Michael Noonan (Limerick City, Fine Gael) | Oireachtas source

First, when the housing policy document was produced in July, I asked the people in the Department with responsibility for the environment not to reveal any details of a help-to-buy scheme because it would interfere with the market. If the Deputy was one of the partners in the case of a young couple thinking of buying a house and if the prospect of getting a big chunk of money was held out to him, he would probably defer his plans to buy. I did not want to disrupt the market. To help ensure there would not be market disruption, we said it would be backdated to the date of that announcement. I am still reluctant to give the details and even though there are only three weeks remaining to budget day, I do not want people who have paid deposits to pull back from purchasing. Whatever we do will be retrospective. We have problems enough with supply without creating some kind of hiccup in the market by announcing a help-to-buy scheme prematurely.

Second, anything we are doing is with the full knowledge of the Central Bank. It knows exactly what I have in mind and it approves of it. The Deputy will see what is proposed on budget day when we will give the full details. I think it will be a pretty good scheme. We have to do things and we cannot nail things down 100%.

The Deputy referred to brining the VAT down from 13.5% to 9%. I got no advice from anywhere to do that. It was a political decision by the Government but it took a tourist industry that was on the ground and put it back up on its feet, as it were. The same happened when we abolished the travel tax at a cost of €37 million. More than 2 million extra people have been flown into the country by Ryanair and Aer Lingus. There are things one has to do. Why have Ministers and Government if everything is based on the best opinion of officials? There has to be a situation where Ministers take political initiatives and hold themselves responsible and accountable for them. Obviously some things do not work and other things work and we try to evaluate them as best we can in advance to make sure there are many more pluses than minuses. However, with respect to anything one does on the property side, be it introduce a grant scheme or a tax break or whatever, there is no doubt it will have a possible price effect. Once more money is put into the system and if more money is available and more purchasers with money are available, there is a temptation for small builders to increase the price if they think they can get it. However, many small builders would say that what they need now is a price increase because they cannot deliver the supply at current prices. It is quite complicated, and I am sure we will have a full debate on it, but the Central Bank is in the frame.