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Finance (Local Property Tax) Bill 2012: Second Stage (Continued)

Friday, 14 December 2012

Dáil Éireann Debate
Vol. 786 No. 4

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(Speaker Continuing)

[Deputy Dessie Ellis: Information on Dessie Ellis Zoom on Dessie Ellis] The current demand, more than double the lowest levels ever recorded in the State, is approximately 100,000 applicants on the housing waiting list, with an additional 100,000 on RAS and rental supplement, which I do not consider to be housed.

Local authorities, housing bodies and co-operatives house many thousands of people in every county, borough and city. They provide that most basic of things, a roof to lie under and a place to call home. A state which fails so many in this regard is not one of which to be proud. Funding for social housing has been cut repeatedly in recent years following decades of the running down of public housing and the long-running attempt to relinquish the State of the responsibility for social housing provision. The buck has been passed on to the housing bodies which cannot meet the demand and are being cut by the Government. The private rental market has also been enlisted, being subsidised by more than €600 million every year, as more than 100,000 families are on rental subsidy and RAS. It is a shame that we have gone down that road.

Last week, the Government cut a further €46 million from the local authority housing budget, down to €65 million from €189 million in 2011. Regeneration projects, in Cork, Dublin and Limerick in particular, have been cut by €34 million. Funding for Traveller accommodation has been virtually abolished. That is unsurprising given who is Minister for the Environment, Community and Local Government. Traveller sites and homes are to be liable for the tax. Housing is not a priority for this Government. The thousands in substandard, overcrowded, unaffordable accommodation crying out for a decent place to live - the cut after cut to housing and the increase in the number of those sleeping rough and shelters bursting at the seams are all testament to that. Now we have the home tax, which is the nail in the coffin for anyone who was naive enough to believe the Government gave a fiddler's for housing. If the Government rejects the Sinn Féin amendments, the new tax will be levied on the houses provided by local authorities and housing bodies. That will add approximately €5 to €7 a week on each council property. It is an absolute scandal. For local authorities across the State, that means a bill of approximately €25 million. According to Respond! Housing Association it will cost it up to €400,000 and cost the voluntary sector €3 million as a whole. Most likely, those figures do not take into account the loss of work hours calculating the levy on these bodies for the audacity of doing a job the State has failed or shirked.

Local authorities are supposedly to benefit from the home tax. What a lot of nonsense. What benefit will councils realise as they fork out for every home they have provided? The only conclusion is that this money will be taken from services the council provides. In Dublin, we have a crisis not just in provision but also in the upkeep of social housing. How much will the council cut from maintenance to pay its bill for the home tax? Will tenants be forced to pay higher rents? Will local authorities have to front-load the tax? Given that some tenants are already struggling and many are in arrears, one could ask how we will get money from such people.

I urge the Government to support the amendments my party has submitted. The amendments would exclude social housing from liability. It is unacceptable to force any person or family on social welfare to pay out of their payment. We would also exclude pyrite-affected homes. Families who live in homes which have serious structural problems or are threatened by them should not have to pay the tax. Such people were failed by the State which did not properly regulate to weed out materials contaminated with impurities like pyrite and there must be recognition of that. I welcome the exclusion of unfinished estates but I ask that the owners of homes in problem buildings or estates such as Priory Hall, The Laurels, Gleann Riada, Aileach Valley and Balgaddy would also be included. To do anything else would be to act irrationally and callously. We have had too much of that from the Government already.

Many of my former Labour colleagues on the council have decided to abandon the tenants for whom we all fought in the council chamber. We fought to keep rents down and to help such tenants by seeking increased funding for maintenance. Members have let tenants down. They have forgotten where they came from. There are alternatives. We have shown what they are. One such possibility is a wealth tax. It is being used more and more in Europe. Even the opposition in Germany has proposed a wealth tax. Let us look at possible alternatives and listen to proposals made by others. People have rights and it is a breach of civil rights to go after people's money. It is an outrage that we have come to this stage. There may be legislative reasons that this measure should not be allowed. It is outrageous. I call on Members to vote against the Bill, which will impose significant penalties on families, far more than people realise. In January or February, people will be beating down our doors on all the other budget cuts. This tax will elicit the same response when people see what is involved. I urge Members to vote against the Bill.

Deputy Mary Lou McDonald: Information on Mary Lou McDonald Zoom on Mary Lou McDonald How much time do I have?

An Leas-Cheann Comhairle: Information on Michael Kitt Zoom on Michael Kitt Twelve minutes.

Deputy Peter Mathews: Information on Peter Mathews Zoom on Peter Mathews Deputy McDonald is lucky.

Deputy Mary Lou McDonald: Information on Mary Lou McDonald Zoom on Mary Lou McDonald Indeed. It is difficult to know where to begin. This is an unfair and unjust proposal, which comes hot on the heels of social welfare cuts rushed through the Dáil yesterday. We are all acquainted with those. I hope we are all equally acquainted with the consequences that the cuts will have on people's domestic budgets, on their standard of living and decisions they will make on whether they can pay their energy bills, pay rent or buy a new pair of shoes or a coat for a child.

I am conscious sometimes that when I raise such issues they might be considered a little mundane for a Chamber as auspicious as this one. It is worthwhile for all of us to remember that in the final analysis, when all the political rhetoric has been done and dusted and people have dug themselves into whichever political trench is appropriate, we all go home and we go back into the real world. The communities I represent are no different from those of many other Members. In the real world, people are struggling. That is not just rhetoric; that is the truth.

One could ask why the property tax is wrong and irrational. It is because people cannot pay it. Sin é. I will go into more detail in my finessed political arguments but the bottom line is that people do not have the money, end of story. In theory, the Minister for Finance, Deputy Noonan, might think it a noble thing to introduce this new form of taxation. He might make arguments about broadening the tax base and point to other jurisdictions. That is alright, but he must come back to the inescapable reality that people are not able to pay it. It is not just those people to whom my colleague, Deputy Ellis, referred, tenants of local authority flats or houses. They undoubtedly will endure a hike in their rent, or a further reduction in maintenance services. That will be a significant problem for them. However, there is a whole other category of person who bought a home of their own that is now struggling with negative equity but, more to the point, with mortgages they simply cannot pay anymore. The Central Bank figures that emerged this week inform us that one in four home owners are now unable to maintain their original mortgage contract. That is where it is at. We have come through the trauma of a property bubble that was inflated over the years, disgracefully and irresponsibly, by Fianna Fáil-led Governments. The bubble burst and we are left with the wreckage of it.


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