Fidelma Healy Eames (Fine Gael) | Oireachtas source

I also support the call for a debate on the tax system because taxes are too high and Senator Colm Burke's very wise proposal of a seven-day re-allocation period for vacant houses. There are 78 boarded-up houses in Galway city and thousands on the waiting list.

My main reason for standing up today is to raise a question about the provision of easy mortgages for first-time buyers on the back of a Government-backed insurance scheme to protect banks where homeowners may default. I support any scheme that is sustainable and based on sound fundamentals and that will increase supply at affordable prices. However, I do not support any scheme that will inflate prices, as Senator Barrett has said, and where the homeowner genuinely cannot pay back. If we go down that road, we will face the same problems the previous Government created.

It is very important that we have a debate on this issue in this House. I would like to see the following questions answered. What safeguards will we have to ensure that the buyer or mortgage holder can repay? Has this been discussed with the Governor of the Central Bank? At a meeting of the Oireachtas Joint Committee on Finance, Public Expenditure and Reform, he agreed with me in respect of our fair lending policy, that we must prevent reckless lending into the future and that debt-to-income ratios must be adhered to. What is the State's exposure in respect of this scheme? We cannot protect banks and expose the taxpayer again.

Let us move forward on this issue with sound fundamentals and make sure that we create a new supply of houses that are at affordable rates. We must think this issue through very carefully and it would be very wise if the Minister for Finance came to the House before this scheme is announced in the autumn. I know it is under negotiation at the moment and that the Taoiseach is taking a personal interest in rebooting the construction industry. I support that on the basis of it being sustainable and based on sound fundamentals rather than an inflated boom which will inevitably be followed by a bust. We should be really careful and learn from the last one. It cost €64 billion.