Council attributes record €102m rates payments to ‘flexibility’

Despite the economic downturn, Cork County Council took in €101.8m in rates last year, up more than €10m on what it collected in 2008.

Councillors maintain the secret of their rate collection success is based on staff trying to be as accommodating as they can with struggling businesses, offering them the choice of stage payments and giving them time to pay.

Liz Barry, the council’s acting head of finance, said the local authority “is conscious of the extremely challenging circumstances some businesses find themselves in and the rate collection staff engage with ratepayers to agree payment plans as appropriate on a case-by-case basis.”

Ms Barry added that the council was also fortunate that it had some very large companies (especially in the Little Island and Ringaskiddy area) which were well able to pay and its collection rate from all businesses was much higher than the national average for local authorities.

She said that rates accounted for more than 30% of the council’s revenue income last year and they had come in ahead of target, despite the fact that €13.6m of rates were deemed as irrecoverable from failed businesses.

The council’s income from rates continues to improve, despite the recession and the fact that it hasn’t imposed an increase in charges for the past six years.

Ms Barry said the council was a preferential creditor when it came to receiverships and it had benefited financially from a few of them last year.

Cllr Kevin O’Keeffe (FF) said it was ironic that the council was taking in a record sum when the services it was delivering to the public were decreasing.

Town councils have significantly lower rate charges than businesses which are within the county council-controlled areas.

Several councillors expressed concern that businesses in town council areas would, therefore, face significant hikes in their rates when town councils are abolished in the summer and the power to strike a rate in towns is taken over by the county council.

Cllr Noel McCarthy (Lab) said that businesses in his hometown of Fermoy would face a 22% increase in their rates to bring them up to the county level.

Meanwhile, Cllr Donal O’Rourke (FF) said that a nationwide re-evaluation of rates was moving too slowly for flood-hit businesses in Clonakilty, many of which he maintained were paying over the odds and struggling during the recession.

Cllr Derry Canty (FG) and Mayor of County Cork Noel O’Connor (FG) said incentives should be broadened to encourage start-up businesses, such as offering them a 50% reduction in their rates for their first year of operation.

Cllr Dermot Sheehan (FG) believed rates should be proportional to the profitability of a business.

Acting county manager Declan Daly said that on retiring last December then county manager Martin Riordan had asked council staff to look at some start-up supports for businesses and, he said, there were a number of things they were currently looking at.