Councils cannot spend €1.2bn in levies

CASH-strapped local authorities have been forced to store away €1.2 billion of development levies which could be used for public services like water and parks because of how the Government is applying EU budget rules.

As local councils struggle with funding reductions, the Government said it will examine ways of freeing up this money which was put in reserve to make Ireland’s deficit look smaller for the EU’s Growth and Stability Pact.

The Government asked councils not to spend levies accumulated before 2009 so they can be used as reserves to reduce the Government’s budget deficit, which the EU requires stays below 3% of GDP.