Deal or no deal: Frustrations vented as Cork councils fail to reach compensation package

Deal or no deal: Frustrations vented as Cork councils fail to reach compensation package
Map showing the old city boundary and the new expanded Cork City Council boundary which comes into effect in May 2019.

THE annual compensation Cork City Council will pay Cork County Council for the city boundary extension has still not been agreed.

Negotiations between the two Chief Executives have been ongoing for months, with both councils saying they hope to reach an agreement soon.

Both the City and County Council have produced draft budgets in the absence of a definitive compensation figure.

The compensation is necessary for the loss in revenue the County Council will incur following June's city boundary extension, as it is losing Rates and Local Property Tax from the areas that have moved into the city's boundary.

The Echo understands that Cork City Council has put aside roughly €13 million for 2020's compensation payment, under the miscellaneous section of its budget.

City councillors have expressed frustration and are calling for the Oversight Committee, an independent group who help the councils implement the boundary extension, to intervene.

"We were informed that [roughly €13m] was put aside for the payment this year, but no definitive agreement has been reached," says Cllr Kieran McCarthy.

"I do think there needs to an appendix in this draft annual budget, saying how the compensation figure was reached, plus a little about previous expenditure in our new areas.

"We feel the Oversight Committee should step in at this stage. There's been some sort of breakdown in communication.

"We are just handing money over to an adjacent authority with little communication when we need to be working together as a region.

"There's concern in the finance committee, but we get the same answer every month, 'negotiations are ongoing'.

"I think the fallout from the boundary extension is playing out in this compensation package."

Fianna Fáil councillor Sean Martin also called for an agreement to be reached.

"I think the Oversight Committee should make a judgement. This should have been sorted six months ago."

"There is disagreement on a number of issues and a recommendation should be made about these. Hopefully, this will be done before Christmas, but will it?

"The information has been slow to get to councillors. We were in a bit of limbo with the budget.

"We should be working together for the greater good of the county and region, for the likes of Fermoy, Midelton, Bandon, Clonakilty."

Cllr Martin added that councils can receive revenue from areas and spend it elsewhere on city or county-wide services, and this is difficult to account for in a compensation package.

"However, there's no reason why the executives can't sit down, roll up their sleeves, and reach an agreement."

Cllr Des Cahill said that while the figure is in City Hall's budget, it hasn't been finalised.

"It's a provisional figure on the upper end of the scale, we don't believe this will be the final figure."

"Whatever is left over should be spent on repairing footpaths and road repairs."

The Cork City Council press office said: "The planning for the annual budget is always a difficult task and the fact that the final compensation figure is not yet signed off has added further complexity, however, we are in an ongoing process which has to be completed before a final figure is agreed."

"The Oversight Committee must make an Implementation Plan, setting out the matters to be addressed by the two local authorities in order to achieve the timely, effective and equitable implementation of the boundary alteration to the administrative areas of Cork City and County Councils.

"The compensation figure will represent the difference between income generated in the extended area less expenditure incurred in the transferred area based on the 2017 Financial Accounts. The figure is under negotiation."

The compensation will be payable every year for ten years and will be subject to indexation. After ten years, a review will take place.

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