MORE and more city businesses are falling into rates arrears despite a series of reductions in the charge levied by Limerick City Council in recent years.
Head of finance Tom Gilligan told councillors that the cash amount collected fell from €23.9 million in 2012 to €22.7 million last year. In percentage terms, the collection rate fell from 55% to 53% over the same period.
City businesses currently owe €20.1 million in rates, around €2.1 million of which relates to 55 companies that are in liquidation. City Hall was negotiating with liquidators on these debts, Mr Gilligan said.
The council had “as a last resort” initiated legal proceedings against 25 businesses who are in arrears to the tune of approximately €2 million between them.
Cllr Joe Leddin said it was “disappointing that the rate of collection is just above 50% while all the time conscious of the struggles businesses have gone through”.
The council, he said, had reduced rates by 21% over the last two years and Limerick now had the cheapest rates of any city in the country.
If the collection rate were to fall below 50%, Cllr John Gilligan warned, “we’ll go out of business ourselves”.
“We have a lot of employees to look after albeit a lot less than we used to have. We also have to keep the roads maintained to a point where people won’t take claims against us. We can’t afford to be sanguine about this,” Cllr Gilligan said.
Councillors, Cllr Diarmuid Scully said, had supported the business community in applying the “lowest possible level of rates”.
“But as part of that deal, the rates must be paid,” he said.
Cllr Scully added, however, that everybody had to be “conscious that this country has come through the worst economic crisis not since the Great Depression, but since the Famine”.
Cllr Jim Long, meanwhile, urged officials not to employ the services of debt collection agencies which had proliferated in recent years.
“Some of them are no better than thugs,” Cllr Long declared.
But Mr Gilligan said the council had engaged private companies to collect debts in the past.
“Our job is to maximise our collection and we use all legal means to do it. I have no qualms about using an agency but anyone we would use would be of the highest reputation,” he said.