Paul Murphy (Dublin South West, Anti-Austerity Alliance) | Oireachtas source

We are opposing section 15 of the Bill. It is restoring full interest deductibility for rented residential property over a five-year period at 5% a year, going from 75% to 80% and back up to 100%. It was a key demand made by the landlord lobby groups, certainly to the Committee on Housing and Homelessness and, presumably, also to the Government. The Government has agreed to it and obviously it will manage to get it through. The logic the Minister of State will put forward will be of boosting supply and stopping landlords from exiting the market. It is of one with a general complete lack of coherence in the Government's housing policy, which is also reflected in some of the stuff that is coming out in its rental plan of subsidising people's rent, which is surely going to push rent even higher.

Effectively, the impact of this will be to incentivise buy-to-lets at a time when there is still a huge hangover of buy-to-lets in arrears from before the crash, covering up the fact that Ulster Bank has sold close to 2,000 buy-to-lets in long-term arrears to Cerberus. There was a report which I asked the Minister, Deputy Noonan, about in the Dáil last week on AIB planning to sell off close to €2 billion worth of buy-to-lets. A 5% increase in relief will not make much difference to people in long-term arrears but will incentivise new landlords to take out new buy-to-lets, which will increase competition for a limited supply of housing and drive up prices.

I made the point in the Dáil that Dr. Lorcan Sirr was quite scathing in The Sunday Timesof the Government's programme and the incoherence of it. He wrote that the Government was pushing up house prices and helping to make them unaffordable for first-time buyers. He wrote that the fact the Government is incentivising this with more tax breaks, while simultaneously handing out first-time buyer rebates, shows how incoherent its policy is. I do not understand why we would incentivise buy-to-let landlords at this stage. I do not see how it is going to make any contribution to resolving the housing crisis. In fact, it will have a detrimental impact.