Dáil Éireann debate -
Tuesday, 30 May 1978

Vol. 307 No. 1

Local Loans Fund (Amendment) Bill, 1978: Second Stage (Resumed) and Subsequent Stages .

Question again proposed: "That the Bill be now read a Second Time."

Mr. Donnellan

: The Fine Gael Party fully support this Bill to make an extra £500 million available to the Local Loans Fund. I am sure it will not prove half as contentious as the issue certain people have been discussing for the past while.

Making available an extra £500 million is an indication of the huge price increases which have taken place since this Government took office. It is a good thing that this money is being made available for these essential services. As the Minister of State said, this money is the principal source of capital available to local authorities for a number of projects and to the regional health boards, vocational education committees and harbour authorities for the provision of water and sewerage facilities. It provides finance for county councils.

In 1974 when a similar Bill was before the House, Deputy Colley on behalf of the then Opposition, was very critical of the £400 million being sought at that time. When does the Minister anticipate it will be necessary for a Minister to come before the House again seeking a further allocation? I have certain ideas about this matter. Rather than having a debate on the Local Loans Fund every few years, in my view it would be better to give Members an annual opportunity of expressing their views on this matter.

Local authorities rely heavily on this fund but since Fianna Fáil took office there has been a lack of emphasis on the public sector. Ministers, Deputies and Senators on the Government side are not alone trying to encourage people to get involved in the private housing sector but they are telling them that it is a proper thing to do. They are getting away from their responsibility as a Government which is to provide houses for people who cannot afford to build their own. The average price of houses has increased by 19.2 per cent since the Government took office—that information was given in answer to a question on 26 February 1978—and when one considers that one will realise that the £500 million referred to in this Bill will not last long. The grant of £1,000 for new houses which was part of the Fianna Fáil election manifesto has been gobbled up many times by inflation since last June.

It should be remembered that local authorities must rely on the Local Loans Fund to cater for the VECs to a certain extent. In that direction there has been a decrease in the amount of money available from £4 million to £3.9 million for 1978. There has also been a reduction of a little less than £1 million in the area of primary education. The Minister for Education when he was interviewed on television by Michael Heeney recently said that his aim was similar to that of the INTO in regard to the provision of new schools and the repairing of others. If there is a decrease in the allocation for primary schools I cannot see how the Minister can contend that his aim is similar to that of the INTO.

Mr. Wilson

: Was the Deputy referring to a decrease in relation to primary schools?

An Leas-Cheann Comhairle

: We are getting away from the terms of the Bill. It is a limited Bill and we cannot discuss in detail every aspect of public expenditure.

Mr. Donnellan

: The debate was not that limited when this matter was discussed before. I read that debate and saw that those who contributed covered a wide area.

There is a great need for eliminating a lot of red tape which must be gone through to get money from this fund. For instance, a health board anxious to avail of the fund must first apply to the Department of Health who in turn must refer the application to the Office of Public Works. The Office of Public Works then refer the application to the Department of Finance. The same position applies in relation to harbour boards, educational authorities and all others anxious to avail of the fund. The Minister should devise a method of short-circuiting his system in order to eliminate a lot of the red tape.

I notice that £28.6 million was sought from the Local Loans Fund this year and £22.6 million was allocated. The Minister should look into this matter. I support the measure but I must complain about the lack of expenditure by local authorities on sewerage and other schemes. There is little sense in making £500 million available if local authorities must wait a long time before a decision is reached on their applications. Invariably, such applications are not granted. There is a long list of rural towns in my constituency seeking assistance from this fund for sewerage schemes and they have been given the standard answer that the money is not available for those schemes. It is my hope that future applicants will be given assistance.

Mr. B. Desmond

: We welcome the Bill and feel that for the time being the limits proposed are reasonable. There was an increase for 1977-78 of £36 million but we have no indication of what the position will be in 1979. The increased capacity of an additional £500 million should mean that there will be reasonable accommodation available for the next four or five years. We must emphasise that the previous administration, particularly during 1973-74, drew heavily from that fund. I hope that that pace of withdrawal will continue although I am apprehensive about it doing so. I am a member of Dublin County Council and I am aware that over the years we drew heavily from that fund. Should there be any major cutback on public expenditure, as is foreshadowed, withdrawals from the fund will substantially diminish. The amount referred to in the Bill should be adequate for the life of this Dáil and it should be an incentive to local authorities to avail of the money. We do not cavil with the introduction of the Bill.

Mr. W. O'Brien

: I welcome the Bill. It is a sign that we are being constructive when we welcome such a measure. I remember 1974, to which other speakers referred. At that time Deputy Colley said he supported the measure and supposed it was an indication of the extent to which inflation had gripped our economy that the Minister was obliged to come into the House with a proposal to increase the maximum figure allowable by £400 million, whereas the previous increase, after a period of four years, raised the maximum limit by £200 million.

At that time it was described as inflation. Today, the Minister of State, Mr. Wyse, described it as an indication of the improvement of work because of increased loans. Having made that statement in 1974, I am not surprised that the Minister for Finance, Deputy Colley, is not in the House now. In fairness to him, he could not possibly sit over there today and tell us that he was sincere in looking for the £500 million without admitting that inflation is very high.

In 1974 the price of houses, the ceiling on loans, and the ceiling on supplementary grants were widely discussed. Today the loans have been increased but that increase has found its way into the hands of the builders instead of into the hands of those who are trying to build their own homes. The Government have not taken action to put a ceiling on the price of houses. Last night I met a person who informed me that cement blocks have increased by £25 per thousand in three weeks.

In fairness, the people on the other side should admit that they have now realised that we had inflation and a recession. The only consolation left to the people is that there was a change of Government in 1973. What would have happened to the unfortunate house seekers between 1973 and 1977 if we had pursued the policy of the present Government? People are asking why the price of houses is not being controlled. How could we control the price of houses when the price is too high as far as the builders are concerned? There is a group known as the Tacateers who are associated with the building industry and the unfortunate people are asked to make their contributions. Fianna Fáil cannot introduce a ceiling on the price of houses.

We have heard much of the £1,000 grant but that grant has gone into the pocket of the builders and of the Tacateers. I ask the Government and the Minister to admit the truth and tell us what is happening. If any of the Ministers were sentenced for sincerity they would be wrongly imprisoned. Never in our history has there been so much insincerity from the Government benches.

It is maddening to read the 1974 speeches on inflation. That remark also applies to the second House. I am not allowed to mention the second House, but I will say that this Government have stabbed the people who are seeking houses in the back. It is well known down the country that the Government cannot control house prices because there was a certain guarantee for certain people to start building at a certain price, which cannot be reduced. To prove my argument you will not hear any of our Ministers speaking about control of house prices. When he was in Opposition the Minister spoke frequently of the price of houses, cement and other building materials. I want to make it clear that the thousands of people down the country are not being codded.

Minister of State at the Department of Finance (Mr. Wyse)

: It is a limited Bill. We are talking about financing the local loans fund. I appreciate the remarks made by some of the speakers in welcoming the increase. Any member of a local authority will naturally welcome any increase in the local loans fund.

Deputy Donnellan said we should have a review of the matter in 12 months. I do not believe that is necessary because there will be sufficient money for the next three years. However, if a review is necessary the Government will review the matter.

Mr. Donnellan

: A short annual debate would be better than a review every few years.

Mr. Wyse

: I see the Deputy's point but he can always avail of a discussion on the Estimates for the Departments responsible for drawing from the fund. It would be no harm to avail of those debates to ask for a review. I am quite satisfied that the money made available to the local loans fund will be sufficient for three years. If not, the matter can be reviewed.

The last speaker went into the area of local government rather than finance.

I am glad the Bill was welcomed and I am sure it will be welcomed throughout the country. I hope the money will be availed of by the local authorities. Deputy Donnellan raised the question of confusion and delay in payment. Those of us who are members of local authorities know that we are often responsible for delays in paying local funds. As far as my Department are concerned, there will not be any delays in financing worthwhile projects.

Question put and agreed to.

Agreed to take remaining Stages today.

Bill put through Committee, reported without amendment and passed.