LOCAL AUTHORITY
BUDGETS
Peter Duggan, FCA
Head of Finance
Mayo County Council
Local Authority Budgets
 Introduction
 Budgetary
 Budget
Process
– Key Components
INTRODUCTION
INTRODUCTION
Significant changes in Local Authorities
 Introduction of Irish Water
- Transition of Functions from 1 Jan 2014
- Provision of Service under an SLA agreement with Irish water
 Enterprise
- Roll out of Local Enterprise Offices (LEO’s)
- Replaces County Enterprise Boards and will operate under the
aegis of the Local Authority in collaboration with Enterprise Ireland
INTRODUCTION

Alignment
- Set-up of Local Community Development Committees (LCDC’s)
- LCDC’s take over the role of the County Development Boards

Municipalities
- Town Councils have been dissolved
- Introduction of Municipal Districts

Specific Changes in Finance
- New Budgetary Process
- Introduction of Local Property Tax
- Cessation of NPPR
INTRODUCTION

Operations and activities of Local Authorities can be
divided into two primary accounts
1.
Revenue Account
Covers the day-to day activities of the Council i.e. the provision of
Local Services
2.
Capital Account
Covers the Construction/provision of Infrastructure (Assets) within
the County

Obligation to keep both accounts “in Balance”
BUDGETARTY PROCESS
Budgetary Process
 Legislative
 Key
Issues
 Key
Tasks
 Timelines
Basis
Legislative basis





Local Government Act 2001 (as amended by
S 58 Local Government Reform Act 2014)
S102 Local Authority Budget
S103 Local Authority Budget Meeting
Local Government (Financial & Audit
Procedures) Regulations 2014
Informed by EU requirements that, inter alia,
main parameters of National Budget to be
published by 15 October each year
Respective Roles & Functions
 Corporate
policy group involved at
outset and assists executive in
setting parameters, identification of
issues and agreeing approaches
 Chief Executive & Head of Finance to
lead at executive level the
calculations of the draft Income &
Expenditure budgets noting
parameters, issues, approaches etc.
Respective Roles & Functions
Authorities may have interim workshops
with full Council to inform of approaches,
obtain feedback and refine emerging
issues
 Municipal Districts – Chief Executive to
prepare draft budgetary plan regarding
General Municipal Allocation (GMA) for
municipal district, for consideration and
adoption, with or without amendment

Respective Roles & Functions
 Chief
Executive takes account of
these draft budgetary plans when
completing overall, draft local
authority budget for the County
 Statutory Budget meeting of the
members of the County Council
considers and adopts with or without
amendment final adopted Revenue
Budget for the following year
Key Issues
 Local
Property Tax/General Purposes
Grant
 Local Property Tax Variation (if
applicable)
 Income from Goods & Services
 Income from Grants & Subsidies
 Commercial Rates
 Miscellaneous Income
Key Issues
Determination
of Fixed & Nondiscretionary costs
 Pensions, Wages & Salaries
 Loan Charges
 Contractual & Statutory
Commitments
 Fixed & semi-fixed overheads
Key Issues
 Calculation
of Non-Fixed or
Discretionary expenditure
 Will include strategic expenditure
areas that while classified as
discretionary are discretionary in
scale/amount only
 General Municipal Allocation,
determined from available remaining
income
Key tasks



Local Property Tax variation consideration
(S20 Finance (Local Property Tax) Act
2012
L.A. may as reserved function resolve to
vary LPT by +/- 15% from 2015
L.A. must have regard to current financial
position, likely Income & Expenditure
overall, impact of any decision on the full
range of stakeholders and report on
submissions from the public.
Key tasks



General Municipal Allocation (GMA)
Pool of discretionary funding made
available to municipal district members for
allocation in draft budgetary plan
Level calculated by Chief Executive
following determination of overall fixed,
semi-fixed and non-discretionary costs &
available income
Key tasks

Completion of budgetary report for L.A. to
DECLG
Required for EU reporting
requirements
 Sets out preliminary estimate of
Income & Expenditure for both
Revenue & Capital for coming year
 To be submitted by 30th September
 Further details pending

Timelines
July/Aug (Indicative) CPG meetings &
initial workshops to agree parameters,
identify issues, and to consider
implications of range of options on LPT,
Rates & GMA taking into account current
financial position
 July (Indicative) Commencement of public
consultation process on LPT variation
option

Timelines





October - Chief Executive to allocate agreed
GMA between the Municipal Districts
October - M.D.’s to consider and adopt
individual draft budgetary plans meetings to
take place between 1st and 10th October 2014
October/November - Chief Executive to
formulate final Draft Revenue Budget for
County taking account of M.D. draft plans
Statutory Budget meeting must take place
between 1st & 24th November
14 day adjournment allowed
BUDGET
KEY COMPONENTS
Revenue Account – Expenditure & Funding
LOCAL AUTHORITY BUDGETS 2013
€
Total Expenditure
4,180,552,610
Financed by:
Government Grants/Subsidies
849,153,613
General Purpose Grant
637,226,671
Commercial Rates
1,469,121,608
Goods/Services
1,133,466,841
Pension Related Deductions/Other
91,583,877
4,180,552,610
Revenue Account - Funding
 Budget
2015 will include for the first
time Income from Local Property Tax
(LPT)
 This funding source is replacing GPG
allocation.
 Some authorities will continue to
receive a GPG allocation where LPT
Income in 2015 is less than their
GPG allocation for 2014.
Revenue Account - Funding
LOCAL AUTHORITY BUDGETS 2013
€
%
Government Grants/Subsidies
849,153,613
20.3%
General Purpose Grant
637,226,671
15.3%
Commercial Rates
1,469,121,608
35.1%
Goods/Services
1,133,466,841
27.1%
91,583,877
2.2%
4,180,552,610
100.0%
Income:
Pension Related Deductions/Other
TOTAL
Grants/Subsidies

Grants received from various Government Departments
and Bodies
- Dept of Environment, Community & Local Government
- National Roads Authority
- Department of Transport
- Department of Education & Skills

Grants are primarily non-discretionary and must be spent
in the area for which they are allocated

The General Purposes Grant is the only NonDiscretionary grant that Local Authorities receive
Grants/Subsidies
LOCAL AUTHORITY ANNUAL FINANCIAL STATEMENTS 2011 - GRANTS &
SUBSIDIES
Department of the Environment, Community and Local Government
Road Grants
Housing Grants & Subsidies
€
19,709,913
253,982,455
Library Services
238,185
Local Improvement Schemes
152,000
Water Services Group Schemes
25,790,868
Environmental Protection/Conservation Grants
26,527,363
Miscellaneous
34,731,012
361,131,796
Other Departments and Bodies
Road Grants (NRA & Dept of Transport)
455,852,172
Higher Education Grants
173,782,297
VEC Pensions and Gratuities
146,400,159
Community Employment Schemes
7,805,857
Civil Defense
2,550,300
Miscellaneous
47,461,228
833,852,013
Total
1,194,983,809
General Purpose Grant

Also known as Local Government Fund Allocation

Grant is Discretionary and primarily used to fund the
day-to-day activities of the Local Authority

Each Local Authority receives an annual allocation which
is paid quarterly

Grant is paid by the DOECLG out of the Local
Government Fund
General Purpose Grant
LOCAL GOVERNMENT FUND 2014
€'000s
Income:
Local Property Tax
Gross Motor Tax Receipts
Interest
TOTAL INCOME
550,000
1,160,000
150
1,710,150
Expenditure:
General Purpose Grants
275,000
Dept of Transport Payments
363,943
Payment to Exchequer
600,000
Irish Water Subvention
490,000
Other Schemes
TOTAL EXPENDITURE
Excess of Expenditure over Income
Balance on Fund c/f from 2013
Projected Balance Dec 2014
50,000
1,778,943
-68,793
68,889
96
Goods/Services

Local Authorities charges for the provision of certain
services

Rates charged can be set by the Local Authority

Some Charges are set by Minister/statute (e.g. Planning
Fees, dog licenses)

Examples of the services for which Local Authorities
charge include:
- Housing Rents
- Housing Loans
- Parking Fines/charges
- Library Fees
- Landfill Charges
- Planning Fees
- Fire Charges
- Swimming Pool Fees
Goods/Services
LOCAL AUTHORITY ANNUAL FINANCIAL STATEMENTS 2011
GOODS & SERVICES
€
Rents from Houses
344,469,301
Water and Waste Water Charges
248,797,530
Parking Fines/Charges
92,282,853
NPPR
77,017,861
Pension Contributions
61,742,088
Housing Loans Interest & Charges
55,097,199
Landfill Charges
49,966,981
Agency Services
29,648,572
Recreation & Amenity Activities
19,635,910
Property Rental & Leasing of Land
15,348,319
Planning Fees
14,157,351
Fire Charges
12,107,688
Library Fees/Fines
Misc.
TOTAL GOODS/SERVICES
2,621,023
210,228,499
1,233,121,175
Expenditure

Divided into eight Divisions (A-H):
A. Housing & Building
B. Road Transportation & Safety
C. Water Services
D. Development Management
E. Environmental Services
F. Recreation & Amenity
G. Agriculture, Education, Health & Welfare
H. Miscellaneous Services
Expenditure
LOCAL AUTHORITY BUDGETS 2013
Expenditure
€
%
Housing and Building
763,066,188
18.3%
B
Road Transportation and Safety
829,667,112
19.8%
C
Water Services
711,315,277
17.0%
D
Development Management
270,449,181
6.5%
E
Environmental Services
643,846,728
15.4%
F
Recreation & Amenity
368,519,839
8.8%
G
Agriculture, Education, Health & welfare
160,681,292
3.8%
H
Miscellaneous Services
433,006,992
10.4%
TOTAL EXPENDITURE
4,180,552,609
100.0%
Division
Description
A
Thank You
Questions ?
Peter Duggan
Head of Finance
Mayo County Council