Tipperary council faces elected members' revolt over proposed 7% rise in commercial rates

Tipperary County Council’s proposal in its draft budget to increase commercial rates levied on businesses  by 7% next year is expected to face a lot of opposition from councillors if it’s tabled at the local authority’s annual budget meeting on Friday.

Some Independents, including the Mayor of Clonmel, have indicated they will vote against the budget if it contains this rates hike. 

And some Fine Gael and Fianna Fáil councillors, who would normally support the council budget, have also said they will be unable to support the budget if it contains this rates increase because of the huge pressure the business community is under due to the cost of living crisis.   

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In its draft budget, the council explains that a 7% increase in the Annual Rate on Valuation (ARV) to 0.2053 for 2023 is necessary to raise the matching finance it must contribute towards Rural Regeneration Development  Fund and Urban Regeneration Development Fund projects across the county. . 

The council has, to date, secured almost €70m in government grants for such projects for which matching funding of €18.7m is required. 

Two weeks ago, it secured €30.8m RRDF grants for  regeneration schemes for Carrick-on-Suir, Cahir and Roscrea and must now come up with matching funding for the three projects, €3.6m in the case of Carrick and almost €3m for Cahir.  

The council held a pre-budget workshop for councillors yesterday afternoon (Tuesday) as The Nationalist went to press at which public representatives were expected to air their deep concerns about the commercial rates rise proposed.  

Clonmel Cllr Michael Murphy is one of the Fine Gael councillors dismayed at the 7% rates hike proposal. He has declared he won’t support a rates hike and called on the council to raise the revenue it needs through other means. 

 “I won't support an increase in rates having regard to the perfect storm that many small and medium enterprises in the county are in at the moment because of the cost of living crisis and particularly escalating energy costs. 

“I fully understand that the council needs to raise revenue to get matching funds for the recently announced RRDF projects but we have to look at other revenue streams not commercial rates at this point and time.”

He said many businesses have gone through two difficult years of the Covid-19 pandemic and are carrying a lot of debt. They don’t have the cash reserves to help them navigate through this current cost of living crisis. 

Carrick-on-Suir Fianna Fáil Cllr Kieran Bourke has also urged the council to look at other income streams to raising revenue to meet its matching funding obligations for projects such as his hometown’s regeneration scheme allocated €14.39m in the latest round of RRDF allocations. 

He said it shouldn’t be down to businesses to bear the burden after struggling through the Covid pandemic and now struggling through huge cost increases for everything from  energy to materials.  

In view of the €18m regeneration scheme for his hometown, Cllr Bourke said he would only “reluctantly” support a 2.5% rise in commercial rates phased in over a period of two years. 

Clonmel Independent Cllr Richie Molloy also said  he will vote against the council budget if it contains a rates hike because shops and businesses in his hometown are under so much pressure. 

“They really can’t stomach another increase. So many places have closed up over the last few months.” 

Mayor of Clonmel Borough Cllr Pat English of the Workers & Unemployment Action Group will also vote against the budget if it include a commercial rates increase. 

He said he has a problem with a rates increase being levied on small businesses who are under severe pressure and believes any hike should be confined to the big firms and multi-nationals as commercial rates in Tipperary are lower than in neighbouring Waterford and Limerick. Cllr Murphy, however, points out that unfortunately legislation prevents the council from separating big business from SMEs in the levying of rates.  

 Carrick-on-Suir Sinn Féin Cllr David Dunne, who is chairman of Carrick Municipal District, indicated he wasn’t in favour of a 7% rise in rates due to the impact on small businesses and his party was drawing up alternative revenue raising proposals for the council to consider adopting. 

He said Sinn Féin has not yet  decided whether to vote for or against the budget as a lot of discussions still have to take place ahead of Friday’s  meeting. 

The council, meanwhile, argues in its draft budget that the 7% rates increase is necessary to “underwrite the largest investment ever in our town centres, villages and rural amenities.” 

To “cushion the impact” on smaller rate payers, it's proposing to extend the early payments scheme through a number of measures.  

The council said  its budget has been prepared against the background of persistent inflationary pressures, escalating energy costs  and economic uncertainty arising from the Ukraine War and other factors.  It also cites growing demands on its services, lack of buoyancy across its main income sources and ongoing issues arising from emerging from the pandemic as other challenges it’s facing.