck by the fact that in the last few days we have seen concrete evidence already that this section may very well leave itself open to abuse and may be abused.
I would like to ask the Minister first of all if it is not an extraordinary precedent to issue to local authorities a letter in which he restricts their increase on last year's rate, in the context of the striking of the coming year's rate, to 10 per cent by assuming power in anticipation of this legislation. The Minister's letter states:
Section 10 (2) of the Local Government (Financial Provisions) Bill, 1977, which has had a Second Reading in Dáil Éireann, provides for the giving of a direction by the Minister in relation to the aggregate of the rates to be determined by a rating authority. In anticipation of the enactment of the legislation and in accordance with the provisions of section 10 (2) the Minister, with the consent of the Minister for Finance, has directed that 10 per cent shall be the maximum amount by which the aggregate rate in the £ to be determined by each rating authority in respect of the local financial year 1979 shall exceed the aggregate rate in the £ determined by such rating authority in respect of 1978.
I am relatively new to this House but common sense tells me that we are all wasting our time if there is some manner or means by which the Minister may act in anticipation of legislation which is still under discussion. The reason we are discussing it, and I presume the reason the Minister is sitting here, is to make progress on this Bill, to have an open mind with regard to the possibility of having certain changes introduced, and indeed, if possible to have certain parts of the Bill thrown out completely. I just wonder what the thinking behind this attitude is. If we are to accept the implications of it we may find any Minister coming in here having made a decision in anticipation of legislation being approved. To say that it is undemocratic is being very charitable. To say that it is a total and absolute negation of the whole parliamentary process is very much nearer the truth.
I would like the Minister, first of all, to explain how that happened and what his justification for it is. It is possible that this Bill will not see the light of day in terms of being enacted. It is possible for any one of a number of reasons. Yet the Minister, in a circular dated 8 December 1978 circulated to local authorities all over the country this very week, has said that in anticipation of the enactment of legislation the Minister has directed. Indeed, he is quite unequivocal about this because on a number of occasions throughout the letter he refers to the legislation which is before us. Before we go any further it is very important to clear this point up. Are we all wasting our time? Has the Minister got the right to make directions in anticipation of legislation? If he has, how prematurely may he make that anticipated judgment? Would it be reasonable for the Minister for Health, or the Minister for Justice or the Minister for Education or any other Minister to make judgments in anticipation of legislation which we have been promised? This week the various local authorities are grappling with problems imposed by the Minister and he has presumed—in my view, quite wrongly —the enactment of legislation which has yet to be approved. This is the Committee Stage of the Bill and it is not appropriate that we should go on making long speeches unless we get some response from the Minister. I would like him to reply to us and then give us an opportunity of saying a few more words on other aspects of the matter. Would the Minister like to comment on this?
I will.
The other points may be relevant. I do not believe that a directive of this nature to local authorities based on a decision made in anticipation of legislation could be legal. It is not ethical and I believe it is a bluff. There is no statutory basis for such a directive. The Minister is trying it on and the local authorities are buying it. It is perfectly clear that our worst fears about this section will be realised, that local authorities will become even bigger rubber stamps than they are at the moment. We will have local elections next year and it is reasonable to assume that we would have the most lenient actions by the Government and the Minister. I shudder to think what will happen next year if this is to be the good faith of the Minister, as indicated in the directive he has issued, in the light of section 10.
The Minister has put a blanket 10 per cent on all increased expenditure. I do not know why he had to waste the valuable time of decent officials up and down the country in preparing estimates in a total vacuum when the result of all that labour is a 10 per cent blanket ceiling. My young brother could have come up with that in half-an-hour. I would say the wait was worth while if we saw some evidence that the Minister was interested in local sensitivity or in trying to understand the needs of local areas and particular regions and was responding to those in a comprehensive way. There is no excuse for waiting so long unless the Minister hoped that a pre-Christmas euphoria would take away the sting of this blanket instruction.
The limit the Minister has imposed is a national limit and does not take into account the needs of various areas. He said in his letter that he appreciates that there are differences in the needs and resources of different local authorities and that their priorities may vary. This is an indication that he appreciates the case this side of the House are making. He went on to say that he is satisfied that the application of an upper limit expressed as a uniform percentage addition to the existing rate in the £ of each local authority continues to be the most satisfactory method of aligning the programmes of local authorities with national policies. That is another example of Government gobble-de-gook which nobody can make any sense of and is in total conflict with what the Minister said earlier.
The Minister further said in his letter that the premature implementation of the power in this section represents the minimum of interference with the traditional freedom of action of local authorities but at the same time has due regard to the varying needs of individual rating authorities, the response of councils to those needs in previous years and the interests of non-domestic ratepayers. The Minister cannot have it both ways. He is either not interfering with the traditional freedom of action of local councils and authorities in which case they have freedom to raise money or he is. It is perfectly clear that he is interfering with their actions because I have the estimates for Dublin city and Mr. James Molloy, the city manager, a hardworking and genuine official, spent many man-hours and a substantial amount of our money preparing estimates for a budget of £102 million for this year based on a proposed increase of 11 per cent on last year's rates. That 11 per cent was on the basis of a continuation of services at existing levels and maintaining the existing work force. Yesterday morning the traditional freedom which the Minister allows this city council resulted in a scurrying attempt to cut back £500,000 in Dublin city. What does the Minister mean by saying we have traditional freedom if we are forced to do this? If we do not do this the Minister says in the section that after we have talked about it if we do not accept his constraints he will strike the rate. There is one advantage for the Minister in this, as he will not be faced with political egg on his face, as one of his predecessors was, by having to dissolve the council.
What will managers do next year as a result of this section? They will decide that instead of having this annual débâacle of a cutback because the Government will not tell them in time what they will be entitled to and instead of their being associated with the odium of cutbacks in public expenditure, they will estimate very conservatively: they will probably decide that 8 per cent will do next year and perhaps they will get 10 per cent from the Government. The result of the Minister's policy will be a whittling away of the calibre of local services. This will happen involuntarily because people will not want the annual hassle over cutbacks and the whittling away of public expenditure.
It is extremely unfair to expect officials to become embroiled in this argument if they have an option, which is to estimate conservatively. The Minister knows well that if he delays telling local authorities what they will get they will decide to estimate conservatively. What will happen if the manager of Dublin city or Dún Laoghaire borough says that he needs 15 per cent more than he had last year? There will be a much louder outcry than the relatively muted squealing yesterday if there are to be cutbacks of even 5 per cent on the proposed estimates. I guarantee that no local authority will estimate for a 15 per cent increase next year. They will not chance even a 10 per cent increase because they reckon that the Minister's policies as implicit in this section and as explicit in the pronouncements of his Government clearly imply that local government expenditure is to be systematically, ruthlessly and dedicatedly cut back. I leave it to others to conclude the reasons for this or the political ideology or philosophy behind it.
We are now in the throes of a systematic run down of local authority expenditure and, therefore, services. There is no denying that, I submit that the Minister seeks in this section to utilise power in a way which is fundamentally repugnant to the idea of local democracy. He is in such a rush to do so that he has anticipated the legislators which, for a seasoned and hardened politician like himself, takes some neck and is a gross impertinence. He owes this House an apology.
Local democracy is the kernel of the question. Many cliches are used in discussing this. There is and must be room in a democratic system for a genuine forum from which local attitudes and opinions can percolate into the mainstream of our daily lives. I have grave reservations about the way the local authority structure at present operates. The work and dedication of the vast body of local councillors is very largely unappreciated and for some obscure reason they are the ready butt of any humourist, presumably because such councillors are not organised or articulate enough to respond in kind. These men will find that their role is an empty one; it is relatively empty already. They will find if they want to raise a few bob that they cannot do it. It is naïve, simplistic and perhaps deceitful for the Minister to suggest that in some way the ordering of their expenses is their own business and they have ample room to lay emphasis here and there. That is not so because statutory charges and demands on a council's budget make up the vast proportion of that budget. There can be no suggestion of interfering and the Minister would be the first to start squawking if there were interference with such things as men's wages, refuse collection and disposal services. The percentage of local authority expenditure which councils are free to manipulate is very small and is confined principally to areas relating to community grants, cultural grants and so on. That power is to be restricted.
I would not be averse to a suggestion that the expenditure of local authorities should in some general way find itself in harmony with national economic policy. I do not believe that local authorities should have an open-ended honeymoon if they want to go on a spree and I am not aware that any of them are so doing. It is most unfair to insinuate in this highhanded way a paragraph of this significance into this Bill, which is allegedly designed to bring about an increase of largesse and to get rid of an anomaly.
I do not know if the Minister and his colleagues fully appreciate what they are doing. The Minister has behind him more members of local councils than we have on this side of the House. I do not believe Deputies Thomas Nolan, Liam Aylward, James Leonard, Seán French, Thomas Meaney, Barry Cogan, Jeremiah Cronin, Joe Walsh, Hugh Conaghan, Tim Killeen, Eileen Lemass or Tom Leonard or the other members of local authorities fully appreciate what the Minister is doing. I would be extremely amused if I had the time to watch the contortions and acrobatics of the Minister's colleagues when they try to explain to local councils the effect of this Bill. I have no doubt when the Minister gets the feedback he will be very interested in ameliorating this section. I suggest that he should do it now with all the grace and dignity he would wish. He should reconsider this section and in some way try to marry local expenditure with national economic policy in a sensitive way which allows for local input. Let him reform local bodies if he wishes but give them an opportunity to talk to him or his officials. We need a flexible local expenditure policy and the section does not allow that.
Section 10 provides for a joint approach by the Minister for the Environment and the Minister for Finance. I am not sufficiently experienced in this House to know whether there are many precedents for this. Ministers for Finance through the years have been revered and feared as being, in some cases, the ogres of the Government. A number of Ministers for Finance have reputations which are somewhat unfortunate and a bit harsh. The present Minister for Finance does not escape from the attitude which beset and still besets some of his predecessors. He is a man about whom it cannot be said as yet that he has given a great deal of largesse to any of his colleagues. Going by the sounds one hears from various Departments, I see no reason for the Minister for the Environment to believe he will get a substantially greater purse than his colleagues in the Departments of Health, Social Welfare or Education or the other Departments which, for some extraordinary reason, are said to be "Non-productive". Perhaps it is time to re-define that phrase.
The Department of the Environment had until now the same entitlement to operate and the same financial sovereignty as all the other Departments. For some reason the Minister sees a need to spell out in this section what he may now do with the consent of the Minister for Finance. This is an unhappy section and it will inevitably mean that the Minister's powers to operate freely will be restricted. I am more concerned about his successor. The Minister for Finance will undoubtedly put the hammer on the Minister for the Environment when it suits him. People throughout the country will be told, regardless of endless hours of debate, that they must take, say, 7 per cent. The same blanket approach will be applied, giving no recognition to varying growth patterns and demands. It will be clearly implied that needs in depopulated and depopulating rural areas are the same as those in fast growing areas, such as the County Dublin area with its new towns. I do not know how the Minister can justify that approach.
The attempt in paragraph 6 of his letter to the local authorities of 8 December is a most ambiguous and irrelevant attempt to justify this blanket approach. I suspect that the imposition of the 10 per cent limit was done without any great thought. It does not reflect any kind of local concern or sensitivity and unfortunately is the thin end of the wedge. If the Minister sees fit to do this this year I will be extremely worried about what he will do next year when there are no elections on the way.
Subsection (2) says:
The Minister may, with the consent of the Minister for Finance, by a direction given in writing to a local authority which is a rating authority, and so given before the adoption by the authority of an estimate of expenses relating to the local financial year specified in the direction, require that as regards that local financial year—
(a) the aggregate of the rates required ... to be determined by the authority shall be limited by reference to an amount or in such other manner as may be so specified,
The purpose of legislation is to spell out clearly, and explicitly the Minister's powers. The effect of legislation is negatived if you include such a gesture as this, which is a form of words which sets at nought what goes before it. If you say the Minister has the power to order an authority and their expenses in specific ways and then "in such other manner as may be so specified", that generality makes ludicrous the earlier attempt to be specific. That gives open-ended authority to the Minister.
I would not be averse to giving substantial powers to a Minister and hope he would use them and not continue to procrastinate about many of the areas in which he is doing very little; I am not unhappy to have an elected Minister having strong powers and doing the job, but in fairness there is not much point in having detailed legislation setting out specifics which are in some way set at naught by this kind of general paragraph. That kind of worry underlines much of our objections to section 10.
Paragraph (3) (c) reads:
...the adoption by the authority of an estimate of expenses for the local financial year so specified shall not be thereby invalidated but such estimate shall be construed as if for any amount therein contained which is not in accordance with the requirements of the direction there were substituted the maximum amount permissible having regard to the limit specified in the direction or in case more than one limit is so specified, the relevant limit so specified,
It seems unusual for a Minister to say he has the power to order authorities to carry out their "duty", whatever that is, and to accord to his response while, at the same time, not setting out some ministerial response if they do not accord. If it is right for them to do as the Minister asks, there should be some sanction if they do not. The Minister skilfully sidesteps that. He says that if the councillors do not accept the 10 per cent limit, they should cross out whatever they propose and read it as ten. This makes a charade of the whole process of local government and will tempt councillors to take less interest in their estimates.
I have attended a number of these meetings and already there is an air of pointlessness and growing futility about the exercise, even more than in previous years when at least they had the hope that the Department would respond in a sympathetic way. Now it will be even worse. A local authority may spend a great deal of time working on a figure, but in the forefront of their minds they will have to accept that that figure, by the stroke of the manager's pen, may be substituted by a figure dictated by the Minister and his colleague, the Minister for Finance.
I cannot understand how the Minister for the Environment, who has substantial local authority experience and who knows more about local authorities than I do, can be happy about this proposed legislation which leaves itself open to abuse, and already there are signs that it is being abused. Because of the lateness of the hour I will not delay the House too long.
My main point is that if the example of Dublin city this week is anything to go by, we can anticipate a winding down of investment in, expenditure by and provision of services and jobs by local authorities. We can also expect growing ingrained conservatism by the estimators. In all this there is not the slightest suggestion that the Minister might encourage or require the concept of zero budgeting, to start at nought and find out whether the vast sums being expended are being used usefully. He is happy to accept the same traditional proportionality of expenditure, the same headings and subheadings, the same little increases on each heading over last year's figure. The relevance and ratio of each one to the other is not of concern to the Minister. He is only concerned about keeping a rein on local authorities. If he was truly concerned about expenditure he would ask that a pound per pound evaluation be made of the way local authorities are spending their budgets and that we start afresh and look at the local authorities' total needs.
He might even go further and suggest that local authorities could and should provide, perhaps, ten year social and economic programmes to which they would work, instead of reacting Pavlovian-like annually, depending on what figure emanates from the Department, which is what they are now forced to do. They are forced to wait for the Minister to speak and then cut their cloth to measure on a year to year basis.
Local authorities are involved in providing services which by their nature cannot be provided on a year to year basis. If the Minister said that the local authorities over the next ten years would have £X million, they would have some idea of how to plan. But how can one plan when from one year to the next one does not know what the Minister will say in relation to the amount of money to be spent. How, therefore, can the local authorities provide services which they are statutorily obliged to provide because, as I said, they are by their very nature services which need long-term planning. They are planning on a wing and a prayer, hoping the money will be there, but it depends on the Minister for the Environment, or may be, the Minister for Finance, or the Minister for Economic Planning and Development or the Taoiseach.
There are serious problems about the section and this Bill. If the Minister were serious and earnest about his attempt to bring in the main benefits of this legislation, he would excise from the Bill these sections which any democratic person must find repugnant. There are a substantial number of democrats in the Minister's party and I have no doubt that they are extremely unhappy about some of the provisions in this legislation which will mean that from now on future councillors will be saddled with legislation which will be on our Statute Book until kingdom come, legislation which does not give them any power to raise money and, allegedly, gives them power to order their finances but in reality it does not do so because the best part of that expenditure has to be made because it is a statutory demand, or because it is related to services which are so fundamental and essential that only a madman would suggest that there should be a cut-back on such things as refuse collection or sewerage services.
The power in this Bill is repugnant to us. I suggest that the Minister think about it again, discuss it with his colleagues who are members of local authorities and ask them what they think. I suggest that he explain this extraordinary breach of parliamentary etiquette, this discourtesy to the House, this parliamentary impertinence, which allowed him this week to send a circular to local authorities in which he said that he anticipated certain powers under this Bill and that "he was thereby directing". Inexperienced as I may be, common sense tells me that that could not be legally, ethically or morally right.
The Minister acted unwisely and possibly arbitrarily. If the propriety of this section were to be tested in the courts I believe it would be found to be without substance by reason of there not existing the legal base on which it rests. There is not in force at this moment a Local Government (Financial Provisions) Act, 1977. Therefore, the Minister does not have the power to say that in anticipation of the enactment of the legislation and in accordance with the provisions of section 10, subsection (2), the Minister has directed that 10 per cent shall be the maximum amount by which the aggregate rate in the £ shall be determined by each rating authority. Neither has the Minister the power to say that the directions set out in paragraph 2 are issued in anticipation of section 10 (2), of the Bill.
I should hope that this temporary lapse is not an omen of greed and lust for power and possibly an obsession with incipient dictatorship which might be brought about by the Government having an overall majority. I would remind the Minister that this House remains a democratic institution, that he does not have the right to take powers which are not yet his and that this House deserves more respect than to be treated in this fashion.
All of us here irrespective of party affiliations would wish very much that the limited time available for this very important and crucial debate would be shared as equitably as possible and that none of us would consume an unfair share of that time.
I am prepared to sit down at this point and listen to the Minister because we expect him to reply to the very many serious questions that have been put to him. We are dealing with a very serious piece of legislation. Many of us on this side of the House have spent much time seeking to alert the House and the country to the implications of this Bill, to its effects on the structure of local government, on the rights of members of local authorities and on the fundamental democratic base of our local authorities. We have said that this is a piece of legislation that will have very serious repercussions which would virtually destroy the power of local authorities in regard to striking rates and to implementing the various services.
The Minister has invoked section 10 of the Bill and by way of circular has informed the various local authorities that they may not exceed the expenditure for the coming year by more than 10 per cent of last year's expenditure. This is the situation as we saw it all along, although some people may have thought that we were exaggerating. This Bill is simply a take-over by the Minister for the Environment of the rights, duties and powers that are vested in local authorities. It is an undermining of the local government procedures as we have known them down through the years. That is bad enough but the Bill is also a take-over by the Minister for Finance, as is very clear here. That is one reason why I am prepared to sit down at this point and hear the Minister. We are very concerned with his attitude to this legislation. He is adopting a very dangerous stand. He is adopting an attitude of indifference, of complacency and of silence in the knowledge that at the end of the day he will have a majority of 20 to help him push through this dictatorial piece of legislation. That is a dangerous situation not only for the House but for the country. Therefore, I am inviting the Minister to attempt to defend the measure. He has failed so far to defend it. He has shown himself to be either unable or unwilling to defend it but, as I have said, he knows he has a majority that will allow the Bill to be jackbooted through the House after a limited debate.
The Bill is an unwarranted interference with the affairs of local authorities and members of local authorities realise now the extent of the interference involved. We were told last week by the Minister of State at the Department of the Environment that members of local authorities are retaining upwards of 99.5 per cent of the powers vested in them. He told us that they will continue to have power to initiate various schemes. They will not be able to initiate anything unless the necessary money is available but the power to provide money is being taken from them.
The Bill pauperises local authorities. It makes beggars of our public representatives while it makes spies of our county managers. It destroys the good relationship that exists between members and managers. The dangers inherent in section 10 in particular are demonstrated amply by the Minister's circular in which he said that the 10 per cent increase is all that local authorities will be allowed in next year's estimates. We know that in respect of very many councils and corporations the 10 per cent increase referred to has been earmarked already to pay for goods and services and for salaries and wages incurred in the present year. The Minister must know that this will mean there is little or no increase to most local authorities. We know of the situation in Dublin Corporation. At a time when estimates have been more or less finalised in many local authorities, members will have to reconvene and there will be cutbacks all over the country. In some instances it is fair to assume that essential services will suffer and that the standard will be set back. In addition, new schemes will not be initiated and employment will suffer. Jobs will be lost as a result of this policy while such matters as the safeguarding of pensions and superannuation rights will be jeopardised. There is no provision in respect of an emergency situation that might be due to an act of God, to fire, to storms or to excessive rains which could ravage our roads.
The Minister must answer these questions. What is the position in respect of expenditure that had to be incurred this year due to excessive flooding? What will be the position next year with regard to essential over-expenditure to deal with emergency situations? If councils want to borrow money for these purposes, will the Minister sanction money to carry out essential services and to keep men at work? What is the position in respect of section 4? Will the Minister sanction that section which has been passed democratically by a majority of council members? The Minister cannot remain silent any longer. He cannot sit there, aloof and indifferent, waiting for the bells to ring, the vote to take place and the feet to march through the lobbies. It is not good enough. This is a national assembly. Tonight we are talking about the retention of democracy. Local government means exactly what it says, at least up to now. We will not have local government any longer. This is a take-over by the Minister and his party, making puppets of people in public life.
I could speak on this matter for a long time but I realise that other Members are anxious to speak. In particular we wish to hear the Minister attempt to defend this dictatorial legislation. If he can let him do so now. I invite him to do so.
Like the previous speakers——
The Minister is not availing of the opportunity to speak.
I will.
Like the previous speakers, last year I had fears when the 11 per cent figure was introduced that at the end of the year every county council would be in a bad way. My fears have been realised to the full extent in my own county. Quite a number of people in my county will be suing Limerick County Council in respect of damage to their cars because of the condition of the roads. There are a few questions I wish to ask the Minister. My first question deals with malicious injury. This year my county is faced with a bill of £60,000——
For what?
It is in respect of malicious damages. According to the present regulations that will have to be met within the 10 per cent limit and I ask the Minister to consider not taking that within the limit of 10 per cent. Because of the local government elections we will be faced with additional costs that will come to 1½ per cent of our entire estimate. What will be the position with regard to the national wage agreement? If there is a new agreement, will the local authorities be called on to meet that cost also? If that is the case we will be down to 8 per cent to meet the work we should be doing.
Our county manager—and I am sure the same applies throughout the country—has spent many hours preparing his estimate. The council will have to spend much time in trying to decide what services will have to be scrapped. County councillors have always displayed their interest on behalf of the ratepapers. In fact, quite a number of councillors have been elected solely by certain groups as the watchdogs of the ratepayers.
It is not necessary to set a limit of 10 per cent. I have never agreed with a flat rate. There is no comparison with regard to counties because they vary to a great extent. There should be some way of assessing what rate they should be allowed. I would ask the Minister to reply to the three points I made: firstly, with regard to malicious damage; secondly, the matter of local elections and, thirdly, the national wage agreement. If the Minister can assure me he will make provision for these three matters I will be happy.
Deputy Treacy referred to the Bill as dictatorial and he said that it was being bulldozed through the Dáil with our majority of 20 seats. One reason why we have a majority of 20 seats is because of our commitment to derate the domestic sector as well as secondary schools and community halls. That is one reason the people voted overwhelmingly in favour of us. Whether the Deputy wishes to describe the Bill as dictatorial or obnoxious, it gives legislative effect to what the people voted for, namely, derating.
The Government have not a mandate to destroy local democracy.
There is no such thing as destroying local democracy. It was wrong of the Deputy to make the allegation that I have not defended this Bill. I have defended it for several weeks but it may not have been convenient for the Deputy to have been here on all the occasions.
Deputy Quinn raised a question with regard to paragraph (e) (iii). He seemed to be worried that this would take away some powers from elected members and put them in the hands of managers. This cannot happen so long as councils observe the overall limit fixed by the Minister. Paragraph (e) (i) merely requires managers to spell out clearly to members what is the ministerial direction. This is to ensure that councillors will have the direction properly conveyed to them and that they understand it as it affects their own areas.
The main issue here is the 10 per cent or the upper limit on the rates which local authorities may strike. It is not the rate they have to strike but it is the upper limit within which they have to stay. I justified this on several occasions but it is no harm to do so again. We should remember that before domestic derating the State's contribution to the total rates income of local authorities was about 25 per cent and this was through the agricultural rates relief grant. With the full derating of domestic and certain other properties as set out in this Bill, Exchequer participation in the total amount levied through the rating system has increased to slightly over 60 per cent. This represents a liability of nearly £120 million this year. It will cost even more in the coming year, about £133 million. If no limit applied to rate poundages to the local authorities, without question through the domestic rate grant and the agricultural grant, the State would have to meet any demand which local authorities individually or collectively chose to formulate. This would not be fair. Local authority services would be alone in having an unquestioned and an unlimited claim on Exchequer resources.
No one suggested that.
They did. Other services equally vital to the country's well-being would not have the same privilege. A major purpose of the limit on rate poundage is to ensure a fair alignment of local government needs with those of other sectors of our economy. This limit affords protection in two other ways. It protects remaining ratepayers against excessive increases in rates. It also protects responsible local authorities from the pressure which would be caused if only a few local authorities began to resort to unreasonable rate increases in a free for all type of situation.
Would the Minister answer the question: how does the 10 per cent bring about a fair alignment?
The increase being allowed for 1979 is 10 per cent.
How can an increase across the board be fair?
Assuming that a local authority avail of the whole of that increase——
Is the Minister suggesting they will not?
Last year 16 did not. Assuming they avail of the whole of that increase their income from rates and rates-linked State grants will increase by more than this amount. This arises because of valuation increases on new properties including domestic properties in every local authority area. This is what we call buoyancy. The pattern of increases will vary from area to area but, in aggregate, it is estimated that local authorities will enjoy an increase of 13 per cent in rates income during 1979. In areas of more rapid development, this increase will be greater.
Because the commercial sector are taking up the slack.
Not at all. New houses will still be valued even though the Exchequer are responsible for the rates.
They will not be paying rates.
Under the procedure in operation all down through the years new properties will still be required to have a valuation.
There is no rating revenue from them.
There will be rating revenue from new houses. There will be an increased valuation for the local authority and my Department will pay the appropriate grant for the increased valuation on houses.
What about the commercial sector?
The rating limits apply to the State grant and the commercial grant sector and there will be increased valuations in that sector as well. It is a fair and equitable system. As previous speakers said, time is limited and I should like to get on with my speech.
(Cavan-Monaghan): Is it not a fact that the Minister gets 3 per cent by averaging county Dublin and county Leitrim?
By what?
(Cavan-Monaghan): By averaging all the local authorities.
I have said certain authorities will come out better than others because of more development. If there is more and more development in a local authority, they will be required to give more and more services. We should not lose sight of that fact. Local authorities will have an extra £26 million available to them in 1979 from rates and rates-linked State grants, bringing their income from these sources to nearly £220 million. This will ensure that their programmes expand at a rate comparable to development in the other sectors of the economy. The percentage increase in rate poundage authorised by me leaves local authorities entirely free within the overall limit to decide their rate in the £ and the priorities which should apply between their different programmes.
Absolute rubbish.
That is a fact of life. Whether it is rubbish or otherwise it is a fact. I might recommend some good reading to Deputies, particularly Deputy Keating.
I hope the Minister is not talking about the manifesto.
There is a heading in The Evening Press, “No cut-back in spending in Dublin County”. The paper goes on to report that the manager has sent a circular to all the county councillors in the area. It also says the manager emphasises that no shortfall in public services for the county is anticipated and, in fact, the local authority will be taking on 60 extra employees to cater for increased activity at various levels. That is reassuring reading for some Deputies.
Perhaps for the Minister. Why does he not answer the point raised?
A question was asked about the delay about the 10 per cent.
What about the percentage question?
The Deputy should not ask questions while the Minister is talking.
This is not a Second Stage debate.
On an Adjournment Debate the other evening I explained to the House that consideration on the limit of rate poundage was closely bound up with other budgetary questions. The Government have now made their decision and it is being communicated to all local authorities over the weekend. With the Christmas season intervening, time may be a little short to enable all the local authorities to complete their estimates within the period prescribed from 23 November to 31 December. Where local authorities feel the time constraints are too tight, they may apply to me for a departure from the Public Bodies Order to allow their estimate meetings to be postponed until January. A number of local authorities have already applied and they will be allowed to do so.
Deputy Keating was worried about the legality of what I have been doing in anticipation of this legislation. Section 10 which we are discussing will be deemed to have come into effect from 1 November 1977. When the Bill is passed, any direction by the Minister will have the force of law from the time it was issued.
Has it now?
Let me go on a little. I said it will have the force of law when it is passed. A motion was passed in this House on 6 July 1977 with regard to derating.
The Minister is not dealing with the point I raised.
This 25 per cent of derating which took place in 1977 is covered in this legislation. The Coalition Government were not concerned whether or not this was within the law. When I became Minister on 5 July 1977 there was no activity——
This is all irrelevant.
——with regard to bringing in the necessary legislation to cover the 25 per cent. If I am breaking the law, the National Coalition were also breaking the law. The difference is that I started the preparation of a Bill immediately to give it legislative effect. When the Bill is passed here and in the other House, and signed by the President, the rates reliefs will be effective from 1 January 1977.
It is not effective now.
This is a common procedure in this House. It happens quite often as the Deputy will find out as time goes on. It is an acceptable procedure and always has been.
The Minister is anticipating the use of power he has not got.
The National Coalition anticipated a Bill they did not even prepare.
Deputy Keating should not continue to interrupt.
The Minister should not continue trying to pull the wool over my eyes.
If Deputy Keating continues to interrupt, the Chair will have to ask the Deputy to leave the House.
The Minister should stop trying to pull the wool over my eyes.
The Chair is the judge of order in the House, not the Deputy.
The two Opposition parties should make up their minds whether or not they are for derating.
More bluff.
At the end of Second Reading, one Opposition party called for a vote but they had too many non-runners. That is the same as if they voted against derating.
Anything but an answer to the question.
On Committee Stage the Deputy's party voted against a provision which protects the flat-dwellers.
(Cavan-Monaghan): It does not protect the flatdwellers.
The Deputy's party voted against the interests of the flatdwellers.
Not one of whom is benefiting.
The Deputy spoke for a long time without interruption.
If that is not voting against derating——
On a point of order, are we on section 10 or are we going back to Second Stage?
We are as much on section 10 as we ever were. Second Reading speeches have been made all round. It is time-consuming but the Chair has been overly tolerant because it ends at 9.30 p.m. anyhow.
With all due respect, discussing the merits or demerits of calling divisions has nothing to do with section 10 or with a Second Stage debate.
It is no harm to remind Deputies of these facts.
So long as the Minister is doing it.
The upper limit is justified for all the reasons I gave now and on previous occassions. It is not a 10 per cent upper limit. The aggregate will work out at 13 per cent. Some local authorities, such as Dublin County Council, will do better than others because of increased valuations and more buoyancy. Sixteen local authorities did not even require the 11 per cent.
Will the Minister answer one question?
I raised the question of the national wage agreement and also the question of malicious damages.
If malicious damage is connected with the troubles in Northern Ireland it is recouped 100 per cent. With regard to other types of malicious damage the first 20p in the £ is paid by the local authority and after that the remainder is recouped.
What about the national wage agreement?
I have dealt with this already. There were always national wage agreements which never came into being until long after the estimates meeting.
I put a number of questions to the Minister and I would be grateful for his reply to them. Does the Minister know the number of local authorities which have already exceeded their limits this year and to what extent that may be so? By what percentage have councils and corporations over-expended and are in arrears? I also asked the Minister if he would be prepared to entertain requests for further money in any circumstances where grave reasons, due to an emergency situation, arose. What is the Minister's stance where extra moneys are required for reasons that could not have been anticipated in the compilation of the estimates?
No local authority ever anticipated severe flooding, earthquakes, hurricanes or anything like that. I would consider an emergency when it occurred. This is a hypothetical instance but I would consider an emergency when it occured.
It is not all that hypothetical.
Hypothetical or otherwise, I will have it considered.
It has already happened in certain counties. Would the Minister give the same consideration to a situation where moneys have run out on a particular estimate giving rise to possible layoffs in respect of workers?
I have no evidence of any lay-off in any local authority area.
Will the Minister guarantee that if there were an emergency——
I am putting the question that section 10, as amended, stand part of the Bill.
Is the Minister in a position now, having crowed long enough about the 10 per cent, to tell the House on what basis the 10 per cent, is calculated?
No.
The Minister is very much to the point but we are dealing with the first implementation and the second implementation of the 10 per cent.
It is a budgetary matter.
If the Minister is not prepared to indicate at this stage, could he say at what stage he might be prepared to?
Not on this discussion of the Bill.
What would be the position if the next national wage round exceeds 10 per cent?
We have been informed by the unions that they will not participate in any national wage agreement, so we do not know. That would be provided for in the existing agreement.
But what if the wage increase exceeds 10 per cent?
Order, please. I am putting the question.
Question put.
The Committee divided: Tá, 61; Níl, 34.
Tá.
- Ahern, Bertie.
- Ahern, Kit.
- Allen, Lorcan.
- Andrews, Niall.
- Aylward, Liam.
- Barrett, Sylvester.
- Brady, Vincent.
- Briscoe, Ben.
- Browne, Seán.
- Callanan, John.
- Calleary, Seán.
- Cogan, Barry.
- Colley, George.
- Collins, Gerard.
- Conaghan, Hugh.
- Cronin, Jerry.
- Daly, Brendan.
- de Valera, Síle.
- Doherty, Seán.
- Farrell, Joe.
- Faulkner, Pádraig.
- Filgate, Eddie.
- Fitzgerald, Gene.
- Fitzpatrick, Tom (Dublin South-Central).
- Fitzsimons, James N.
- Flynn, Pádraig.
- Fox, Christopher J.
- French, Seán.
- Gallagher, Dennis.
- Haughey, Charles J.
- Hussey, Thomas.
- Keegan, Seán.
- Kenneally, William.
- Killeen, Tim.
- Killilea, Mark.
- Lalor, Patrick J.
- Lawlor, Liam.
- Lemass, Eileen.
- Lenihan, Brian.
- Leonard, Tom.
- Leyden, Terry.
- Lynch, Jack.
- McCreevy, Charlie.
- McEllistrim, Thomas.
- Molloy, Robert.
- Moore, Seán.
- Morley, P.J.
- Murphy, Ciarán P.
- Noonan, Michael.
- O'Connor, Timothy C.
- O'Donoghue, Martin.
- O'Hanlon, Rory.
- O'Kennedy, Michael.
- O'Malley, Desmond.
- Reynolds, Albert.
- Smith, Michael.
- Tunney, Jim.
- Walsh, Seán.
- Wilson, John P.
- Woods, Michael J.
- Wyse, Pearse.
Níl.
- Barry, Richard.
- Begley, Michael.
- Belton, Luke.
- Bermingham, Joseph.
- Bruton, John.
- Burke, Joan.
- Collins, Edward.
- Conlan, John F.
- Cosgrave, Michael J.
- Crotty, Kieran.
- D'Arcy, Michael J.
- Deasy, Martin A.
- Desmond, Eileen.
- Donegan, Patrick S.
- Donnellan, John F.
- Enright, Thomas W.
- Fitzpatrick, Tom (Cavan-Monaghan).
- Flanagan, Oliver J.
- Gilhawley, Eugene.
- Griffin, Brendan.
- Hegarty, Paddy.
- Keating, Michael.
- Kenny, Enda.
- McMahon, Larry.
- Mannion, John M.
- O'Brien, Fergus.
- O'Brien, William.
- O'Donnell, Tom.
- O'Keeffe, Jim.
- O'Toole, Paddy.
- Quinn, Ruairí.
- Taylor, Frank.
- Treacy, Seán.
- Tully, James.
Tellers: Tá, Deputies P. Lalor and Briscoe; Níl, Deputies McMahon and Bermingham.
Question declared carried.
Section 10, as amended, agreed to.
It is now past 9.30 p.m. and in accordance with the resolution of the Dáil today I am putting the following question on the Bill: "That all amendments set down by the Member in charge of the Bill and not disposed of are hereby made to the Bill; the Bill, as amended, is hereby agreed to and, as amended, is reported to the House and the Bill is hereby passed."
Question put and agreed to.
The Dáil adjourned at 9.35 p.m. until 10.30 a.m. on Wednesday, 13 December 1978.