Pearse Doherty (Donegal South West, Sinn Fein) | Oireachtas source

My views on this initiative are well known as I spoke about it on Second Stage and at length on Committee Stage of last year's Finance Bill. I am concerned that the Minister is extending a scheme which is not up and running. It is not that there has been no take-up, as Deputy Timmins mentioned. There cannot be a take-up because we have not given effect to the scheme in last year's Finance Bill as we have not received approval from the EU, or did not made an application until the cost benefit analysis was done. However, we have decided not only to extend the scheme to four different regions but have decided to substantially change the nature of the scheme. The number of properties eligible to come under this scheme has changed substantially.

I am not sure what areas of Cork, Galway, Kilkenny and Dublin the Minister intends to designate for this scheme. I presume that has not been worked out with the local authorities yet. What areas are being considered? Will it be the northside or the southside? The decision on which parts of the city centres will be designated is being left up to the Minister.

It is necessary to include provisions in finance Bills that will create economic activity. We must take risks but we must do so on the basis of the best evidence available. If this is a pilot scheme, it should be allowed to run as a pilot scheme. The cost benefit analysis that has been done in terms of the impact on employment, urban renewal, property values in designated areas, business activities and so on, was derived from surveys of auctioneers, residents and retailers. I presume that cost benefit analysis was done in the context of the original scheme, which was for Georgian houses. Now that we have changed the scheme substantially, by opening it up to pre-1915 buildings, other issues arise. Will the European Commission be happy with that change? We must examine the details of the scheme closely. It gives 100% tax relief for the cost incurred in the refurbishment or conversion of eligible properties, subject to the individual having a tax liability of that amount. It is very lucrative, therefore, for property owners with relatively high incomes.

I agree with the Minister that when one walks through the aforementioned cities one sees many neglected buildings. However, the same is true of many towns and villages. Should the scheme be extended to every town and village? In the villages of Pettigo and Mountcharles in my constituency, for example, there are many boarded up houses. In Pettigo, which is on the Border, there has been some renewal with refurbishment of shops and pubs and the opening of a new community centre. The villagers are doing their best to keep the spirit of the place alive but there are lots of boarded up houses there. The same is true in many other towns and villages across the country. There is an issue of fairness here.

The Minister has said that he is not opposed to the extension of the scheme if it works and then it could apply to places like the main street of Letterkenny, the lower half of which contains many boarded up buildings, as well as many other towns across the State. Then we could end up with a scheme which provides enormous tax reliefs for property development in the centre of cities, towns and even villages. I am not sure about this. I think we should go down this road very carefully. We have been here and done that. We have looked at incentives such as this in the past, although that is not a reason not to look again, reshape them and remodel them to the needs of today. However, we must tread very carefully. I do not understand the urgency about expanding the scheme to the six cities that have been identified. We do not know what areas of those cities will qualify.

I see the rationale for the pre-1915 condition and believe it is fairer than restricting the scheme to Georgian houses. That said, the Minister must tread very carefully. I would not be supportive of jumping in with both an expansion of the scheme and an expansion of the qualifying criteria before the scheme has been up and running and its impact has been assessed properly. There is no urgency about this. It will be limited in its scope in terms of the areas that the Minister designates, most likely the city centre areas. While the scheme will not apply to a large number of properties, it is very lucrative and for that reason, I would tread more carefully than the Minister is currently doing. We should not be expanding a scheme that does not even exist at this point in time. It is for these reasons that I am opposed to this section of the Bill.