Derry City Council - Rates Information

Derry City Council - Your Local Rates Information

Chairperson's Address

Rates Estimates 2010/11

This year’s rate setting process has again proved to be a challenging one for Council and in the circumstances members and officers are to be commended for getting the district rate increase down to 4.99%. The public sector is not immune from the current economic downturn and next year Council must maintain everyday services with little extra financial resources. The challenge therefore for Derry City Council was to keep the rates increase as low as possible while continuing to provide vital local and regional services. This is the approach which Council has endeavoured to use in recent years through the establishment of the Strategic Review Group

Similar to recent years, Council has had to absorb unavoidable increases in statutory/regulatory expenditure such as landfill tax, annual pay awards set at a national level and increased employer’s contribution to the NILGOSC Pension Scheme. In addition, Council has also had to absorb above inflationary increases on utility costs and further reductions in building control and property certificate income due to the continued economic downturn, bringing the overall increase in net expenditure to 2.65%. By identifying savings of just over £1 million across Council services, the increase in net expenditure before departmental bids, has been limited to just 0.32% of the rates increase.

Consequently, reduction in reserves applied of £1 million and departmental bids account for the bulk of the rates increase of 4.99%.
Council has benefited from both a small gain on the Estimated Penny Product (EPP) of 1.06% and a slight increase in General Grant of £33,821. Following the significant cuts in EPP experienced by most Councils last year, it is to be welcomed that Council has returned to growth albeit at a very low level when compared with other Councils, some of which have growth of up to 5% in EPP.

As a result of the lower than average growth on EPP, it would have been expected that Council would have received a significant increase on the resources element of General Grant. It is therefore disappointing to report that instead of an increase, Council has received a small reduction of £739 due to a 5% cut being imposed by DOE as a saving contribution to the Comprehensive Spending Review. In monetary terms the cut in resources grant represents a loss of approximately £70,000 for Derry City Council and in a challenging year left Council with no option but to pass on an increase of approximately 0.25% to our ratepayers. Council wrote to Minister Poots to point out the unfairness of this cut which impacts on the poorest Councils only, and asked for this decision to be reversed. This proved to be unsuccessful.

The Airport’s operating deficit for 2010/11 is estimated to be £4,032,800, an increase of £460,000 (12.88%) on 2009/10. Despite assumptions of new routes to Manchester/Edinburgh and increased income from concessions and car park, reduced passenger numbers over the past 18 months means that income has decreased overall by almost £155,000. A budget provision of £80,000 has also been made for costs associated with Incorporation.

The City of Derry Airport brings a significant economic benefit to the North West Region and is rightly recognized as a key economic driver for the region. Council has recognized that governance reform is essential to guarantee the long-term viability of the Airport and it is pleasing to report that significant progress has been made over the past year with Incorporation completed, Non Executive Directors appointments under way and a new company, CODA (Operations) Limited, becoming operational from April 2010. The formal market test exercise, seeking commercial partners, is also on target to be completed by April 2010.

Derry City Council continues to invest in Waste Management Initiatives and is on course to achieve both the Northern Ireland targets for recycling and the EU Landfill Directive targets of diverting biodegradable municipal waste from landfill. Following a detailed review of the overall budget this year, it has been assessed that a saving of £250,000 can be reflected in 2010/11 Rates Estimates. This is in addition to absorbing the increase in landfill tax (£88,000), the reopening of Brandywell and Eglinton Civic Amenity Sites (£80,000) and increases in waste treatment costs for 2010/11. In the Budget, the Chancellor confirmed that landfill tax would increase by a further £8 to £48 per tonne from 1st April 2010, bringing the sum included in the estimates to £1,488,000. Further increases of £8 per tonne are planned for financial years 2011/12, 2012/13 and 2013/14, which would increase landfill tax to £72 per tonne by 2013/14.

Within the district rates increase of 4.99%, Capital projects planned, under way, or nearing completion include Airport Safety Works, Various Minor Community Schemes, Restoration/Aftercare of Culmore Landfill Site, Guildhall Restoration, Skateboard Park and Walled City Signature Project (Lighting Strategy). In addition, other capital projects referred to in the approved Corporate Plan are being considered at SRG and Council, and include Brooke Park Restoration, the Northwest Sports Campus and various Play Parks.

Essential bids of £789,300 (2.27%) have been included and relate to the phasing out of external funding for funded posts, support for major events such as the City of Culture Bid and Major Maritime Event, various community capital schemes and the commencement of a development fund (£4.25 million initially) to carry out major refurbishment works to existing leisure facilities. It has been agreed that a Leisure Strategy which will determine regional, district and local needs will be urgently formulated and this will inform how the Leisure Development Fund will be spent.

To ease the burden on ratepayers, Council has reduced its own controllable expenditure by £1 million, the equivalent of 2.31%. I would also advise that the NI Assembly is likely to freeze both the domestic and non-domestic regional rate for 2010/11. For ratepayers, this would mean that based on the proposal before you today, the combined district and regional rates increase for domestic and non-domestic properties in 2010/11 would be 2.54% and 2.31% respectively.

As Chair of the Policy and Resources Committee, I want to record my thanks to the Officers and Members for their sterling work and I propose that a district rate increase of 4.99% for domestic and non-domestic properties be accepted.


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Chairperson's Address Rates Estimates 2010/11 This year’s rate setting process has again proved to be a challenging one for Council and in the circumstances members and officers are to be commended for getting the district rate increase down to 4.99%. The public sector is not immune from the current economic downturn and next year Council must maintain everyday services with little extra financial resources. The challenge therefore for Derry City Council was to keep the rates increase as low as possible while continuing to provide vital local and regional services. This is the approach which Council has endeavoured to use in recent years through the establishment of the Strategic Review Group Similar to recent years, Council has had to absorb unavoidable increases in statutory/regulatory expenditure such as landfill tax, annual pay awards set at a national level and increased employer’s contribution to the NILGOSC Pension Scheme. In addition, Council has also had to absorb above inflationary increases on utility costs and further reductions in building control and property certificate income due to the continued economic downturn, bringing the overall increase in net expenditure to 2.65%. By identifying savings of just over £1 million across Council services, the increase in net expenditure before departmental bids, has been limited to just 0.32% of the rates increase. Consequently, reduction in reserves applied of £1 million and departmental bids account for the bulk of the rates increase of 4.99%. Council has benefited from both a small gain on the Estimated Penny Product (EPP) of 1.06% and a slight increase in General Grant of £33,821. Following the significant cuts in EPP experienced by most Councils last year, it is to be welcomed that Council has returned to growth albeit at a very low level when compared with other Councils, some of which have growth of up to 5% in EPP. As a result of the lower than average growth on EPP, it would have been expected that Council would have received a significant increase on the resources element of General Grant. It is therefore disappointing to report that instead of an increase, Council has received a small reduction of £739 due to a 5% cut being imposed by DOE as a saving contribution to the Comprehensive Spending Review. In monetary terms the cut in resources grant represents a loss of approximately £70,000 for Derry City Council and in a challenging year left Council with no option but to pass on an increase of approximately 0.25% to our ratepayers. Council wrote to Minister Poots to point out the unfairness of this cut which impacts on the poorest Councils only, and asked for this decision to be reversed. This proved to be unsuccessful. The Airport’s operating deficit for 2010/11 is estimated to be £4,032,800, an increase of £460,000 (12.88%) on 2009/10. Despite assumptions of new routes to Manchester/Edinburgh and increased income from concessions and car park, reduced passenger numbers over the past 18 months means that income has decreased overall by almost £155,000. A budget provision of £80,000 has also been made for costs associated with Incorporation. The City of Derry Airport brings a significant economic benefit to the North West Region and is rightly recognized as a key economic driver for the region. Council has recognized that governance reform is essential to guarantee the long-term viability of the Airport and it is pleasing to report that significant progress has been made over the past year with Incorporation completed, Non Executive Directors appointments under way and a new company, CODA (Operations) Limited, becoming operational from April 2010. The formal market test exercise, seeking commercial partners, is also on target to be completed by April 2010. Derry City Council continues to invest in Waste Management Initiatives and is on course to achieve both the Northern Ireland targets for recycling and the EU Landfill Directive targets of diverting biodegradable municipal waste from landfill. Following a detailed review of the overall budget this year, it has been assessed that a saving of £250,000 can be reflected in 2010/11 Rates Estimates. This is in addition to absorbing the increase in landfill tax (£88,000), the reopening of Brandywell and Eglinton Civic Amenity Sites (£80,000) and increases in waste treatment costs for 2010/11. In the Budget, the Chancellor confirmed that landfill tax would increase by a further £8 to £48 per tonne from 1st April 2010, bringing the sum included in the estimates to £1,488,000. Further increases of £8 per tonne are planned for financial years 2011/12, 2012/13 and 2013/14, which would increase landfill tax to £72 per tonne by 2013/14. Within the district rates increase of 4.99%, Capital projects planned, under way, or nearing completion include Airport Safety Works, Various Minor Community Schemes, Restoration/Aftercare of Culmore Landfill Site, Guildhall Restoration, Skateboard Park and Walled City Signature Project (Lighting Strategy). In addition, other capital projects referred to in the approved Corporate Plan are being considered at SRG and Council, and include Brooke Park Restoration, the Northwest Sports Campus and various Play Parks. Essential bids of £789,300 (2.27%) have been included and relate to the phasing out of external funding for funded posts, support for major events such as the City of Culture Bid and Major Maritime Event, various community capital schemes and the commencement of a development fund (£4.25 million initially) to carry out major refurbishment works to existing leisure facilities. It has been agreed that a Leisure Strategy which will determine regional, district and local needs will be urgently formulated and this will inform how the Leisure Development Fund will be spent. To ease the burden on ratepayers, Council has reduced its own controllable expenditure by £1 million, the equivalent of 2.31%. I would also advise that the NI Assembly is likely to freeze both the domestic and non-domestic regional rate for 2010/11. For ratepayers, this would mean that based on the proposal before you today, the combined district and regional rates increase for domestic and non-domestic properties in 2010/11 would be 2.54% and 2.31% respectively. As Chair of the Policy and Resources Committee, I want to record my thanks to the Officers and Members for their sterling work and I propose that a district rate increase of 4.99% for domestic and non-domestic properties be accepted.
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