Joan Burton (Dublin West, Labour)

It is right that the State should, as far as possible, promote people's ownership of their own houses. I remind Deputy Mansergh, who is something of a historian, that in 1973 the then Labour Party Minister for the Environment, Jimmy Tully, gave people the right to buy council houses. There has been cross-party agreement that the right to access home ownership is a social good. I suppose we are continuing the tradition of the 40-shilling freehold.

As those who are renting their homes enjoy very little security of tenure, it is difficult for them to access a long-term right to rent properties in a fair way. There was once such a right in Ireland and continues to be in many European countries. If one travels to city centres in France and Italy, one will find families which are renting high quality apartments and houses. They can rent such properties intergenerationally because they have rights of succession. The Irish market is different and has become more different as the years have passed. Most people try to get on the property ladder by buying a home, but the recent problems in the housing sector have made that extremely difficult. The affordability barrier has been raised by the credit crunch. It costs much more to pay a mortgage for a modest starter home than it did some time ago. The impact of the Minister's increases in mortgage interest relief over the last two budgets has been negated by recent developments in the international and Irish finance markets, the property market and the credit market.

When the many people who have to rent in the private housing market rent old section 23 properties, or the successors of those properties, landlords get tax breaks. In such circumstances, most landlords register properly with the Private Residential Tenancies Board and the Revenue Commissioners and are quite happy to assist tenants who wish to avail of tax relief on the rent they are paying. Landlords who do not register with the Revenue Commissioners, because there is no tax benefit in it for them, are often reluctant to register with the Private Residential Tenancies Board as they are required by law to do. Many of them are reluctant to pay tax on the rents they receive. The situation becomes even more ridiculous when one considers that the Health Service Executive, which spends several hundred million euro on rent allowances, often consciously turns a blind eye to those to whom rents are being paid.

The Labour Party has tabled an amendment, which will be considered later in this Report Stage debate, providing that the Revenue Commissioners be given full access to the information registered with the Private Residential Tenancies Board in order that they can pursue landlords who are not paying tax on the rental of properties. The HSE and the local authorities need to get their act together to end the waste of public money which is resulting from the Government's management of the rent allowance structure. It seems the Government has decided to hardly ever again build old-style local authority accommodation. If that means massive estates like those in many of our cities and towns will no longer be developed, that is fine. I do not think anybody wants to see massive local authority estates becoming islands of deprivation in otherwise well off cities and towns.

The Government's attitude to the rental sector needs to be seriously overhauled. Landlords should be paying tax on their earnings from the properties they rent. Information about such properties should be available to the Revenue Commissioners, who should be able to pursue landlords who avoid paying tax. Equally, tenants should be encouraged and facilitated to claim tax relief on their rent allowances. I do not want to return to the debate that took place this morning. Landlords who operate under the counter often strongly discourage tenants from claiming tax allowances. To secure their properties, tenants often have to supplement the rent that is recorded by the HSE as being paid with under the counter payments to landlords. That is quite common in certain parts of the country. The Minister needs to recognise that while there are many decent landlords — it can be a good business if one runs one's property properly — the many landlords who do not want to pay tax are having a field day. One way of incentivising tenants to ensure that the landlord of the property they are renting is paying tax is to improve the tax rebate people can get for renting. Therefore, I recommend the thrust of the Fine Gael amendment to the Minister because it incentivises people.

I raised a matter on Committee Stage which was previously highlighted by my colleague, Deputy Ciarán Lynch from Cork. This is the case where tenants in receipt of rent supplement from the HSE end up having to deduct tax for non-resident landlords because people who pay rent to foreign landlords are obliged to deduct the tax at source. It seems ridiculous that even people renting through the HSE have a responsibility for deducting tax on behalf of a non-resident landlord and can become liable for it.

I recommend the spirit of the amendment and I feel this is one of the areas where in the good years of the Celtic tiger it was very easy for the Government to turn a blind eye to whether landlords paid their fair share of tax. Now that times are getting tougher, we cannot afford parasitic landlords who are renting, in some cases, very substandard properties for €1,200 or €1,600 a month and then showing two fingers to the rest of us by not paying tax on the properties.

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