A proposal from Fianna Fáil local election candidate in Mayo County Council Gerard McHale could save Mayo County Council €3.8 million over the term of the council.
The Claremorris-based candidate is proposing that all local authorities in Ireland restructure their banking operations to come together under one bank, thus pooling their collective bargaining and consequently reducing the amount of interest being paid by individual local authorities such as Mayo County Council which are currently overdrawn.
“This is a very simple idea which could potentially save Mayo County Council €760,000 a year, or up to €3.8 million over the next term of the council,” McHale said.
“The model is similar to that used by global companies such as Microsoft or Coca Cola. The companies use the same bank across the world, and this significantly strengthens their bargaining power with their bank.
“In Ireland there are currently 29 county councils, five city councils, and 80 town councils, and they all have separate banking facilities across multiple banks. Each local authority manages its own liquidity and working capital facility.
“However, if they worked together and used the strength of their collective bargaining, the councils which are currently in debt, such as Mayo County Council, could offset their debt against the positive balances in other local authorities and ultimately both would end up better off.”
McHale continued: “The councils who are currently in debt would see their interest reduced and those in credit would see their interest earned increase. Assuming that at least 20 councils have negative balances similar to Mayo County Council, then this measure could potentially provide for savings in the region of €12 million annually.
“This model is also used very effectively by the Denmark government. This is the kind of thinking outside of the box that is needed on Mayo County Council and, if elected to represent the people of Mayo, I will pursue the introduction of this significant savings measure,” Mr McHale concluded.
