10% cut in property tax for Cork households

More than 161,000 householders living in Cork county will receive a 10% cut in their Local Property Tax next year but essential council services will be reduced as a result.

In homes valued at under €100,000, a €9 reduction will apply in the 2015 bill but householders in properties worth €950,000-€1m will benefit by €175.

Sinn Féin and Fianna Fáil councillors yesterday ignored pleas from the county council’s chief executive, Tim Lucey, not to reduce the LPT as it would force cuts to spending on roads, local authority housing maintenance, litter control, library services, and community grants.

Sinn Féin sought a 15% cut, while Fianna Fáil pressed for a 10% reduction next year and a further 5% in 2016.

Fine Gael, however, maintained there should be no reduction because of the potential damage to council services.

After one of the longest, most controversial, debates which included two adjournments, three votes were eventually taken with Fianna Fáil finally winning the day with 38 in favour and 16 against its proposal.

The Fine Gael motion was comfortably defeated and after Sinn Féin’s proposal was defeated, its members backed Fianna Fáil, as did the Independents.

Mr Lucey said a 10% cut would deprive the local authority of €4.1m in income, which could hit services. After continuing reductions in recent years, he was not confident 2015 levels would be on a par with 2014.

He said it would be up to councillors to decide the likely cuts before their November 20 budget.

Councillor Seamus McGrath said Fianna Fáil was not proposing as high a cut as Sinn Féin because the party wanted to maintain a decent level of services and also wanted leeway to be able to give ratepayers a cut as well.

Fine Gael councillor Kevin Murphy described the Fianna Fáil proposal as “an absolute cop-out”.

“Reducing the LPT by any percentage will have a detrimental effect on our services,” he argued.

Sinn Féin councillor Des O’Grady said a 15% cut was needed on the “unfair, regressive tax which doesn’t take account of income”. He said both Fianna Fáil and Fine Gael had supported in principle, in June last, cutting the tax.

Fine Gael councillor Gerard Murphy said Fianna Fáil was turning back to “old pre-election rhetoric” and claimed the party would cause “economic turmoil” if it ever returned to power nationally.

Fine Gael councillor Susan McCarthy said people living in social housing units were not paying the tax and the cut would benefit the rich.

Independent councillor Claire Cullinane demanded a return of LPT money designated for the council but given to Irish Water instead. Fellow Independent Marcia D’Alton agreed and said that decision “made fools of” councillors.

Mr Lucey said the council had to utilise its reserves for the past five years to balance the books. Last year, it dipped into its reserves for €4.5m and by the end of this year, the council will have just €6.5m left from a €20m pot.

He said continuing to subsidise budgets from reserves was “unsustainable” and no further cost-saving could be found within the council.

However, county mayor, Fianna Fáil councillor Alan Coleman, said he believed services could be retained at 2014 levels.

Mr Lucey said the LPT reduction would “most likely create difficulties” especially for funding of the eight municipal authorities and also for the council’s discretionary grants.