Longford County Council’s financial situation is so grave it could run out of money to meet wekly payroll costs and keep water supplies turned on at night.
In documents obtained by the Leader detailing the local authority’s monetary well being during the opening six months of 2012, finance chiefs describe the council’s financial status as being both “critical” and “increasingly difficult” to sustain.
This, they blame on cuts to central government funding and the deepening recession, leaving a €3m revenue gap when compared to its 2008 figures.
One of the council’s biggest outlays has been on staff retirements. Since the Government’s roll out of its early retirement scheme, the deadline for which came in February, nine staff were paid approximately €557,089.
Management of wastewater plants up and down the county has likewise seen the council having to stomach a €616,000 deficit.
In an effort to minimise its financial predicament, senior executives have put a lid on all discretionary expenditure as attempts are now made to identify other sources of funding in order to keep its own road and water crews employed.
Head of Finance Barry Lynch presented councillors with the grim news at last week’s council meeting along with a detailed overview of where a further €300,000 in cost savings could be made.
Stressing that the cuts would not immediately impact upon frontline services, Mr Lynch warned of possible further financial hardship should the Government proceed with axing an additional €1m from its Local Authority Grant allocation.
“We are trying to preserve frontline services to the maximum extent possible,” he said. “The Minister (for Environment, Phil Hogan) will shortly decide what the position is regarding the fourth quarter (October-December) grant. We don’t know what he is going to do with cuts there but if he decides on a further reduction we will have to come back to members with proposals to deal with that.”
Part of those recommendations, in documentation seen by the Leader, involve the immediate suspension of all frontline and day to day activities normally carried out by Longford County Council.
“If the department confirms that it is going to deduct a further million euro, it will be necessary to immediately suspend roadworks, housing maintenance, street lighting and disabled persons grants and cut back on street lighting and cleaning,” the three page transcript outlined.
In a further blow, the council admitted water supplies may have to be turned off at night with difficulties also likely regarding its ability to pay staff.
“A cut of €1m could also have implications for the council meeting its payroll costs between now and the end of the year,” the document stated.
One potential solution, Mr Lynch said remained open to the council was by chasing down the near 40 per cent of homeowners who have yet to pay the Government’s controversial household charge.
With Longford’s compliance rate currently standing at 59 per cent, Mr Lynch said staff were now pursuing “every legal avenue” open to the council in a last ditch attempt to track down those who have still to pay the €100 fee.