Mr. Joe Cullen:

I will take the Deputy through the broad outline of the steps that ought to apply. In the first instance, a market defect or need would need to be identified. In the case of the scheme the Deputy mentioned, at the time it was proposed, there was a perceived lack of activity in the building sector. The scheme was put in place to seek to promote activity in the sector by providing tax relief to first-time buyers. Is there a need? What is the need? Can that need be met through other routes? I mentioned the direct expenditure route in my opening statement. From an official perspective, it has advantages in that it is more transparent and it can be more focused. Our first question is always: can this be done through direct spending? The budgetary process around spending is much more developed than on the tax expenditure side.

That is also true internationally.

Moving on from there, if a need is identified, the question is to devise a scheme that addresses the need in a way that has regard to the scarcity of public funds. While there may not be the type of transparency one would like with regard to tax spending, from the point of view of the internal budgetary process, we are obliged to seek to put a number on the cost of a scheme when it is being introduced. That number finds its way into the budgetary arithmetic and calculations on whether the budget will be balanced in the fiscal space and all that stuff. We always seek to put a number on it, accepting that in some cases it may be very difficult.

I mentioned the KEEP scheme in my opening statement. It was a brand new scheme and it was difficult to identify what the cost would be. In that case, we looked at the cost in the nearest jurisdiction, the UK, which has a similar scheme and scaled it down to arrive at an estimate. It is far from perfect but that is the process. In terms of policy development, we seek to put the parameters of the scheme in place and a number of broad policy controls. The Minister of the day would need to approve the scheme. From there it might be announced as part of a budget or if it is a little later than the budget, as part of the finance Bill. Our Revenue colleagues would then draft the legislation in accordance with the broad policy parameters. From there the scheme would find its way, in the Finance Bill, to the Houses of the Oireachtas where it would be debated and modified if necessary and, ultimately, approved as legislation.

A newer feature in recent years is we seek to time limit schemes. The help-to-buy scheme has a time limit on it. It is due to expire at the end of this year. Ideally, as part of the identification of the need for the measure, we might undertake an ex anteevaluation. While desirable, it may not always be possible. In the case of the help-to-buy scheme, two subsequent reviews were carried out shortly after the incentive was put in place. Once the scheme goes into operation, it is closely monitored. In the case of the KEEP scheme, which came into operation on 1 January 2018, we keep our eyes and ears open. Although no formal data are available yet on the operation of the scheme and the number of claimants, the anecdotal evidence, including that coming through representations, is that the uptake has been lower than anticipated. We are fairly responsive to that. Ideally, if we put a scheme in place, we want it to work efficiently and effectively. If that is not the case, we seek to take steps to make it happen. With KEEP, this year, once we get some formal data from our colleagues in Revenue, we will, with the Minister's approval, undertake a consultation process with stakeholders to find out why it is not working as it should. We made some modifications in the Finance Act 2018 to increase the level of relief available and make the scheme more attractive but we intend to take further steps this year following a consultation process. They are the broad steps we take with any relief.

Once a scheme has met its policy purpose, we would recommend to the Minister that it be potentially wound up.