The Parliamentary Secretary knows that the total amounts available this year for private housing grants was £6,500,000 and for the nine months of 1974 was £6 million. This shows that there was a considerable reduction in the 1975 figure compared with that for the nine months in 1974—£6 million would be equivalent to £8 million this year. Yet the figure for this year was only £6,500,000. I am not taking into consideration the very rapid increases in costs, nor do the figures I have given take account of the inflation rate. The official figures I got show that the ordinary inflationary rate a year ago was about 24 per cent to 25 per cent, and the rate of increase in the building industry was over 30 per cent. It is in this context that we must view the extra £1 million being made available in this Suplementary Estimate, which is totally inadequate. The figure for last year is greater then the total being provided for this year, including the £1 million in this Supplementary Estimate. It is greater even without taking into consideration the rapid rate of inflation experienced over the past year.
This extra money is not sufficient to give the necessary fillip to the building industry. I stated before that there has been a crisis situation in the building industry over the past year. The Parliamentary Secretary is aware that the number engaged in this industry dropped by about 8,000 compared with the number employed in the industry last year. There are approximately 20,000 building workers unemployed, an increase of approximately 50 per cent on the number unemployed a year ago. We on this side of the House asked the Minister on many occasions to take positive action to overcome this problem, but without success. I hope I may have more success in my appeal to the Parliamentary Secretary.
I am convinced that the only real way in which the Minister and the Parliamentary Secretary can reverse the unemployment trend in this industry is by making more money available to the private housing sector by increasing the level of loans and grants and the qualifying income limit. Until such a step is taken the employment situation will continue to deteriorate, as it has done in the past year.
The levels of the SDA grants and loans were fixed in May, 1973. Since then there have been enormous increases in building costs and salaries and wages, which have resulted in many people who were entitled to housing grants and loans in May, 1973, not being entitled to them any longer. It should be remembered that increases in salaries and wages over the past two years were merely keeping in line with the increases in the cost of living. Therefore people in receipt of the increased salaries and wages were no better off than they had been at the earlier stage. At best, they were keeping up with the cost of living.
To be eligible for supplementary private house grants one had to have an income of less than £1,950 per annum and this was increased in certain circumstances, depending on the size of the family. The maximum income limit, irrespective of the size of the family, was £2,350. One need only try to compare the buying power of such an income today with that of 1973 to see the enormous difference involved. If it were accepted that one needed such an income in 1973 to build or buy a new house, it should be obvious that the same income today falls well below the necessary level to enable a person to buy or build his own house. The average wage of industrial workers—and I would like to impress this on the Parliamentary Secretary— is approximately £400 higher than the maximum qualifying income limit for loans and grants. This means that to a great extent the people for whom these grants and loans were made available originally cannot benefit from them.
I asked the Taoiseach recently what was the increase in building and construction costs since 1973. The answer I received was that it was over 70 per cent. We should remember that the calculation on which this reply was based did not take cognisance of all the factors involved. Therefore the true percentage increase is much higher than 70 per cent. Surely it should be obvious that there is a real need to increase the level of housing grants and loans in order to do justice to those who wish to build or buy their own house and, perhaps equally important, to ensure that many of those at present unemployed in the building industry will return to work. If the Parliamentary Secretary were to convince the Minister and the Government that an increase in the grant and loan levels under the qualifying income limit for private house building were essential he would be doing a very good day's work.
It has been said in this House on many occasions by me and my colleagues, and it is generally accepted, that there is no industry which can bring about a worthwhile improvement in our unemployment problem as speedily as the building industry, if it is properly financed. The private sector of the house building industry can effect this improvement much quicker than any other section of the construction industry. If a loan is made available for a new house as well as a realistic grant, it takes a very short period to begin work on the house. Other types of construction take more time because very often elaborate plans have to be prepared and there is much to-ing and fro-ing between the local authority and the Department.
Though I am not objecting to the request for the provision of money for new houses, I want to point out that the £1 million is totally inadequate, that the money will not improve the position in the building industry one iota, that it will not help to improve the chronic unemployment situation in the industry. It simply makes money available to fulfil existing commitments and I do not think it will be even sufficient to do that: there will be many people awaiting payment of grants into the New Year.
I again appeal to the Minister and the Parliamentary Secretary for a change of heart in regard to the level of grants and loans and the qualifying period. We are anxious to see a dent made in the numbers unemployed, and the advice we are giving to the Parliamentary Secretary would help not only those in need of houses but also to re-employ the many building workers who are now out of work. The Minister has said, and I suppose he will say it again, that he is concentrating on the building of local authority houses, but he is well aware that the total number of such houses built is only about one-third of the number built heretofore. If the necessary fillip is not given to the private sector many of our people in need of houses will have to wait for years.
We know the enormous number of people living in flats or in rooms with relatives. These conditions, to say the least, will result in the break-down of marriages. Many such people are anxious to build their own houses or to buy their own houses but they can only do so if realistic grants and loans are available. It is of little use offering loans and grants which fall short by several thousands of pounds of the price which a new house costs—I am referring to the average price of SDA houses. The position is that because of the low levels of loans and grants, unless a person proposing to build a house has another source from which he can get finance he simply is not able to proceed with the building of his house.
The spin-off effects of the fall in private house building have had serious effects in ancillary industry. Cement sales in the first half of this year fell by 9 per cent and this is a pointer to the condition in which the industry finds itself. The fact that there has been such a fall in cement sales is felt at the production and the retail levels and in employment. I know there is money available for private house building from sources such as the building societies and the associated banks but the changing rates of interest and the interest levels have meant that these sources were not much availed of in the past. SDA loans and grants were favoured because of the fixed interest rates. This was unfortunately changed in the June budget when the interest rate was changed from 10½ per cent to 11 per cent, but at least the borrower is still in the advantageous position that he knows the rate will not change suddenly. Such grants and loans were the source of finance for home building for the man of small means. Today levels of income and of interest rates make it impossible for people to avail of loans and, therefore, numbers of people who used to avail of them will be joining the queues for local authority houses. This in turn will mean that applicants for local authority houses who would not normally consider building houses themselves will find themselves competing with many more people.
My next point relates to the expenditure on the register of electors. This is a reflection on the increased cost of living in an inflationary position. It might be well to note that the increase over the original estimated expenditure is about 23 per cent. This is a small business venture and if we apply it to production costs generally we can see how difficult it is for us to sell our goods in competition both at home and abroad where inflation rates are much lower. The compilation and preparation of the register of electors is necessary work and I congratulate those involved in it for the manner in which they do the work. A moment ago I said it is necessary because of the inflationary situation to make extra money available. I would very much prefer to see the extra money spent on continuing to do a good job rather than making a saving which would reduce the standard with which we have been accustomed in this work.
I support the appeal made by the Minister on a number of occasions to political parties and to other individuals to study carefully the draft register so as to ensure that every citizen is entitled to vote in elections, a right which he will not have if his name is not included on the register. The greatest care must be exercised at all levels to ensure that no name is omitted. This process requires the help of all those concerned in the preparation of the register, from those who originally collected the names for insertion, through the publishers and printers who finalise the work. It is very disappointing for a person to arrive at a polling station only to be told that he is not entitled to vote because of the absence of his name from the register but more than that he is being deprived of a fundamental right, a right that is essential if democracy is to continue to operate. Therefore, I join with the Minister in appealing to those concerned to give all possible assistance in regard to the compilation and publication of an accurate register.
There is the question, too, of the extra money required for An Foras Forbartha. I take this opportunity of commending An Foras for the excellent work they are doing in the field of research. No doubt this work is appreciated by the Minister and his Department. An Foras have issued many reports on matters relating to the work of the Department and to such matters as housing, studies of the environment, planning, water pollution, water quality and so on. In times of economic depression there is considerable merit in increasing involvement in research so as to make the best possible use of available resources and, thereby, help to increase employment.
I am somewhat saddened, however, when I note that small industries have decided to cut back on expenses by leaving research aside for a period. This is a retrograde step and the money so saved is money which would have produced worthwhile results if the research concerned had been continued.
There is a tendency in most places at times of economic depression to cut back on research although increasing aid for work in this field could produce much more desirable results than a saving in expenditure.
I wonder whether An Foras Forbartha have stopped to ask themselves if the work they are doing is helping, for example, the building industry, to respond quickly to the economic situation. No doubt it is very useful to plan the kind of house we are likely to build in three years time but for the moment perhaps it would be more advantageous if an examination were to be carried out into methods used in house building so as to ascertain how we could make better use of the means available. Perhaps, too, some of the resources of An Foras might be diverted to studying the problems which are now awaiting urgent solutions. Some worthwhile reports have been published by An Foras, reports which highlighted areas in which, if action were taken, worthwhile improvements would result. I am concerned to some extent regarding the lack of follow-up in relation to these reports. Admittedly, it would not be possible to act at once on all reports but where possible there should be a follow-up and concrete action taken.
I note from the Parliamentary Secretary's statement that the increase for An Foras is in respect of wages and salaries. It is regrettable that it has not been possible to make much more money available to them for the purpose of funding research. I am convinced that it is at times such as those that the need is greatest for research into the most persistent of the problems facing the Department.
I should like briefly to return to the statement in the brief which would lead one to believe that it is intended to discontinue the subsidy being paid to building societies. When I read this in the context of a reduced rate of ¾ per cent instead of the original one per cent I cannot come to any other conclusion and then there is a further reference which indicates that the matter will be reviewed. This step would mean very serious consequences for the mortgage holders who are overburdened with repayments particularly at times when there is such a considerable increase in the cost of all other aspects of living.
On the other hand, the consequences would be equally serious if the building societies were to decide to lower their interest rates to depositors because in that event the money which has been building up for some time past would flow out again. There is nothing so sensitive as money. Even a change of a ½ per cent means that money will flow from one area to another. If this were to happen at a time when the situation in relation to building is very serious, when so many people in the industry are unemployed and when so many are becoming redundant in ancillary industries, the consequences would be grave. That is why it would be a very serious step on the part of the Government to remove the ¾ per cent subsidy, a subsidy which I believe should still be 1 per cent. At the time that this problem was before them, the Government realised that it was essential to make this subsidy available if the building societies were to be enabled to retain their mortgage rates at 11½ per cent and their interest rates at 8 per cent. The Government know that if they did not make this subsidy available the situation in regard to the building societies would be very serious.
It is less than a year since we had the situation where the societies had very much less money than they would have wished for. This had a detrimental effect on the building industry. We do not wish for a recurrence of that situation but if the Government were to remove the subsidy entirely we would have a recurrence of that. It is only because interest rates dropped that building societies were able to hold their interest rates at a steady level. Money flowed in but nobody knows better than the societies how rapidly that money would move out again if the subsidy were changed and they were forced to reduce their rates. I appeal again to the Parliamentary Secretary to impress on the Minister and the Government the importance of being very careful in this matter. Over the past year we have had a dual problem —one in relation to the shortage of money in the societies and another in relation to the qualifying income limit levels and the levels of loans and grants. Both contributed to a very serious situation in the building industry. Money has once again flowed into the building industry because the rates are better now than they are elsewhere. We should be careful not to disturb that situation. We should be careful to ensure that not alone will that level be maintained but that the inflow will increase. If we do this the building industry will successfully overcome the crisis and do what only the building industry can do, namely, provide homes for our people more quickly than any other agency and provide work for those who are unemployed.