Ciarán Lynch (Cork South Central, Labour)

I move amendment No. 109:

In page 70, between lines 15 and 16, to insert the following:

"(3) The Minister may by directive provide for a discount on the sale price of an apartment under this section where the sale is to a tenant who has been recorded by the council concerned as having requested the option of purchasing the apartment prior to the commencement of this section but who has been precluded from doing so by the absence of legislative provision in that behalf.".

The purpose of the amendment is to bring to a positive conclusion a long-standing problem by correcting an unjust and unfair anomaly affecting a specific group of local authority tenants. I first encountered the problem in 1992 while knocking on doors in the Ballyphehane area of Cork. A lady explained to me that she was prohibited from buying her home because it was a flat, whereas local authority tenants living in houses were able to purchase their homes. On my election to Cork City Council, I pursued the matter and quickly discovered that the problem did not reside with the council but with national legislation prohibiting certain council tenants from purchasing their homes.

In the intervening years, Deputy Kathleen Lynch and I and many others have sought to have legislation introduced to afford council tenants living in flats the right to buy their homes. A long time has passed - the Celtic tiger has come and gone, a property bubble has burst and the economy has fundamentally changed - and those who sought to buy their homes in the past have grown older and their financial circumstances have changed. The age profile of many of them prevents them from acquiring a mortgage because the minimum term of mortgages under standard arrangements is 20 years.

The amendment proposes to give tangible recognition to the campaign waged by tenants affected by the prohibition. I accept the legislation solves the overall problem by providing for the establishment of a legislative framework enabling tenants to purchase local authority flats. The Minister of State and his officials have done considerable work on the issue, as have other parties who were included in the design process for the new mechanism. Notwithstanding their efforts, however, under this legislation tenants who have been waiting for ten years or more to purchase their homes will pay exactly the same price as all other tenants who avail of the scheme. This provision is unfair and it is unfortunate the Minister did not address this anomaly in the Bill.

The inclusion in the Bill of a new mechanism enabling local authority tenants to purchase flats is due to the campaign conducted by residents of flats in Cork and Dublin seeking the right to purchase their homes. These local authority tenants have lobbied their public representatives on this issue for a decade or more. Having introduced the legislation only a couple of weeks ago, the Minister is rushing it through the House. Given the significance of the issue I raise, both in the past decade and no doubt in future years, it deserves to be debated in the House.

The legislation will radically alter the tenant purchase scheme. In the past, a tenant purchasing a home entered into an agreement with a local authority and received a discount of 3% on the property value for each year of tenancy, up to a maximum of ten years. In other words, tenants could obtain a discount of up to 30% on the value of the property. The legislation replaces the current discount mechanism with an equity discount of between 40% and 60%. As I noted, the new scheme will be available to new tenants as well as established tenants and, as such, does not take account of the years during which residents of flats were prevented from buying their homes.

As an Opposition spokesperson on housing, I am aware that I am constrained by Standing Orders in terms of the amendments I may table. For this reason, I chose not to take a prescriptive approach to this issue. The amendment was written with two considerations in mind. First, I sought to ensure it would not have financial implications that would result in it being ruled out of order, thus preventing debate on the issue and precluding the House from finding a solution to the problem. Second, I sought to give sufficient flexibility to the Minister to produce a satisfactory outcome. Ultimately, the amendment provides for a win-win scenario. If passed, it will provide for the establishment of a mechanism to rectify the problem I have described by allowing the Minister to introduce an appropriate discount by means of a directive.

I understand it will be some time before local authorities implement the provisions of the legislation, once enacted. The Minister has ample time to consider this amendment over the summer recess and when we return in the autumn and the sales start to go through the local authority systems, a proper discount system would be in place.

The amendment also aims to ensure a scenario does not develop whereby people who have not qualified, but who see an opportunity to slip into a programme that was not intended for them, can avail of it. The wording of the amendment is clear. It refers to those who have been recorded as having tried to make a purchase in the past, but who have been prohibited from doing so. The Minister is aware that more than 100, if not 200, test cases are pending in the courts in this regard. The issue has gone as far as the High Court. Rather than allow this issue to linger and fester on the steps of the courts, this amendment offers a clear solution. These court cases could be sidelined and the issue resolved through the acceptance of this amendment.

I welcome the overall legislative framework the Minister of State has put in place for the sale of flats. Some anomalies may arise with the operation of the legislation and further examination may be needed. However, I recognise what has been achieved overall. The Bill has been in the making for some time, but the issue has existed for many years. The framework that came to us on Committee Stage has an obvious shortcoming, it does not cater for the people who have caused this legislation to be made. The people responsible for the legislation before the House are not the Opposition Members who have put forward amendments or the Minister of State who has inserted a complete section regarding the sale of flats, but the people who have been campaigning for more than a decade for the right to buy their homes. One further piece of work remains to be done in that regard, namely, to include this amendment.

See this speech in context