Rory Hearne (Dublin North-West, Social Democrats)

I will speak to resolution No.4. In this reduction in the VAT rate, the Government is very clearly throwing us back to an Ireland that we thought we had left behind. It is the Ireland of crony deals and dig-outs for developers and the wealthy. I was wondering if Fianna Fáil and Fine Gael did some séance or bring out a Ouija board to design the budget? Did they conjure up the spirit of Charlie Haughey and ask him what they should do? Did he say they should keep bending the knee and rolling out the red carpet for the big money? The truth is this VAT cut is the same old Fianna Fáil and Fine Gael policy. They did it in forming the Government; they resurrected Michael Lowry. Now they are resurrecting the failed tax policies of the Celtic tiger with tax breaks for developers but now it actually gets even worse.

We are seeing the bankrolling of global vulture funds. That is who will benefit from this tax cut. It will be multibillion global funds and big developers who will get their tax bills cut. Through this reduction in the VAT rate, they will get almost €500 million every year between the VAT cut and the other measure to reduce construction costs. This is being poured into their pockets for what? It is to develop build-to-rent apartments that they will then charge absolutely astronomical rents for, which will now have no rent controls under the Government's new housing measures.

I will give examples of the companies the Government is bankrolling. Kennedy Wilson, a $28 billion US real estate fund with thousands of rental apartments here, will no doubt be developing and buying more. It charges €3,800 for a two-bedroom apartment. IRES REIT is another one that will be developing, buying up and benefiting from these VAT cuts. It charges €2,100 for a one-bedroom apartment. It had a rental income of €83 million last year but who are its major shareholders? Where is this money going? Kennedy Wilson, as I said, is a major US fund. The major shareholders of IRES REIT are the US-based BlackRock and Fidelity, and UK-based asset managers. It is similar for big developers, Glenveigh and Cairn. International funds are creaming huge amounts of money from this.

While one in five of our children is in poverty after the family pays their housing costs, in this budget the Government is going to give €500 million to global and Irish investor funds to build even more extortionate rental apartments that no young people in this country will be able to buy. It is absolutely incredulous that in the coming two or three years, we could be looking at over €2 billion given in tax breaks to these funds to build apartments on which there will be no requirement whatsoever regarding the price they are sold at or the rent that is charged. We are pumping billions of euro of taxpayers' money to build apartments on which there will be no affordability requirement. It is essentially providing a slush fund to these developers and investor funds to charge whatever they want. This is not policy; it is madness.

Fianna Fáil and Fine Gael claim to be the parties of home ownership, but now that is just a figment of their imagination. They have self-deluded themselves into thinking that their policies promote home ownership. Between 2011 and 2022, the number of 25--to-35-year-olds who own their homes has collapsed by 50%.

They have turned our young people into rental fodder for global vulture funds. It is important we point this out because there is a serious lack of critical thinking and engagement in policy in the Government, the Department of housing and the Department of Finance regarding this measure. There is no guarantee whatsoever that new units will be built or that they will have affordability requirements. They will be able to charge whatever price and rent they want.

What choice is the Government giving young people in this country? It is giving them the choice to either hand over the majority of their hard-earned money to a corporate landlord, stay stuck in their childhood box rooms unable to start their independent lives, or else emigrate. Fianna Fáil and Fine Gael are telling young people in this country to emigrate because they are not going to offer them a home.

The only big initiative the Government is doing on housing in this budget is to bankroll investor funds and developers. The Government is so devoid of new ideas, vision or ambition. The Taoiseach said he was going to make difficult housing policy decisions, but the difficult decision would have been to pump money into State construction to actually deliver homes that would bring down rents and house prices. Instead, the Government is doing nothing in that regard. It is very clearly captured by the large funds and that is what this VAT change is about. The Government is about blaming everyone else except itself. It needs to take responsibility. This VAT cut will not deliver anything except more expensive rental housing.

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