Rates and rent freeze will see Dublin city run out of money, Keegan warns

Dublin City Council will not have enough money to run the city if a blanket moratorium on commercial rates and social housing rents is implemented during the coronavirus pandemic, council chief executive Owen Keegan has warned.

Council chief executive Owen Keegan has urged city councillors not to call for a rates freeze for business or a blanket suspension of rent collections from council tenants.

Retail Excellence Ireland chief executive David Fitzsimons said yesterday non-essential business should be shut and rates payments should be stopped. "Business needs to cease all rents and rates payments. When they come back, when they open their doors there can be no legacy bills," he said. No rates should be payable "for a year" he added.

Labour group leader on the council Dermot Lacey had earlier called on council management to defer collection of commercial rates for March and for as long as the Covid-19 crisis continues to support small business.

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Mr Keegan said income from rates, and rents from the council’s almost 25,000 tenants, is essential to keeping the city running.

“There have been calls by a number of elected members for a moratorium on payment of commercial rates, rents etc. I would strongly caution against this approach if we are to maintain city council services,” he said.

However, he said the city council recognises the “very difficult trading conditions that exist for certain businesses, especially small businesses, as a consequence of Covid-19-related developments”.

Any ratepayer “experiencing difficulties in meeting their rates liabilities should contact their rate collector to discuss the matter and agree an appropriate arrangement”.

The contact details of the council’s rate collectors was referenced on each rates bill he said.

In relation to social-housing rents, the council operates a “differential rent scheme” which means tenants pay rent based on their incomes.

Almost half of the city council’s tenants are charged the minimum rent of €25.65 weekly.

These are largely people whose income is provided directly through State supports.

Tenants with jobs are generally charged extra rent, depending on their individual circumstances. The current highest weekly charge paid by any tenant is €265.87, while the average rent across the council’s 24,574 tenancies is €69.41 a week.

For those who have lost jobs as a result of the pandemic, their rents could be reduced, Mr Keegan said, as it would if they became unemployed in the normal course of events.

“If any social housing tenant experiences a reduction in income they should make contact with the rents section,” he said, “and their rent can be adjusted accordingly. This flexibility is built into the system already”.

He added households with mortgage loans from the council that have experienced a drop in income should contact the council’s housing loans unit.