This Bill is, in effect, a continuation of Section 12 of the Local Government Act, 1927. It differs from that section in the fact that it confines relief from rates to buildings which are residences. The Act of 1927, as continued in operation by succeeding Acts up to last October, allowed a remission of rates in respect of a number of buildings that were not used or occupied as residences. The remission which it is proposed to allow is the same as that which was granted before, namely, two-thirds of the full rate for five years or until the next general revision of valuation, whichever is the shorter period. This remission will be granted in respect of residences completed before the 30th September, 1942. The Bill, as introduced in the Dáil, fixed the period as the 30th September, 1941, but there was a compromise amendment agreed to, which gave a further extension to the 30th September, 1942. A remission will also be allowed in respect of enlargements or improvements. The Commissioner of Valuation will indicate the houses or the residences to which the remission will apply. There is a new provision in sub-section (5) of Section 2, which requires local authorities to satisfy themselves that the buildings are being used as residences. Certain classes of buildings are also excluded from the Bill. Those are dwellings which were built with State assistance in one form or another, or dwellings which already enjoy remissions under other Acts. The Bill will not affect these exemptions, which will continue as heretofore.
Local Government (Remission of Rates) Bill, 1940—Second Stage.
I wonder would the Minister give us his reasons for the change of policy indicated in the Bill? The previous Act was, I know, a temporary Act, but, if my memory serves me aright, it was afterwards renewed for various periods. The principal difference between this Bill and the previous Act, as far as I can understand—and I am confirmed in my view by what the Minister has just stated— is that the present Bill excludes from its scope buildings which may be used for business purposes. I understood the object of the previous measure was to induce people at their own expense to increase the total valuation by means of improvements, holding out to them the inducement that they would not have to pay additional rates, that is, that they would pay the same rates as at present, for a period of five years. This Bill provides that inducement for persons building their own residences or building houses which they propose to let for residential purposes. It seems to me that if there was any case at all for the previous Act—and I think there was—there is even a greater case for encouraging people at the present time to improve buildings even if they are to be used for business purposes. We want to provide as much work as we can in this country, and unlike the position in another country, we want to induce people to spend money in providing such work. The more money we can expend in keeping people at work, the better we shall be able to weather the storm in the present crisis. I should be much more satisfied if the Minister, in carrying on the principle established under the original Act, had not specifically excluded buildings which are to be used for business purposes because it does seem to me that while there are many business premises that could be improved, we should do our utmost to encourage people to undertake these improvements.
When legislation similar to this was introduced in 1925 there was need to encourage the class of building to which Senator Douglas has referred, but our experience for the past few years is that that want does not now obtain. That was extended even to cinemas, factories, and places like that, and we could not see for the last year or two that that necessity existed in that way. People who make these improvements or erect these buildings are in a fairly good position to pay rates. After considering the question and seeing the number of buildings which have been erected, we did not feel that that want continued now. It was certainly necessary at that time to encourage as much building as possible along the lines which Senator Douglas has in mind, but that want does not obtain to anything like the same extent to-day.
Even so far as residential buildings are concerned, there has been a considerable falling off for the past two years. A great number of buildings have been erected—thousands of them —and even with regard to those classes —that is, to residential premises—there has been a considerable falling off. It is considered desirable to continue that remission wherever it may be necessary, but we are not prepared to extend it to purely business premises, some of which are in a very substantial way. I do not think it is fair that the local authority should be deprived of the taxes or rates on such buildings.
It may be taken that the Minister has been answering a question put to him by Senator Douglas, and has not been concluding the debate.
What is the position in regard to premises which are used partly as business premises and partly for residential purposes?
The Bill applies to the residential portion only.
We all appreciate what the Minister has said as regards cinemas, factories and other institutions of that kind, but it is hardly fair that the ordinary shopkeeper should be excluded from the benefits of the Bill. There are very few shopkeepers now who can afford to renovate or improve their premises at the present time, but any who have the industry to do so should be encouraged, and should receive the remission for the period specified for other buildings. Certainly, if ever there was a time when shopkeepers needed to put out a good front in order to keep business alive at all, that time is the present. In the case of business premises in existence which may be improved by a plate-glass window or a new signboard, any increased valuation on such premises should be entitled to remission over the period. A considerable number of residential houses have been erected under the Small Dwellings (Acquisition) Act, and they have become a very serious burden on the local authority.
If a field of a few acres is taken up— one which was of little or no value before—and the owner starts to build houses, his system is this: he builds a house first on his own responsibility, probably with his own money; somebody comes to him then and says he would like to get that house, and the owner tells that person to go to the local authority, and that, under the Small Dwellings (Acquisition) Act, the prospective buyer can borrow a sufficient sum to take this house over. That comes off, and the owner of the site may make a profit out of it. That money is really public money—the taxpayers' money. There is a loan and a small grant, but the local authority is called upon to develop that site, by adding sewerage, water and light, at enormous expense; and for a period of seven years they only get a rate on the valuation, at the rate of one-third.
In my opinion that is too heavy a burden on the local authority. The existing ratepayers—the people in the centre of the town—are called upon to develop a new site for a builder who owns that site, making it extremely valuable. If one-third is charged to the occupier, I suggest that the owner of the site should be called upon to pay the other two-thirds to make up the rate, as the site is the real value which has been developed at public expense. Somebody must pay. Personally, I am aware that my own council, and other councils I know of, have been placed very heavily in debt over the extension of buildings under various schemes, where they are called upon to develop the site by new roads, new sewerage schemes, new water schemes and extension of light, while all they get for seven years is one-third of the rate on the valuation. It is time that that be reconsidered.
As regards the Bill which we are discussing at the moment, I do not think there is anything which anybody can object to. It is right and proper however, that any man who improves business premises, especially by the addition of a new front or an improvement of that kind, should get a remission of rates for the same period as the others.
There are two separate questions concerned in this: one is the dwelling house, either a new building or an improved one, and the other is the matter of business premises. I should like to state my agreement with what Senator Honan has said with regard to business premises. The Minister is right in regarding it as unreasonable that the local authority should not be able to get its rates from a business premises—a newly erected cinema theatre, for instance—and I am not arguing in favour of that particular type of legislation now. There is, however, the other person who already has business premises and is paying rates: he desires to make a certain extension and very often he has got to get a loan of the money for the making of that extension. Under previous legislation, when that extension has been made—such as a new front or some other such addition as Senator Honan suggested—his rateable valuation is increased. Under the existing legislation which lapsed and which this Bill now continues in part, that type of person would not become liable for the full increase in the rate until the end of, I think, five years. He now becomes liable at once. It is rather unreasonable and rather tends to prevent development and consequently tends to decrease employment. If the man who has made the extension is made pay one-third of the increase only for a period of five years, then he has five years to make up what he had spent on the premises and get himself out of any debt which he may have incurred.
The local body loses nothing at all and, at the end of five years they have increased premises, out of which they get a higher rate. I think there should be a remission of rates in that case. It appears to me that the Bill only extends to 1942 and, if that is so, I think what I have already mentioned should be taken into consideration: that is, that where a business premises is concerned, the full increase of rates should not be collected until the time that this Bill expires.
With regard to Section 1, I should like to know from the Minister whether that would include a poultry-house, a piggery, or anything like that.
Farm buildings and outhouses are exempt already.
I am not sure whether I understood Senator Honan rightly, or whether he was describing an existing situation when he spoke of a man building a house in a field where the local council could get no rates but where the local authority would still be bound to provide that man with sewerage facilities, water supply, and so on. I do not think that is so, but I may have misunderstood the Senator.
I am afraid, Senator Fitzgerald, that I went outside the scope of the present Bill in speaking of that matter. I was really thinking of conditions under the Small Dwellings (Acquisition) Act.
Well, I may have misunderstood the Senator, but what I understood was that in the Dublin Corporation area, at least, if you build a house within a certain area, covered by the Dublin Corporation, that corporation is bound to supply water, sewerage facilities, and so on; but if you are just outside that area, they are not bound to supply these facilities, and I think that, as a result of that, the environs of Dublin have been made hideous by a lot of ribbon building, and that is a development that has been produced, in my opinion, by the existing legislation, which offers every opportunity to speculative builders to put up houses for which the corporation eventually will have to provide the necessary facilities. As I say, I may have misunderstood Senator Honan, but I thought that, in the country generally, if you build a house in a field, it is up to you to provide such facilities as water supply, sewerage, and so on, and not to ask the local body to supply these facilities.
Apart from the other things that have been mentioned, I think that there is one type of house that Senator Honan had in mind when he spoke of housing under the Small Dwellings (Acquisition) Act. A number of the houses erected under that Act received a grant, and I presume that such houses would come under this particular heading, but we have had a condition arising in which, for one reason or another, a number of houses that were to be erected under the Small Dwellings (Acquisition) Act were not completed. For instance, I know that the Galway Corporation, with the sanction of the Minister's Department, erected a number of these houses, and if the original loan is taken into consideration, together with the supplementary loan, and if no remission of rates is to be given, then such houses as I have in mind will be subject to a higher rent than other houses.
On the point of giving remission of rates for shop fronts, or something like that, which has been mentioned by certain Senators, we must bear in mind that this is very exceptional legislation and originated at a time when the desire and the necessity was there to try to encourage building as much as possible. One can quite understand how exceptional legislation of that kind was, in the particular circumstances, when one realises that it applied to such businesses as banks, cinemas, and so on. It has been continued since then, but always as exceptional legislation, in order to encourage—as far as it could possibly be encouraged—building, but you have to remember that, to a great extent, a number of these wants have been satisfied. Whether they were necessary or not is another matter, but I think that some Senators, at any rate, will agree that the banks, at least, were not very much in need of that remission. It is brought down now to the question of people who want to build residences and we must remember that it is the ordinary ratepayer and the ordinary local authority that has to suffer in this matter of the remission of rates. Bearing that in mind, whatever necessity may be said to exist, the only necessity that exists, to my mind, is the necessity for the building of houses for people as residences, so far as we can, and I do not think that any extension of the remission as proposed in the Bill would be justified.
When is it proposed to take the Committee Stage?
I suggest that we should take it now, Sir.
I have no objection to the Committee Stage being taken now, but is there any urgency about this Bill? What about taking the Committee Stage on the next sitting day of the Seanad?
Well, as it is the beginning of the financial year, I think it is rather urgent.
I am sure the Minister must remember that it has been delayed for some time already.
Does the Minister agree to attend the Seanad next Tuesday or Wednesday?
It does not make much difference, since I will be in the Dáil in any case.
Has the House any objection to taking the Committee Stage now?
I do not think there is any objection, except on the question of general principle, from the point of view of not giving sufficient time for consideration of such matters.
The Seanad gave me the Fertilisers Bill last week.
Yes, I quite agree, and I agree that, if there is no objection by the House, this Bill should also be given, but I thought that it was rather a bad precedent.
I think the House would agree to take the Committee Stage now.
Agreed to take the Committee Stage now.