Council bosses decline voluntary pay cut

The top bosses in Offaly County Council are refusing to take a voluntary pay cut of 10%, as suggested by Finance Minister Brian Lenihan and a local councillor, because they say the pension and income levies already amount to more than that. The call for a pay cut came as it was revealed this week that Offaly County Council need to make savings of €4.1 million during the remainder of this year otherwise they will start next year with a huge deficit. Last November Minister Brian Lenihan called on all top civil servants to take a pay cut similar to the TDs, in what he described as a patriotic duty. The salary of County Manager Pat Gallagher was set at €133,250 in March 2008. However, Offaly County Council claim that because of the controversial public sector pension levy, the income tax levy and health levy, all introduced in the last eight months by the government, they have now taken a hit to their wage packets that is greater than a 10% cut. "The council executive are taking a cut well beyond 10%," said Frank Heslin, Director of Services with Offaly County Council Director of Services. "Staff wages and terms and conditions are decided nationally by the Department. There are a number of things like the pension levy, the health levy and a 20% cut in travel expenses that were agreed nationally, so salaries are certainly down by more than 10% and there's probably more to come." Because the pay scales are set nationally by the Department of the Environment, Heritage and Local Government, it is not up to the council staff themselves to cut their own pay. Frank Heslin added that councillors are also contributing by already accepting a cut in expenses for this year. "Councillors did agree to reduce their conference expenses for this year by 20% and we will be going through the same process again this year for next year... rates for meetings have also been reduced recently nationally," he added. The money saved from the councillors cut in conference expenses, as its decided at local level, does end up back in the council budget for the year, but councillors do not have a say in what areas this money can instead be allocated. At Monday's council meeting, Independent Councillor Dervill Dolan volunteered to take a cut in expenses and he urged the other councillors to do the same. Cllr Tony McLoughlin said councillors should take a 75% cut in expenses. The council's falling income is due to a substantial reduction in landfill income, planning fees and a shortfall in the allocation for water services. The government also imposed a substantial cut in the annual capital grant and also cut the road maintenance grant earlier this year. The council will now save €1 million in staff cuts and pay costs, €500,000 from plant hire and contracts, €64,000 from consultant fees, €84,000 from a new deal with ESB, save €145,500 on landfill costs and take loan payments for the Arás building in Tullamore from a capital reserve fund. Other savings will be made in health and safety and water services, while general tightening up will save around €300,000. Along with planning fees, water rates, parking rates, the council will raise €200,000 by increasing landfill rates and there's a new tax on second homes. The council does not yet know how much this 'Non-principal Private Residents' or second-home tax of €200 per property will net the county as there are no numbers of second homes yet available and the tax payment is voluntary for now. Although a higher penalty will be enforced if a person is found to own a second home in the county. Chairman of Offaly County Council Noel Bourke said that while the savings do need to be implemented, "every effort" was being made by staff to ensure that front-line services will be maintained for the public "in the best possible way". "We're going through the same sort of situation as at a national level, but on a smaller scale, so we have to look at council expenditure and reduce costs. We have to work towards avoiding a deficit, it's very important we work within our budget in order to keep our finances right and in order to pre-plan for 2010."He said that the executive will give the councillors regular updates on how the budget is faring over the rest of the year and that all expenditure will be "carefully monitored". County councillors earn a basic annual 'representation allowance' of €17,604, which is subject to income tax, but they do not receive any benefits from it such as PSRI. They also receive a travel allowance and expenses to attend conferences. "Offaly County Council has one of the lowest conference allowances in the country and we already reduced that by 20% in December 2008," added Cllr Bourke. "There was also a general reduction in expenses by the Department six to eight months ago."