Tuesday, 4 October 2022
Defective Concrete Products Levy: Motion [Private Members]
Seán Fleming (Laois-Offaly, Fianna Fail) | Oireachtas source
I have listened carefully to the comments of the Deputies in the House tonight. The scandal of defective concrete products is one which this Government is committed to addressing. We have already spoken about the redress scheme that this Government has put in place which will assist an estimated 7,500 householders who, through no fault of their own, have had their lives severely impacted by the supply of defective concrete products; products which they quite rightly expected to be manufactured to a suitable standard.
The cost of the redress scheme is in the order of billions of euro and it is untenable and unwise to suggest that all of the costs of this should fall entirely to the hard-pressed taxpayer. It is only just and right that the industry which, after all, caused the problem contributes towards making it right. The Government has come up with real solutions to support those affected by defective block products, while ensuring that the cost of this is shared with the industry that caused the issues and problems in the first place.
We have developed a levy which is targeted at the concrete industry and will raise a meaningful contribution towards the costs associated with redress for affected homeowners. The Government has no intention of allowing those responsible for the unconscionable situation that the use of mica and pyrite in the manufacture of construction materials has given rise to not to be held to account. Every possible avenue of recourse open to the Government will be pursued.
The Minister for Housing, Local Government and Heritage is currently advancing plans to appoint a senior counsel to review the defective concrete blocks issue and make recommendations on the options open to the Government to pursue potentially-liable wrongdoers, while the Government is united in its commitment to ensuring that an occurrence such as the defective concrete blocks debacle never happens again.
The Minister is also committed to establishing an independent building standards regulator to strengthen the oversight role of the State with the aim of further reducing the risk of building failures and enhancing public confidence in the construction-related activities. The purpose of the independent building standards regulator will be to oversee building controls nationwide and to act as a custodian of the building controls management system.
The scheme is currently estimated to cost in the region of €2.7 billion. This is on the basis that it will support approximately 7,500 affected householders. A redress scheme of this scale and nature is only possible if industry makes a contribution. It would be unsustainable and unjust for the Irish taxpayer to shoulder the entire cost alone. That is why the Government made a decision on the scheme last November. It has also agreed that some of the costs associated with this scheme should be borne by industry. This was widely reported at the time and it should not come as any surprise that the Minister for Finance will bring forward a levy to ensure the industry contributes to the cost of redressing the issues that originated with it.
As was announced in his budget 2023 speech, my colleague, the Minister for Finance, proposes to introduce a levy on pouring concrete, concrete blocks and certain other concrete products which are used in the construction of buildings. The levy has been set at a rate of 10% on the price of concrete products which will apply at the point of first supply of product in the State. It is intended to come into force on 3 April 2023 and will be applied to all liable concrete products manufactured or used in the State.
The proposed levy is only one among many actions this Government has taken and is taking to tackle the root cause of the defective concrete products issue. In addition to the redress scheme, my colleague, the Minister for Housing, Heritage and Local Government is developing proposals for the establishment of the independent building standards regulator and this will allow the State to strengthen its oversight role with the aim of further reducing the risks in this area and in construction-related activity.
I can also assure the Dáil that the Government is committed to addressing all of the shortcomings that led to the use of the defective concrete products in the construction of people's homes. The redress scheme was an obvious first priority to ensure homeowners were supported. However, the Deputies and others will agree that more must be done.
I will relate what has been said by one Deputy on the issue of the defective concrete blocks legislation, which provides for the State to take over a legal right or claim with regard to defective concrete blocks in a relevant dwelling against any party. This will be a condition for those people who want to participate in the scheme to agree with.
It will allow the State to pursue claims against wrongdoers and remove this burden from individual homeowners. The Minister, Deputy Ryan, is determined to pursue claims against wrongdoers, where such an option is considered possible, following the senior counsel review and the evidence gathered from homeowners as part of the application process under the enhanced scheme to adequately support any such claim. The statute of limitations is being examined as part of that review to see whether such pursuit of claims can be made by the State in respect of all these properties where homeowners agree to sign up to the particular scheme. We do not yet know whether that will be successful, but we are doing everything in our power to pursue it subject to the statute of limitations and to recover money from the wrongdoers and their insurance companies where possible. The Government is determined to follow that route.
There is a reference in the motion to the Society of Chartered Surveyors commenting in detail on how much it will cost, but it would be prudent for people to see the details of the finance Bill, which is to be published on 28 October, in order to have a full, comprehensive understanding of the specific details of the scheme.
I think every single Member who spoke here tonight said that the industry, the wrongdoers and the suppliers must pay. There is unanimous agreement that the taxpayers should not carry the full cost. There is unanimous agreement in this House that the wrongdoers must be forced to contribute. That is what we are doing. We are going after the wrongdoers through the court, where possible, and we will make every effort to be successful in that regard. We are putting a specific levy on the concrete projects mentioned which are in the schedule as announced on budget day and there is unanimous agreement that, through the industry, funds should be collected.
The only point of difference is the specific method of implementing that charge on the industry. There is a unanimous view that there should be a charge on the industry, which is the wrongdoer. It must be pursued and the Government is determined to do so. The taxpayer cannot bear the entire cost on his or her own and, therefore, it is only right that a levy or a charge be introduced on the industry in order that it makes a meaningful contribution to the overall scheme.