Gerald Nash (Louth, Labour) | Oireachtas source

I welcome the opportunity to speak on this motion on behalf of the Labour Party. I heard the Taoiseach say this week that the issue of housing is the biggest issue facing young people and I agree with him. It is also the biggest issue facing our society more generally. Precarious housing and precarious work produce precarious lives. Precarious lives destroy communities and wreck social cohesion and they will destroy our social contract.

The Minister made reference in his contribution to the fact that it used to be the case that if one studied hard, worked hard and saved hard, one had a shot at owning one's own home. This is no longer the case for far too many people. I have said time and again before this awful pandemic hit that this generation that was born in the 1980s and the 1990s was likely to be the first since Independence that was destined to do less well than their parents. The ESRI report published this morning confirms that to be the case. It makes for harrowing reading. On all the metrics such as housing, pay and decent work and life opportunities, younger people have been the casualties.

Fine Gael has told us in recent years that things are going ever so well. On GDP terms we are but if one looks under the bonnet it tells an entirely different story. The economic and financial disaster that was inherited from Fianna Fáil in 2011 was fixed, in no small part, by the work done by my party, and by Fine Gael I must acknowledge. It turns out though that the sacrifices made then brought about a recovery for some but left a whole generation behind, the generation at least facing the risk of being left behind. Household wealth has grown enormously since 2013. This is down to year-on-year growth in house prices and supply is a factor here. Fine Gael knows where its electoral and political market is. We are two Fine Gael housing Ministers later, all tacitly backed by Fianna Fáil.

During those years, we failed to build the public, private and affordable homes people need. We failed to make renting secure. We failed to see sufficient caps placed on ever-escalating record rents.

Fine Gael is in an ideological cul-de-sac and it now has a Fianna Fáil Minister cornered and captured. This is truly no country for young people. Is it any wonder that REITs and IREFs have declared open season on Ireland? These faceless monster investment funds have it every way. They are hoovering up everything in sight and are now outbidding would-be first-time buyers in areas such as my home town of Drogheda. The longer the supply problem exists, the better will be the yield for these funds' investors. These funds exploit tax rules introduced in a certain context in 2012. Those rules have remained largely untouched since, with a small exception or two. Almost ten years on, and in a fundamentally different housing market and environment, it is high time that time was called on certain activities of these funds. It is morally unjust and politically indefensible that REITs and IREFs pay the same percentage rate of stamp duty on residential purchases as typical first-time buyers. Even Boris Johnson's Conservative Party cottoned on to the impact of REITs and slapped a 15% rate of stamp duty on them, with additional surcharges in some cases. If the political will exists in the Government, this and other very targeted tax measures could be taken to soften the cough of these vehicles that are, frankly, drunk and out of control on tax breaks.

It is also open to the Government to change the tax rules that apply to these structures. REITs elect to be considered REITs by Revenue. There are clear rules that need to be complied with for a REIT to benefit from exemptions such as those relating to corporate tax and capital gains tax. These rules can be amended and aligned with Government planning on housing policy in a targeted way to restrict or, indeed, end the activity that we all say we are so concerned about.

My colleague, Senator Rebecca Moynihan, has proposed a number of key measures that would be game changers for renters, for the provision of public, private and long-term rental homes and for first-time buyers. She has also made some very important points about the way in which housing is discussed, the narrative around it and how it is almost always presented through the lens of a couple, and more specifically, a couple who are first-time buyers. Housing is an issue for everyone. Let us not forget the 400,000 people who live alone and those who want to remain as single-person households. They also need security, certainty and a chance to own their own place.

Senator Moynihan was not playing games when she pledged last week to introduce a Bill from the artist formerly known as plain old Deputy Darragh O'Brien before he entered the Customs House. That Bill has been submitted this week in the name of Deputy Duncan Smith. We submitted it because we believe it has potential, if amended, to be a fix for the problems we are experiencing. The submission of the Bill is also designed to keep the Minister honest.

Our view, expressed long before we reached this sorry pass, is that we need a complete and fundamental culture shift on the provision of housing and how we view housing policy more generally. Housing ought not to be a commodity to be traded. It is not a status symbol. The only ladder we should associate with housing is that one we use to clean our windows. The financialisation of housing has destroyed lives and communities. Let us get back to building good well-designed homes and integrated communities and not just units, in the language of the business, informed by cost and profit motive.

I also have a word of warning for the Minister. The kind of investment we will need for an ambitious public home building programme will require unprecedented levels of State capital investment. At present, we can borrow money at negative interest rates but EU spending strictures, which owe more to an economic experiment from the financial crash than to the circumstances of 2021 and beyond, could see us straitjacketed.. At the same time as we are prevented from borrowing, the European Central Bank and other central banks are flooding the markets with cheap cash. There are vast amounts of money circulating the world in search of investment. This includes investment in developing land and housing. The net result of this is a bidding war for capital assets, which inevitably is causing capital asset inflation.

The real effect of these investment funds outbidding each other is the impact this is having on potential first-time buyers in Ireland. This is the real world impact. This is the effect. The double whammy is that, on the one hand, Europe, through its lending, fiscal and monetary policy, is funding the investors who are driving up the price of Irish houses while, on the other hand, through its borrowing policy, it is preventing the Government from borrowing in order to build sufficient numbers of public and affordable homes. It is as if Europe were selling discount weapons to its enemies while imposing strict disarmament upon itself. No one could argue that the combined effect of these two policies was ever intended or that it is sustainable. Frankly, it needs to change.

My firm view is that if the future of the EU is to be a strong entity to which we can all give our support, and I do, then after the pandemic we will need a Marshall plan investment approach to rebuilding our economies and to building the homes, social infrastructure and secure jobs on which social solidarity and national and EU cohesion depend. This requires the type of investment that, frankly, anachronistic EU fiscal rules, which are completely outdated as they are structured, do not allow. This needs to change to help us reach our ambitions for Ireland in terms of capital investment in housing and infrastructure to make sure we can rebuild our economy and rebuild our society and build back better.

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