Joe Higgins (Dublin West, Socialist Party)

I welcome and support the Labour Party motion. It echoes the position that I have been putting forward in the Dáil and the position that the Socialist Party in Fingal County Council has been strongly advocating for over a year. Unfortunately, Labour Party councillors in Fingal were, up to now, not very supportive but I have no doubt that the spokesperson for the party on local government and the environment will brief the councillors thoroughly on the contents and the import of this motion and that they will adopt a much firmer and better position from now on.

The management company setup is a scam by which developers evade the costs they would have hitherto borne for finishing off estates and maintaining them to some degree until they were officially handed over the local authority. It is also, following the handover to the residents, which is what is envisaged, a blatant privatisation of services.

When I have raised this issue with the Government and the Minister for the Environment, Heritage and Local Government, as recently as yesterday, I have been met with generalities. The Government says it is opposed but in west Dublin, Meath, Kildare and other areas, thousands of householders are faced with enormous bills, at the very time they are vulnerable to large mortgage payments, child care costs and so on, imposed first by the developers who control the management companies and later by local authorities which insist that the services be privatised. The management companies are controlled for several years by the developers who are demanding annual fees from the same householders from whom they have made a massive profit in the sale of those houses.

The level of the scam is shown by the home development in Tyrrellstown in west Dublin in 2000, where the budget for 2006 provides for total management fees of €355,000, of which administration costs are proposed to be €119,000, one third of the total. A further €19,000 is to be demanded, on top of the total, for public liability insurance. So, if somebody falls in the main thoroughfare, rather than the local authority having to answer, it is householders in the estate who will be called upon to pay. Clearly, even in the worst days, the Taca days of the 1960s, the mohair suits who supported Fianna Fáil at that time would not even have dreamt of such a scam.

Twenty householders will be dragged to court by these same developers, masquerading as management companies on foot of civil process in January. What words of comfort can the Government offer to them and the thousands who are stuck with this development? What does the Minister have to say in this regard? Will he ask the developers to pull back, the local authorities to end this immediately and take those householders out of the stress they are suffering?

Fine Gael has said nothing on the wider issue of the application of management companies in housing estates. I warn Fianna Fáil, the Progressive Democrats and Fine Gael on this issue — it is only beginning. It will be a major issue in crucial constituencies in the election and they had better get their act together on it and stand with the hard-pressed householders, mortgage payers, working people and PAYE people and resolve it forthwith.

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