The sins of the Fianna Fail government of 1977 came home with a vengeance yesterday with the announcement of the abolition of two of the three local-government service charges and the residential property tax. The short-sighted decision to do away with domestic rates for party-political purposes, without any consideration of a substitute method ford financing local government, led to two decades of hamfisted efforts to fill the gap, some injustice and much waffling from successive governments.
Rates needed to be fundamentally changed, but once they ceased to exist - at some cost to local democracy which thenceforward had no control over; its major source of income from central funds - the opportunity was lost for introducing an alternative system, however rational. Like it or not, people will not accept that direct taxes should be related to criteria other than income. Service charges, for the general public, have had a spurious logic in spite of being linked to the costs of supplying various services: they are not related to consumption, and above all they apply with equal force to rich and poor, but not to non-householders.
The new system of transferring motor-tax revenue to the local authorities meets many of the objections to service charges. The taxes are already in place and no increase is involved for the first year, with modest increases possible after that. They are linked, very roughly, to individual circumstances, and many people, by not owning cars, are already exempted. It is a neat solution politically: it hands back a margin of democratic control to the councils, and provided that regional disparities do not emerge, ought not to raise many difficulties in implementation.
Mr Howlin was positively lyrical in his praise of the role of local government when announcing the intention to create "a modern, efficient and properly resourced" system, the spearhead of central action at local level and "the legitimate voice of local communities". It will be interesting to see whether his words are translated into deeds, because there are profound implications for the traditionally local bias of national politics and recognition of the proper function of TDs in a complex modern society.
The abolition of RPT is long overdue. Mr Quinn, on television last night, was disingenuous in suggesting that the tax was other than a clumsy attempt at social justice that got out of hand and became politically unacceptable when it ceased to be paid by just a handful of arbitrarily chosen taxpayers (arbitrary because the market value of property has never been a fair indicator of ability to pay or not to pay). If it was meant to broaden the tax base, it obviously makes no sense to abolish it when more people come into the net. But politics is politics, and Mr Quinn can be as forgetful as the next man. On the other hand, raising the rate of stamp duty on more expensive houses is good economics and socially just as well. Why was it not done before the Labour Party felt the chill wind of voter resistance?