Dáil Éireann debate -
Tuesday, 8 Nov 1966

Vol. 225 No. 3

Private Members' Business. - Local Authority Rent Schemes.

Mr. S. Dunne

I move:

That Dáil Éireann condemns the action of the Minister for Local Government in urging city and county managers to revise local authority rent schemes on an exorbitant scale; that it deplores the Minister's threat to withhold housing subsidies from local authorities and the action of city and county managers in introducing rent schemes which can only result in further inflation and consequent economic hardship on the families of the tenants concerned.

This motion was provoked and made essential by the action of the Minister for Local Government, as outlined in its terms which are obvious to every Member of the House. In the economic conditions in which we live today, it would seem to most an obvious fact that Government Departments and Ministers have a special responsibility to see that in so far as they can affect, by their statements or actions, the trend of living costs of the ordinary people, such statements and actions should be directed to restrain costs from increasing. We have all seen within the past two or three years the disastrous, calamitous effect of certain steps taken by the Government, which had the result of increasing the cost of living. I shall not refer to them in detail but, in passing, would mention a particular instance, the turnover tax. Any step of this kind which increases the cost of living of the workers, the main producers of our society, has the inevitable end result of reducing the purchasing power of the wage packet or salary and incites in turn an inevitable demand amongst the people, justifiably, for wage increases. These wage increases again in turn are reduced in their real value by what has come to be called the spiral of inflation.

It is because of this step of the Minister for Local Government in inciting city and county managers to review existing rent schemes and to review them with a view to increasing rents, which must have an inflationary effect on the economy, that we put down this motion. We think it essential that the matter be discussed by the House and that an effort be made to bring the Minister for Local Government to see reason. Indeed, I do not know in this day of "instant Taoiseachs" whether the present incumbent of the office will be responsible for the discharge of the obligations of his Department this day week. It would seem that he may or may not: the things is in the balance. I am not concerned about that; it does not matter to us who the individual is. What we are concerned about is to see that there is a change of policy in the approach of the Minister and his Department to the question of rents generally.

There have been statements of a wild and irresponsible nature by the Minister and members of his Party concerning the tenants of Dublin Corporation houses; for instance, concerning the incomes of tenants of Dublin Corporation houses, which must be answered here and must be nailed for the falseness which is inherent in them. We have heard about tenants of corporation houses who are said to be earning astronomical wages or salaries. I have yet to meet them, and I would claim to have a closer acquaintance with them than the Minister, in so far as they are constituents of mine in large numbers. Indeed, while there may exist instances of families whose aggregate earnings may total a figure which would seem—if it is loosely used in argument as it has been here— to be extraordinarily high, these families are, if you examine them closely, usually families of adult people, each of them earning in their own right, each of them with his or her own responsibilities of keeping themselves and, in most cases, of saving as much as they can in order that they may get married. Anybody who is familiar with the problem which faces newly-married couples of this city today must admit that the costs of that undertaking—which it is most essential we should encourage—are going beyond all bounds of reason. The costs which face young people today about to get married do not need to be demonstrated by me. They are people who are exploited to the very last possible penny of their very often slender means, and more particularly exploited in the field of housing.

Young people about to get married must set about saving for a deposit for a house and I hope to have an opportunity in the very near future of exposing in this House a scandal in the matter of house deposits, in the matter of the usury rate of interest charged by builders to people who have put down house deposits of up to £700, which in some cases are liable to confiscation. If the loan is not granted by the local authority, such people have to pay interest while the builder waits on the loan from the local authority in some cases from nine months to one year. Such people are being denied the opportunity of seeing their houses until the loan is paid and they have put down the deposit and secured the loan. However, I will dilate on that, as I have said, when another opportunity offers itself. I cannot properly deal with it on this motion as I am tied to time.

That is the kind of problem that faces young people who are members of the families of tenants who live in Dublin Corporation houses. They have to try to get together such huge figures because the grasping greed of the builders and developers in this city demands huge deposits and huge prices for houses. When statements are made regarding huge aggregate family incomes, it must be borne in mind that each person in the family has a responsibility to save, and to think in terms of adding together the total earnings of the adults in a family is not to be realistic, because the total earnings in such case are not relevant to the actual amount which is used for the running of the household. Yet that excuse is used for the proposed savage increase in rents not only in the case of Dublin Corporation schemes such as Ballyfermot, Finglas, Coolock and Rathfarnham, but also in the case of schemes much nearer to the city centre which are on fixed rents. A proposal has been made and encouraged by the Minister, on his initiative, that the rents of such tenants, both differential rents tenants and fixed rents tenants, should be increased.

We think this is socially undesirable and economically disastrous. The whole thing reveals something which I have often referred to here before: the disregard and lack of knowledge of the problems facing corporation tenants with which the Custom House has been afflicted for so long and, indeed, with which the bulk of the Fianna Fáil Party have been afflicted for so long. Looking at the Official Report of the Dáil Debates of October 11th, when the discussion was proceeding on the Estimate for the Department of Local Government, at column 940, one finds a Fianna Fáil Deputy exposing his attitude in these words:

The Minister is now asking and urging local authorities to increase those rents and to help to reduce the new rents for the new home-owners and, indeed, to try to keep taxation down by making those pay who can afford to pay. Anybody who cares to trouble himself to go around some of the old housing estates in Dublin will notice the number of cars parked outside the homes and in the streets and can be in no doubt as to the position.

Let us take that for analysis as an approbation of the Minister's policy. By the way, the Deputy who made that speech is not a Dublin Deputy, but he has a lot to do with Dublin. He refers to the number of cars outside the houses of corporation tenants, and he obviously thinks it undesirable that there should be cars outside such houses. Obviously also he considers that the existence of these cars outside corporation tenants' houses connotes wealth. The principal reason why there are cars—and they are not there in the numbers suggested in this speech—and secondhand cars to be found outside the houses in corporation schemes is that it is cheaper to run a car to go to work than it is to pay the extraordinarily high bus fares demanded by CIE. That is a simple fact. The presence of cars outside these houses does not by any means indicate undue wealth. It is an economy. It is cheaper to buy a car on the hire purchase system and drive it to work, and possibly share the expenses with two or three neighbours, than it is to use the buses.

This gentleman suggested something else. He suggested that the workers were apparently living in luxury and rolling in wealth. He went on:

I think indeed that local authorities should go farther. They should make it mandatory on the tenant fully to declare his income and, indeed, any changes that might arise in his income, either upwards or downwards. If his income goes up he should notify it and if it goes down he should notify it.

That of course is typical of the kind of authoritarian, stupid person who has no regard for the individual rights of the citizen.

I remember when the idea of differential rents was first proposed. It was proposed by one of the great social pioneers of the century in this country. The principle behind differential rents was, to put it simply, that the workers in those days, which were far more difficult than they are now, should not have to pay the same level of rents when unemployed as they had to pay when in employment. It might be said that the concept was idealistic to some extent. The working out of that ideal did not prove to be what one had hoped for. In the event, the working out of the differential rent system resulted in one section of the workers being made to subsidise another section, and this was done by the manipulation of interested members of the local authorities, by the activities of the Custom House over the last number of years, and by the influence of the Custom House. When I say "the Custom House", I mean the Minister for Local Government.

One of the great disabilities of the system has been the inquiry into the circumstances and the income of individuals. It is not at any time desirable that the income of the ordinary citizen should be subject to scrutiny by outside sources, except in so far as it can be proved to be socially desirable. Here we have a Fianna Fáil Deputy who will go right down the line to have the income of the humble corporation tenant examined in detail and in every particular, and make it legally obligatory on him to report an increase or a decrease in income to, it is to be assumed, Dublin Corporation. No matter what his attitude might be on fixed or differential rents, he wants to impose this on the whole of the corporation housing estates.

We reject this. We say it is contrary to commonsense. It is unacceptable to the people and if a law is unacceptable to the people, it has always been found not to have been workable. Therefore, in tabling this motion, we are expressing the feeling that it is our duty in this House to impress on the Minister that the present actions of the City Manager of Dublin in trying to change the rents scheme in the Dublin area are not alone ill-advised and unacceptable but will never be made to work because the people living in these houses are incensed at the approach made by the City Manager at the instigation of the Minister. I want to pin the blame on the Minister because he is the one who thought up the idea. It is his brainchild and he must answer for it.

Mr. Larkin

I second the motion and reserve the right to speak on it later.

Mr. T.J. Fitzpatrick

(Cavan): I rise to support the motion on behalf of Fine Gael. Some time ago the Minister issued a circular inviting local authorities to revise the rents charged for local authority houses and in the same announcement, he threatened that if local authorities did not revise rents in what he called a realistic manner, he would cease to pay subsidies on the houses concerned. The first thing I wish to say is that this is a particularly inopportune time to increase rents. The Minister will probably say it is not the intention to increase rents and that in many cases rents will be reduced. I say the object of this proposal is to collect more money from local authority tenants. If that is to be achieved, it follows that if there are to be reductions, there will have to be substantial increases also.

I say it is a particularly inopportune time to ask tenants to pay higher rents for their houses because there is an acute shortage of houses throughout the length and breadth of the country. Notwithstanding what the Minister may say, local authorities find it impossible to get the green light to proceed with housing schemes. Admittedly, there is a shortage of money, but one of the schemes or devices employed by the Department to avoid building houses at the present time is despicable. I know a local authority who submitted a proposal to build 20 houses. After consultation with the Department of Local Government, the Department pointed out that approval for the building of 20 houses could not be given because the Minister and his advisers were of the opinion that 32 houses should be built on a site which was entirely unsuitable for the building of 32 houses. The subsidy is paid on a cost of £1,650 per house.

An Ceann Comhairle

I wonder if the Deputy misunderstands the motion. It has reference to city and county managers and to the proposed revision of local authority rent schemes. It deplores the Minister's threat to withhold housing subsidies from local authorities and the action of city and county managers in introducing rent schemes which can only result in further inflation.

Mr. T.J. Fitzpatrick

(Cavan): I fully appreciate that. I have been making the case that the effect of this revision will be to increase rents and that this is a most inopportune time.

An Ceann Comhairle

That is the Deputy's argument?

Mr. T.J. Fitzpatrick

(Cavan): That is my argument. I was attempting to show that in fact there is a black market in houses brought about by the Department. The Department refused in a case I know of to sanction the erection of 20 local authority houses and invited the local authority to build 32 houses, though the best technical advice available to that local authority was that it would cost about £500 per house to develop the additional 12 houses. I say that is tantamount to refusing authority to that local authority to build houses and I say further that no revision of rents, the overall effect of which will be to increase rents substantially, should be put into effect until such time as the Minister for Local Government and the Department have discharged their obligations to the local authorities in the matter of housing.

The Minister's proposal is based on the argument that rents of houses should be based on family incomes. In other words, he argues that the incomes, or a substantial portion thereof, of members of families living in local authority houses should be taken into consideration in calculating the rents charged to the head of the house. We know that members of families are not regarded as lodgers in these houses: we know that by and large they consume in food and other expenses as much as they contribute to the family exchequer and that they often are a burden on the family exchequer. I do not say that is always the case and I do not base my argument on that proposition but I do say that members of a family who are more than 20 years of age have their own responsibilities to think about. They must provide for the day when they themselves will want to build houses, when they will get married and take on the responsibilities of married life. If considerable inroads are to be made on the earnings of these members of families, it will become impossible for them to plan for their own future.

I know that the effect of the scheme which has been introduced, or at least drafted, will be to increase from 23/-to 35/- per week the rent of a man who has a wife and four children under the age of 16 years to support. His earnings are £9 per week. Admittedly, notice is being taken of the fact that some members of the family are earning, but this is being done under the guise of reducing the rent of a man who has a wife and five children under the age of 16 years and has to support them on unemployment assistance of £4 9s per week. It is proposed to reduce his rent from 7/5 to 4/- per week. I say that a man with a wife and five children on unemployment assistance of £4 9s 6d per week should not be charged any rent. The promise of reducing his rent from 7/5 per week to 4/- per week simply means nothing and is not worth the trouble involved in it.

Furthermore, it is proposed to increase the rent of some houses which were built as long as 30 or 40 years ago. Some of those houses do not have the amenity of a bathroom or even the amenity of an indoor toilet. Agreed, those houses are being treated on a somewhat different level from the others but before the Minister suggests to local authorities in the year 1966 that they should increase the rent of a house with no bathroom and no indoor toilet facilities, he should see to it that those facilities are provided at the expense of the local authorities, generously subsidised by the Department of Local Government.

The proposal here is to increase rents throughout the length and breadth of the country. I have dealt with rural local authorities in the specific case which I gave. In the city of Dublin, the proposal is to increase rents by as much as £2 and £3 per week. It is very significant that the Minister for Justice in introducing a Rent Restrictions Bill recently dealing with private landlords thought fit to restrict private landlords to an increase of 15 per cent or 3/- in the £1, whereas the Minister for Local Government is inviting local authorities to take heed of non-existing incomes in arriving at the rents to be charged.

It is not good enough for the Minister to stand up here or elsewhere and say that a realistic approach should be made to the rents being charged by local authorities. The Minister should tell exactly what he has in mind. He should draft a scheme for the whole country which he thinks will be fair and equitable. It is a question here of passing the buck, of asking local authorities to work out a reasonable scheme.

At the present time no justification at all can be made for a substantial increase in the rents of local authority houses. I agree with the assertion that to increase the rents of these houses at the present time will mean an increase in the cost of living which will be followed by a demand for higher wages because the present wages being paid to those people have been fixed, many of them by the Labour Court, many of them by negotiation and one of the factors which were taken into consideration was the rent which those people had to pay. What would the Minister and the Government say to a demand which might follow on his proposals for an increase in the wages payable to people living in local authority houses following these proposed increases?

I want to tell the Minister with the utmost conviction he will not convince this House and will not convince the tenants of local authority houses that his idea is to reduce rents. He simply will not get away with that. Why should he refuse to pay a subsidy to people who refuse to reduce rents?

I am strongly against this proposal for a number of reasons which I have outlined. The first reason is that the time is most inopportune. The second reason is that it will apply to houses which lack modern facilities and houses which should be provided with those modern facilities. The third reason is that in arriving at the income of a family, the Minister proposes to charge against the head of the household income which everybody knows he does not in fact receive.

In conclusion, I suggest that this circular of the Minister, this draft of the Minister, should be postponed until such time as the Minister has discharged his obligation to the community of providing houses both for private individuals, who want to build their own houses and for local authorities who want to house people who are not fit to house themselves.

Mr. Larkin

The action of the Minister in this regard cannot in any way be contradicted on the basis that he is not the architect of what is happening at the present time. Prior to the issue of the circular dated 30th March, 1966, he indicated in this House, and elsewhere, that, in his view, the rents of local authority dwellings should be revised and that the basis of the revision should be that the maximum rents in the differential rent schemes should be equated with the full economic cost of the dwelling — not just the full economic cost of the dwelling at the time of its construction, or even one or two years after its construction, but the full economic cost of providing the dwelling at this stage. Further, in those cases in which there were fixed rents, many of them fixed 20 and 30 years ago, in his opinion, schemes should be introduced bringing these dwellings under a differential renting scheme and, in fixing the rate of the differential rent, the maximum rents should be the target, providing an equivalent rent structure at today's prices.

The Minister embarked on this adventure following on his failure to agree to adjust the level of subsidy to local authorities. In this House, and outside it, repeated appeals were made to the Minister pointing out that the level of assistance given by the State had been progressively declining over the years. The subsidy on loan charges was a figure of two-thirds up to a maximum of £1,650. When the same type of house was costing £2,500 to build, the loan charges subsidy remained at £1,650. The Minister was not prepared to adjust it. The approach was the same in the case of flat schemes.

The Minister was quite open about his views. He felt, as Minister, that people should pay economic rents. The peculiarity is that those who buy their houses are not supposed to be required to pay economic prices. The same Minister who was advancing this theory in relation to those who rent houses was quite willing, in the case of a house purchaser, that he should get a State grant, a supplementary grant and remission of rates. In the Housing Bill, which went through this House not so long ago, he even referred to a development grant. He indicated that local authorities might pay grants on the lines he suggested for development.

He issued a circular to local authorities, dated 30th March. In the course of that circular, he said in the appendix, paragraph 4:

The maximum rent for the dwelling in each group should be equivalent to the rent based on the actual or estimated cost of providing similar accommodation at current prices, adjusted to the general standard and amenity of the dwellings, together with the amount calculated at one per cent of such cost to cover maintenance, depreciation and administration.

He goes on to say that the level of rents should, in his opinion, be reviewed within every year once they were rationalised so as to provide increases if costs of building houses went up in the meantime or to provide some amelioration if there was a reduction in rates.

What do we find? The Minister sends a circular out to city and county managers and they proceed to implement that circular. It was made quite clear that any future help to local authorities, meaning the city and county managers, would depend on how they reacted to the Minister's suggestion. There are many ways of issuing instructions and one of the most effective is to suggest to somebody that if he does not do something, then he will be at some disadvantage. That is a good method of ensuring one's suggestions are implemented.

Mr. Ryan

Starvation.

Mr. Larkin

What happened? In the case of the city and county managers of Dublin, the suggestion was acted upon and a number of schemes were proposed. In the case of earnings assessable for rent purposes which were 1/- or so more than the average industrial wage, there would be an increase in rent. The increase could become quite substantial. In a report submitted by the principal officer of the Housing Department, it was indicated that the maximum increase for a four-roomed dwelling would be as high as 8/- in the first year. Over a period of five years, the maximum rent increase could be 40/-.

There is a great deal of talk about people in the lower income group getting reductions. There is no reference to the fact that these increases will not only be 40/- maximum but 39/-, 38/-and 37/- on those whose income does not reach the maximum. On a four-roomed dwelling, over a period of five years, the increase can be as much as 40/- maximum. In the case of older dwellings, it can be £1 per week. Let us talk about the increase of 8/- a week in the first year. A few months ago, when workers were looking for an adjustment in wage rates, the Government said they should not have any such adjustments. Government speakers throughout the country advised against wage increases. A few months later the Minister comes along and recommends to city and county managers that they must increase the rents of their tenants.

Let us look at another aspect of this matter. The circular states:

The maximum rent for the dwellings in each group should be equivalent to the rent based on the actual or estimated cost of providing similar accommodation at current prices....

This proposal, in respect of houses built in 1934, 1936 and 1938 would mean a maximum rent based on 12/6 per room, plus rates. Yet, according to the information supplied as recently as the 12th January last, the full economic rent of houses built in Crumlin in 1934—and the full economic rate covers the cost of acquisition, development, construction and maintenance and also the current rates— works out at £1 8s 8d. However, the Minister says to the managers: "That is not good enough. It is not good enough for people to pay even the full economic rent; you must have profit and you must increase the rent over and above the full economic rent." We have the peculiar situation that people who have been tenants of corporation dwellings for upwards of 30 years, paying the rent fixed by local authorities, and any increase in rates that took place, plus a special contribution in respect of repairs, to the extent of 28/6, would be expected to pay 48/-.

I suggest to Deputy Dowling that he should visit Dún Laoghaire and learn of the activities of his colleague for the Dún Laoghaire/Rathdown area, Deputy Andrews, who is making it known there that he is completely opposed to the proposal in the area to impose a substantial increase of rent on the cottages in Sallynoggin. At present the tenants pay 8/6d a week, plus rates, and he is completely opposed to their being brought under the differential rents scheme. When this debate has been concluded, it will be interesting to see if Deputy Andrews, and possibly the other Fianna Fáil Deputies who may be keeping very quiet on this issue, will vote with the Minister or vote in favour of their undercover activities in the various areas.

Our motion says that the proposed increases are exorbitant and should not be supported. The Parliamentary Secretary will hardly disagree with me when I say that to apply increases in the region of 8/- or 9/- per week this year and the same increases next year and the year after would certainly be to apply exorbitant increases. At present instead of assisting people who need assistance, instead of building dwellings which are urgently needed and instead of providing the money for the acquisition of land so that housing schemes can go ahead, the Minister is engaged in an exercise of using his authority to issue this circular to the city and county managers urging them to impose these unjust increases on tenants of local authority dwellings.

Many of these tenants up to the present have been fairly strong supporters of the Fianna Fáil Party and many of them are quite vocal about their objection to the scheme. Unfortunately, however, some of them have the idea that these increases are being imposed by the elected representatives in the various local authorities. It has not been brought home to them sufficiently, but possibly this motion may do so, that the initiative in this matter lies with the Minister and nobody else and the city and county managers—and not for the first time—are acting as agents of the Minister.

Mr. Clinton

Good, loyal agents.

Mr. Larkin

The House will remember during the debate on the Housing Bill the number of occasions on which this Party sought to have more power of decision left in the hands of the local representatives and that on each occasion the Minister refused. He was not prepared to listen to Deputies' arguments or their appeals for democratic decisions being left in the hands of democratically-elected people. We know why the Minister was not prepared to do that. The Minister would know that a circular such as that issued by him on the 30th March enjoining city and county managers to impose rent increases would, if it were up to the elected representatives, be thrown out and treated with the contempt it deserves.

It is not sufficient for the Minister to plead that there is a shortage of money. Everyone is aware that there is a shortage of money and it was many weeks before the Minister admitted in this House that there was a shortage of money. But to endeavour for the first time to get tenants of corporation dwellings to pay rents which are even in excess of the economic rent is surely an attitude that cannot be supported, when, on the other hand, the people who are willing or anxious to buy their own homes are supplied with grants and supplementary grants, etc. Why is it that some attempt was not made to deal with the problem of those in the lower income group earlier? Nobody with any knowledge of the situation will deny that a small percentage of the people will benefit but many of these will benefit only to a relatively small extent. Many who benefit will be people who need other forms of assistance than a mere adjustment in their rents. This is not a motion on which we can discuss in detail that aspect of the matter but the Minister and the Government and every Deputy knows the needs of the old age pensioners and the widows.

The justification put forward for putting increases on families where the income is fairly large because of the number of wage earners in the family is that people on a low income may derive some benefit. Perhaps the Minister is not aware that in the case of a man and wife with three or four children, aged 16 to 19 years, with perhaps two of them having just started work, the calculation of what the differential rent will be for that family is 13/4d. for the girl with perhaps 12 months' service in a factory and another 13/4d. for her brother who is also, perhaps, a year at work. That amount of their income is to go towards building up the maximum.

If the Minister or any Deputy behind him can make a case for £4 15. 0d. rent a week, I want to hear it. If any Deputies who have knowledge of the circumstances in Dublin city can make a case for introducing a differential rents scheme for tenants who have been local authority tenants for 25 or 30 years and compelling them to pay very substantial increases in rent, I want to hear it. They will not convince the tenants concerned that they are being treated with justice or equity. I support the motion and recommend its adoption by the House.

Mr. Ryan

We of the Fine Gael Party are only too glad to lend our support to this motion because it does no more than express our innermost thoughts regarding the outrageous proposal to fleece local authority tenants throughout the country to subsidise the Government in their financial crisis.

I see in the Evening Press tonight that one of the elders of this House, Deputy MacEntee, is astonished that the Taoiseach should be resigning. It is no cause of astonishment to those who see in this House a Government who do not know where their head or their tail is and who are simply going around in circles.

Last week we had a motion asking the Dáil to encourage CIE to provide free travel for old age pensioners and the Government went into the Lobbies and said as a matter of principle that it was wrong that social welfare beneficiaries should be subsidised out of the transport industry. The Minister for Transport and Power and his colleagues enunciated their philosophy that social welfare beneficiaries, being people who were down and out and deserving of support from society, should get that support direct in the form of a direct State payment through the social welfare code and in no other way. That is how they voted last week but this week we shall probably see them going to the Division Lobbies saying that these social welfare beneficiaries must be supported out of the rents being paid by people in local authority houses because that is the only justification for the miserable plea being put up by the Minister for Local Government, the Government and the Fianna Fáil Party in defence of their outrageous proposals.

They put the baby of the social welfare beneficiaries in their arms, give it a twist to make sure the baby cries and then they say that those who abhor these outrageous increases in rent want to make the baby cry even more. But what the Minister is seeking to do is make every local authority tenant subsidise the social welfare beneficiaries. He is not asking the well-to-do people who are not living in local authority dwellings to subsidise social welfare beneficiaries living in local authority houses because they cannot afford houses elsewhere but he is making the poor help the poor. That is the whole basis of any justification which he has, as yet, proposed to the local authorities, the country or the Dáil in respect of this outrageous proposal.

There are not too many grey hairs yet showing on my poll and I remember the time when my neighbours in Kimmage, Dublin, were by scores and hundreds down on their knees scraping for cinders in the dumps of Kimmage. Those are the people who 30 years ago went into the local authority houses in Kimmage. They are the people who today, I am glad to say, in most cases can do a little better. They are no longer on their knees in the rubbish and dirt of Dublin. Perhaps they have a little car that they bought for about £50 third or fourth-hand. Perhaps they have a television set and perhaps in the autumn of their days, they have some little comforts that they did not know 20 or 30 years ago. But that is not good enough; they must not be left to enjoy this; we must reduce the local authority tenants down to the lowest common multiple. We must make them, if they survive another few years, pay an extra 40/- or 45/- in their rents. If ever there was a more despicable philosophy put before people for acceptance, I do not know it.

It is well known that people in their younger days, when they establish homes, may find it a burden to pay the rent or the cost of a house, but if they are fortunate enough to have a deposit and take out a mortgage, their mortgage will be related to the price of the house at the time they purchased it. Although the property may increase nominally in value—it may in ten or 20 years double in price in the open market—the repayments which people make under privately arranged mortgages or under mortgages with the local authorities remain at a level which is associated with the price of the house at the time it was built. One would consider it fair that we should apply the same mode of payment to other people, people who, because they have not got deposits and because their incomes are low, dwell in local authority houses. It is reasonable to argue that because one section of the community can enjoy repayments at a standard level associated with the price of the house at the time it was built, the less fortunate in the community might enjoy a similar experience, and to some extent that has applied until now.

In the future it is not to apply to the less fortunate members of the community. They in future are to be obliged to pay—we shall not use the word "rent" because "rent" is a rather confined work; whether one pays a mortgage repayment, a rent or some other form of outgoing, it does not matter; we shall use the word "outgoing"—outgoings which have no relation to the cost of the house in which they dwell or in which they have dwelt for decades past. This is a contemptible proposal. It is a proposal which, no matter how the Minister may try to twist it, is directed against the section of the community which is not as well off as the people who are buying their own houses because they have the means to do so.

My colleague, Deputy Fitzpatrick, and others here have emphasised the dangerous inflationary spiral that will be set in motion by this proposal. At the present time, for instance, in Dublin something like half the population of the city dwell in corporation houses. Is there anybody here so foolish as to suggest that you are not creating and stimulating inflation if you oblige people to pay in the next five years rents which are not only a percentage of what they are now paying but increases which in some cases will be double and treble what they are now paying? Is there anybody here so foolish as to suggest that a household who are called upon to pay in rent an increase of 40/- to 45/- over the next five years is not going to demand an increase in wages? Of course they will, and more power to them for doing so, and it would be less than justice not to give them such increases in wages to meet the increase in the outgoings in their homes. The alternative is to lower their standard of living, and there is no other way of describing it. If you are to ask families to pay an extra £100 a year for the houses they now occupy, they are bound to demand increases in wages, no matter how many people in the house are bringing in money.

One cannot understand Deputy MacEntee being astonished by the Taoiseach resigning. How could it be otherwise when he has the Minister for Finance in Waterford asking for a relaxation of pressure on demands for increased income and, at the same time, the Minister for Local Government in the same Government setting in motion something which is going to put the greatest pressure on income increases that we have experienced for decades.

In the Dáil tomorrow we shall have before us again the Rent Restrictions Bill which this Government are asking us to approve. This Rent Restrictions Bill proposes increases in rent of 15 per cent only. We could consider when we discuss this matter next week that 15 per cent in some of the circumstances envisaged in the Bill is not justifiable, but the Minister for Justice considers that all that is necessary to give equity to the owners of private houses is an increase of 15 per cent upon the basic rent which in some cases was created, or certainly had its roots, as far back as 1914.

That is the proposal for one section of the community, but again those are the people who are able to pay higher rents perhaps than many people in local authority dwellings. However, this is not good enough for the local authority tenant. He will be compelled under the Minister's proposals to pay, in some cases, rents 100, 200 or 300 per cent higher than he is paying at present, and that within a cycle of five years, with the pious indication that if he or she should fall on poor days, the rent will be reduced to a very low figure at the expense, I wish to emphasise, of his fellow-tenants in similar local authority accommodation.

Deputy Larkin struck the nail well and truly on the head. He drew attention, quite properly, to the fact that the State has been reducing its contribution to housing costs.

There is a stranger in the House. Of course, members of the Seanad can be nominated to the Government. Goodness knows what is going to happen next. Where was I before that apparition appeared. I was saying that Deputy Larkin drew attention to the fact that the State has been reducing its contribution to housing costs. We are tired to the point of being ill with the speeches of the Minister for Local Government indicating how much more in pounds, shillings and pence he is spending one year after another on housing. The additional amounts which he has spent—and he knows this all too well—bear no relation to the overall increase in the cost of houses, and the State contribution towards the cost of local authority houses has been falling year after year, because the Minister has maintained the same subsidy ceiling whereas the costs of houses have been spiralling. That has been bad enough in relation to houses but the situation becomes very much worse in relation to flats which are so much more costly to build.

The real reason why 40,000 people in Dublin are converging from the suburban areas and marching here in the greatest protest of indignation we have ever experienced is that the Government have been reducing the subsidy on housing one year after another. The result is that if the Minister for Local Government and the Minister for Finance will not provide money for housing at a time housing is increasing in price, the money has to be produced somewhere. Therefore, some wiseacre thought up the idea: "We shall milk the people who are living in houses which were built 30 or 40 years ago at a mere fraction of what it would cost to build them today. These are the people who have matured over the years, who have now some members of their grown-up families working and living with them. These are the people we shall milk for the future. These are the people we will make pay for the Government's neglect in failing to raise the Government subsidy in accordance with the increased cost of building."

In addition, the Government's failure over a period of seven years to maintain an adequate number of new houses, at a time when money was plentiful, at a time when money was cheap, now obliges the Government, in a state of panic, to endeavour to make good their default at a time when money is scarce, when money is dear. So it is that money must be borrowed at inflated rates of interest to build houses which are being put on the market at inflated prices and, notwithstanding the competition which exists in relation to tenders for local authority houses, the fact is that the housing industry is now so well arranged that the prices of even local authority houses can be kept at an artificially high level in order to ensure profits at the public expense.

The sad situation will also exist that the tenants who are in comfortable circumstances but are unwilling to pay the rents which the Minister now proposes to exact from them and who may not be disposed to purchase the houses in which they live at the prices which apparently it is proposed to demand from them will not be in a position to move out of their houses into privately built houses because the money is simply not there to enable such houses to be bought. The Minister knows all too well that builders in the private sector are experiencing financial difficulties. Some have gone bust. Others are on the verge of bankruptcy and can easily be tipped in there. Others have avoided this predicament by simply stopping building altogether. Whatever builders there are who still have money and their own resources are finding it difficult to build because building land is not available for them.

So the position is that several people will have the gun put to their head. Literally, they will have no choice. It is only because of that, because there is no opportunity for election, no opportunity for choice, that this scheme is being brought in. If this scheme were brought in at a time when there was a generous supply of houses on the market, there are many local authority tenants who would get out of the houses they now occupy and perhaps it could be argued, although I would not support the argument, that it would be advantageous to bring in these penal rents because it would force out of local authority houses people who could well afford to buy their own. There are very few people—in fact, I am sure there are no tenants of local authorities—who could afford to buy their own houses outright and they would therefore be forced to look for mortgages. There is simply no money available from Dublin Corporation, from Dublin County Council, from the Government or from any building society to finance tenants of local authority houses who want to surrender their houses rather than pay the penal rents which the Minister now proposes.

So it is clear what the Minister's motive is, that is, to exact more money. Quite clearly, at a time of financial crisis, when money is short, the Minister would not be asking local authorities to propose any scheme the net effect of which was going to reduce the amount of money available for housing purposes. It is patent, therefore, even before we do any arithmetic on the consequences of the Minister's proposals, that the whole object of this exercise is to extract more money out of local authority tenants.

I said earlier, perhaps erroneously, that the Minister had only one justification for his scheme, and that was, that a marginal number of people might be on lower rents and that, therefore, the rest of the people should suffer rent increases of 200 and 300 per cent in order to pay for the marginal reductions to be given to a very small number of people but, of course, that was not the only argument to be advanced in favour of his scheme. The other argument was that money was needed for the housing programmes. That is true. Money is needed for future housing programmes but until now it has been possible to finance housing programmes without milking existing tenants to pay for the cost of future houses. The Minister has not yet justified this change in policy, this change in outlook, that people who occupied houses years ago and who have ever since been repaying the cost of them should now, in addition to paying the cost of the old houses, also be called upon to pay the cost of houses to be built in future.

Mr. O'Leary

On a point of order, am I correct in saying that the speaker is exceeding his time?

An Leas-Cheann Comhairle

No; the speaker is still in order.

Mr. Dowling

He is in the 30 mile an hour zone.

Mr. Ryan

I could accelerate to 40 but might knock down more obstacles on the way. The kind of thing to which I have been referring reminds me of the annoyance which is often felt in some Dublin parishes where the parishioners build churches, halls and so on and then, with the spread of the city, are asked to contribute towards the cost of churches and halls to be built outside their parishes. This causes a certain amount of vexation but, for the greater good of the greater number of people, in religious matters, people are prepared to make that sacrifice. It becomes an entirely different exercise when people are asked, not only to pay for their own houses, but also to pay for houses for other people after they have paid for their own.

It must be borne in mind that the tenants now occupying houses for 20, 30 and 40 years, at the time they first bought their houses were obliged to pay what was then the full economic rent. Many of them went into houses in respect of which there was no subsidy paid by the State and the total cost fell upon the local authority. In the meanwhile, I am glad to say, better counsels prevailed and Oireachtas Éireann passed legislation which would make it obligatory on the Government to come to the assistance of people in providing their own houses. But there are people who are paying what are called fixed rents today, or relatively low rents in relation to their income today, who at one time paid rents for their houses which represented as much as 25 per cent of their income.

People who did that are entitled to some consideration in the autumn of their days. Instead of being allowed now the benefit of the immense sacrifices which they made in those days, they are being obliged to pay for the Government's mistakes, to pay for that valley of seven years during which no houses were built, to pay for the Government's panic measures after neglecting housing for seven years, and to pay for the exorbitant rates of interest for any money borrowed here because of the Government's recklessness in financial matters for the last decade or so.

This is completely contrary to every canon of equity and I cannot see how the Minister can justify it. If the object is to get people to buy their own houses. I do hope the Minister for Local Government and the Government in general will no longer dig their heels in against the overwhelming wishes of Dublin Corporation, that the corporation will be facilitated in bringing in a tenant purchase scheme, that the State subsidy will be continued in relation to houses bought in connection with a tenant purchase scheme.

The Minister may not know, because I am sure his partisan colleagues behind him would not want to upset him when he has other things on his mind, but Deputy Dowling, Deputy Moore, Deputy Mrs. Lynch, Deputy Burke and others have said in Dublin Corporation that there should be a purchase scheme for Dublin Corporation tenants. I do not blame the Minister——

An Leas-Cheann Comhairle

The Deputy seems to be getting away from the motion, which deals with the revision of the scheme of local authority rents.

Mr. Ryan

Yes, Sir, but in relation to the scheme of local authority rents there is also the scheme for driving people to cease to be tenants and to become purchasers of their houses. That is a recognised object of the Minister's proposal. My argument here is that in Dublin this becomes impossible, certainly for the majority of persons, because the Minister refuses to maintain the subsidy in relation to houses which people buy.

Debate adjourned.