Spending cuts loom as Kilkenny council faces €8.1m Covid budget blackhole

All income streams for the council have been affected

Sam Matthews


Sam Matthews




County Hall on John Street

Spending deferrals in a variety of service areas provided by Kilkenny County Council are being considered as the council faces a budgetary black hole as a result of Covid-19.

Housing maintenance, festival supports, street cleaning and other mainstays of the council’s spending plan for the coming months are all potentially in the firing line. Local councillors were briefed on the situation by head of finance Martin Prendiville at their June monthly meeting earlier this month, and they are facing some stark realities. They were told there is a potential shortfall of €8.1 million in income.

A budget with expenditure of €83.6 million was agreed last November, with the members opting to raise the basic rate of Local Property Tax to increase income to meet spending demands. Since then, Covid-19 has hit, and all income streams have been affected - from commercial rates and housing rents to car parking, planning receipts and development charges.

The total gross rates demand for Kilkenny is around €21 million. The estimated loss at the moment is approximately €8.7 million. With just €2.5 million pledged so far from Central Government, it leaves a potential shortfall at present of €6.2 million.

The position on commercial rates is to be reviewed by the Government at the end of this month. The council is waiting to hear what further compensation might follow, but there is also a lot of uncertainty over how many businesses will reopen and how quickly they will be able to resume rate paying.

Parking charges, another important revenue generator for the council, look set to be down by almost 40%. The council had budgeted for €2.3 million, but now expects to fall short of this by around €1 million. Add to this the drop-off in Development Charges (at €1.5 million out of an expected €3 million) and as much as €400,000 shy in housing rents, the total shortfall as it stands is more than €8 million.

There have also been additional costs as a result of the crisis, including IT investment, protective measures, and the city’s new one-way system. While it’s hard to put a figure on these, Mr Prendiville said it could run to €500,000.

There are a limited number of areas that can be reviewed. The council has identified around €2.35 million of expenditure it will likely defer ‘until we see what transpires’ in the months ahead: “We have to proactively manage the situation we find ourselves in,” said Mr Prendiville. “It is not of our making but doing nothing is not an option.”