Billy Timmins (Wicklow, Independent) | Oireachtas source

I thank the Chairman for permitting me to contribute. I followed Professor Honohan's contribution on the monitor.

To take up Deputy Rabbitte's last point, I made a note on foot of it to the effect that this is an easy touch for tax revenue. There has been a sense of hypocrisy at the core of all Government policy on housing in recent years. I refer to the non-essential costs associated with housing. Only last week a young girl in my area who got planning approval for a house had to pay a levy of €10,000 before she borrowed any money to build the house and provide the infrastructure. The Central Bank may have a role to play in trying to drive home some common sense to policy makers. We talk about access to water being a human right, but one of the basic human rights is housing, and we make it very difficult for people to purchase a house. I know developers are not the flavour of the month, but when I heard it mentioned earlier that we do not know what house prices are, I telephoned a builder and he made the point that if he spends €100 on blocks and cement and spends ten hours putting them up, he must at least get €200 for building the wall; he cannot build it any more cheaply. Those are aspects we need to examine.

The other issue I want to raise is the reporting of house prices. I read in a local newspaper recently that house prices in Galway, given out by a reputable company, showed a dramatic increase.

However, they showed a dramatic increase. While I stand to be corrected on the exact detail, apparently on analysis there was a house valued at €1.3 million in Athenry. Although this clearly was an incorrect figure, it drove the percentage through the roof, as only ten or 15 houses had been sold during the period. Such percentages send panic through people. I can remember appearing on "Questions and Answers" in January 2008 or January 2009 with a representative of the Construction Industry Federation in a broadcast on which the auctioneers' association was well represented in the audience. They talked up the housing industry, but it was a complete sham. There must be some way of monitoring the position in order that people know the truth.

I have almost concluded, but the Governor mentioned infrastructure. One of the unintended consequences of the establishment of Irish Water is that it will now, in effect, be able to decide where new development will take place because it will be able to decide what land will be serviced as it will actually hold the purse strings. Does the Governor see potential dangers in this?

On a highly relevant issue, the Governor might recall a few members of the Reform Alliance and I sent a document to the Central Bank based on fair value lending. The document showed the historical correlation between the average house price and the average income. We had sought a lot of inputs into it for a number of months beforehand and considered it to be a good document. We remain of that view and while it might seem like heresy to some, its purpose simply is to stop irresponsible lending for which ultimately and historically the taxpayer has been obliged to pick up the tab. I seek the Governor's views because we consider it to be a better way than seeking a 20% deposit as it pertains to the actual amount of money being lent. I have always maintained Ireland did not have a property bubble; rather, it had a lending bubble that caused the difficulty.