Sligo council votes by margin of one to seek €7.5m loan

Sligo County Council yesterday voted by a margin of one vote to seek a €7.5 million loan amid claims that the local authority is on the verge of bankruptcy.

This follows the Department of the Environment’s rejection of a recommendation by independent consultants Grant Thornton that the beleaguered local authority get a €10 million State bailout to ensure its survival.

County manager Hubert Kearns said it was time for an examination of how local government is funded, given the healthy finances of some local authorities on the east coast. This was a political issue that had to be discussed. There was an issue of whether in difficult times “the rich should help the poor” and this was a decision for Government.

The council has a capital debt of about €73 million, while its revenue deficit is €13 million.

In a letter to the council from the department, received at yesterday’s meeting, sanction was given for the conversion of an overdraft to a term loan, but some members were angry when it emerged a €7.5 million overdraft – and the €7.5 million loan – will stay in place for the moment.

Describing the letter from the department as “disastrous news” for the council, Independent councillor Declan Bree said the Minister was now saying that “we must paddle our own canoe”. Describing the proposal to seek a loan as “madness”, he said it was incredible the manager would make such a proposal given the appalling financial record of the council.

Fine Gael councillor Hubert Keaney said he was tired of “the same childish vindictive comments”.

The proposal to seek the €7.5 million loan was rejected by Fianna Fáil, Sinn Féin and some Independent councillors, and approved by Fine Gael and Independent chairwoman Veronica Cawley.

Fianna Fáil councillor Jude Devins said the consultants had left the council with two options – seek a €10 million cash injection or “have our own Croke Park agreement”, which would open the door for more redundancies.

Sinn Féin councillor Seán Mac Manus said the letter was “a damning indictment” of the council.