Pearse Doherty (Donegal, Sinn Fein) | Oireachtas source

In the past hour we have heard the usual excuses and well-versed defences from Government, something that has not changed in the years that I have been raising this issue. Any investors, cuckoo funds or vulture funds listening to the contributions from the Minister for Finance, Deputy Donohoe, and the Minister of State, Deputy Burke, will be happy enough because they know that their lads in Fine Gael have their back. Nothing is going to change, according to the two lads here. The Minister for Finance tried in his speech to convince us all that the vulture funds are poor souls, trying to do their best for the ordinary renters and home purchasers out there and that maybe we should shed a tear for them. The reality, however, is very different. The fact that the Minister did not even talk about the fact they do not pay any corporation tax or capital gains tax shows that there is no defence for the sweetheart deals he and his colleagues have given to these funds over the last few years.

One of the myths peddled by the Government, and reiterated by the Minister this evening, is that these funds finance residential developments that would otherwise not be built. This is not the first time we have heard this. The Minister has said it numerous times previously. Indeed, his party leader, the Tánaiste, told the Dáil that the role of these funds was to finance the construction of developments which would not otherwise have been built because such developments were not able to get funding from banks. That is what he told this House but that is blatantly untrue. As the estate agents Hooke and MacDonald noted in a recent report on residential investment in Dublin, very few institutional investors have funded the development and construction of properties they bought in the Irish market. That is the truth and not what Deputies Donohoe and Varadkar have said, and not the spin that is coming from this Government.

Last week a report from BNP Paribas found that investment funds bulk-purchased 4,900 properties in 2021 alone and they paid 32% more than the average asking price. They paid 32% more because they believe that rents are going to stay at current levels. Those same properties are now being rented out at extortionate prices. The prices are extortionate; there is no other word for it but the Minister of State, Deputy Burke, wants us to shed a tear at the prospect that the funds might have to pay €400 more, even though they do not pay any tax whatsoever. These funds have more fire power than ordinary workers and families. If the Government cares, it must do something about it. They have more fire power and the Government is actually making things worse. It has given them even more fire power because its policies gives them a greater advantage over workers and families and that is the blunt truth. There is no hiding place from this.

Home Building Finance Ireland, HBFI, which is wholly owned by the Minister for Finance, was set up by the Government to finance residential development. It has provided €264 million in funding for five developments comprising a total of 916 units. Those units have been or will be bought up by these same funds. Taxpayer funding of more than a quarter of a billion euro is being provided to develop homes but those homes will never come on the market. The funds buy them right from the start. The funds agree to buy them and charge eye-watering rents of €2,000 plus but the Minister for Finance, with the support of Fianna Fáil, Fine Gael and the Green Party, tells them that they do not have to pay one cent of tax on the millions of euro they get in rental income. Any other company or individual would have to pay tax on that rental income but the Government has decided that these funds should have special privileges. They can boost up rental and house prices. They can pay 32% over the asking prices, thus pushing up house prices for everybody else. Then the Government tries to convince us that ordinary renters, workers and families are at the heart and core of its housing policies but nothing could be further from the truth. The Government's policies only serve one purpose and that is to support the funds.

In May 2020 the Dublin-based investment advisory firm Gillen Markets wrote a note to international investors on our housing market and why it is broken. It said that current housing policy has benefited both institutions and developers at the expense of individual buyers. The aim of institutions is to maximise rental income from their properties and developers are designing apartment blocks to maximise this income for the institutions rather than aiming to meet the needs of society. It went on to say that the current high level of house prices and rents in Ireland in the residential property market has been driven to a significant extent by Government housing policies aimed at attracting institutional investors into the market. Their gradual move into the market has contributed to higher housing prices and higher rents. These are not my words or the words of Sinn Féin. This is the market talking to itself, exposing what Fine Gael in government has done over the last ten years. Successive Governments have rolled out the red carpet to funds, given them more fire power and allowed them to push up prices for ordinary people but the public can no longer stand for it. What is happening is crazy. People are pleading with the Government to take away the advantage the funds enjoy. Why under God would the Government allow them to outbid ordinary families who are in desperate need of homes? Why is it allowing them to do it? Neither the Minister nor the Minister of State addressed that question in their ten minute contributions. Not once did they justify allowing them to pay no tax, to outbid ordinary people and to push up rents in this city across the board.

This motion should be supported by anybody who has the interests of workers and families at heart rather than the profits of these funds.

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