Mr. Tom Parlon:

We all have kids trying to get on the housing ladder. I know personally that unless one digs into one's own pocket, it will not happen. For a €300,000 starter home in Dublin, it is very difficult for two civil servants to get a mortgage together to afford the house. The mortgage would then hang over them. There is a challenge. On the other hand, if a person decides to build in the "wilderness", as mentioned, or buy down there, he or she might not have a job. Within our members and those who work for them, many are commuting five hours per day to work in Dublin because this is where they work. They get into vans and get stuck on the M50. They cannot to stay overnight in Dublin because of a lack of accommodation and so on. It is a challenge.

We have raised the VAT issue time and again with the Government. There is 13.5% VAT on housing, which is €30,000 or €40,000 on a general house. The builder must pay that the day the contract is signed. It is not in the North of Ireland or the UK. I used a figure lately and if one has a meeting in a room with Department of Finance officials, they go ballistic at the notion of touching VAT because it is so important to them. We had a report done by Grant Thornton that indicates by reducing VAT and increasing output, it would pay for itself in a short time. A 16% increase in output would pay for a 4% reduction in VAT. As Mr. Fitzpatrick stated, €100,000 from a €300,000 house goes to the Exchequer. It is a bonanza for the Exchequer if we are building houses. The Economic and Social Research Institute raised concerns that if house building reached 25,000 units per year again, there might be a danger of the economy overheating. As it is labour-intensive it would provide many extra jobs and so on. It is a dilemma we must deal with and there is very little scope on the hard construction side to reduce costs. We must look at the other 50%, whether this equates to VAT, levies or whatever else.

The issue of self-employed contractors was raised and a Deputy also commented on the matter of strange bedfellows coming before the committee, in that the Irish Congress of Trade Unions, ICTU, and the CIF are promoting additional investment. We have a very good relationship with ICTU and Ms Patricia King is coming to speak at our event with the Commissioner and the European Union. It raised the very same issues in meetings with the Government and I have sat beside its representatives. They argued that if housing was more affordable and available, they would not have to take such a hard line on pay increases. That is where they are coming from. We had a registered employment agreement set up 60 years ago - it was in being for a long time - but it was eventually deemed by a Supreme Court challenge to be against the Constitution and has been dropped. We have a live application to the Labour Court to set up a sectoral employment order. The unions are supporting us in this and that will lay down all the conditions. Eventually, the Labour Court will recommend the rate that will apply there. I am touching wood but currently we have a very good industrial relationship. We understand entirely that we must pay decent wages and provide good and safe working conditions in order to attract people to the industry. That must be passed on to the client, whoever engages us, and that was a major problem for us in the past when we did not have an registered employment agreement. Some companies that were not paying the proper rate were able to undercut others and there was a non-level playing field. We are pushing very hard through the Department of Jobs, Enterprise and Trade and the Labour Court to have the sectoral employment order applied across the board to construction. That will certainly outlaw the particular practice mentioned by the Deputy.