Developers unlikely to pay €850m levy bill

BUILDERS are likely to walk away without paying a combined €850 million in development levies owed to cash-strapped local authorities after the Department of Environment asked for “relative flexibility” in dealing with the debts.

As the Government conceded that at least €191m of these are “doubtful debts” that will never be collected from developers, it emerged that almost 4,000 social housing units are lying empty because councils do not have the funds to carry out repair works on them.

This is despite more than 100,000 people waiting on social housing lists around the country.

Fingal County Council, owed more than €161m, is taking 50 legal proceedings for non-payment of levies, while Dublin City Council has referred 10 cases to court to address its €147m shortfall.

Cork County Council is owed more than €60m, while the city council is owed just under €15m.

Limerick county and city councils are owed €42m between them, while both local authorities in Galway are owed €22m.

The Department of the Environment said €348m of what is owed around the country is categorised as “deferred income” which they expect to collect when developments progress in years to come.

More than 200 staff are working full time in city and county councils around the country to recoup the money, which they rely heavily on to provide services and facilities, such as roads and water, used by developments.

Secretary general of the Department of the Environment, Geraldine Tallon, said while local authorities must make an effort to secure as much of these payments as possible “we have to be conscious that development contributions are a significant potential burden on new activity seeking to locate in particular areas”.

She said representations have been made arguing that “development contributions are a cost to competitiveness” and ” something of an impediment to economic recovery”.

Ms Fallon told the Dáil’s Public Accounts Committee (PAC) that “we are looking to authorities to be reasonably flexible”.

Committee chairman, Bernard Allen, whose Fine Gael party originally opposed the introduction of such levies, said it was too late for the Government to decide that they shouldn’t be paid back.

“A lot of us could object and did object in relation to the policy. But it is now law and whether you like it or not, you cannot make that argument,” he said.

Labour’s Roisín Shortall said she was “taken aback” by Ms Tallon’s comments and said local authorities do not have enough funds to repair houses which are “a blight on communities”.

The committee heard there are 3,859 vacant social housing units around the country. Ms Shortall said these houses “are sealed up and a complete blight on local authority estates” but that “grant aid is not now available from the department to bring in contractors to do that work”.