Rising overheads, falling consumer sentiment and unrelenting economic pressures has seen Longford Town Council’s rate arrears balloon almost eight fold within the space of four years, new figures reveal.
From the start of 2006, outstanding monies owed to the council has risen from €116,511 to a whopping €914,175, fuelling fears certain local authority services may have to be scaled back to deal with the shortfall.
To add to the council’s financial woes, Head of Finance Barry Lynch told elected representatives at a stormy council meeting last Wednesday that more than €650,000 had been classed as bad debts last year-or monies that were likely to remain uncollectable.
As Mr Lynch disclosed the figures to councillors, some headed by Cllr Tony Flaherty questioned the tactics presently being employed by local authority executives in dealing with cash-strapped businesses.
From his own research, Cllr Flaherty said Town Council officials and a newly devised rates and water debt management committee had planned to take in €4.2m in rates for 2011, a figure he claimed was grossly over-inflated.
“It’s great to see that we are taking into consideration that it (rate arrears deficit) is due to the economic downturn, but if it is the economic downturn why are we taking our people to court?”
Cllr Flaherty was equally frank in his assessment of the council’s debt management committee and the apparent lack of local representation among its members.
But it was Cllr Flaherty’s use of the term “bullyboy tactics” which he claimed was being used by council officials in liaising with hard pressed companies which saw the Fianna Fail councillor become embroiled in an angry exchange with county manager, Tim Caffrey.
“Why hasn’t our rate collector been given the power to do a deal with these people who have fallen on hard times?” Cllr Flaherty asked, as he addressed the council’s executive.
“There are two businesses in this town nearly 50 years in business who have paid their rates for 48 years and when they are less than two years in trouble we have them in court.”
Mr Caffrey sharply replied: “I can’t sit here and listen to that nonsense. Every time I come into this council chamber I hear bullyboy tactics being used. I don’t like that kind of language anywhere.
“The law hasn’t changed. There was a team set up to deal with the ratepayer and we are not in a position as an executive to try and discourage business; we are doing everything we possibly can to facilitate businesses,” he said, before making reference to a business incentive scheme recently introduced by the council in a bid to stimulate the local economy.
As the war of words between the two men intensified, other councillors looked on in stunned silence as Cllr Flaherty shouted: “I don’t speak nonsense. It might sound nonsense to an executive that’s behind a desk all day but I have a mandate to speak on behalf of my constituents.”
In an attempt to return the meeting to a more orderly fashion, Town Mayor James Keogh allowed a number of other councillors to express their own opinion on the council’s rate collection crisis.
Cllr Michael Connellan suggested the introduction of a 20 rate inducement scheme for those businesses that settle their invoices within a particular timeframe.
Fine Gael Cllr Alan Mitchell said the council’s debt management committee needed to thrash out an exact figure in terms of what monies still outstanding could be recouped while Cllr Mae Sexton raised question marks over the use of legislation in tackling rate payment arrears.
Under present guidelines, councillors were told officials still rely upon the Poor Relief Ireland Act of 1838 when enforcing rate collection governance.
But it was the revelation from Mr Lynch that any tenant moving into a new premises could be forced to pay unpaid bills from its previous occupier which drew scathing remarks from Cllr Sexton and Cllr Paul Connell.
“It seems to me that decisions are being made by people who do not live in town,” said a bemused looking Cllr Connell. “I am not saying it is a good idea to have write-offs but if somebody is struggling surely common sense and a humane attitude have to come into it.”