Gerald Nash (Louth, Labour) | Oireachtas source

We hear high-profile murmurings this week of new tax incentives for developers, leading me to the conclusion that this Government does not mind a bit of socialism as long as the welfare payments are paid to wealthy developers and to the benefit of corporate landlords. The Government’s message to those who are looking to put a roof over their heads is that it is going to take some of their taxes to give to private developers to encourage them to get their fingers out and finally build the homes we need. This is apparently because the profit motive just is not enough these days.

I am a pragmatist. We are a pragmatic party. We are happy to scrutinise any proposal on tax reliefs that Fianna Fáil wants to propose. However, Fianna Fáil’s history with tax cuts and developers has never ended well. The people of Ireland are still paying the price. It seems that we are destined to enter a doom spiral of never learning, of doing the same thing and expecting a different outcome.

Looking at Fianna Fáil’s and Fine Gael’s recent history of expensive, untargeted tax reliefs in the housing area, we see a tax credit for landlords that they never asked for, an answer to a question nobody ever asked, yet landlords are still fleeing the market. That was an absolute distraction. I am drawn to the comment made by eminent economist Barra Roantree at the time this proposal was introduced, when he said this was among the stupidest tax reliefs in recent times, amid very stiff competition. The help-to-buy scheme is a tax relief costing close to €1 billion which is pocketed by developers and only serves to inflate house prices, as we always said it would. It was repeatedly opposed by officials in the Department of Finance who are paid to advise the Minister. The Government already subsidised developers to complete apartment complexes under Croí Cónaithe yet they still have the paw out for more. This is absolutely incredible.

We in the Labour Party would take a different approach, not merely because we have a different political philosophy but because the Government’s approach has failed and will continue to fail. Tax cuts for builders will not address the escalating price of land. They will not magic up tens of thousands of skilled workers. Tax cuts will not streamline our planning system. They will not incentivise developers to use new technologies and innovate. This is why ten years ago the ESRI said “No” to tax breaks for private home builders. The exact same case remains today. The Labour Party also believes that we can and should smartly use public resources to help to create better conditions to make it more attractive for SME developers to build the private and cost-rental homes we need.

We would also establish a State investment and development bank to finance private housing development using a portion of the Future Ireland Fund. We propose that we develop a new long-term financing product for approved housing bodies underwritten by the State to provide financing at 3% or less over 50 or 60 years. This would reduce the cost of financing the cost-rental housing we need and make those rents much more affordable, bringing certainty into the system for developers and also for long-term renters. We have a plan to unlock some of the €150 billion in private savings on deposit by developing a housing solidarity bond via State Savings that would have an attractive interest rate and help to redirect private investment from vulture funds towards housing development. I believe, given the crisis we are in, that the Irish people would be up for that.

We would also provide for further opportunities for credit unions to underwrite mortgages and invest in housing using surplus savings. These measures, along with the establishment of a State construction company, which, by the way, to remind the Taoiseach, is merely the next step in the evolution of the LDA, an initiative that the Labour Party, uniquely in the Opposition, supported, are the kinds of practical ideas to address the housing crisis that the senior members of this Government thumbed their noses at when we entered exploratory talks on forming a Government.

There is time for a radical redirection in housing policy that ramps up housing delivery and brings costs down for those seeking to buy or rent a home.

It is not the Labour Party which is hostage to dogma and ideology; it is the Taoiseach.

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