I move: "That the Bill be now read a Second Time."
As everybody in this Chamber knows, rents are completely out of control. A quick look on daft.ie today confirms this. In Cork city, the cost of renting a standard two-bedroom home is €16,000 per year. In Lucan, which is in my constituency, the cost is an astonishing €24,000. Across the electoral boundary, in Castleknock in the Taoiseach's constituency, the cost of renting an average family home with two bedrooms is €25,000 a year. In parts of the constituency of the Minister for Housing, Planning and Local Government , Deputy Eoghan Murphy, rents can be as high as €34,000 annually. That is absolutely insane. How is any working person or a couple on a modest or average income meant to afford this? Average rents in Dublin are now €1,700 per month. Across the State, the average is €1,400. In many cases, one would need a household income of between €80,000 and €100,000 to be able to afford these kinds of prices. The impact of astronomical rents can be seen everywhere. Renters live under huge financial pressure. First-time buyers are forced to move back home with their parents in order to save for a deposit. Local economies are starved of spending as workers pay 40% to 50% of their disposable income on rent. Small and medium-sized employers struggle with rising wage claims that, in the main, are being driven, by high housing costs. The crisis in the rental sector is hurting people and damaging our economy.
It was not meant to be this way. When he was Minister for Housing, Planning, Community and Local Government, the Tánaiste, Deputy Coveney, launched his strategy for the private rental sector in December 2016. He promised to "moderate the rate of rent increase" and stated that after three years "new supply will have come on stream and pressures will have eased." He and his successor have failed because Fine Gael has left it to the private sector to increase rental supply. Fine Gael has failed to deliver a single cost rental home in three years. It is relying on the private rental sector to meet social housing need, increasing demand and rents for all. Crucially, rent pressure zones are not working. Fine Gael said rent pressure zones would limit rent increases to 4% a year for three years. Since January 2017, rents in Dublin have increased by 23% and by 24% across the State. That is double what the Government promised. No doubt the Minister will claim that there is finally some evidence that rent inflation moderation is happening. Even if that is true - and it is not clear yet - it is far too late. This policy has failed. Any future rent increases for hard-pressed renters are completely unacceptable. It it time to give renters a break.
The Bill before us, co-sponsored by my new constituency colleague, Deputy Mark Ward, does just that. It seeks to put a month's rent back in every renters' pocket through a refundable tax credit and to stop rents from further increasing. Fine Gael has given tax breaks to just about everybody else in the housing system. First-time buyers got the help to buy scheme, landlords got increases in mortgage interest relief and vulture funds get even more generous tax breaks. What about renters? Do they not deserve the same support? A refundable tax credit, as we outlined, would put up to €1,500 back into the pocket of every renter. It would cost the Exchequer €260 million a year but, in our view, would be money well spent. Meanwhile rents, would be frozen for three years at their current level for existing tenants and at the Residential Tenancies Board, RTB, rent index level for that size and location of property for all new tenancies.
This is an emergency measure. It is intended to ease the pressure on renters and to give the Government some time to address the issue of supply. The private sector cannot and will not deliver affordable rental accommodation, especially in large cities. That can only be done with public housing on public land. In 2014, the Fine Gael Government promised to invest in affordable cost rental accommodation. In 2016, Rebuilding Ireland made the same commitment. Only this year, the first pilot cost rental scheme went on site. Just 50 units will be delivered next year. That is 50 affordable rental units throughout the course of Rebuilding Ireland. In its alternative budgets for 2019 and 2020, Sinn Féin proposed a major investment in council-led affordable rental accommodation. We committed €395 million to deliver more than 1,700 cost rental units in a single year. This is in addition to a commitment to deliver more than 4,000 affordable purchase homes in the same period. That scale of ambition is required. Anything less will condemn renters to a decade of unaffordable rents.
The Government will claim that the Bill is actually bad for renters because it will deter investment and choke off supply. That is absolute nonsense. Given Fine Gael's generous tax breaks for institutional investors, combined with record high rental yields, investing in rental accommodation is a pretty sure bet, even with a rent freeze in place. That claim is just cover for Fine Gael doing what it always does, which is looking after the big investors and landlords while letting working men and women fend for themselves.
I understand that some of the other Opposition parties have concerns about the Bill. I give a commitment to every Deputy in those parties that Sinn Féin will work constructively with everyone involved to iron out any potential difficulties and improve this Bill, if necessary. With the right approach, there is no reason this legislation could not pass before the end of the year. Let us roll up our sleeves, work together and give renters the early Christmas present they rightly deserve, namely, a refundable tax credit that will put a month's rent back in their pockets, an emergency rent freeze for three years and real investment in affordable cost rental accommodation. The latter will ensure that workers and families can access the secure and affordable accommodation they so desperately need and rightly deserve.