Danny Healy-Rae (Kerry, Independent) | Oireachtas source

The housing crisis rolls on and its cause is the lack of supply. Would-be developers and building contractors cannot start building in the private sector as they cannot borrow from many of our mainstream banks. The banks will not lend them any money. Would-be builders do not have any money of their own and the only option is to borrow from lending institutions outside the State that are imposing interest rates with double-digit figures. Can the Government intervene and ascertain why banks in this country will not lend to developers or building contractors? That is where we have to start.

The second blockage is the amount of levies and State taxes being demanded from developers and building contractors. Grant Thornton carried out an independent review and found that the levies, taxes and VAT amount to 37% of the cost of building a house. Can the Taoiseach do something to reduce these charges? Local government levies for road, water and sewage infrastructure are very excessive. Can the Taoiseach intervene here? Builders cannot start without a water connection. It is fine paying the full cost of the water connection but the trouble is the levy. It costs builders a lot of money, which must be paid up-front. They cannot pay it up-front. This has to be addressed if we are to resolve the housing crisis. VAT, taxes and PAYE for workers have to be paid in every two months even though the builder will not be paid for the house or any part of it until it is completed and the key is turned in the door. The Minister responsible must deal with these issues.

Previously, the builder or developer was paid in stages when a house was bought from the plans. On the first stage, the builder was paid for the site. A second instalment was paid when the building was at ground-floor level, and a third was paid when the roof was on. The last payment was demanded only when the house was finished. New rules mean the builder now cannot be paid until the house is totally finished. This regulation was put in place to deal with rogue builders but most builders, or 95%, were always fine. The 5% could be dealt with by having quality or standard checks organised by an independent body, established by the Government, or the building control officials in the local authorities. Payment should be allowed at different stages. Builders will not even dream of starting under the present arrangement. They must take all the risk and deal with all the safety regulations and the burden of waiting for money, finishing up with a profit margin of 2% to 3% because of the cost of their loans, if they get them.

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