Paschal Donohoe (Dublin Central, Fine Gael) | Oireachtas source

I thank the Deputies for the points they have raised. I will deal with the general issues that have been raised overall, then I will come back to the specific matter that was raised by Deputy Boyd Barrett in his intervention, some of which I have already dealt with in the answer to a parliamentary question that I provided to the Deputy.

In February 2021 the Minister for Housing, Local Government and Heritage established an independent working group to examine defects in housing in line with the programme for Government commitment. The Department of Finance was represented on this group. We contributed to discussions, but as noted in the report, we did not take a position on the final recommendations within the report as it is due to be considered by Government. That report was presented to the Minister for Housing, Local Government and Heritage on 28 July. It sets out ten recommendations in relation to the process of the remediation of defects. In relation to funding options, the report provides commentary and four options for consideration by Government. Taxation measures are but one possible approach. However, the working group concluded that further consideration should be given to how tax options might operate in relation to each tenure type. The taxation options presented include references to income tax relief and local property tax relief. However, the report states that any support must be considered in the context of Department of Finance tax expenditure guidelines. These guidelines state that any policy proposal which involves tax expenditures should only occur in limited circumstances, for example, where there are demonstrable market failures. In particular, a tax-based incentive should only be considered where it would be more efficient than a direct expenditure intervention. It is clear, from the working group's report, that the process of remediation is likely to take many years to complete, and that appropriate actions will need to be prioritised. It is also clear from the report that further work needs to be undertaken to assess the relative merits of each funding option, particularly as the estimated potential costs of remediation are so substantial, ranging from approximately €1.56 billion to €2.5 billion. In the circumstances, a report as sought, focusing on a tax-based approach to funding remediation actions, would be premature at this point, which is why I am not in a position to accept the amendment on this important matter.

In relation to the specific matter that has been raised by Deputy Boyd Barrett and the properties that he has referred to in Carrickmines, I am advised that the receiver, in his capacity as an agent of the developer and without any legal obligation or requirement to do so, has carried out substantial remediation works to the development that is funded NAMA, certification of which has been provided to the local authority. I also understand there is substantial litigation on the way with regard to this property and NAMA is not party to the litigation so it is not appropriate for NAMA or me to interfere with this ongoing legal case.

The Deputy is aware that I am not in a position to give direction to NAMA regarding how it handles a matter like this. I have to respect the independence of NAMA and its board and how issues like this are dealt with. I am sure that those who are involved in dealing with this case on behalf of NAMA are aware of the human issues Deputy Boyd Barrett has referred to. A general issue that came up in the interventions from Deputies was that of tax reliefs and comparing this with the tax reliefs that are available to landlords. However, it should be noted that for the tax reliefs that are available to landlords for remediation works, the costs of them are generally deducted when the property is disposed of and are therefore set against capital gains tax. The current operation of how remediation works are dealt with by landlords operates based on when the property is disposed of but overall a lot more work needs to be done on what the best option is for funding the response that is needed. It is for that purpose that accepting an amendment to the Finance Bill 2022 at this time would not be appropriate because it would give a preference to one of those options versus other ones when there is still a lot more work we need to do. I assess that we need to do that quickly.