Donegal County Council meets today to consider its Draft Revenue Budget for 2026.
The budget provides for expenditure of almost €224,035,000 for the year ending 31st December 2026.
In his introduction, Chief Executive John McLaughlin says the Council has not raised commercial rates since 2018. but a 5% increase is now necessary.
Mr McLaughlin says since the last increase in 2018, there’s been huge inflation in the intervening seven years which has had the effect of eroding the spending power of existing monies, and that necessitates a 5% increase in the commercial rate.
He acknowledges there is a huge pressure on businesses, and a drive upwards in costs.
However, he says the Draft Budget will cover the basic and essential activities that the Council is expected to deliver, as well as providing some monies to allow further development.
Mr McLaughlin says there are a number of key priorities in the budget, including the maintenance and improvement of houses, roads, and other key infrastructure, and support for economic development and job creation.
Other priorities include tourism development, promotion, town centre regeneration, and the improvement of recreation and leisure facilities.
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Chief Executive’s introduction in full –
ANNUAL REVENUE BUDGET 2026
1.0
Introduction
I submit for your consideration the Draft Revenue Budget for 2026. This Draft Budget provides for
expenditure in the sum of €224,034,793 for the year ending 31st December 2026. The Council has not raised
commercial rates since 2018 and there has been huge inflation in those 7 years which has had the effect of
eroding the spending power of the existing monies. That is a similar position across all sectors and society in
general and it is also acknowledged that there is a huge pressure on businesses and a drive upwards in costs.
In that regard, it has been a very challenging budget to bring forward. However, it is a time of great
opportunity for Donegal and this Draft Budget is structured to do the very best for Donegal and its place to
drive the development of the wider North West Region.
The Draft Budget will cover the basic and essential activities that the Council is expected to deliver. It will
also provide some monies to allow further development. It is set in the context of maintaining a focus on the
core business of the Council and on the day-to-day operational requirements that will arise during 2026.
The strategic objectives of the Council, as outlined in our new Corporate Plan 2024 to 2029, have guided the
drafting of the revenue budget for 2026. Creating the circumstances to build the financial capacity of the
organisation has, during the past number of years, been a critical priority of the Council. To this end, the
Council has, I believe, struck a good balance between establishing a solid sustainable financial position and,
at the same time, ensuring that expenditure provisions are sufficient to enable the delivery of required
services and to fund work that supports and develops the County and economy at local level.
The Draft Budget will provide additional monies to further support the drawing down of loans to counter
fund capital projects in the years ahead. These capital projects are very much necessary and will help
transform the County when completed.
2.0
Current Financial Environment
The significant “cost of living” crisis and inflationary pressures over the last three years has resulted in
eroding the spending power of the Council’s budgets.
The cost of the Council’s services and contracts have increased significantly right across all divisions. The cost
implications have had to be dealt with by obtaining additional funds and by adjusting and reducing other
components to meet the budget available. It is important to acknowledge that our central government,
working along with Council and our wider sector has been helpful in providing financial assistance towards
bridging gaps in funding where possible. Without that central government assistance, it would not have been
possible to bring forward this balanced budget in the manner it is being presented.
Separately as a Council, we wish to acknowledge the effects the “cost of living” increases are having on our
citizens and communities. The price of essential household necessities such as food, oil, gas and electricity
has seen massive increases and many families find it difficult to pay for everything on top of their housing
and other costs.
3.0
General Budget Considerations 2026
In framing the Draft Revenue Budget for 2026, I have taken account of the priorities of the Elected Council,
with an emphasis on a number of key areas including:
a) The maintenance and improvement of houses, roads, and other key infrastructure,
b) Support for economic development and job creation,
c)
Preparing a pipeline of plans for housing, roads, public-realm improvements, town centre
regeneration, recreation/leisure, and job-creation infrastructure,
d) Tourism development, promotion, and product development,
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e) Development in rural towns, villages, and communities across the County
f)
Targeting additional funding streams and enabling co-financing
g)
Targeting capital grants from government for improvements in towns and villages
h) Support the growth of the North West Region
The Draft Budget herein provides for key areas such as the €925,000 for the Development Funds Initiative,
€370,000 for the Members Development Funds, an increase to the Public Lights and Minor Infrastructure
Fund at €370,000, an additional €205,000 (Total €555,000) to undertake maintenance in Housing Estates,
(formerly the ‘Back Lane Programme’), the provision of essential frontline services, and meeting the
anticipated co-funding requirements in 2026 for all the projects underway.
These provisions cannot be made without the requirement for an increase in the Commercial Rates. In
making this Draft Budget, I have had regard to the views of the Elected Members as presented through
deliberations at Corporate Policy Group, Plenary Council, the Municipal District Meetings, and the Municipal
District Budget processes for 2026.
4.0
Co-Funding of Development Projects
The Council has been particularly successful in recent years at competing for and winning significant
development projects such as:
i.
ii.
iii.
iv.
v.
vi.
Ballybofey SEED Project
Ballyshannon RRDF
Letterkenny URDF
Repowering Buncrana
Ailt an Chorráin/Árainn Mhór
Significant Piers and Harbours Projects
At this point, particular projects to the value of over €230 million that require co-funding from the Council of
€60 million to €70 million have been granted to the Council. While the Council has borrowed €35 million,
further funding will have to be provided for over the next few years. Indeed, our ambition is to compete for
and win further similar projects. The development and further success of Donegal depends on this type of
investment and there is an obligation on us all to maximise this opportunity when it exists. The government
in recent times have reduced the percentage co-funding on some new projects and this will assist greatly in
the delivery of future projects in Donegal.
The Draft Budget provides €1,050,000 which will allow the borrowing of an additional €15m to be put
towards co-funding of capital projects.
The Council has not increased Commercial Rates in years 2019, 2020, 2021, 2022, 2023, 2024 or 2025. The
spending power of money since 2019 has now been greatly reduced given the levels of inflation and cost
pressures in recent years. Consequently, given the seven consecutive years of no increase in Commercial
Rates multipliers, the rising costs facing the Council in carrying out its business and the need to provide for
much needed work and in order to provide a balanced Draft Budget for 2026, Commercial Rates will need to
be increased by 5%.
5.0
Northwest Region: Issues and Opportunities
Our ongoing work and close ties with Derry City and Strabane District Council have set us apart nationally
and indeed in Europe in terms of our cross-border region and collaboration. The unique Strategic Growth
Partnership is well established and supported. Taking the next steps to secure investment in the region is
vitally important and can assist in bringing the region to a place where it can be a net contributor to the
economy on a long-term and sustainable basis. We are also eager to collaborate with our other neighbouring
Councils of Fermanagh/Omagh/Leitrim and Sligo.
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The Council views very positively the opportunities that present at this time for our county and region. The
Council works closely with our strategic partners in education/skills, healthcare and the wider business
sectors. The provision of the ATU in Letterkenny together with the work of the Education & Training Board
(ETB) and coupled with the cross-border education bodies, will provide a great opportunity for students and
future workers in our region.
The Draft Budget for 2026 provides for the Council to continue its participation in the range of initiatives
affecting the Northwest Region.
The Council has given renewed support for the A5 Road connecting Dublin. Our local TEN-T Road Projects is
expected to be submitted for statutory approvals early in 2026, the National Broadband project is well
advanced, the inclusion (in a limited way) in the All Island Rail Review – all help to position Donegal in a
better environment for growth.
6.0
Defective Concrete Blocks
The issue of Defective Concrete Blocks has caused great distress in Donegal for several years, with many,
many families suffering and having a fear of living in their homes. The issue continues to dominate discussion
in Donegal and further afield. The Government Enhanced Scheme for privately owned properties came into
operation in July 2023. It is beginning to deliver solutions for a number of families. It is also acknowledged
that a number of families have said they can’t access the Scheme and the council will continue to seek
amendments. It is hoped the scheme can deliver significant progress in 2026 and beyond. The Council has
increased its staff complement to administer the new scheme. Grants payable under the Scheme are fully
recoupable by the Council from the Department.
The Council owns an estimated 1,200 social houses with similar defective concrete blocks. The Council has
made a submission to Government seeking approval and funding for these houses. There have been a
number of engagements with the Department and it is understood to be at an advanced stage and the
Department are likely to provide approval to proceed in 2026.
7.0
Housing for All
The provision of housing is a huge challenge in every county at this stage. The issue generally is affecting
many people and families including social housing tenants, people seeking to get on the property ladder,
workers moving location and indeed older people looking to “right-size” their home. It is affecting companies
recruiting workers who find it difficult to get housing.
The Minister for Housing launched the new Housing for All plan in late 2021. The Council has developed a
multi-year plan and agreed it with the Department of Housing. It represents a significant investment in high
quality social housing. It includes a number of delivery options including purchasing land/building own
houses, turnkey packages, design/build and direct purchases.
It is acknowledged that there have been huge efforts made by staff and elected members, and the pipeline
of delivery is showing some good results with over 500 homes in construction currently.
The provision of homeless services which was quite rare in Donegal in the past is fast becoming an issue in
Donegal and a programme of services must be provided.
8.0
Climate Action Measures
We all have the opportunity and obligation to take action and work with solutions that will help reduce our
contribution to global warming. The Council must play its part and adjust its direction to best meet the
demands of reducing its carbon footprint.
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The central government has funded three posts in Donegal to work full time on Climate Change measures
and it is expected that this will help drive our response across the Council and wider society to the Climate
Action Plan. Our first Climate Action Plan was adopted in early 2024 and our wider Climate Action Team has
been formed.
9.0
Lifford Headquarters
It is necessary to improve Council Accommodation at its Headquarters in Lifford. The Draft Budget 2026
includes provision of €100,000 to continue the examination of the Council’s needs over the next number of
decades. This could result in an investment in Lifford of several million Euro. The engagement with staff,
Elected Members and the public will be critical, and it is expected that such arrangements will be ramped up
in 2026.
The investment is in Lifford Council Headquarters has the potential to compliment other investments in
Lifford such as the Riverine Projects, the Lifford Commons Development and the Greenways and TEN-T
projects that the Council is leading. Together, these investments will transform the town of Lifford.
Our needs will have to take account of new hybrid working arrangements, decentralised services, and new
services etc. The working group of staff and elected members will continue to meet to advance this work.
10.0
Acknowledgements
I wish to extend my thanks and appreciation to the Cathaoirleach Cllr. Paul Canning, former Cathaoirleach
Cllr. Niamh Kennedy, and to the Elected Members of the Council for their support and co-operation during
the year. I wish to thank the Corporate Policy Group and the Strategic Policy and other committees for their
efforts and application in delivering on the 2025 work plan. I wish to acknowledge the continued significant
contribution of my colleagues on the Council’s Management Team and their staff in the delivery of an
intensive programme of works and services over the past years. I also wish to acknowledge the efforts of the
Directors of Service and their staff in the preparation of this Draft Revenue Budget for 2026. In
acknowledging the efforts of Mr. Richard Gibson and his staff, I wish to also acknowledge the input to the
process of Ms. Tanya Kee as the Council’s Management Accountant. I wish to thank Ms. Anne McElchar and
Ms. Cara Patton for their roles in supporting the running of the Chief Executive’s Office.
I would also like to acknowledge and pay tribute to Mr Liam Ward, Director of Services and Deputy Chief
Executive who retired in October 2025 after 42 years of loyal and high-quality service to Donegal County
Council.
Lastly, I would like to acknowledge that our Council won the “Council of the Year for 2025” from both LAMA
and Chambers Ireland. I would like to thank our staff and elected members for all their work that made us
competitive and ultimately led to winning that national award.
RECOMMENDATION
I recommend that the Council adopt the 2026 Draft Revenue Budget as presented with an Annual Rate of
Valuation (ARV) of 0.2436 for the County of Donegal, which represents a 5% increase on the rate for 2025.
_______________________________
John G. McLaughlin
Chief Executive
