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LAMA NewsLetter Spring 2013

Cumann Chomhaltaí na nÚdarás Áitiúil

LAMA Spring

Seminar 2013

FEDERATION OF EUROPEAN COUNCILS

Local Electoral Area Boundary Committee Submission on behalf of The Local Authority Members Association LAMA

Local Authorities in Ireland – New Challenges – New Opportunities

April 5th & 6th Ashdown Park Hotel, Gorey, Co. Wexford.

Seminar Banquet April 5th

Cllr Hugh McElvaney, LAMA Chairperson, and Cllr Noel Bourke, General Secretary, LAMA

F

urther to previous correspondence The Local Authority Members Association wishes to make the following points for consideration by the Local Electoral Area Boundary Committee;

Guest Speaker

Brendan Howlin TD Minister for Public Expenditure and Reform

Saturday April 6th Irish Water

Guest Speaker

Fergus O’Dowd TD Minister of State

See your local authority for details

1 Members in about half of the proposed Councils are extremely concerned about the possibility of having less Councillors when the new Councils are in place. 2 The formula set out in the Terms of Reference of the Boundary Committee suggests that about half of the new Councils will have less Councillors and this taken with the possible loss of Borough and Town Councils would mean a serious loss of local representation and therefore of local democracy. This would be very unsatisfactory. 3 LAMA believes that there should not be a reduction of Councillors in any of the new Councils and in fact it believes the numbers should be increased if any of the existing Councils in the Counties concerned are abolished. 4 It is particularly important in all Counties where the abolition of Councils is being suggested that the number of County Councillors remain at their present level at the very least. 5 Councillors are concerned that electoral areas might be too big geographically as this would be an obstacle to delivering a good service to those they represent. 6 Members of Borough Councils are

seriously concerned about the threat to their existence and feel strongly that their proposed abolition will be a negative step for the areas concerned. Representatives of the five Borough Councils recently met with the Chairman and General Secretary of LAMA and demonstrated that they can make a strong case for their retention. Their opinion is fully supported by LAMA. LAMA notes and indeed has encouraged all Councils and political parties/groupings/ individuals to make submissions dealing with the specifics aspects of their Council areas such as boundaries of electoral areas etc and put forward, as people working on the ground, what they consider is necessary in the best interest of the people they represent. 24th January 2013

DATE FOR YOU R DIARY

LAMA

Autumn Seminar

2013

October 11th & 12th Falls Hotel, Ennistymon, Co. Clare

LAMA NEWSLETTER 1


Elected Members Retirement Scheme A Guide for County/City Councillors

Introduction

T

he local elected members gratuity arrangements are implemented by means of a number of regulations and directions issued by the Minister for the Environment, Heritage and Local Government under the Local Government Act 2001. The purpose of this document is to explain the current retirement scheme and what it means in monetary terms to an elected member who is retiring. This document is for information purposes only, and is not intended to be a legal interpretation of the various regulations and circulars which have been adopted by the Department. It is a matter for each Councillor to inquire from the Finance Department of their local authority to obtain a calculation of his or her entitlements and to contact their local tax office in relation to any tax implications which may arise for them. On retirement a local elected representative with at least 2 years service will receive a lump sum payment of a gratuity for service from 4th May 2000, and an ex-gratia payment for years of service prior to that date up to a maximum allowable 40 years service. The significance of May 4th 2000 is this is the date the Local Government Bill was published.

The Retirement Scheme The Retirement Scheme for elected members comprises 2 elements: 1 A gratuity payment for service from 4th May 2000 and 2 An ex gratia payment for service prior the 4th May 2000. 1. The Retirement Gratuity Scheme (A) The Minimum Qualifying Period The minimum qualifying period for an elected member to be paid the gratuity is 2 years. This means that an elected member is eligible for a payment after two years service. (B) A Death in Service Payment A death in service payment is available under the Scheme. There is a minimum payment of the greater of one years representational payment (currently €16724 per annum) paid on the death of a serving member or the amount of gratuity/ex-gratia payment which would have been payable to the member on the date of death if the member had ceased to hold office on that date on the grounds of permanent infirmity, whichever is greater. This payment is made to the deceased member’s legal personal representative on

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production of a grant of probate/letters of administration. (C) Amount of the Gratuity The amount of gratuity payable is for years of service from 4th May 2000 (the date the Local Government Bill was published). The gratuity payable is 1/5th of the representational (R.P.) payable at the time of retirement per year of service from May 4th 2000. At the current rates of R.P. the gratuity is €3344.80 per year of service from 4th May 2000. If the member has County Council and Town Council service at the same time the gratuity will be paid for the County Council service only. If the member had both County Council service and Town Council service after May 2000, but not at the same time, that member will receive a reduced gratuity for the Town Council service. The amount of the reduced gratuity depends on the size of the town council involved. The maximum gratuity payable after 20 years service from May 2000 is four times the representational payment. Payment of the gratuity is made once a retired member has reached 50 years of age or earlier if a member became incapable of performing his or her duties due to permanent infirmity of mind or body or dies in office. When a person ceases to be a Councillor before age 50 due to retirement or not being re-elected, the gratuity will be preserved until that person reaches 50 years of age, and will be paid based on the representational payment applicable at that time when they reach 50 years of age. Any entitlement to the preserved gratuity will cease if a person becomes an elected member again before reaching age 50. When this happens the earlier service will be aggregated with the subsequent service to determine the amount of gratuity to be paid once the person finally retires. In calculating the gratuity the total service by an elected member may include a fraction of a year. A member who was elected in June 2009 and who is not re-elected or retires in June 2014 will receive one full year’s representational payment €16724. (D) Additional service awarded where retirement is due to permanent infirmity Where a member with at least 3 years and less than 20 years qualifying service ceases to hold office, on account of having become incapable of performing his or her duties as a member due to permanent infirmity of mind or body, the

local authority may add a period to his or her qualifying service for the purposes of calculating the amount of gratuity payable. The total of added years service together with the members qualifying service must not exceed 20 years. Added years may be allowed on the following basis: (a) For service of not less than 3 and not more than 5 years, an amount of added service equal to the member’s actual service to the date of retirement or death may be allowed subject to the member’s total potential service to age 65 not being less. (i.e. a member aged 63 would only receive 2 years additional service.) (b) For service of not less than 5 and not more than 10 years, the greater of the following may be allowed – (i) 10 years less the members actual service subject to the members total potential service to age 65 not being less than this calculated period of service or (ii) 3.33 years subject to the members total potential service to age 50 not being less. (c) For service of not less than 10 years, 3.33 years may be allowed subject to the member’s total potential service to age 50 not being less. (e.g. A member aged 48 would only receive 2 years additional service.) The sum of actual service and added years may not exceed 20 years in total for the purposes of calculating the gratuity payable to the member retiring due to permanent infirmity. 2. Ex gratia payment for pre-May 2000 service An Ex gratia payment of €714.23 per year of service is paid to serving councillors for their years of service prior to 4th May 2000. The payment is €714.23 per year for the first 20 years and €476.15 per year thereafter up to a maximum of 40 years in total. Where a retiring member has more than 40 years service the amount of gratuity to be paid will be for the period of service from 4th May 2000 with the balance of the ex gratia payment for the number of years service prior to 4th May 2000 up to a maximum of 40 years for both pre-4th May 2000 and post 4th May 2000 service. (For example if a member retires after 50 years with 9 years qualifying service post May 2000 the maximum service which will count towards the ex gratia payment is 31 years.) This payment is based on 75% of the amount which would have been paid under the 1999 Retirement Scheme which were as follows: Retiring members of County Councils or Corporations of a County Borough were paid £750 for the first 20 years of service and


£500 for any additional years of service up to a maximum total service of 40 years. The figures of €714.23 and €476.15 are 75% of these amounts. Retiring members of Corporations of a Borough (other than a County Borough) or an Urban District Council were paid £375 for the first 20 years of service and £250 for any additional years of service up to a maximum total service of 40 years. The figures of €357.11 and €238.08 are 75% of these amounts. Retiring members of Town Commissions were paid £187.50 for the first 20 years of service and £125 for any additional years of service up to a maximum total service of 40 years. The figures of €178.56 and €119.04 are 75% of these amounts. Under the 1999 Retirement Scheme, members who held dual or concurrent membership of more than one local authority were entitled to be paid for service for the local authority which gave the most favourable payment. In the case of both County Council and Urban District Councils service the payment will be for the county council service only. All local authority service by an elected member is taken into account for the purposes of determining the Ex gratia payment. If the member was, for example, a member of an Urban District Council before he/she became a member of a County Council , the service on the Urban District Council will be taken into account in determining the Ex gratia payment on retirement.

The Taxation of lump sum payments Under current tax legislation a portion of the retirement payment may be liable to income tax. The Revenue Leaflet IT21 “Lump Sum Payments on Redundancy/ Retirement”, which is available on www.revenue.ie, provides further information on the tax treatment of lump sum payments. Elected Members should check with their local tax office or tax advisor to determine if they have a tax liability. The longer the length of service the greater the likelihood of tax being due and payable on a portion of the lump sum. The exemptions provided for in current tax law are as follows: 1 A Basic exemption of €10,160 plus €765 for each year of service up to retirement or 2 An increased exemption of €10000 over the basic exemption above provided no relief has been claimed in the previous 10 years or 3 Standard Capital Superannuation Benefit (SCSB) is a relief given for each year of service equal to 1/15th of the average annual pay for the last 3 years of service. Your Council is obliged to deduct PAYE and USC on all of the lump sum less the basic exemption or SCSB, as previously outlined above. The taxable part of the lump sum payment is regarded as part of your total income and is taxed accordingly.

In certain circumstances an additional relief called Top Slicing Relief may be due to you. Top Slicing Relief relates to the tax payable and ensures that your lump sum is not taxed at a rate higher than your average rate of tax for the three years prior to your retirement. The formula for calculating this relief is: Taxable lump sum X (tax rate applied to lump sum – average tax rate for previous three years) In the case of a couple, taxed under joint assessment, where both spouses or civil partners have income in any of the three years preceding the tax year to which the termination payment refers, the tax rate will be based on the income of the spouse or civil partner who received the termination payment or on the combined income of both spouses or civil partners depending on which rate is the most beneficial to the couple. Example of Top Slicing Relief based on current tax law: A County or City Councillor

retires in June 2014. The taxable amount of the lump sum is €10,000, which is taxed at the marginal rate of 41%. The average rate of tax for the prior three tax years was 32%. Top slicing relief is: €10,000 x (41% - 32%) = €900. The tax payable will be reduced by €900. Top Slicing Relief may be claimed, by contacting Revenue after the end of the tax year. The time limit for claiming tax reliefs in respect of lump sum payments is four years from the end of the year in which the lump sum payment is treated as income. Note: Based on current representational allowance March 2013 Contributed by Senator Michael Mullins, email: michael.mullins@oireachtas.ie

Examples of approximate payments to County/ City Councillors retiring in 2014 These examples are based on the current rate of representational payment of €16,724 and are approximate only. In calculating periods of service a part of a year will be taken into account when your local authority does the calculation of your gratuity entitlement.

6: Councillor with 25 years service

1: Councillor with 5 years service

7: Councillor with 29 years service (elected June 1985)

Gratuity:

€3344.80 x 5 €16,724

2: Councillor with 10 years service Gratuity:

€3344.80 x 10 €33,448

Gratuity: €3344.80 x 14 €46,827.20 Ex gratia payment: €714.23 x 11 €7,856.53 Total Payment: €54,683.73

Gratuity: €3344.80 x 14 €46,827.20 Ex gratia payment: €714.23 x 15 €10,713.45 Total payment: €57,540.65

3: Councillor with 15 years service

8: Councillor with 30 years service

Gratuity: €3344.80 x 14 €46,827.20 Ex gratia payment: €714.23 x 1 €714.23 Total Payment: €47,541.4 Note: Gratuity is paid for 14 years from 4th May 2000

Gratuity: €3344.80 x 14 €46,827.20 Ex gratia payment: €714.23 x 16 €11,427.68 Total payment: €58,254.88

4: Councillor with 20 years service Gratuity: €3344.80 x 14 €46,827.20 Exgratia payment: €714.23 x 6 €4,285.38 Total Payment: €51,112.58

5: Councillor with 23 years service (elected June 1991) Gratuity: €3344.80 x 14 €46,827.20 Ex gratia payment: €714.23 x 9 €6,428.07 Total Payment: €53,255.27

9: Councillor with 40 years service Gratuity: €3344.80 x 14 €46,827.20 Ex gratia payment: €714.23 x 20 €14,284.60 Ex gratia payment: €476.15 x 6 €2,856.90 Total payment: €63,968.70 Note: A Councillor with greater than 40 years service will not receive more than the amount in Example 9 above as the maximum service allowable for both the gratuity and the ex gratia payment is 40 years in total. Any period of service in excess of 40 years is disregarded under the current regulations.

LAMA NEWSLETTER 3


Outstanding projects honoured at LAMA Awards 2013

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he LAMA Awards 2013, in association with Irish Public Bodies, were held on January 20th in Dublin’s Crowne Plaza Hotel. Hosted again by Miriam O’Callaghan, the awards are in their seventh year and were attended by over 400 guests. This year’s LAMA award winners were selected after the introduction of six

new categories, a reorganisation of the nomination and adjudication process and resulted in a large increase in nominations. “We are delighted to highlight and recognise excellent projects and initiatives at local, county and national level,” said Councillor Hugh McElvaney, Chairman of LAMA, who congratulated the winners.

George Jones, Chairman of IPB, speaking at the LAMA Awards 2013 in association with IPB.

winners Best Civil Engineering Project

Best Healthcare Building

Best Use of IT

Tipperary Decentralisation Project Nominated by Tipperary Town Council Submitted by Tipperary Town Council

LauraLynn House – Ireland’s Children’s Hospice Nominated by: Dún Laoghaire/Rathdown County Council Submitted by: LauraLynn House – Ireland’s Children’s Hospice

Parking Tag Nominated by: Dublin City Council Submitted by: Dublin City Council

Best Community Based Initiative Fleadh Cheol na hÉireann Nominated by Cavan County Council Submitted by Cavan County Council

Best Community Sports Club Parnells GAA Club “The Chanel Sports and Hospitality Venue” Nominated by: Dublin City Council Submitted by: Parnells GAA Club

Best Eco-Friendly Initiative SMILE Resource Exchange Nominated by: Cork County Council Submitted by: Cork County Council

Best Economic Partnership/Unit MEET WEST Nominated by: Galway County Council Submitted by: Galway County Council

Best Heritage Project Enniscorthy Castle Nominated by: Enniscorthy Town Council Submitted by: Enniscorthy Town Council

Best Irish Business working with the Community Supermac’s Ireland – Road Safety Colouring Competition Nominated by: Mayo County Council Submitted by: Supermac’s Ireland

Community Volunteer of the Year Joe Byrne Nominated by: South Dublin County Council Submitted by: William Lavelle

Council of the Year South Dublin County Council Nominated by: South Dublin County Council Submitted by: South Dublin County Council

Emergency Response Person/ Team of the Year

Best Managed Water Project

Andrew Connolly – Civil Defence Volunteers Nominated by: Dublin City Council Submitted by: Dublin Civil Defence

Ballycroy, Killeen, Kilmeena Group Water Schemes Nominated by: Mayo County Council Submitted by: Ballycroy, Killeen, Kilmeena Group Water Schemes

Ready2Read Nominated by: South Dublin County Council Submitted by: South Dublin County Council

Best Public Building

Most Innovative Authority

Solstice Arts Centre Nominated by: Navan Town Council Submitted by: Solstice Arts Centre

Mayo County Council Nominated by: Mayo County Council Submitted by: Mayo County Council

Best Public Park

National Impact Award

Camcor Park Riverside Walk Nominated by: Birr Town Council Submitted by: Birr Town Council

Volvo Ocean Race Finale Galway Nominated by: Galway City Council Submitted by: Lets Do It Global

Local Educational Initiative of the Year

Best Educational Building Engineering Building NUI Galway Nominated by: Galway City Council Submitted by: Taylor Architects

Best Energy Efficient Project University College of Cork Implementation of International Energy Management Standard ISO 50001 Nominated by: Cork County Council Submitted by: University College of Cork

Best Green Authority Cork County Council – UCC Implementation of International Energy Management Standard ISO 50001 Nominated by: Cork County Council Submitted by: University College of Cork

Best Social Housing Project

The Grand Prix

Cuan Aoibhinn Achill Sheltered Housing Association Nominated by: Mayo County Council Submitted by: Cuan Aoibhinn Achill Sheltered Housing Association

Laura Lynn House – Ireland’s Children’s Hospice Nominated by: Dún Laoghaire/Rathdown County Council Submitted by: LauraLynn House – Ireland’s Children’s Hospice

Please send on any information that you would like to have included in our next newsletter to: Councillor Padraig Conneely t: 087 259 3886 or Councillor John Kennedy t: 087 241 0540

LAMA Spring 2013 Newsletter  

LAMA Newsletter