Property tax fails to improve accountability
Published 01/10/2016 | 02:30
The advent of the property tax was supposed to bring about a new era in the relationship between the homeowner and their local council.
The amount of money an individual householder paid over was to be linked to the resources required by their local authority.
The intention was to connect efficiencies in budgeting by a council to the citizens who voted them into office.
Somewhere along the way, the principle got lost. The property tax was inequitable from the start as it treated urban and rural houses the same. The difference between what €300,000 will buy you in Dublin and what the same sum will get you in the rest of the country is quite dramatic.
Rather than the site valuation tax model, advocated by many economists, the then Fine Gael-Labour Party government went for a system based solely on the market value of the property.
The rebalancing was supposed to be made up by allowing councils to set the rates themselves. City councils, with a larger number of houses in a tighter space, would obviously be able to lower their tax rate. Rural county councils, who might have access to less funding such as commercial rates, would be able to increase their rate to be charged.
Again, there was tinkering with the system, with only a range of plus or minus 15pc of the standard rate allowed.
As the years pass, there is now a greater level of variation within the system, but the inequities remain.
As for the increased level of accountability from councils, the report of the Comptroller and Auditor General makes for distressing reading. The C&AG points to an apparent lack of transparency on how valuable State money is spent in councils. The Dáil Public Accounts Committee's hearings on that front will be worth watching if you're a homeowner.
Questions remain for Creed and Donohoe on HRI post
The hearing during the week of the Oireachtas Joint Committee on Agriculture, Food and the Marine was a rather unsatisfactory affair.
The controversial reappointment of the CEO of Horse Racing Ireland (HRI) was under scrutiny.
Brian Kavanagh was reappointed for a third term as CEO of HRI, even though Government guidelines on chief executives of semi-State bodies say they should serve no more than one seven-year term.
If the purpose of an Oireachtas committee is to quiz officials and hold them to account, then the TDs failed in their duty. At the committee, Agriculture Minister Michael Creed defended his role in sanctioning the reappointment. The minister emerged from the hearing largely unscathed and with a number of questions unanswered. And his Cabinet colleague, Public Spending Minister Paschal Donohoe, should certainly be due an appearance too.
Kavanagh took up his role in 2001 and has served two terms, as allowed under the guidelines. Special permission was needed from the Government for him to continue for a third term. During the economic downturn, the maximum salary allowed for such a State board post dropped to a range of €138,000 to €164,000. Kavanagh's salary under his old contract, which predated this change, was €190,000.
The Department of Agriculture and Department of Public Expenditure pointed to this salary cap, but then allowed for it to be breached in the new contract.
The rules, it would appear, are there to be broken.