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Financial Resolution No. 2: General (Resumed) (Continued)

Thursday, 13 October 2016

Dáil Éireann Debate
Vol. 924 No. 3

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  2 o’clock

(Speaker Continuing)

[Deputy Paul Kehoe: Information on Paul Kehoe Zoom on Paul Kehoe] The Permanent Defence Force has conducted a recruitment campaign targeting an intake of approximately 600 general service recruits in 2016. In addition, there have been 97 officer cadets in 2016, the highest cadet intake in the history of the State. Plans are also in place to continue with general service recruitment in 2017. I am committed to ongoing recruitment in the Defence Forces to reach the established strength figure of 9,500. We will recruit significantly more personnel this year and next year than in previous years, and I have ensured the Defence Forces vote has the necessary funding to do this.

A capital spending allocation of €74 million represents an increase of €7 million on the 2017 defence allocation contained in the 2016 to 2021 capital investment programme. This allocation will facilitate the investment necessary to ensure the Defence Forces have the equipment and infrastructure to deliver on all their roles as set out in the White Paper. Broad areas I identified for capital expenditure in 2017 include the acquisition of armoured logistical vehicles for overseas missions, the further development of the armoured personnel carrier fleet, the replacement of Air Corps aircraft and the replacement of naval vessels in the Naval Service flotilla. In 2017 we will also continue to invest in the Defence Forces built infrastructure, improving barracks throughout the country. Next week, we will commission the third ship in the naval vessel replacement programme. At a total cost of €199 million, these purchases represent excellent value for money and have strengthened Ireland's capabilities quite considerably. We will continue this investment and I confirm an additional ship of the same class as the previous purchases is due for delivery in 2018 at a cost of €67 million.

I recognise the work of the men and women of the Irish Defence Forces. As of 1 September, Ireland was contributing 498 personnel to 11 overseas missions. This includes continued commitment to search and rescue humanitarian efforts in the Mediterranean. The work of the Irish Naval Service is a great source of pride. Its efforts in rescuing more than 13,400 migrants represent the very best of our Defence Forces contribution to international peace and security efforts. Many lives have been saved as a result of their efforts. We should also be very proud and appreciative of the overseas peacekeeping efforts of all Defence Forces in various missions. I acknowledge the contribution of the Reserve Defence Force. It is powered by a strong volunteer base and its dedication to its support role to the Permanent Defence Force is greatly appreciated and I look forward to the continued development of the Reserve Defence Force.

The allocation also supports civil defence. I thank the 4,000 civil defence volunteers for their efforts in supporting front-line emergency services and the tremendous value they provide to every community in the State.

There will be a €6 million increase in the provision for the Army pensions vote for 2017. Approximately 12,200 pensioners will be paid by the Department from the Army pensions vote, and the increased allocation will help address the growing demands on this vote. The increased allocation for 2017 will ensure continued provision of the necessary resources to the Defence Forces to enable them undertake all roles assigned by the Government at home and overseas. It recognises and acknowledges the high levels of professionalism and ability evident in the Irish Defence Forces.

Deputy Barry Cowen: Information on Barry Cowen Zoom on Barry Cowen The backdrop to the budget is a housing crisis that is being felt in every part of the country. We face intertwined problems of endemic homelessness, spiralling rents, insufficient social housing and a stagnant private market. For an entire generation, the basic aspiration of home ownership is slipping away. The dream of having a place to call one's own around which one can build a vibrant family life and play an active role in the local community is disappearing. Instead of putting down roots, young people are paying up to landlords.

We need to give ordinary workers who are getting going in their lives, who are newly married or who are starting a family a real chance at owning their own homes. However, the first time buyers grant announced is not the solution they need. The Minister for Housing, Planning, Community and Local Government, Deputy Coveney, has conceded that the first time buyers grant is not a silver bullet, but he is firing the starting gun on a new property price race. Overall, the €20,000 grant will see more money chasing the same few homes. Builders will simply boost prices to get higher profits, which they need or which their banks demand. The cost of building a new home will remain fundamentally unaddressed. A young couple will find themselves using the grant just to try outbid other couples armed with the same amount looking at the same home.

This will have wider implications beyond just first time buyers. Homeowners looking to trade up are the Cinderella of the property market. These families, who have outgrown their old home or who have just escaped from negative equity, will also be hit by artificially spiked prices. Those trading up have been entirely neglected in the Central Bank rules and will now have to compete with first time buyers armed with an additional €20,000 to outbid them. The help to buy scheme or, rather, the help to sell scheme, is a demand-side solution to a supply-side problem

The extremes of the scheme are the sharp end of Fine Gael's two-tiered outlook on this country. The €600,000 limit imposed is completely off the wall. It is out of sync with the reality of ordinary first time buyers. The average overall cost of providing a three-bed semi-detached house of 1,214 sq. ft. in the greater Dublin area is €330,493, including VAT. The €600,000 limit is almost double this, which effectively turns the scheme into nothing more than a mansion grant. A new home worth €600,000 would require a €98,000 deposit and an income of at least €145,000. This is four times the average industrial wage. A couple earning this when starting out in life does not need €20,000 from the State, which is struggling to tackle a social housing waiting list of 130,000 homes. It means ordinary taxpayers are directly subsidising people earning four times the average wage to buy a home worth three times the national average price of a three-bed semi-detached house.

I do not agree with the scheme. I expressed my concerns to the Minister, Deputy Coveney, about the potential of the scheme a number of weeks ago. I asked him to carry out an impact assessment. This morning, the Minister for Education and Skills, Deputy Bruton, told us this was carried out. If it was carried out, and I doubt it very much, it will have serious implications for the Cabinet and it needs to be published immediately.

I beg members of the Government to examine the scheme and see the blatant unfairness of it at its extremes, by which I mean not capping the grant for houses at €400,000 and allowing the grant to €600,000. Those who can afford to buy such homes are not the squeezed middle. They are not an ordinary young couple, just married, looking to buy a semi-detached house and start a family. They are not young gardaí, young nurses or young teachers. They are not young professionals who have studied hard and worked hard while their parents paid a lot to put them through college. What the Government is financing and giving to those who can afford homes at this rate is a mansion grant. If they were considering buying a house three weeks ago for €580,000 they do not need an extra €20,000 now to pay €600,000 for it. This will undoubtedly turn a two tier recovery into a two tier property market. Those first time buyers a few years into their careers, struggling to save and pay rent will be not be served by further spiking prices on homes that will never be within their reach.

I want to make clear that Fianna Fáil believes in home ownership. We believe it is good for families and good for communities. Having something to pass onto future generations and a firm sense of place is a basic and fundamental human desire.

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