Michael McGrath (Cork South Central, Fianna Fail)
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We made our views on this known during the budget debate and I will not repeat them at length. Our view is this is not the right intervention. It is a supply problem primarily and to stimulate supply, the Minister faces a few choices aside from the bottleneck issues of land availability, zoning, serviced land and so forth. The fundamental choice is to increase prices or to reduce the cost of delivering new homes. This measure will place upward pressure on prices. There is anecdotal evidence of that, which may not be proven categorically, but it is inevitable that there will be upward pressure on prices in certain sections of the market and I believe that the Minister believes that is not such a bad thing because there are benefits for builders. It will certainly help to improve supply. There are also benefits for banks in respect of strengthening their balance sheets but it will have an impact on the indebtedness faced by borrowers. As Deputy Doherty said, with any intervention, there is an end date and whether one accepts or not that there is a distortion when the intervention is made, there will certainly be one when it is ended. How will it be possible to phase this out, given it is currently proposed to be in place for a number of years?

An independent impact assessment should have been conducted before the decision was made. That could have been done quietly. This was mooted back in July when the Rebuilding Ireland programme was first announced. There was time, therefore, to conduct an impact assessment. The predominant problem is supply and the focus should be on examining the cost of delivering new homes. We will go through the amendments later that deal with that issue, the issue of the impact assessment and some changes we propose relating to self-builds and non-self-builds and so forth.

The reality of the situation we are in is Fianna Fáil has a confidence and supply arrangement with Fine Gael. It does not provide for this intervention in the property market. We are committed to facilitating the passage of budgets provided they are consistent with principles in the agreement. It would not be reasonable for us to say the Government cannot bring forward measures in its own right that we may not agree with fully. We do not agree with this but we will not block it. We will seek to shape it and to insist on an impact assessment at an early opportunity.