Private Members' Business. - Local Government Funding: Motion (Resumed). – Dáil Éireann (29th Dáil) – Wednesday, 26 Nov 2003

Private Members' Business. - Local Government Funding: Motion (Resumed).

The following motion was moved by Deputy Allen on Tuesday, 25 November 2003:

That Dáil Eireann:

– noting that, since it took office, the Government has:

– abolished the first-time buyer's grant;

– raised VAT on house purchases;

– presided over a tripling in the price of houses; and

– allowed the numbers awaiting local authority housing to rise to 52,000 households, comprising over 100,000 individuals;

– condemns the failure of the Government to adequately fund local government which will force local authorities to set punitively high development levies which will result in higher prices for new homes, hinder the development of new business and damage the competitiveness of the economy.

Debate resumed on amendment No. 1:

To delete all words after "Dáil Éireann" and substitute the following:

"–acknowledges the achievements of the Government in:

– increasing the resources provided to local authorities through the local government fund and through the buoyancy in their income from local sources due to the success of this Government's policies;

– ensuring that local authorities have adequate resources to service the land necessary for development, including industrial, commercial and housing developments;

– ensuring that the cost to the public purse of servicing land for private development is recouped in part from the persons developing that land;

– revising the long-standing system of levying development contributions to help fund local authority infrastructure to ensure it is implemented in a more transparent and consistent way across the country with a new role for the elected members of authorities in overseeing the system;

– focusing on increasing housing supply as the key response to the broad range of housing needs and demand;

– supporting record levels of housing output since 1997 with the prospect of a further record level of housing output being achieved in 2003;

– moderating the rate of house price increases;

and supports the continued action and commitment by the Government to adequately resource the local government system to underpin the continuing development and competitiveness of the economy."

–(Minister of State at the Department of

the Environment, Heritage and Local

Government,

Mr. N. Ahern).

Mr. Nolan

I wish to share time with Deputies O'Connor, Batt O'Keeffe and Sean Power.

Last year was the eighth year of record housing output with almost 57,700 completions nationally, an increase of almost 10% on the figure for 2001, during which 52,600 units were completed, also a record. Housing output in Dublin also reached record levels last year, with more than 12,500 units built, an increase of 30% on the 2001 figure. More than 29,600 houses were completed nationally in the first six months of this year and all the indicators are there will be record housing output again in 2003.

The Government has consistently stated supply is the key to addressing the high cost of housing and its focus has been on investing in infrastructure, that is, the provision of water and sewerage facilities, and to ensure the effective use of more serviced land through residential density guidelines. These policies are having positive effects. Since 1997, more than 280,000 houses have been built nationally. House prices were increasing at up to 40% annually until 1998 but, thankfully, the rate of increase has reduced substantially in recent years. The Government's focus will be on maintaining a strong supply of houses to meet the high demand and moderating the rate of increase in house prices to bring the housing market back to normal.

The greatest problem facing young people is securing a mortgage to purchase a house. Four years ago it was estimated 500,000 new units would need to be completed to meet housing demand between then and 2010. The Government enacted Part 5 of the Planning and Development Bill 2000 which was later amended by the Planning and Development (Amendment) Act 2002 to assist in the provision of social and affordable housing. The effects are only now coming on stream and many local authorities will, over the coming months, reap the benefits of the provision which developers lobbied to have removed from the legislation but I am pleased the Minister at the time insisted on its inclusion. While we must wait to witness its merits, many local authorities will reap the benefits. My local authority, Carlow County Council, will open two major developments next month under Part 5, which is welcome.

The number of households whose needs are met though the various social and affordable housing measures has increased by almost 50% since 1998. Local authority housing output is at its highest level in 15 years and record output is expected by the voluntary and co-operative housing sectors this year. The Government is addressing the needs of existing tenants in run-down estates through regeneration and remedial schemes. It is important that we do not make the mistakes of the 1960s and 1970s when thousands of low costs houses were constructed and costly remedial works had be carried out on the schemes in the mid-1980s. Some remedial works were more costly than the original housing.

Much criticism was foisted on the Government when the first-time buyer's grant was abolished more than a year ago but it is generally accepted the abolition of the grant was a positive move because, if it had been index-linked from its inception, it would be worth between €12,000 and €15,000 per house today. The Government is to be commended for making major tracts of State land available in counties Dublin, Kildare and Meath for affordable housing and I hope more will be made available in other counties where suitable land is identified among the State's resources.

Since the homeless strategy was launched in 2000, the quality and range of services provided for homeless persons has improved. Funding to local authorities for the provision of accommodation and related services for homeless persons increased by €12.5 million in 1999 and was increased to €50 million in 2003.

Mr. O'Connor

I am glad to have the opportunity to contribute to this Private Members' debate. I have availed of Private Members' Business on a number of occasions to make a contribution as it is important that Members should take the opportunity to discuss the issues of the day. I thank Fine Gael for tabling this motion, although that is as much support as the party will get. Deputy English has been sent to the House to mark the rest of us and I do not want him to draw me out because I want to be kind to him.

The public thinks criticism of the Government's policy on housing is hypocritical. Our job is to represent the needs of our constituents. I could refer to the contribution made by Deputy Timmins on the first-time buyer's grant but I would like to be positive, particularly about my constituency. I live in Tallaght and, until recently, was a member of South Dublin County Council. I was first elected to Dublin City Council in 1991 and, under the legislation to reorganise local government in 1994, became a member of the SDCC.

Local authority housing will never be perfect. I conduct seven clinics a week in Tallaght, Firhouse, Templeogue and Greenhills and receive many inquiries regarding housing. These involve people seeking local authority housing or help to address anti-social behaviour on housing estates or other matters under the housing remit. It is important that the people concerned should be supported.

I refer to the achievements of the SDCC and the efforts it is making in respect of the housing programme. I applaud the progressive refurbishment programme in which it is engaged with the assistance of the Department. It involves three estates in south Dublin, including Cushlawn, which is part of the Killinarden Estate in Tallaght. The local community welcomes such programmes. I was raised on a local authority estate in Crumlin and over the years, even before I became interested in politics, I was aware of the need for Dublin Corporation to look after the houses and tenants. I am glad the Department is funding this programme in Tallaght. The more funding that can be provided for such programmes the better. A great deal of housing stock in Dublin county and Tallaght needs to be refurbished for which as much funding as possible should be sought. In Tallaght, we have a multi-annual construction which I believe is delivering first-class housing across a range of options. It is very important to support programmes at local authority level to deal with housing issues. The skyline of Tallaght is dominated by cranes, as is also the case in other areas around the country, indicating the delivery of quality housing programmes.

Mr. English

Not at the right price.

Mr. O'Connor

Any of the Deputies opposite is welcome to stop by in Tallaght to see the situation. I will be happy to show them around and to point out where good programmes are in progress, with good funding, providing quality housing.

Mr. Timmins

We are held up in traffic any time we go there.

Mr. O'Connor

We are dealing with that also. There is good accommodation available. The town centre lands and The Square are particularly worth viewing.

Mr. English

The Government has reduced the capacity of Tallaght Hospital.

An Leas-Cheann Comhairle

Order, please.

Mr. O'Connor

I appreciate the protection of the Chair. On the housing programme, I welcome the recent opening of the exchange building in Tallaght. That is a very progressive and innovative development, whereby accommodation is being provided by the St. John of God service for people with disabilities in conjunction with normal housing. A new project which is about to open at The Square has a mix of apartments, shops and leisure facilities. I am glad there are so many significant developments taking place in my constituency, with further projects coming on stream.

In the Jobstown area, the county council is in partnership with a number of agencies in the Russell Square development. In that regard, I wish to make an appeal to the Minister, to whom I ask the Minister of State, Deputy Tim O'Malley, to convey my views. We need to progress that particular project and to give final approval to the voluntary housing agencies who wish to develop their facilities.

I applaud the Government's efforts with regard to social and affordable housing, which I hope will be supported by everybody. Many families looking to such programmes for quality housing deserve our support. I support the Government amendment which is before the House.

Mr. B. O'Keeffe

Fine Gael spokespersons in this debate have questioned the housing output. I should remind Deputy English, my erstwhile team mate "down under", that one should not opt for a scrum when one is not going to win the ball. One would be better advised to avoid an own goal and take the situation as it comes.

Mr. English

One could get a penalty.

Mr. B. O'Keeffe

Those from the Fine Gael side who question what this Fianna Fáil-led Government has done and compare it with what Fine Gael did during its time in Government will find there is no comparison. They are really in the ha'penny place. Since 1997, Fianna Fáil has succeeded in having 287,000 houses built. We have supported regularly increasing levels of output every year since 1997. The Royal Institute of Chartered Surveyors, which would not be regarded as great friends of Fianna Fáil, said:

The strength and extent of the property boom since the mid-1990s in Ireland can be seen in the fact that, between 1994 and 2001, around 320,000 houses were built – an absolutely astonishing level of housing. . . . This continued growth so far confounded all the arguments put forward by the construction industry, which argued that private house construction would decline by up to 20% with the introduction of the requirement that developers set aside land for social and affordable housing. The actuality is that there has been absolute buoyancy in new housing, which has grown, in 2001, by 15%.

All of us accept that housing is a vital concern for our people. From the very beginning, this Government recognised that as one of the issues which mattered most. This year's output of 62,000 houses was the highest per capitain Europe. Because a rented house should also be a real home, we have strengthened tenants' rights and ensured security of tenure. We have a strong social housing programme as part of our policy. Under the laws we introduced, developers can be required to provide, or contribute in kind, 20% of all new housing for social and affordable housing. We have broken new ground and made major tracts of land available in Dublin, Kildare and Deputy English's royal County Meath.

Mr. English

Who is paying for that?

Mr. B. O'Keeffe

All that land is available for affordable housing and the Taoiseach has pledged that even more State land will be made available. Although the supply of housing is closer than ever to demand, I know that, for some, the dream of owning a house is difficult to achieve. We have delivered a very simple message that exorbitant prices for new houses are not sustainable and exorbitant profits are not acceptable. Developers who hoard land banks or slow development to increase prices will be dealt with decisively. Through laws requiring development to meet housing needs, or by other means, we will intervene when required to ensure there is a fair market.

We accept that housing is an essential need. Land is a finite resource and the land of Ireland is for the people of Ireland – all the people of Ireland. That might be difficult for some people in Fine Gael, having regard to some of their statements in the past. This Government's tough stand on land speculation has already freed up thousands of sites and helped to increase the rate of new planning applications in Dublin by 40% this year alone. Since 1997, the Government has spent a great deal of time examining the housing market, although economists generally advise governments not to get involved.

The normal economic solution to a shortage is to create supply, as we have done. Our initiatives have been hugely successful. In a good year, we build approximately 25,000 houses.

The belated concern shown by the Fine Gael Party with regard to housing is, unfortunately, not credible. It is noteworthy that the proposed action plan by the outgoing rainbow Government in 1997 did not even mention housing. Between 1995 and 1997, when Fine Gael was the main player in Government, local authority housing output fell by 11%. The number of new local authority houses built or acquired annually during its term in office fell from 2,916 to 2,632.

Alongside current positive developments in Dublin, there are still pockets of poverty and deprivation. A thriving capital city should not be a place where people are marginalised or denied an opportunity. That is the reason this Government has made a firm commitment to radical urban regeneration programmes in the inner city, which improves facilities for the general community. We have spent a huge amount of money in the inner city flat complexes under the remedial works programme. These include the Oliver Bond flats, Nicholas Street, Ross Road, Liberty House and Mary Aikenhead House.

Major regeneration schemes have been ongoing, such as the redevelopment of Ballymun where 2,900 new low rise houses will be provided over the next six years. There has been the start of demolition there, which is a milestone for that area. It marks the beginning of a new era, which will include private and public housing. Ballyfermot has also developed. The same type of regeneration has begun in all other cities, be it Cork or Limerick.

I want Members to take stock of the increase of 32.5% for the first quarter of 2003 and the same percentage increase in 2002 in the level of local authority housing output, including completions, acquisitions and regeneration projects. The housing sector continues to perform well with the number of completions continuing to increase. The overall priority of Government in this area is supply. That objective is being continually achieved with the result of moderation in the rate of house price increases. With the State land that is now becoming available, further supply will be possible. This is excellent news for affordable housing as it removes from house prices the high cost of land. Fianna Fáil has provided that political vision—

Mr. Crawford

Which wing of Fianna Fáil? Was it the one the Deputy was with last night?

Mr. B. O'Keeffe

—for the economic renaissance that has utterly transformed this country. From 1987 onwards when hard decisions and daring choices had to be made, Fianna Fáil took them.

Mr. S. Power

Elections for most parties are difficult times and for the Fine Gael Party, in particular, the last election was probably the most difficult.

Mr. McCormack

We are looking forward to the next one.

Mr. S. Power

I am sure the members of that party who were re-elected were devastated to lose so many of their colleagues. For the first few weeks and months they spent most of their time deliberating on how the electorate had been so cruel to them. They decided to elect a new leader and make a new beginning. However, it is obvious that party has not learnt the lessons the last general election should have taught it. After any election a party would set about developing new policies. It is obvious that the policies the Fine Gael Party had prior to the last election did not go down too well. Its members spent the first 12 months immediately after the election trying to re-run it but, as we all know, that cannot happen.

Private Members' time is a wonderful opportunity for Opposition parties. A former member, Deputy Shatter, used it in a positive way on many occasions. It is unfortunate the Fine Gael Party has not taken a leaf out of his book. This motion specifically cites as a criticism of the Government the abolition of the first-time buyer's grant. It is signed by all members of the Fine Gael Party, the last name being that of Deputy Timmins.

I will refer to two contributions that gentleman made. During debate on the Finance Bill on 28 February 2001 Deputy Timmins stated:

My colleague called for the extension of the first-time buyers' grant which should be abolished. The grant was introduced in 1987 as a boost to the building trade, not house buyers. The grant was increased to £2,000 in 1993 and it could be in the region of £10,000 to £15,000 now if it had been index linked. The grant does not benefit anyone. Two thirds of first-time buyers buy second hand houses. We should target all first-time buyers, not one third.

Mr. Crawford

I remind the Deputy of what was said about zero tolerance.

Mr. S. Power

To be consistent, a little over 18 months ago, the Deputy stated that if he was the Minister responsible for housing he would abolish the housing grant. He stated it is clear that the grant which is for first-time buyers goes straight to builders. He further stated that only about one third of first-time buyers are assisted in this way as about two thirds of them buy second-hand houses.

That Deputy has the cheek to put his name to this motion. Does he stand over the words he stated here on two previous occasions in the recent past or will he do as he did in 2001 when he did not take part in the vote on the Finance Bill? We will know soon enough.

For any party to have credibility it must have some consistency in the policies it puts forward. There is no point in singing one song now and a different one next week.

Mr. Crawford

The Deputy talks about credibility. What about the vote in his parliamentary party?

Mr. McHugh

What about last night's 40?

Mr. S. Power

Housing is a vital concern for all of us. Few issues have been given as much attention by any Government as the current one. I will not stand here and pretend that our handling of the issue has been perfect but we have made an honest effort to deal with it. On the one hand there has been a major increase in prices and the difficulty many couples face in trying to buy their first house and, on the other, there has been an increase in the numbers looking for local authority housing.

The Government took a number of measures to deal with this situation. One step, which was reluctantly taken, was to try to interfere with supply and demand in the market, and it certainly paid dividends, but our record is a good one. As Deputy Batt O'Keeffe said, this year we will have built more than 62,000 houses, the highest output per capita in Europe. Over the past number of years we have been building, on average, more than 50,000 per year and we have reached the stage where supply and demand will be more or less the same. That is something any Government would hope to achieve.

There has also been the introduction of the Residential Tenancies Bill which will strengthen the rights of tenants. For too long many landlords were only interested in what they could get from their tenants rather than providing them with proper accommodation.

As a public representatives, we all deal with people who are desperately in need of local authority housing. I appeal to the Minister to examine a situation that currently exists. I refer to the length of time it takes for a house to be re-allocated, from the time the keys are handed back until a new tenant takes occupancy of the house. The Minister should conduct a survey of local authorities to determine the difference between the best and the worst in this regard. I believe the difference would be substantial. It is important that the system used by local authorities which are doing the job should become the policy of all other local authorities. It is heartbreaking to see so many houses unoccupied, with little or no work to be done to bring them up to an acceptable standard for reallocation. I am aware there can be a difficulty in getting carpenters or electricians to carry out certain works but the length of time some local authorities take in reallocating houses leaves a lot to be desired. It would be to the benefit of all if the matter could be examined and a proper policy put in place and implemented in every local authority, not only in some.

Local authorities throughout the country are reviewing levies. I ask county councils to examine those not only in terms of a source of income. It is vital that we encourage activity in rural Ireland. Too many areas throughout the country, which were once vibrant, have died and it would take very little to reactivate those areas. It is important that we learn that lesson and not allow a similar fate befall villages that are currently vibrant. There is an ignorance of the will of people and the love they have for living in rural areas. Recently, the committee on the environment invited seven different groups to make presentations on rural housing. The huge difference in opinion on this issue between the organisations was obvious at those meetings. However, I was heartened that the committee easily put together a report with recommendations.

I understand the Minister has agreed to publish new guidelines on one-off rural housing. The environment committee wrote to each of the local authorities inquiring about plans for dealing with one-off housing under the county development plan. Only half the local authorities bothered to reply.

Mr. Timmins

Fianna Fáil is going to give them extra money.

Mr. S. Power

If they gave some indication—

An Leas-Cheann Comhairle

I call Deputy Gregory.

Mr. S. Power

We will be looking forward to hearing Deputy Timmins.

Mr. Timmins

Read the motion.

Mr. S. Power

Good Government needs good Opposition and we look forward to the day when we have it.

Mr. Timmins

What about the €28,000 spent on Department scriptwriters?

Mr. Gregory

I wish to share my time with Deputies McHugh, Healy, Cuffe and Ó Caoláin.

An Leas-Cheann Comhairle

Is that agreed? Agreed.

Mr. Gregory

I support this motion on the inadequacy of local government funding and the housing crisis. The inadequate funding of local government forced a majority of the members of Dublin City Council – although I resisted it – into introducing a bin tax. The Dublin Anti-Bin Tax Campaign recently obtained information through a FOI request—

Mr. S. Power

Are they still around?

Mr. Gregory

Deputy Power should listen to this interesting information. I am sick to death of listening to the Minister for the Environment, Heritage and Local Government, Deputy Cullen, and Dublin City Manager, Mr. Fitzgerald, on the airwaves where they cannot be challenged, stating that 80% of households in the Dublin City Council area are compliant with the bin charges and that the majority of people welcome the opportunity to pay this new stealth tax.

The Dublin Anti-Bin Tax Campaign recently obtained information through a FOI request when even I could not as a member of the city council. The information states that of 164,136 households in the Dublin City Council area, so far only 48,927 have paid the charges in full. While my maths were never good at school, even I can work out that this comes to 30% of households. It does not correspond to the Minister's or Dublin City Manager's figure of in excess of 80%.

Of the remainder, 30,000 households have paid nothing. That is what people think of the Government's inadequate funding of local authorities. In addition, a further 45,709 have only paid a small amount of the overall three year charges. This means that of the 164,136 households, 75,709 have paid nothing in bin charges for this year. This House, as well as those who watch RTE, have been misled time and again by the Minister, Deputy Cullen.

I support the motion put forward by Fine Gael. I do not care who puts it forward because it is the content that counts. If members of Fianna Fáil want to ignore the outrage of the people at the appalling price of houses and the inaccessible costs to the vast majority of people, they do so at their peril. They will find that out at the local elections next year. Time and again on Private Members' Business, the Opposition has drawn attention to this crisis, yet the Government will not take the radical action necessary to deal with the problem.

Mr. Healy

I support the motion and I wish to draw attention to recent cutbacks in the rent supplement scheme. It appears that the Minister for Social and Family Affairs, Deputy Coughlan, has drawn her red biro through this scheme without any reflection on what the results may be for the individuals concerned. How are those who availed of this scheme to obtain housing accommodation in the future? It appears that the Minister, Deputy Coughlan, was simply instructed by the Minister for Finance to cut €58 million from the social welfare budget and this was the most convenient scheme to abolish to achieve this.

I work with the Cuan Saor group which supports women who have suffered domestic violence. The effect of the abolition of the rent supplement scheme will be astonishing for them. In future, women abused by their partners who leave the family home with their children will now find they cannot avail of the rent subsidy unless they have been renting for the previous six months. They now find themselves condemned to stay with the violent partner or in refuges. The whole support system for women and children in these violent situations has been undermined by the Minister. Has the Minister even thought of the consequences of the decision she has made?

Can the Minister inform us what proposals are in place for those who become homeless? The Government accepts that 5,500 people are homeless. Will they be dealt with? What instructions have been given to local authorities? Local authorities normally provided temporary accommodation to homeless persons, while private rented accommodation was subsidised by the rent supplement payable by the health board. What will happen to those who have not rented for the previous six months? Will they remain on the streets in doorways? Has the Minister fully thought out the consequences of abolishing this scheme? I ask the Minister to reverse the abolition of the scheme which supports poor people in difficult circumstances.

Mr. McHugh

Reform of local government has been promoted by the Government for some time. However, the only legacy of this programme is more layers of bureaucracy at local level government level, with not one iota of improved efficiency or an attempt to bring about an equitable system of financing local authorities. The Government amendment to the Fine Gael motion refers to the fact that, among other things, this new system gives a new role for the elected members of authorities in overseeing the system. This is rubbish. The only role local authority members have in the area of development levies is to rubber stamp the proposals put forward by officials or at best make some small face-saving adjustments at the edges. Any local authority, which does not put a levy scheme in place, will be rapped on the knuckles by the Minister and will be penalised financially.

The only new role for councillors under the Minister for the Environment, Heritage and Local Government is to become accustomed to being continually undermined and overruled if they do not do the bidding of the Government, as can be witnessed by the action of the Minister by including in the Protection of the Environment Act a provision to give precedence to that Act over county development plans in a direct action to frustrate the wishes of Galway County Council, which had sought to protect the public from the hazards associated with landfills. The same fate awaits local authorities that fail to implement a development levy scheme. Their funding from central Government will be reduced in a display of might by the Government.

If the expanded and increased development levies were to be funded solely by the developer, I would support the Government wholeheartedly. However this is not the case. Those levies will hit and hurt the young people throughout this country who are starting to put the money together to buy a house or have a house built on their own sites. The levies will put the ambition of owning a home of their own beyond the reach of many young couples.

There seems to be an agenda to create the false impression that those development levies are a tax on developers only or at least that the burden of the levies will be borne by the developer. How innocent can those politicians be who peddle this line? Do they think the electorate is stupid and will accept that line?

How can people be so naive to believe that a developer whose main aim is to make profit will carry the burden of the charges? The levies will hit young couples, not the developer. Based on his speech of last night, the Minister of State, Deputy Noel Ahem, pretends he expects the developer to carry the charges. If they hand on the costs to the purchasers the Minister of State has a remedy – I quote from his speech last night: "Hard questions will have to be asked of the industry about its willingness to pass on costs." I am sure today many multi-millionaire developers throughout the country are quaking in their boots because the Minister of State is threatening to ask them hard questions. If this were not so serious for young people it would be a good joke.

Mr. Cuffe

I wish to share my time with Deputy Ó Caoláin.

An Leas-Cheann Comhairle

Is that agreed? Agreed.

Mr. Cuffe

I was barely out of short trousers when the Fianna Fáil Government abolished domestic rates in 1977. Ever since then, local government has been plagued by not having an adequate source of revenue, which has stifled the growth of local government. It has caused significant problems for local government in addressing the tumultuous changes that have swept Ireland in the intervening years. In particular it made it difficult for local government to adapt to the very rapid changes in the past ten years.

In travelling around Europe I am often asked how local government operates in Ireland and what powers does it have. Sadly, the reply has to be that it has grossly inadequate powers compared to the rest of Europe and is grossly underfunded when compared to the systems in place elsewhere. We should not simply tinker at the edges of the problem, but should address the wider issues of local government finance. I do not see evidence of that in the recently proposed levy system.

It is inequitable to fund local government projects that benefit all by simply levying a significant tax on new developments, just as I believe it is inequitable to provide social housing by taxing those who propose to build new developments. In so far as I find there is significant inequity in Part V of the Planning and Development Act 2000, it is also inequitable to grossly inflate the local government levies proposed for new developments. While we have had levies going back to 1 October 1964, the very dramatic increase in those levies as proposed in local authorities around the country represent a gross distortion of charges on a select few rather than on all in society.

We should consider more general changes in local government taxation. The Green Party believes we should consider site value taxation. In other words we should put a charge on lands that are zoned for development but remain undeveloped. We should particularly focus on large tracts of land that have been zoned for development in successive development plans but remain undeveloped. The Government should put up or shut up. If lands are zoned for development we should make sure they are used for development or else ensure the owner passes them on to somebody who will develop them. A significant tax on those lands would ensure that housing is brought on stream in local authority areas.

Although we abolished domestic rates, we should reconsider introducing some form of taxation on private rented dwellings, second homes and zoned lands that are not being developed. Such taxation would be considerably more equitable than simply hammering the developers of new homes. We must widen the remit of taxation in this regard. Local authority taxation needs a significant rethink rather than just tinkering with the development levy system. The current changes do not go far enough. We should also consider local authority housing and I intend to expand on that at a future date.

Caoimhghín Ó Caoláin

I support the motion in the name of the Fine Gael Deputies. Two weeks ago the Sinn Féin Members also used their Private Members' time for a debate on housing. In replying on that occasion and attempting to defend the disastrous housing record of the Government, the Minister of State, Deputy Noel Ahern, cited a range of measures, including the following in the course of his speech: "Those unable to do so from their own resources would have access to social housing or income support to rent private housing."

Two days later the Minister for Social and Family Affairs introduced the now infamous attack on rent supplement, the very measure of which the Minister of State, Deputy Noel Ahern, had boasted 48 hours earlier. She said it was "not a housing measure." I make no apology for again putting on the record of the House the clear contradiction of the two Ministers' positions. I do so because when I asked the Taoiseach last week which of his Ministers was correct he refused to answer, and I still await that answer.

In preparation for tonight's debate I read the Official Report of last night's debates. I could not believe my eyes when I saw yet another remarkable statement from the Minister of State, Deputy Noel Ahern. When speaking about the local authority development levies he said:

The main plank of the Opposition argument is that house prices will suffer a direct increase as a consequence of the new development contribution schemes. That is incorrect. . . If builders do hand on these costs, hard questions will have to be asked of the industry about its willingness to pass on costs while maintaining its profits.

These assertions are quite incredible.

Everyone knows that all kinds of costs and charges are not only passed on to new home buyers by developers but are multiplied to ensure bloated profits. The Government has encouraged this massive inflation in the housing market which puts homes beyond the reach of even people on average income. The Minister of State at the Department of the Environment, Heritage and Local Government, Deputy Noel Ahern, will now take on the builders. He said he would ask them hard questions and, as Deputy McHugh said, I am sure they are quaking in their boots.

The Minister of State's assertion was even more remarkable than that. I looked at the Committee Stage debate on the Planning and Development Bill on 10 May 2000. The then Minister for the Environment, Heritage and Local Government, Deputy Noel Dempsey, stated the following in regard to the development levies:

The one thing we should not forget when speaking about development levies and so on and developers paying these levies is that it is those who buy the houses who pay these levies because they are passed on by the builders.

Which Minister is right? Here is a second example of two Ministers giving totally contradictory positions on the vexed question of the failure of the Government to meet social housing needs.

Local authorities throughout the Twenty-six counties are in the process of imposing those development levies in a manner which will hit new homeowners hard. These levies, when provided for in the Planning and Development Act 2000, were intended for the development of infrastructure such as roads, water services, public transport, open spaces and community facilities. The idea was that developers would share the burden of providing infrastructure with local authorities.

The Fianna Fáil-Progressive Democrats Government has failed to supply sufficient social and affordable housing, failed to control house prices, abolished the first-time buyer's grant and it is now permitting this further fleecing of new home owners. The levies, as they are now being applied, represent an abuse of the planning laws. The levies, as provided for in the Planning and Development Act 2000, were never intended to be a tax on new housing and their application must be stringently opposed.

Mr. Deenihan

I wish to share time with Deputies McCormack and Crawford.

Dáil Éireann debate - Wednesday, 26 Nov 2003