Tommy Broughan (Dublin North East, Labour)
Link to this: Individually | In context

Question 211: To ask the Minister for Finance if he has reviewed the trend for top-up loans or deposits being offered by property developers; his views on this type of activity in the mortgage sector; if these financial offers are being fully invigilated by the relevant regulatory authorities; and if he will make a statement on the matter. [34056/08]

Brian Lenihan Jnr (Dublin West, Fianna Fail)
Link to this: Individually | In context

I refer the Deputy to my reply to his PQ Dáil Question No. 74 (Ref: 31317/08), taken together with Dáil Question No. 52 (Ref: 31336/08) tabled by Deputy Sean Sherlock, for oral answer on Thursday 25 September 2008. He will have noted that my Department has asked the Consumer Director in the Financial Regulator to review current practices of seller financing of deposits for housing sales and that I will advise the Deputy of the outcome of this assessment.

Tommy Broughan (Dublin North East, Labour)
Link to this: Individually | In context

Question 212: To ask the Minister for Finance his views on measures that make more attractive the provision of lower or fixed rate mortgage and other associated financial products; and if he will make a statement on the matter. [34057/08]

Brian Lenihan Jnr (Dublin West, Fianna Fail)
Link to this: Individually | In context

I would point out to the Deputy that this Government has provided significant supports to first-time buyers through the mortgage interest relief measure fulfilling the commitment contained in the programme for Government. Cumulatively, as a result of Budget 2007 and Budget 2008, first-time buyers have obtained additional relief of up to €100 per month, if single, or €200 per month, if married or widowed, subject to paying sufficient mortgage interest to avail of the relief.

In addition to the increase in mortgage interest relief, the limit of the exemption from income tax which applies to rent received when a person rents out a room or rooms in his or her principal private residence was increased from €7,620 to €10,000 in Budget 2008.

These are substantial measures and I am informed by the Revenue Commissioners that the cost of all mortgage interest relief in 2008 is expected to be approximately €665 million.

The question of any change in the rate of mortgage interest relief would be a matter to be considered in the context of future Budgets. However as it is a long-standing practice of the Minister for Finance not to comment in advance of the Budget on any tax or expenditure matters that might be the subject of Budget decisions. I do not propose to depart from that practice.

Furthermore, last week against the backdrop of unprecedented difficulties in international financial markets, the Government acted quickly and resolutely to guarantee the depositors and lenders with Irish financial institutions and ensure these institutions can access the funding necessary to enable them to continue to provide the financial services and liquidity needed for the proper functioning of our economy and society.

The Credit Institutions (Financial Support) Act 2008, provides the necessary legal underpinning to the Government's announcement and I will shortly bring before the Houses of the Oireachtas the scheme provided for in the Act, which will set out in greater detail the terms and conditions on which assistance will be provided.

In taking its decisive move, the Government has done its part to create the conditions that will enable credit institutions to access funding so that they are in a position to fulfil their role in providing credit in our economy and society. It is now up to these institutions to respond to the Government's action by ensuring the flow of finance is channelled to sustain economic activity.

Finally, as the Deputy is aware, the decision as to the range and scope of the particular products to be provided by financial institutions is ultimately a commercial one for those organisations and one in which neither I nor the Financial Regulator has an operational role.