5% rate increase for Tipperary

Council passes 'historic' budget of over €200m expenditure

Commercial ratepayers will see a 5% increase in demand next year after Tipperary Co Council adopted a new budget of record expenditure.

Passed by a margin of 33 votes to four, the adoption of the 2023 budget last Friday was described by a number of speakers as a ‘historic’ day for Tipperary. It is the council's biggest ever budget, breaking the €200 million mark in expenditure with a 5.8% increase on last year provided for in the estimates.

It was also the first budget since the amalgamation of Tipperary's councils in 2014 that Sinn Féin voted in favour of, while three Fine Gael councillors broke ranks in voting against the spending plan for next year.

The 5% rate increase was a compromise agreement; the draft budget had sought an increase of 7%. In introducing the draft, CEO Joe MacGrath outlined the challenges against which this budget was prepared. These included cost acceleration arising from persistent inflationary pressures; general economic uncertainty arising from the war in Eastern Europe and other factors; escalation of energy costs; the council's capacity to support growing demands for services; lack of buoyancy across main income sources, and ongoing issues arising from emergence from the Covid-19 pandemic.

‘ONCE IN A GENERATION OPPORTUINTY’

A rates hike would be required for the council to raise the matching funding needed to allow a number of Rural Regeneration Development Fund (RRDF) and Urban Regeneration Development Fund (URDF) projects to proceed for towns across the county. Local projects included in these schemes were Nenagh's Sustainable Energy Centre, Historic and Cultural Quarter, Rialto Digital and Enterprise Hub, and in Roscrea the recently-announced Gantly Road regeneration project.

Part of the Project Ireland 2040 programme, these projects represented a “once in a generation opportunity to transform our town centres and villages, and contribute to a meaningful and sustained enhancement in the quality of life of our communities,” Mr MacGrath wrote in making the case for a 7% rate increase, which would still leave Tipperary with the third-lowest rate demand in the country.

But, towards the end of a five-hour debate in Clonmel last Friday, Cllr Siobhán Ambrose (FF) formally proposed a lower increase of 5%. People in general want to see the URDF and RRDF projects happen, she said. To do this, the council would have to raise the rate. Every alternative option had been explored.

In order to soften the blow on ratepayers, Cllr Ambrose proposed that the upper limit band for businesses to qualify for the council's Early Payment Scheme be increased to €26,000. This, she said, would allow more businesses to be included in the scheme, which enables ratepayers to secure a discount on their bills. The council was asked to hold a “drop-in clinic” in every district where people could discuss the Early Payment Scheme.

In support, Cllr Marie Murphy (FG) said it is never easy to raise money and even more difficult this year with inflation and the cost of living crisis. But she wanted to see the people of Tipperary benefitting from URDF and RRDF scheme, which she did not see another opportunity for.

Also supporting, the council's longest-serving councillor Michael Fitzgerald (FG) said this was “one of the toughest budgets that has been presented to us in a long, long time [with] a lot of hard decisions to be made”.

Cllr Pat English (Workers and Unemployed Action Group) said he could not support “another austerity budget” for Tipperary. The council had been “starved of funding” by central government, he said, arguing that the local authority “can no longer be run on a shoestring” and had to make a stand in the matter.

Formally proposing rejection of the budget, Cllr English said it was wrong to add a 5% rate increase on top of the 10% Local Property Tax increase, which was maintained this year. He also said it was a “scandal” that the council had budgeted €20,000 for conferences abroad, and proposed that this money should instead be added to expenditure on playgrounds. As happened in 2020, a vote was taken and the proposal was defeated.

Also speaking against the budget was Fine Gael's Michael Murphy, who said he could not support a 5% rate increase.

Many businesses just do not have the cash flow to avail of the Early Payment Scheme, he told the meeting.

Despite also expressing misgivings over the rate increase, Cllr David Dunne said he and fellow Sinn Féin councillor Tony Black had to be “responsible politicians” in passing a budget that would allow for the Project Ireland projects to proceed.

While they supported their party position against the LPT, this was going to be a “unique day” as they would support a Tipperary Co Council budget for the first time.

Cllr Séamie Morris (Ind) was of a similar view. He agreed that the Government had refused to adequately fund councils, which had to turn to ratepayers to make up funding, but said he would support the objective of this budget.

Cllr Morris suggested that the council submit a motion calling for different rate bands for smaller businesses, rather than increasing the rate across the board. He also expressed disappointment that Tipperary Chamber of Commerce was not involved in the council's rate discussion.

RATES PAYMENT SCHEME

The budget was passed by a margin of 33 votes to four, with Fine Gael's Michael Murphy, John Fitzgerald and Mary Hanna Hourigan joining Cllr English in voting against it. The meeting was informed that the council would still be able to balance its budget with the lesser rates increase and change to the Early Payment Scheme. This would leave an ARV of 0.2014 for 2023.

Head of Finance Liam McCarthy drew attention to the fact that some 50% of the council's customers did not avail of the Early Rates Scheme this year and in 2021. The scheme is open to customers with arrears on their accounts, subject to certain criteria.