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Dáil Éireann díospóireacht -
Wednesday, 4 Dec 2002

Vol. 558 No. 5

Financial Resolutions, 2002. - Financial Resolution No. 3: Income Tax.

(1) THAT, as respects the year of assessment 2003 and any subsequent year of assessment, section 244(1)(a) of the Taxes Consolidation Act, 1997 (No. 39 of 1997), shall be amended by substituting, in the definition of "relievable interest"–
(a) "7 years" for "5 years",
(b) "€8,000" for "€6,350", and
(c) "€4,000" for "€3,175".
(2) THAT paragraph (1) of this Resolution shall not apply to an individual for whom the fifth year of assessment for which he or she had an entitlement to relief under section 244 of the Taxes Consolidation Act, 1997 in respect of a qualifying loan (within the meaning of that section) was prior to the year of assessment 2002.
(3) IT is hereby declared that it is expedient in the public interest that this Resolution shall have statutory effect under the provisions of the Provisional Collection of Taxes Act, 1927 (No. 7 of 1927).
Financial Resolution No. 1 is an anti-avoidance measure aimed at closing off an unintended use of capital allowances by passive investors in the area of electricity generation. Where individuals are merely "passive investors" in electricity generation, that is, where they invest in electricity generation without actively participating in the trade, it is intended to restrict their entitlement to tax reliefs. In future, such individuals will not be entitled to set off losses and capital allowances of such a trade against their other income so as to reduce their income tax liability.
Over the past few years, the Minister for Finance has taken action on a number of occasions against tax avoidance schemes which used tax incentives and the tax code in artificial or packaged ways to reduce effective tax rates on high incomes to very low levels. In the 1998 budget, for example, the Minister took action against "asset-backed" schemes, where individual passive investors used special incentive reliefs in relation to expenditure on certain buildings so as to reduce the tax liability on their employment income. If unchecked, schemes such as these would allow individuals with high income to avoid paying their fair share of tax to the disadvantage of the general body of taxpayers.
What is proposed in this resolution is entirely consistent with the Minister's approach in other instances in recent years of ringfencing losses and capital allowances for passive investors so that they prevent a reduction in tax on their employment income. That is what we are seeking to do here. The schemes countered by this resolution are in the area of electricity generation using wind turbines. The schemes appear to have no real economic purpose other than to provide tax efficient investment opportunities for high earning individuals. There appears to be little risk associated with the investment. No new turbines are built. Instead, turbines erected by companies who continue to operate them are acquired by the passive investors. The only effect of the schemes, therefore, is to increase the tax cost to the State of turbines already erected.
Under the schemes, tax reliefs which in the hands of a trading company would be set off against income taxable at the rate of 12.5% are transferred to individuals. In the hands of the individuals, these same reliefs can be set against income arising from sources other than the trade of electricity generation and which would otherwise be taxable at the 42% rate. This resolution has no effect on individuals or companies who are genuinely engaged in a full-time capacity in the trade of electricity generation or supply. The measure is targeted at passive investors who do not participate in such businesses in an active way. The resolution seeks to restrict the way the tax reliefs work so that the reliefs can only be used to shelter the individual's income from tax to the extent, if any, that it is earned from electricity generation. It is estimated that this anti-avoidance measure could prevent tax leakages of up to €10 million per year over the next few years. I commend the resolution to the House.
Resolution No. 2 seeks to impose for the tax year 2002 and subsequent years an earnings cap of €254,000 on the amount of remuneration on which an employee may get tax relief in respect of contributions made by him or her to an occupational pension scheme. The House will recall that in last year's Finance Act the relief available to employees was considerably increased on an age-related basis from 15% of remuneration to a maximum of 30% of remuneration at the age of 50 years or over. The same cap of €254,000 has applied since 1999 in respect of retirement annuity contracts for the self-employed and employees not in pensionable employment and is also being applied to the new personal retirement savings accounts which are expected to be available early in the new year. The existing caps apply as a single cap to the aggregate of the contributions made by an individual to an RAC and PRSA. In the same vein, a single cap will now apply to the aggregate contributions made by an individual to all three pension arrangements, namely, occupational pension schemes, RACs and PRSAs. The new cap only applies to contributions made on or after today. Therefore, pension contributions made by employees before today are unaffected by the change, even if they would have exceeded the limit being imposed.
The resolution does not affect the amount an employee may put away for his or her retirement. That is not the issue. It merely limits the amount on which he or she may obtain tax relief. For example, an individual aged over 50 years with earnings of €300,000 could still put aside €150,000 a year, but the tax relief will be restricted to €76,200, or 30% of €254,000, instead of €90,000, or 30% of €300,000. The excess contribution will be carried forward for relief in later years subject to the limits on relief for those years.
The resolution does not affect the amount an employer may put into an occupational pension scheme for his or her employees. Employer contributions will continue to be allowable up to whatever amount is required to secure the benefits under the scheme subject to Revenue approval limits, for example, a maximum pension of two-thirds of final salary.
The earnings cap – both the existing cap applying to the self-employed and the proposed cap for employees – will have no impact for the generality of taxpayers as it is set at a generous level of €254,000. It is unlikely that much more than 10,000 taxpayers, about half of whom would be higher paid employees or proprietary directors, will be affected. I commend the resolution to the House.
Resolution No. 3 is concerned with mortgage interest relief and, especially, the enhanced amount of interest that qualifies for relief in the case of first-time buyers. Income tax relief at the standard rate is granted in respect of interest paid on loans used by an individual for the purchase, repair, development or improvement of a person's sole or main residence. Since 1 January 2002 this relief is given "at source" and applies to interest payments up to a maximum of €3,175 for a single person or €6,350 for married or widowed persons for the first five years for which mortgage interest relief is due. In the case of persons outside the five year period, the interest limits are €2,540 for single persons and €5,080 for widowed or married persons.
The existing higher ceilings for first-time buyers on allowable interest are being increased further, from €6,350 to €8,000 for married couples and widowed persons, and €3,175 to €4,000 for single persons. In addition, the period for which increased amounts of relievable interest will be granted to first-time claimants is being extended from five to seven years. Some 122,300 first-time claimants enjoy the benefit of the higher interest ceilings at the existing levels which are available for five years. From 2003 an estimated 45,000 beneficiaries will benefit from this measure, the cost of which is in the order of €6 million next year and €8 million in a full year.
The new arrangements will apply from next January and be of benefit to individuals who began to claim tax relief in respect of mortgage interest in the tax year 1998-99 or later. All such persons will enjoy a further two years giving them a total of seven years during which their relief will be based on the higher interest ceilings. Persons who commence to claim in 2003 will also benefit. The new arrangements will come into effect in January and it is necessary to have the statutory authority tonight to cover that period.
The measure proposed recognises the difficulties faced by home buyers in current circumstances and will obviously be of assistance. The enhanced first-time buyer's ceiling will benefit those who have sufficient interest to absorb the higher allowance. It is targeted at those first-time buyers who have had to raise or are about to raise high mortgages. Mortgage interest relief covers both new and second-hand houses, whereas the first-time buyer's grant applied only in the case of new houses. Thus, the measure proposed will not just benefit those who would have received the first-time buyer's grant, but all first-time buyers. The estimate is based on the number of first-time buyers who will have sufficient interest to absorb some or all of the enhanced allowance and on the number of those who will benefit from the extension of the period.
The proposed measure on mortgage interest relief will provide a maximum additional amount of relief worth €1,409 for single persons or €2,818 for couples or widowed persons over a seven year period. The total potential tax relief available to a first-time buyer over the seven years will amount to €11,200 in the case of a couple and €5,600 in the case of a single person. I commend the resolution to the House.

I wish to deal with the third proposal first. The sum total of the concession is €330 to a married couple or half that amount to a single first-time buyer. To understand how that does not meet what is required one merely has to bear in mind that the saving from the first-time buyer's grant, which was abolished, is close to €40 million. The additional 1% levy in VAT imposed on first-time buyers of new houses will bring in about €2,000 to €3,000 per house which will yield another €25 million. First-time buyers, therefore, will be asked to yield about €65 million next year and the Taoiseach said the Government is giving €6 million in return. Only one tenth of what the budget is taking from first-time buyers is being returned in this concession. Those on the back benches who believed their protest would be heard will be disappointed. First-time buyers will be disgusted.

The sad reality is that first-time buyers are a minority in the new housing market. Fewer than one in five new houses go to first-time buyers. The vast majority go to those trading up or investors. To evaluate this financial resolution one only has to examine what the Taoiseach and Minister for Finance did last year for investors. They were given the concession of a cut of 6% on their stamp duty which meant a saving for them of €12,000 to €15,000 on a typical house. On top of this, they were granted 100% interest relief at the top rate of 42%. The value to investors of interest relief given last year was about €5,250 as against this concession today of €330.

The Government is deliberately and systematically making it difficult, if not impossible, for the first-time buyer to get onto the first rungs of home ownership. Some simple things could have been done that would not have been hugely costly. For example, the threshold for stamp duty on second hand houses is currently €190,000, which is much less than the average house price in the country, let alone in Dublin. If that threshold had been pushed up to €400,000, the cost to the Exchequer would have been €2.5 million, which is buttons, but would have meant that first time buyers in the second hand market would not have to worry about stamp duty. That would have been somewhat reformist and shown insight into what is happening in the housing market. The stop-go approach to the housing market has produced the sort of problems we are seeing. More young families on what used to be good incomes are being forced to go back on to the housing lists.

The great idea of affordable housing has only produced 500 houses for the whole country. It is not generating a response to the need. Only 2% of house purchases are through the shared ownership scheme, which is the other great hope. This is only scratching the surface of the problems faced by huge numbers of people who are trying to become homeowners. This resolution on mort gage relief simply ignores what is happening in the housing market. There is no understanding of what is going on.

Many people in my area are on rent supplement, including single parents and other single people who are trying to get by. Their income after paying rent is €111 and the Minister has decided to take €4.30 off them. Why is the Minister imposing that sort of mean-minded petty cut on the poorest of the poor? The people targeted in these housing measures are the poorest of the poor and the first-time buyer. If the Government wanted to do something in the housing market to generate some revenue, why not bring some equity back and do something in relation to investors who are having a field day at the moment? They have kept up prices and have enjoyed huge increases in rent.

I cannot oppose Financial Resolution No. 1, which the Taoiseach eloquently described as simply a loophole that was robbing the taxpayer of money. However, at a time when we are considering loopholes, why do we continue to tolerate the use of residence as the basis for capital acquisitions tax and income tax instead of domicile? Since the Government brought in this concession it has just been a charter for people who have the ability to bed and breakfast offshore to avoid paying any taxes in Ireland. I know some changes have been made in relation to CGT after the horse has bolted. Real tax shelters have been created by this Government and the measures in pursuit of these tax shelters will only yield €10 million. Much more could have been done. One characteristic of this Government has been to provide tax shelters at the upper reaches of the tax scale and not for those lower down.

The proposal to put a ceiling on the contributions to pension funds is correct. I understand that ceiling already exists in relation to the self-employed, so it merely applies the same ceiling in both areas. It shows the difference in standards we are applying in many ways. Here we are capping the tax-free contribution that can go into a pension fund at €76,200 per year. This is a far cry from the problems of the people we thought we would be protecting in the budget. They do not have €80,000 to spare to put into a pension fund each year. While this is not an objectionable measure and it is good to encourage contributions to pension funds, we must be aware that the huge increases in the ceilings for pension fund contributions in recent times have been used as a way of avoiding a very substantial amount of tax.

This year when we are not even giving indexation to the people at the bottom, it is hard to understand the balance that is being struck by Government in relation to the tax contributions of people at the top and bottom of the scale. These concessions have nothing to do with ensuring that tax is collected fairly from those with the greatest ability to pay. Quite a different agenda was being pursued. That is what has come unstuck about this tax policy and the way this budget has been structured perpetuates the series of budgets that have gone before it and does not come to grips with the needs of people at the bottom of the scale. There are too many people on very low incomes paying tax and here we are giving a shelter up to €254,000 in the pension fund area. There is an imbalance that cannot even escape the Taoiseach and Tánaiste as they look at our economy and society.

An Leas-Cheann Comhairle

Before calling the next speaker, I would like to point out that the total debate on these resolutions is 45 minutes and this will expire at 8 p.m. As there are a number of speakers offering, I ask Members to be brief and to the point.

I wish to speak specifically to Financial Resolution No. 3, which deals with mortgage interest relief. The Government is trumpeting this measure as addressing the needs of first-time buyers following the Government's earlier disgraceful decision to abolish the first-time buyer's grant. Today's measure to slightly increase the mortgage interest relief ceiling for first-time buyers goes nowhere near addressing the problems faced by those buyers as a result of the abolition of the first-time buyer's grant. By trying to redress the problem in this way, the Government is clearly demonstrating it does not understand the problem in the first place. This problem relates to the difficulty that first-time buyers have in assembling a deposit and in being in a position to compete with investors who are now buying four out of every five new dwellings that come on the market.

When one looks at the cost of this measure, one discovers the real giveaway. The cost of the increase in mortgage interest relief will be €6 million next year and €8 million in a full year. The Government is saving €40 million next year in the abolition of the first-time buyer's grant. In other words, what is being given back to first-time buyers under this measure is at best one fifth of what the Government is taking away through the abolition of the first-time buyer's grant. Indeed the 1% increase on basic rate of VAT will make things worse because it will go directly on the price of houses. The average price of a new house is now in excess of €200,000. An increase of 1% on that will mean an additional €2,000 to the first-time buyer. First-time buyers are being hit on the double. They are being conned by a measure which goes nowhere near compensating the first-time buyer's grant, and are then being hit by the increase in VAT.

There is another measure in the budget that will also impact on the first-time buyer, albeit indirectly. That relates to the changes in stamp duty on non-residential property, the effect of which I believe will be to encourage investors in property to shift from non-residential to residential property, thus increasing the pressure in the residential property market on the first-time buyer.

A comparison between what has been done for first-time buyers and what is being done for the corporate sector indicates the extent to which the Government is giving the two fingers to the first-time buyer with this measure. The reduction in corporation tax will be of 40 times greater benefit to corporate Ireland than the measure seemingly introduced to address the problems facing first-time buyers. The Government appears to be trying to give the impression that this measure will redress the difficulty it created with the abolition of the first-time buyer's grant. It will do nothing of the kind. Its introduction in this manner, coupled with the increase in VAT which will add to the price of houses, is an insult to the intelligence of first-time buyers and will hit them in their pockets.

The Taoiseach will be aware that nobody has a problem with ending tax shelters. However, to use such tax shelters as a reason for introducing Financial Resolution No. 1 fails to give the whole picture. It is important to consider this in the context of the Taoiseach's reference to investments such as wind energy. There should be no need to give tax breaks to encourage renewable energy. If the economy was organised in a way which took into account the full costs of activities such as energy generation, renewable energy would be very competitive. Regardless of the rhetoric emanating from the Government in support of renewable energy, the reality is there is a willingness on its part to allow the fossil fuel sector to avoid paying the full costs associated with its activities.

Tax shelters are inherently unjust and perpetuate the divisions in society. I ask the Taoiseach to address the fact that the fossil fuel sector does not pay its share of the cost of climate change and pays nothing towards either flood prevention, the high insurance premia floods cause, the health problems associated with air pollution or the damage to buildings associated with acid rain. Rather than discussing tax breaks, he should encourage measures to place a realistic value on energy generation by internalising its costs. The taxpayer has subsidised gas pipelines and the grid for fossil fuel power stations for years. We need to strip down all the tax breaks offered to this sector and internalise its costs.

Financial Resolution No. 3 is a different matter. It is similar to Financial Resolution No. 1 only in the sense that while mortgage interest relief is portrayed as a means of assisting people, the new measure does nothing more than provide material for a press release. The benefits from the higher limits will be quickly eaten up by the cost of living, the main part of which for the house buyer is the cost of the house. We should revisit the Kenny report and its fundamental recommendations for addressing the core issue under debate, namely, the price of houses. The housing market is being dictated by sheer greed on the part of people so focused on profit they are prepared to allow others to live in misery and pov erty rather than forego their profiteering. A further issue which must be addressed is the price of land for housing.

When I asked about the Kenny report in a parliamentary question last week, I was informed there were constitutional issues to be addressed. If this is the case with regard to the provision of housing and shelter, the most basic necessities of life, let us address these constitutional problems by holding a referendum. There have been few problems to date with holding referenda when the Government feels like it, as demonstrated by the decision to hold two referenda on exactly the same issue.

Let us have a referendum on an issue of fundamental importance, namely, the widening gap between rich and poor in society, much of which is perpetuated by the price of housing and property. While those with property can increase their wealth many times over, those without are left to try to scrape together the price of rent and those fortunate enough to get on the property ladder must scrape to pay for a mortgage.

We need to start talking about fundamental problems. These will not be solved by mortgage interest relief or even the first-time buyer's grant, which was at least more up-front and generous than this measure. We need to be focused. We already have the Kenny report and the Government needs to implement it. If a referendum is required, let us have one to ensure we can proceed in a manner compatible with the Constitution.

An Leas-Cheann Comhairle

I remind the House I will call the Taoiseach to reply at 7.55 p.m.

In relation to Financial Resolution No. 1, listening to the Minister for Finance's address this afternoon I was surprised this solitary area was singled out for special address. I would have expected a raft of loopholes, as they were described by the Taoiseach earlier, to be addressed this evening. I hope this loophole will be followed by many others because, as the Taoiseach has acknowledged in recent weeks, there are so many which need to be addressed.

I will not oppose the resolution. However, there is much more to be done. As the only resolution which addresses the whole area of people involved in business – active traders – it is interesting. I am sure Members will have noted the Minister's failure to underline or even acknowledge, other than in his preamble, the fact that the standard rate of corporation tax on trading profits will fall to 12.5% with effect from 1 January 2003. One will not find reference to this in the text of the Minister's statement. As it is unlikely there will be another opportunity to highlight this fact, I draw attention to it now.

Undoubtedly the proposal in Financial Resolution No. 2 will not be greeted by some people in the legal profession and other high earners about whom we spoke in the recent past. What is proposed will only marginally affect people who can put away sums in excess of €250,000 for their pension provision. We are dealing with a world I and perhaps the Taoiseach can hardly imagine.

The Deputy would be able to imagine it much more easily than I could.

I wonder why we are being so generous in terms of the cut-off points that are applied. These strike me as strange. The Taoiseach stated the excess can be carried forward. Why is this? It is not a justifiable position. If people have the wherewithal to put away such sums, it should be done on a yearly basis. The notion that the excess can be carried forward for assessment in the next or subsequent years does not stand up.

Financial Resolution No. 3 is a smokescreen. The notion that it will in any way compensate first-time home buyers is unfounded, although it applies to first-time home buyers of both new and second-hand homes. The sum of €6 million was referred to for 2003 and €8 million in a full year. Does it not apply from 1 January? Why were two figures quoted in the Taoiseach's opening remarks? The first-time buyer's grant applied to new homes only. How will this change compensate for the increase in the lower rate of VAT from 12.5% to 13.5%? How will it impact on house prices? It will not do anything at all.

It will impact on the profit margins of builders.

This is merely an attempt by the Government to put forward the notion that it has done something to reach out to the needs of those trying to get into home ownership. The people will not be codded. This measure is simply a smokescreen that does nothing to relieve the pain of recent decisions by the Government in regard to the first-time buyer's grant and the increase in the lower rate of VAT. As Deputy Gilmore raised the point in regard to stamp duty that this particular measure might actually have the opposite effect to that intended, it is not one that I will underline in this contribution.

We must remember that when the first-time buyer's grant was introduced in the 1970s, interest rates were at an astronomical level. Even when the grant was increased, house prices increased at the rate of the grant. Interest rates are now very low. Some 10,000 new homes will be involved. The remainder will be second-hand houses.

The credit will apply to all first-time house buyers, not just purchasers of new houses. This is progress in the right direction. It surprises me that members of the Opposition, especially Deputy Gilmore, are unhappy that there is an extension of an allowance. How can anybody object to people getting allowances?

What about VAT?

A total increase of 1% in VAT is not going to increase house prices by 1%, even though Opposition Members are trying to create that impression.

It is €2,000 less on the price of a house.

Are the builders going to absorb it?

It may reduce the margin for them.

The Minister will lower it all right.

With regard to the cap on pension contributions, one of the pillars of Fianna Fáil policy on taxation is to make it more equitable. This measure will bring more equity into the taxation system. Hearing this policy denigrated leads me to question the seriousness of those who object to such a positive move.

There was a great opportunity for the Government to front-load mortgage interest relief, but what one ends up with is approximately €17 per month for a single person first-time buyer.

It is over €150.

The Taoiseach outlined that it is costing €6 million to €8 million a year. Some €38 million was taken off with the removal of the first-time buyer's grant. There was a great opportunity to do something, but it has not been taken.

The clapometer was weak today. I was out around the plinth after the budget was delivered and the usual suspects were not to be seen. There was nothing but the leaves on the ground.

There was no sign of the Minister of State, Deputy Roche.

The Minister of State, Deputy Parlon was there. He must not understand what is in the budget because the community that elected him has been let down today by the Government. Several incentives have been taken away from the agriculture sector.

An Leas-Cheann Comhairle

Order, please. We are dealing with Financial Resolutions Nos. 1 to 3, inclusive.

A greater percentage of houses are being built in rural areas because people do not have an opportunity to purchase a second-hand house. They have been let down badly by the Government. They are only getting €17, but €3,700 has been taken away.

I saw a very eminent and respected member of the Bar justifying the €800 per day increase for barristers at the various tribunals that are going on all over the city and up as far as County Donegal. He explained that only that day he had written a cheque for €59,000 towards his pension. One could not oppose that very modest change here.

With regard to mortgage interest relief, one has to ask what kind of a motley shower of innocent mutts are behind the Minister on the back benches who applauded today.

Deputies

Hear, hear.

Can they count at all?

They can count votes.

Deputy Fleming is an accountant.

He is running out of the House now.

They will count at the weekend as soon as individual first-time buyers come to see them to go through it in detail. They are being offered €350 as compared to €3,850. That is the comparison. This appears to have been sold to backbenchers by the Minister for Finance on the basis that they need not worry about the scrapping of the first-time buyer's grant because mortgage interest relief will take care of it. That certainly has not happened. It was pathetic today to see them try to muster feeble applause on the basis that the damage done to the first-time buyer was somehow repaired in this minimalist measure which is worth virtually nothing. It is a spit in the eye to the first-time buyer.

Let us look at the affordable housing bruited about so much by the Minister for the Environment and Local Government, Deputy Cullen. As Deputy Bruton said, it is 500 houses, most confined to the Fingal local authority area. It is factored into the price. It is essentially in the deposit. The cheque went to the local authority, not the first-time buyer.

An Leas-Cheann Comhairle

It is now time for the Taoiseach's reply.

Now it is gone. Many of those who would have got a house under the affordable housing scheme will not now be able to get a house at all.

An Leas-Cheann Comhairle

The Taoiseach to reply.

On a point of order—

An Leas-Cheann Comhairle

The order of the House allows for a period of 45 minutes.

There were two or three minutes of discussion at the start.

An Leas-Cheann Comhairle

That is allowed.

I welcome the support of the House for the anti-avoidance measures.

Will the Taoiseach give me a minute or two of his time?

I only have one minute to try and cover what requires five minutes. I will have no time for myself.

It is incorrect to say the Government has failed to provide incentives for investment in renewable energy, including wind turbines. Deputy Sargent knows the number of schemes, some of which are tax-based while others provide price support for the output of such turbines. I do not have time to go through all of them, but there is a corporate tax rate, capital allowances, companies specific tax relief, individual specific tax relief and an alternative energy requirement programme. There are, therefore, many initiatives.

This would not be necessary if the price was fair.

If we could do something about stopping objections, it would be far better than letting on that there are no reliefs. That would be the main purpose.

The main purpose of the first-time buyer's grant, as the Minister of State, Deputy Michael Ahern, has already stated, was to encourage house building at a time when there was only a handful of houses being built. That is what it was all about.

It was for the builder, not the buyer.

It was set at a high level which represented about 7% of the average price of a new house when first introduced.

It was going to be doubled before the general election.

When it was abolished, it represented some 2% of the average new house price. I do not have time to go through all the figures referred to by the Oppostion, but most were wrong. First-time buyers account for roughly 25% of all house purchase transactions.

That is because of the Government's policies. Of the 23,000 first-time house buyers, 10,000 or 45% bought new houses while 55% bought second hand houses. Deputy Rabbitte is correct that some Members cannot count but they do not sit on this side of the House. A married couple will receive €133.33 per month for the first seven years of their mortgage and, therefore, the increased relief is worth an extra €1,409.

Over seven years.

All the 23,000 first-time buyers will receive this amount.

People were using the grant for their deposits.

These people had nothing at all and it is no wonder that the backbenchers of the Government parties responded earlier when at last all the people who received new house grants have something which they did not have before today.

The Taoiseach should conclude as we have reached the conclusion of the debate.

They do not have deposits.

These people can count.

What about VAT?

That is why they are so pleased and happy with this excellent initiative.

Question put: "That Financial Resolutions Nos. 1 to 3, inclusive, be agreed to."

Ahern, Bertie.Ahern, Dermot.Ahern, Michael.Ahern, Noel.Andrews, Barry.Ardagh, Seán.Aylward, Liam.Blaney, Niall.Brady, Johnny.Brady, Martin.Brennan, Seamus.Browne, John.Callanan, Joe.Callely, Ivor.Carey, Pat.Carty, John.

Cassidy, Donie.Collins, Michael.Coughlan, Mary.Cowen, Brian.Cregan, John.Cullen, Martin.Curran, John.Davern, Noel.de Valera, Síle.Dempsey, Noel.Dempsey, Tony.Dennehy, John.Devins, Jimmy.Ellis, John.Fahey, Frank. Finneran, Michael.

Tá–continued

Fitzpatrick, Dermot.Fleming, Seán.Gallagher, Pat The Cope.Glennon, Jim.Grealish, Noel.Hanafin, Mary.Harney, Mary.Haughey, Seán.Healy-Rae, Jackie.Hoctor, Máire.Jacob, Joe.Keaveney, Cecilia.Kelleher, Billy.Kelly, Peter.Killeen, Tony.Kirk, Seamus.Kitt, Tom.Lenihan, Brian.Lenihan, Conor.McDaid, James.McDowell, Michael.McEllistrim, Thomas.McGuinness, John.Martin, Micheál.Moloney, John.Moynihan, Donal.Moynihan, Michael.Mulcahy, Michael.

Nolan, M. J.Ó Cuív, Éamon.Ó Fearghaíl, Seán.O'Connor, Charlie.O'Dea, Willie.O'Donnell, Liz.O'Donoghue, John.O'Donovan, Denis.O'Flynn, Noel.O'Keeffe, Batt.O'Keeffe, Ned.O'Malley, Fiona.O'Malley, Tim.Power, Peter.Power, Seán.Roche, Dick.Ryan, Eoin.Sexton, Mae.Smith, Brendan.Smith, Michael.Treacy, Noel.Wallace, Dan.Wallace, Mary.Walsh, Joe.Wilkinson, Ollie.Woods, Michael.Wright, G. V.

Níl

Allen, Bernard.Boyle, Dan.Breen, James.Breen, Pat.Broughan, Thomas P.Burton, Joan.Connaughton, Paul.Connolly, Paudge.Costello, Joe.Coveney, Simon.Cowley, Jerry.Crawford, Seymour.Cuffe, Ciarán.Deasy, John.Deenihan, Jimmy.Durkan, Bernard J.English, Damien.Enright, Olwyn.Ferris, Martin.Gilmore, Eamon.Gormley, John.Gregory, Tony.Harkin, Marian.Hayes, Tom.Healy, Seamus.Higgins, Joe.Higgins, Michael D.Hogan, Phil.Howlin, Brendan.Kehoe, Paul.Kenny, Enda.

Lowry, Michael.Lynch, Kathleen.McCormack, Padraic.McGinley, Dinny.McGrath, Paul.McHugh, Paddy.McManus, Liz.Mitchell, Olivia.Morgan, Arthur.Murphy, Gerard.Naughten, Denis.Neville, Dan.Noonan, Michael.Ó Caoláin, Caoimhghín.Ó Snodaigh, Aengus.O'Dowd, Fergus.O'Shea, Brian.O'Sullivan, Jan.Pattison, Seamus.Penrose, Willie.Perry, John.Rabbitte, Pat.Ring, Michael.Ryan, Seán.Sargent, Trevor.Sherlock, Joe.Shortall, Róisín.Stagg, Emmet.Timmins, Billy.Upton, Mary.Wall, Jack.

Tellers: Tá, Deputies Hanafin and Kelleher; Níl, Deputies Durkan and Stagg.
Question declared carried.
Barr
Roinn