Paddy Burke (Fine Gael)
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Is the amendment being pressed?

David Cullinane (Sinn Fein)
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On behalf of the Sinn Féin Party I would like to withdraw the amendment. We want to support amendment No. 12 tabled by the Fianna Fáil Party. It is a more substantive amendment.

Paddy Burke (Fine Gael)
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We are dealing with amendments individually.

David Cullinane (Sinn Fein)
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I move amendment No. 11:

In page 8, subsection (4)(b), line 15, to delete "the year 2012 and the year 2013" and substitute "the years from 2012 to 2015".

I will not speak too long on the amendment because it is simple and practical. I welcome the inclusion in the list of those exempt from the charge of people who live in unfinished housing estates. I assume the logic is that all services may not have been provided. It is also unfair that people living in such estates would have to pay a property charge or tax. The timeframe should be extended to 2015. Most of the unfinished housing estates will not have services provided in the timeframe prescribed, namely, 2012 to 2013. We accept and support what the Minister of State and the Government are attempting to do, which is to support people living in unfinished housing estates.

Denis O'Donovan (Fianna Fail)
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I support the amendment and agree with Senator Cullinane.

Caít Keane (Fine Gael)
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I would ask that the definition of "unfinished" would be spelled out in the regulations. There could be a case taken if an estate was not taken in charge that it would be deemed unfinished, even though there would be only small pieces of work to be carried out and perhaps the money was in a bond or such like. It would be important to define "unfinished".

Fergus O'Dowd (Louth, Fine Gael)
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I thank the Senator for tabling the amendment. The Minister recognises that introducing this waiver could have the unintended effect of households in less problematic unfinished estates seeking to have their estate classified as category 3 or 4. This would potentially impact on the Government's priority target of reducing the number of such estates. In addition, there may also be pressure to extend such a waiver to estates which have not yet been taken in charge by local authorities. The Government's priority is to address the needs of these estates as quickly as possible.

In addition, the household charge is an interim measure while the legislation is in preparation and the assessment being made in the context of the property tax which will be introduced. It will be replaced in the short term by a full property tax. This is expected to take place in advance of the 2015 date proposed by the Senator.

In these circumstances I cannot accept the amendment but I thank the Senator for it. I agree with Senator Keane on the point that the definition she is seeking would be clear to everyone.

Brian Ó Domhnaill (Fianna Fail)
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I move amendment No. 12:

In page 8, subsection (4)(b), line 17, after "estate" to insert the following:

",or

(c) the year in which the liability falls if, on that date, he or she is the holder of a medical card issued by the Health Service Executive, or

(d) the year in which the liability falls if, on that date, he or she is in receipt of any of the following payments from the Department of Social Protection:

(i) jobseekers allowance, or

(ii) jobseekers benefit, or

(iii) supplementary welfare allowance, or

(iv) family income supplement, or

(v) farm assist, or

(vi) old age non-contributory pension, provided the recipient is not also in receipt of an occupational pension, or

(vi) disability allowance, or

(vii) disablement benefit, or

(viii) blind pension,

or

(e) the year 2012 and the year 2013 if, on that date, he or she is able to satisfy the relevant local authority that the residential property in which he or she resides is a mortgaged property in respect of which he or she has not been able to pay more than 75 per cent of his or her mortgage repayments in the preceding year, or

(f) the year 2012 and the year 2013 if, on that date, he or she is able to satisfy the relevant local authority that the residential property in which he or she resides is a mortgaged property that is currently valued at less than 75 per cent of the price at which the owner purchased the property.

(5) A person shall only be entitled to seek the waiver provided for in subsection (4)(e) if—

(a) the owner provides the relevant local authority with a certificate from the financial institution that provided the mortgage to the effect that the owner has failed to pay more than 75 per cent of his or her mortgage repayments in the preceding year, and

(b) the financial institution certifies to the local authority that the owner has not fundamentally breached the terms and conditions of the mortgage agreement other than in respect of the non-payment of mortgage arrears.

(6) A person shall only be entitled to seek the waiver provided for in subsection (4)(f) if—

(a) the owner provides the relevant local authority with a valuation from a registered member of the Institute of Professional Auctioneers and Valuers to the effect that the residential property in which he or she resides is a mortgaged property that is currently valued at less than 75 per cent of the price at which the owner purchased the property, and

(b) the owner provides the local authority with a copy of the deed of conveyance or contract of purchase of the residential property identifying the price and date of purchase of the residential property".

Paddy Burke (Fine Gael)
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Amendment No. 12 was discussed with amendment No. 10. Is amendment No. 12 being pressed?

Brian Ó Domhnaill (Fianna Fail)
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The amendment has not been discussed.

Paddy Burke (Fine Gael)
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Yes, it has.

Brian Ó Domhnaill (Fianna Fail)
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It was grouped with Sinn Féin's amendment No. 10. However, that amendment was withdrawn in favour of this one.

Paddy Burke (Fine Gael)
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Amendments Nos. 10 and 12 were discussed together. Is the amendment being pressed?

Brian Ó Domhnaill (Fianna Fail)
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I have no choice but to do so.

David Norris (Independent)
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I propose that we withdraw the amendment so that we may resubmit it on Report Stage.

Brian Ó Domhnaill (Fianna Fail)
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Yes, we will withdraw the amendment.

Paddy Burke (Fine Gael)
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Amendments Nos. 13, 22 and 26a are related and may be discussed together. Is that agreed? Agreed.

Fergus O'Dowd (Louth, Fine Gael)
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Amendments Nos. 13, 22 and 26a are required to effect technical and drafting modifications in the Bill. They do not in any way impact on the policy or intent of the legislation. Their objective is to enhance the clarity of the text for the reader.

Thomas Byrne (Fianna Fail)
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The section deals with exemptions and waivers from the obligation to pay the household charge. However, it does not go far enough. A whole swathe of people have been told that basic social welfare rates are being protected, but at the same time, charges such as this are being imposed on them. Our amendment No. 12 proposed that persons in receipt of jobseeker's allowance, jobseeker's benefit, supplementary welfare allowance, family income supplement, farm assist - for which the means test has been changed - old age non-contributory pension, disability allowance, disablement benefit, blind pension and so on should not be obliged to pay the charge. These people are not eligible for a waiver under the section as it stands. It is a serious deficiency in the Bill that we are applying a tax which will impose the same obligation on millionaires as on social welfare recipients. The waivers and exemptions simply do not go far enough.

Brian Ó Domhnaill (Fianna Fail)
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I am fundamentally opposed to the section as it stands. I appeal to the Minister of State to look with reason at the amendments we have withdrawn and which we propose to resubmit on Report Stage. The household tax will be imposed on every house in the country. As we discussed yesterday, this is not a fair means of taxation. A charge of €100 is being imposed on a large high-value house as well as on a smaller house with a lower value, the home of an elderly person or a person in receipt of social welfare or a medical card. We want exemptions for all medical card-holders. Approximately 400,000 people are in receipt of medical cards and this probably equates to approximately 150,000 households. The jobseeker's benefit was affected in the budget because the six day-period of payment has been reduced to five days. This will have a knock-on effect. Even Sunday working is now brought into the mix as part of the earnings and this will affect the social welfare entitlement of a person on jobseeker's benefit.

I refer to a person in receipt of jobseeker's benefit for three days a week who contacted me by phone. He is working three days a week, he has a large family and he is struggling to cope. He will lose substantially as a result of the changes from six days to five days. He also has a part-time Sunday job.

The supplementary welfare allowance is paid when an individual is awaiting the outcome of a social welfare appeal. Such people should be exempted from payment of the household charge. Approximately 35,000 individuals are currently appealing the refusal of a social welfare benefit and in some instances such individuals are not entitled to supplementary welfare allowance. These individuals should be exempt from payment of the household charge. The farm assist scheme was also reduced in the budget. This scheme is very important to small farmers. The assessment of means for self-employment, including farming, is being raised from 70% to 85%. The deductions from income for children are being halved to €127 per year for each of the first two dependent children and €190 per year for each subsequent child. Poor farmers will find it more difficult to access the €188 per week of farm assist payment. The farm family income supplement supports families and recipients should be exempted from payment of the household charge.

Recipients of non-contributory pension, in particular, elderly people who do not have an occupational pension, have been affected negatively in the budget because they have lost approximately €120 from the fuel allowance scheme. If such people also have to pay the household charge, the net loss to those families will be €220 per year. It would be a step too far to include such pensioners. I welcome the fact that the budget did not impose cuts on weekly payments but on investigation it is clear that cuts will affect everyone in receipt of social welfare payments. There is no need to speak about the disability allowance because we all know what has happened. The Minister for Social Protection, Deputy Burton, outlined on Second Stage of the Social Welfare Bill in the Dáil that she will remove the provisions in the Bill to reduce the disability allowance for those aged between 16 and 24 years. This was the right action to take but she should have had the social conscience to know the effect of such a provision. I refer to the front page of the Irish Examiner this morning which reports on a disabled individual whose payment would have been reduced from €188 to €100 and this person was born without limbs.

Denis O'Donovan (Fianna Fail)
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We are not dealing with the Social Welfare Bill and I ask the Senator to confine his remarks to the Bill under consideration.

Brian Ó Domhnaill (Fianna Fail)
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It is connected to the question of who should be exempted from payment of the household charge such as those in receipt of disability benefit, blind person's allowance and lone parent's allowance. Mortgage-holders in difficulty who are unable to meet mortgage repayments should also be exempted and also people in negative equity and those who bought property during the boom from 2004 to 2011 or thereabouts. Those people paid substantial stamp duties. The budget announced a reduction in stamp duty to provide an incentive for property purchase. The budget provided significant tax incentives which have received scant coverage and these incentives will support all NAMA and commercial properties. These incentives include the writing-off of capital gains for commercial properties if purchased before the end of 2013 and if the property is retained for seven years. This will benefit investors and owners of commercial property and also NAMA.

Denis O'Donovan (Fianna Fail)
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The Senator is straying again.

Brian Ó Domhnaill (Fianna Fail)
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I apologise-----

Caít Keane (Fine Gael)
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He has met himself coming back at this stage.

Denis O'Donovan (Fianna Fail)
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The Senator will soon end up in Gweedore if he keeps going that way.

Brian Ó Domhnaill (Fianna Fail)
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My comments are about the effects of the budget. If I go to Gweedore I could meet myself in Kerry, given the fact that the budget is impacting on everyone across the country, from Gweedore to Kerry, in many negative ways.

David Norris (Independent)
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It was the route chosen by certain parliamentarians to visit Leinster House from different sections of the country.

Denis O'Donovan (Fianna Fail)
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Senator Ó Domhnaill, without interruption.

Brian Ó Domhnaill (Fianna Fail)
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The reason for our opposition to section 4 of the Bill is the question of exemptions. The Minister has stated he is willing to take into consideration individuals in receipt of mortgage interest supplement and this is to be welcomed as there are 18,000 people in receipt of mortgage interest supplement payments. However, this gesture is not sufficient. Already, 70,000 people are in mortgage arrears and they should be included in the exemption as the mortgage interest supplement does not take into account most of those people who find themselves in very difficult and significant financial difficulties.

I hope when our amendment is dealt with on Report Stage there may be some good news from the Minister when he has studied some of the proposals which we believe are valid.

The Department of Finance is budgeting for the household charge to produce a revenue of €160 million in 2012. However, the internal documentation supplied by the Department of the Environment, Community and Local Government to the Department of Finance prior to the budget calculated that the net income to the State will only yield a net income next year of €100 million.

Why is there a discrepancy? The reason is that the Department has calculated its €100 million figure on the basis that many people will not be able to pay the charge, whereas inability to pay has not been taken into account in the budgetary figures presented by the Minister for Finance. A difference of €60 million has emerged between the calculation provided by the Department of the Environment, Community and Local Government, which is sponsoring the legislation, and the Department of Finance, which presented the figures in the budget. I am not sure where the anomaly arises but I ask the Minister to cast some light on the matter.

David Cullinane (Sinn Fein)
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I will not rehearse the arguments made on previous sections as I appreciate we have many amendments to discuss. I accept much of what the Minister of State said yesterday when he outlined many of the exemptions that are in place, for example, for tenants of local authority housing and people who are in receipt of mortgage interest supplement and rent supplement. While a number of categories of people will be exempt from paying the household charge, there is a long list of people who are in receipt of social welfare benefits, which include jobseeker's allowance, jobseeker's benefit, supplementary welfare allowance, family income supplement, farm assist, old age pension, disability allowance, disability benefit, blind pension, invalidity pension and carer's allowance. It is important to ensure anyone who is in receipt of any form of welfare payment is exempt from the €100 household charge.

As I pointed out, Sinn Féin's position is one of outright opposition to the household charge. Notwithstanding that, the Government must ensure, when it is considering exemptions and waivers, that all those in receipt of welfare payments are exempt from the charge. The reason people are in receipt of welfare payments, including those who receive the family income supplement, is that they are in low income households and could be at risk of poverty. I echo the request of previous speakers that the Government take on board the thrust of the amendments which have been withdrawn for resubmission on Report Stage. I hope the Minister of State will reflect on the categories of people who may fall through the cracks in respect of the protections set out in the Bill. Anyone in receipt of a social welfare payment should be exempt from the household charge.

Caít Keane (Fine Gael)
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It is worth repeating that not one Member of the Oireachtas considers the household charge to be an ideal way of introducing a property tax. Equally, however, not one of the Members opposite has produced an alternative methodology.

Thomas Byrne (Fianna Fail)
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The manifestos of both Government parties included alternatives.

Brian Ó Domhnaill (Fianna Fail)
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That was before the election.

Denis O'Donovan (Fianna Fail)
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Please allow Senator Keane to continue without interruption.

Caít Keane (Fine Gael)
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When county councils are drawing up their budgets councillors who recommend the removal of one item must-----

David Cullinane (Sinn Fein)
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With respect, that is not how legislation is drafted or amendments accepted.

Caít Keane (Fine Gael)
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While I will listen to reasonable argument, I wish to make a point.

David Cullinane (Sinn Fein)
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I will drop a copy of our pre-budget submission into the Senator's pigeon hole.

Caít Keane (Fine Gael)
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I would listen carefully to any suggestion on how to balance the budget. We are where we are and we all know why. We also know who is responsible and all of us need to act responsibly.

Thomas Byrne (Fianna Fail)
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The Progressive Democrats, of which the Senator was a member, was also responsible.

Caít Keane (Fine Gael)
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We all know who is responsible. If a member of the Opposition produces a suggestion on where he or she will get the money, I will accept the need for further waivers. However, Senators are asking for every old age pensioner to be given a waiver. We would all love to give everyone a waiver but there are-----

Brian Ó Domhnaill (Fianna Fail)
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On a point of order, we are calling for a waiver for all old age pensioners who are in receipt of a non-contributory pension.

Caít Keane (Fine Gael)
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As I indicated, if one does not tax property but taxes other goods and services, one can distort expenditure and investment decisions. This approach takes such decisions out of people's hands in that it encourages expenditure on and investment in property at the expense of spending on other goods and services. In other words, the absence of a household charge has meant that other taxed goods and services have been adversely affected. For this reason, it is good to broaden the tax base. While the proposed charge is not the ideal way to do this, as the Minister of State pointed out yesterday, it is an interim measure.

On the figure of €160 million versus a figure of €100 million, one would need a glass ball. There is no differentiation between the facts and figures supplied by the Department of the Environment, Community and Local Government and the statement made by the Minister for Finance. Both the Department and Minister provided figures of €160 million. The difference of €60 million referred to by Senator Ó Domhnaill reflects the fact that allowances may have been made for the non-collection of €60 million. While none of us would advocate non-payment, this may explain the difference in the figures. In the current climate we should all encourage people to pay the charge for the good of the country. People would then have more money in their pockets at their own discretion to decide to spend on goods, shops and services, thereby increasing retail sales and employment. We must get the money from somewhere and while the proposed charge is not ideal, it is an interim measure.

David Norris (Independent)
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In general I support the amendment because it deals with the weakest people in society. A certain point has been made about the disability allowance and so forth. A challenge was made by my distinguished colleague, Senator Keane, who stated we all know who is responsible. That is rather simplistic. I agree there was a clear implication that various Governments played a significant role in it but let us not forget that the collapse of the world economy started in the United States of America with the involvement of Enron and the ratings agencies. We should not take all the blame.

Caít Keane (Fine Gael)
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Yes, but we are to blame for the property collapse.

David Norris (Independent)
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When we say we all know who is responsible there is no question or doubt that there is clear responsibility on the part of certain Governments. However, the problem is wider than that as the catastrophe we are facing did not originate in this country. It was facilitated by foolish Governments but responsibility rests with the entire rotten system which is on the point of collapse.

Caít Keane (Fine Gael)
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A certain amount of free will was involved as well.

David Norris (Independent)
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Senator Keane made a reasonable point that the Government may be more inclined to address this issue if alternative sources of funding could be found. I have a proposal in this regard. I suggest an end to the automatic entitlements to an increment in the public service. As people have not yet been given their increment, withdrawing it would not take money out of their pockets and would not breach the Croke Park agreement. I am not attacking the public service but when challenged to produce an alternative source of revenue, my proposal would at least match the proposal before us. I have given one answer that this side can legitimately provide.

Finally, and I should have said this first, we all appreciate very much the courtesy the Minister of State has shown in accepting that the Bill should proceed this evening and taking time out of what is, I have no doubt, an extremely busy schedule to make himself available for this debate. All sides appreciate what he has done.

Thomas Byrne (Fianna Fail)
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While I do not wish to delay proceedings, I will raise an important issue. This section appears to have been dropped into a template Bill that was provided by the legislation on the non-principal private residency charge. With all due respect to those responsible, this is not a particularly well drafted section. Why are certain people not liable to pay the charge while others are entitled to a waiver? Is it intended to make a distinction or difference in respect of waivers? As the Minister of State will recall from his old days when he served with my father on Drogheda Borough Council, a waiver for bin charges was always a reduction and never a full exemption. I do not know what is the exact definition of the term.

David Norris (Independent)
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It is a kind of grace and favour.

Thomas Byrne (Fianna Fail)
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That is the point because some people are entitled to the waiver whereas others are not liable to the charge. Will the Minister of State explain the difference being made between the two groups in the legislation? Is it intended? From a drafting point of view the section is difficult to read. Subsection (5) states: "The Minister shall not prescribe a list for the purposes of this section". The list is for the purposes of subsection (4)(b) which refers to unfinished housing estates. Therefore, the list the Minister would prescribe under subsection (5) is not for the section and the section does not oblige the Minister to prescribe a list. The section also features a number of definitions, including the term "unfinished housing estate". The wording appears to be all over the place. In the interests of plain English and to enable everyone, including Members, to comprehend the section, the definitions in the section should be inserted in the definitions section at the start of the Bill. The list that the Minister will complete is not a list for the purposes of the section but for the purposes of a definition.

My other point of concern is the extent to which political influence will be involved in the drafting of the list. Can one lobby the Minister to say, "This is a really bad estate that should be put on the list"? The local Fine Gael or Labour Party Deputy would get great kudos because 20 residents do not have to pay the €100. I do not know if that is how it will work, I hope not. Taxation should not work like that, whatever about other matters of Government expenditure such as grants for sports, schools, etc.

Fergus O'Dowd (Louth, Fine Gael)
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This is a good debate. We would be happy to respond to the resubmitted amendments on Report Stage. Notwithstanding the points made by the Senator, many of the issues are technical. I appreciate the short notice given of the Bill. I could address these issues if I can----

Thomas Byrne (Fianna Fail)
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Perhaps the officials could look at it.

Fergus O'Dowd (Louth, Fine Gael)
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We will be looking at this tomorrow. As I understand it, the document regarding the €100 million was submitted by the Department long before the legislation was published. The recently published Estimates Volume shows that the household charge is estimated to yield €160 million to the local government fund in 2012. That has been the clear intention of the Government and is clearly outlined in the Estimates. It is our intention to raise that money under this legislation.