Car park, tolls and social housing rent hikes loom for Dublin
Council losing €8.4m rates income on Irish Water-owned properties
East Link: toll for cars is to rise from €1.40 to €1.90 from April 1st to yield an extra €1.9 million for road improvements. Photograph: Dara Mac Dónaill
Dubliners are to face increased parking charges, tolls, social housing rents and commercial rates next year because of a failure to adequately fund the city, Dublin City Council chief executive Owen Keegan has said.
The council will experience increased costs and large losses, including the loss of rates income of €8.4 million on Irish Water-owned properties, and will not be compensated by central government despite prior assurances to the contrary, Mr Keegan said.
As a result, councillors will be asked on Monday to pass a budget for the city which includes a 36 per cent increase in the East Link toll, average social housing rent increases of €160 a year, a rise in business rates of 1.5 per cent and the second hike in on-street parking charges in a year following a decade without increases.
The funding of local authorities by the Government has “consistently shifted” in recent years, Mr Keegan said. This shift has been “disadvantageous” to Dublin city and has shown an “absence of understanding of the funding challenges facing Dublin city”.
In 2020, the council expects additional insurance costs of €11.6 million due to increased premiums and claims. Mr Keegan expects the Health Service Executive will not pay €4 million previously agreed in relation to the Dublin Fire Brigade ambulance service due to an ongoing union dispute. In addition, management fees for tenants living in housing bought from developers will cost €2.7 million.
However, Mr Keegan said the greatest blow will be the loss of rates income from Irish Water properties. The Government has decided to calculate the value of all Irish Water properties nationally and pay rates to local authorities based on their population, instead of the actual value of Irish Water properties in their area.
This will result in a rates loss to the city council of €8.4 million. Mr Keegan said the Government had given a “commitment” Irish Water would have a “cost-neutral” impact on local authorities and there would be a grant to offset the rates losses.
“Dublin City Council has now been advised that no grant funding will be forthcoming and this huge loss of income to the city council in 2020 and beyond will not be addressed. This is the most significant issue in the 2020 budgetary process.”
Earlier this year the council introduced a 10 per cent rise in on-street parking charges in high-demand areas of the city, the first parking charge increases since 2008. However, due to the losses facing the council, Mr Keegan is proposing another increase from July of next year to yield an additional €1.6 million in 2020.
The council also hopes to raise an additional €4 million by increasing social housing rents. This would be done by calculating rents based on 16 per cent of the weekly income of the principal earner, after allowances, instead of 15 per cent. In practice that would mean a tenant earning €203 a week would pay €27.36 instead of €25.65 and a tenant at the higher end of the income spectrum, earning €759 a week, would pay €116.32 weekly instead of €109.05.
The East Link toll is to increase for cars from €1.40 to €1.90 from April 1st, 2020, to provide an additional €1.9 million next year to fund road improvements including footpaths and cycle ways.
The council’s local property tax allocation had been “most disappointing”, Mr Keegan said, and had raised the “expectation of residents while generating little additional income to meet these service expectations”.