It is the temporary loan of some of the Deputy's voters in which I am interested. It was timely of you, Sir, to remind us of that typographical error. It is quite clear that, despite the element of Dáil reform engaged in and the committee system, we will not reach that, or indeed a good many other amendments that are more important.
Deputy Yates's amendment on mortgage interest relief is important. It is a most important decision we are about to enact in terms of all homeowners. For some reason — perhaps the blame rests as much with us as with the media — we have been unable to communicate to people clearly what is involved here. The major part of the Minister's change relates to his commitment to lowering mortgage interest relief to the standard rate. That means that between now and 1997-98 the rate of relief will be cut annually by approximately 5.25 per cent and people do not readily appreciate its extent. However, if one looks at the Principal Features of the Budget of 1994 one will see that the savings to the Minister will be of the order of £81 million, admittedly, that includes relief in respect of VHI premia and health expenses.
As Deputy Yates said, almost £60 million will be saved from homeowners. An additional £3 million is being levied by the residential property tax. One can see the douche of cold water this is for homeowners, already hard pressed to meet their mortgage repayments. They were assured by the Minister that he would not only maintain the level of interest relief as it was but increase it.
As Deputy Yates said, one must put it in context. For the first time the Minister for the Environment has imposed water charges on Dublin county, then there is the imposition of residential property tax, the cut in mortgage interest relief, the cut in VHI premia relief and a raising of the threshold for medical expenses. There is no point in our trying to discuss these in isolation because all of them combine to have a very serious, adverse effect on homeowners. Mortgage interest relief is by far the most serious and people do not readily appreciate that.
The Taoiseach has developed amnesia since his Killarney speech. He is now only one step short of denying that he ever made it. I predict that the Taoiseach will recover his memory very quickly after 9 June and will clarify the position. The star chamber to which Deputy Yates referred — I suppose if it is chaired by the Minister for the Environment, appropriately enough, it should meet in the vaults because he will bring that gravitas of monsigneur-like austerity to bear on it — will bring forward something after 9 June but, in the interim, we are enacting a Bill every backbencher who is listening to this debate should be aware that if householders do not now appreciate that their interest relief will be cut by 5.25 per cent for each succeeding year from now until 1997-98, when it will be reduced to the standard rate, they will then appreciate that that constitutes a severe additional burden on them. On top of all that the sword of Damocles is hanging over home owners. The Taoiseach made it clear that he intends to replace the residential property tax with a house or home tax for the entire country.
I do not agree with my colleagues in Opposition who said that the Taoiseach was walked into this and did not fully appreciate the extent of what he was doing. I think the Taoiseach did it in full knowledge of what he was doing, to try to defuse the row which Deputy Callely and other Fianna Fáil Members, as well as colleagues on the other benches, had created in Dublin about the residential property tax. He wanted Mr. Niall Andrews — I promised to give him a plug — to be in a position to say to people in Dublin "the Taoiseach said in Killarney he would replace this tax. There is no need to worry about it. We have introduced amendments and so on to get over the problem with the Labour Party but the Taoiseach said we will replace it, so relax, it is not serious". I have adopted a different approach from Deputy Yates in my amendments where I seek merely to restore the status quo. I agree that is the minimum the Minister should do in present circumstances. There is no point in presenting a budget that suggests large scale reform if all you do is transfer it from the taxpayer qua taxpayer and take the money back on the other hand from the taxpayer qua householder. It is jigging around the pieces in the jigsaw so that there is some modest improvement in your direct income tax for which you will pay in VHI, in the threshold of medical expenses, mortgage interest relief, water charges and so on. That is the position in Dublin county where they have just got their bills for £70 water charges. Their mortgage interest relief has been reduced and some are liable for residential property tax.