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IBEC stands firm against possible hikes in rates |
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Written by David Raleigh
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Wednesday, 25 November 2009 |
ANY possible further increases in commercial rates and water charges in 2010 cannot be justified, because Mid-West region has been severely hit by the economic downturn and falling prices pose significant risks to jobs locally, IBEC Mid-West Director, Chris O’Donovan, has told the Limerick Independent.
In advance of the 2010 local authority budget process, IBEC Mid-West, the group that represents business in the region, has sent a letter to both the Limerick City Manager and County Manager asking for decreases in commercial rates and water charges, and greater transparency regarding the water and waste-water service pricing for the non-domestic sector.
Local authorities are set to vote on the issue in the coming weeks.
“With so many businesses lowering prices, there can be no excuse for local authorities not to do the same. We are asking local authorities to consider the detrimental effect increased charges will have on local businesses, which are trying to remain viable and keep people in jobs,” Chris O’Donovan said.
He added: “The danger is that local authorities will attempt to fund central government cutbacks and revenue shortfalls by increasing costs to businesses, which are already under severe pressure. Local government must see that the only sustainable approach is to cut costs and pass these savings on to those who pay.”
Limerick and the greater Mid-West region has been severely hit by the economic downturn, highlighted by significant job losses in the cases of Dell, Element Six, Molex, Avocent, Kostal, Proctor and Gamble and Tecnotree among many others.
According to Mr O’Donovan, local authorities should fund any revenue shortfalls with cost-savings through efficiencies, rather than increasing already high charges to businesses.
“Current costs for locally-administered services already represent a significant cost on business and have grown rapidly over recent years. Last year, commercial rates and water charges increased, on average, by 1.7% and 9.7% respectively. Businesses throughout County Clare and Limerick City all incurred a rate increase in 2009. Similar increases in 2010 are not justifiable in the current climate of falling prices and would pose significant risks to employment in the region,” he added.
Inflationary pressures have, in the past, been used to justify commercial rate increases, however, Mr O’Donovan added that with the Consumer Price Index expected to fall by between 4% and 5% in 2009, IBEC is to seek a cut in commercial rates in line with deflation.
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