02 Jul 2022

€4.2 million deficit forces sweeping Council cuts

OFFALY County Council faces a €4.2 million deficit in its 2012 budget and will see sweeping cuts to funding for many services in the forthcoming year in a bid to balance the books.

OFFALY County Council faces a €4.2 million deficit in its 2012 budget and will see sweeping cuts to funding for many services in the forthcoming year in a bid to balance the books.

Under expenditure reductions, there will be decreases in the funding provided to the swimming pools, the library services, environmental, heritage and tourism supports as well as other Council services.

With a projected expenditure of €58 million for the forthcoming year, the budget shortfall is due to income constraints and reductions in funding from central government as well as other income sources.

Outlining details of the Council’s budget, Pat Gallagher, the County Manager, Offaly County Council, warned that the year ahead will be even more difficult.

Mr Gallagher explained that as a small local authority they were heavily dependent on income from the Department of the Environment’s Local Government Fund, which accounts for 24% of its income.

Offaly County councillors were advised that this funding has been significantly reduced since 2008 and has a major impact on the Council’s budget.

“Looking forward to 2012 we are facing into a year of practically no economic growth and significant volatility in financial/currency markets. The impact this is having on the business community in Ireland is very challenging. In addition we will incur increase costs due to the changes in the national budget.”

Mr Gallagher outlined to the councillors at the budget meeting this week a number of changes in funding to the Council including a significant reduction in the Local Government Fund. “As a local authority we are heavily dependent on income from the DoECLG Local Government Fund which accounts for 24% of our income. Gross LG fund allocation is down 24% and net LG Fund receipt is down 29%. The significant reduction in income from this resource since 2008 has a major impact on our budget.”

The County Manager said given the constraints on income available to the council and the cumulative effects of reductions in expenditure since 2008, it has proven extremely difficult to prepare a balanced draft budget for 2012.

Prior to the notificaiton of the LG fund, the councillors heard that the local authority faced increased financial costs in 2012 of €3.2 million. However, due to the reduction in this fund, the County Manager outlined that this has increased the financial cost of €4.2 million for the forthcoming year.

Mr Gallagher said there will be further significant reductions in all areas of expenditure, which will continue to constraint the Council’s ability deliver services in the year ahead.

Details of the budget savings/income that are to be made to bridge this €4.2 million gap were presented to the councillors by Declan Conlon, Head of Finance later in the meeting. These included income reductions in water revenues, losses in planning and landfill net revenues along with additional costs in enforcement legal fees and the Cororoner’s budget.

Concluding, Mr Gallagher said the Council had reached a stage where there will be a reduction/diminution in services due to diminished financial and staff resources.

“We have prudently managed our finances to date. In order for us to comply, with thel egal requirement to provice a balanced budget we have to take some very major decisions. The achievement of this budget in 2012 will be the next stage of the process. It will entail constant examination of performance against budget and if necessary taking corrective action/adjustment as the year progesses.”

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