Report of the Local Government Efficiency Review Group

current levels of resourcing for planning staff and administrative support in
the development management role should decline significantly. The Group
is therefore proposing a 10% reduction in staffing levels in the planning area
through redeployment (see section 6.10). This level of reduction might need
to be moderated in circumstances where the levels of enforcement and
related work significantly exceed expected levels. However the long-term
target across the sector should remain a 10% reduction in staffing levels in
the planning function.
10.4.8 While planning fees are set by central government, they only cover a
fraction of the actual cost of processing planning applications – planning
fees have not been increased since 1998.
10.4.9 The Indecon review of local government financing (see section 2.6)
concluded that the costs of providing the planning service (including forward
planning, development management, and enforcement functions)
significantly exceeded the income generated in receipts from application
fees – the costs providing these services in 2004 was €78.5 million, with fee
income of €41.3 million, a shortfall of some €37 million. The report
recommended that services provided on behalf of central government, such
a planning, be charged at full economic costs.
10.4.10 In 2007, the Department of the Environment, Heritage and Local
Government initiated a review of current planning fees with a view to
establishing, across a number of applications classes, the extent of the
shortfall that existed between fee levels currently charged and the
corresponding service delivery level. The review broadly supported the
findings of the Indecon Report and showed that costs of processing
applications significantly outweighed fees income. For example, the current
planning application fee for the construction of a single house is €65, while
the average current cost of processing a planning application for a single
house is several multiples of this amount at approximately €490,
representing a gap of €425 (the €65 fee for a single house, also compares
with an equivalent fee of €369 in England, €404 in Scotland and €765 in
Northern Ireland). The fees charged for other categories of development
also fall well short of the costs to local authorities of processing planning
applications. This shortfall is being met through the general resources of
local authorities.
10.4.11 The Commission on Taxation report also noted that planning fees are
significantly lower than they are in other European countries, and the
Commission proposed increased charges and an end to maximum fees for
large developments.
10.4.12 On the basis of the review undertaken by the Department in 2007, it was
estimated that an additional €40 million income could have been secured by
moving to recovery of 50% of the costs of processing a planning application.
This was based on the number of planning applications in 2006 which
amounted to almost 92,600. The number of planning applications in 2009
had dropped to 38,500 planning applications, some 42% of the 2006 level.
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