If Galway’s City Council members do not hammer out a 2025 budget by midnight this Sunday, December 15, the Minister for Local Government may sack the city’s councillors and replace them with an unelected commissioner instead.
This was the severe warning from officials at an annual budget assembly held in City Hall on Monday, a continuation of the previous week’s tetchy finance meeting which was adjourned without agreement.
Councillors are planning to meet again tomorrow, Friday, with Councillor John McDonagh (Lab ) suggesting all parties bring sleeping bags to City Hall in case tough negotiations extend into the weekend.
The ruling pact which dominates the city council, comprising Fianna Fáil, Labour, and Sinn Féin councillors, alongside independents Mike Cubbard and Declan McDonnell, has failed to agree to vote on a budget.
It is understood nearly all budget items have been settled amongst pact members, except consensus on raising commercial rates by a proposed 15 per cent. City officials calculate this tax hike is necessary to net an extra €6.4m to balance the city’s books.
In October, with the addition of Mayor Peter Keane’s (FF ) casting vote, a hung council passed the first-ever increase in Galway homeowners’ Local Property Tax (LPT ), to raise an additional €7m over five years.
There are almost 3,200 commercial rates payers in Galway city, and the vast majority will see an increase of around €20 per week, based on a 15 per cent proposed increase in their Annual Rate on Valuation (ARV ). It is understood around 60 businesses, mostly hospitality, retail and light industry, may face crippling increases, which might prompt at least five to close in 2025.
Galway City’s finance director, Helen Kilroy, warned councillors that ministers have sacked entire local authorities four times since 1942. The last time was in 1985, in similar circumstances, when Naas Urban District councillors refused to raise commercial rates in protest against water charges. Section 216 of the 2001 Local Government Act allows a minister to sack councillors if financial planning is “insufficient,” interpreted as a balanced budget, and appoint an unelected overseer instead.
Ironically, Galway City Council had earlier celebrated its 125th birthday as an elected body, based on establishment of Galway Urban District Council in 1899, and the 40th anniversary of Galway’s seminal quincentenary celebrations, in 1984.
Speaking at the margins of the meeting, one pact councillor said he had gone through the 88-page budget book line-by-line, and could balance the city budget with just a four per cent increase in ARV, saving large floor-area businesses, such as restaurants, pubs and factories, from substantial rate hikes. A pact colleague said the cuts necessary to fund this proposal, to sports funding and area masterplans for Renmore, Knocknacarra and the city centre, would be “unpalatable” to constituents.
Former mayor Eddie Hoare (FG ) suggested all 18 city councillors meet in private, without media present, to hammer out a financial plan for 2025 after Councillor Donal Lyons (Ind ) earlier complained no-one had contacted him in the 168 hours since last week’s budget meeting was adjourned. Councillor McDonnell said the previous council’s ruling pact, led by Fine Gael, never “bothered to talk to other [non-pact] councillors,” to which Hoare shot back: “But for 13 years we passed a Budget”.
Days earlier, Hoare’s party colleague, first-time councillor Shane Forde (FG ), posted a social media message suggesting that over the past nine years, Galway city councillors - led by his own party - had engaged in “poor fiscal management” by never increasing commercial rates as the city’s running costs spiralled.
At the council meeting, Forde said officials and pact members should “stop the charade” of refusing to agree a tax hike, comments he later apologised for. Pact member Niáll McNelis (Lab ) lambasted Forde for refusing to vote for Galway city’s first ever LPT increase in October “and then he’s all over Facebook giving out about it”.
City manager Leonard Cleary told councillors that officials did not want to see the Council dissolved by ministerial decree, “as we need the democratic mandate given to councillors” to adopt a city budget. He promised a number of “reasonable schemes,” such as tax rebates and grants, to protect Galway businesses from punitive rates hikes, especially as the government valuation service, Tailte Éireann, recently imposed sweeping upward valuations of Galway city’s commercial properties.
“If we’re looking to [Government] for more funding, we need to look at ourselves in the mirror too, including rates payers,” he said, before complimenting councillors on the dozens of suggestions his office had received regarding next year’s budget, which he described as a “step change” in civic investment.
“I know talks are tense, and sparks fly, but we need to light a fire for the city,” he said.
