FF wants €200m to kickstart new housing scheme
Fianna Fáil has given the Government a budget ultimatum demanding that it provides €200m in funding to kickstart affordable housing.
A reduction in the 4.75% rate of USC and changes to the marginal rate of income tax are also on the cards as part of next week’s budget after the party signalled these as key requests in negotiations.
Fianna Fáil have called for the introduction of an affordable housing scheme which would set the price of a house at below the cost of delivery. This could see a three-bed home delivered for less than €200,000 in some areas.
Although the cost of delivery would be higher in Dublin, Fianna Fáil is still confident that affordable houses in the capital would be less than the €300,000 which Housing Minister Eoghan Murphy has previously indicated.
Instead of attaching specific rates to house types or specific areas, people who buy homes through the new scheme would pay the cost of building the unit minus the cost of servicing the land.
Fianna Fáil fears that setting a specific house price would not deliver homes at the most competitive rate.
The cost associated with purchasing lands and delivering services such as water and other infrastructure would be paid for by the local authority through the Serviced Sites Fund which Fianna Fáil has said must be increased from €75m to €200m for it to facilitate the passing of the budget.
The White Paper published last night revealed an expected extra €1bn in corporation tax this year, giving the Government more space. Finance Minister Paschal Donohoe yesterday said some of this would go towards covering the overspend in the Department of Health.
Speaking as the party outlined its Budget priorities, Fianna Fáil public expenditure spokesman, Barry Cowen, said that current affordable house schemes do not meet their expectations.
“We recognise that this Government has failed and failed drastically in relation to the provision of housing,” said Mr Cowen.
“We have our own ideas that we believe are necessary to address that and we are doing that from a position of facilitating government. We are not a member of government. Ultimately, we will arrive at an agreement that we can both stand over and that is both of our prerogatives and that remains our prerogative.”
Michael McGrath, Fianna Fáil finance spokesman, said “major multi-annual capital commitment” is required from the Government which he said has not provided a single affordable house.
“The dream of owning your own home is a legitimate one and for young people and couples, it’s just getting further and further beyond their reach and that needs to be dealt with,” he said.
Mr Cowen said an SSIA scheme to help first-time buyers save for a deposit has not been part of budget talks.
“That was an initiative that was mentioned in our manifesto but it’s not something that we are specifically pushing for in this instance,” he said.
State of play
With just four days left until the budget 2019 big reveal, some Government ministers can sit back and relax while others are still scrambling to grab their slice of the financial pie.
It is understood that, after weeks of talks with Finance Minister Paschal Donohoe and his officials, Justice Minister Charlie Flanagan will win major concessions on appointing up to 800 gardaí.
Social Protection Minister Regina Doherty — who last week hit out at suggestions the Christmas bonus may not be increased — is also likely to ensure a full 100% return of the same social welfare payment and across-the-board increases in her department.
The Independent Alliance is believed to have been given the green light for a gambling tax plan which would ringfence €50m for addiction and student services, in addition to home refurbishment plans, in return for accepting defeat on the ‘granny grant’ idea from this summer.
Health Minister Simon Harris and Housing Minister Eoghan Murphy are also finalising reforms.
Other cabinet ministers are still struggling to get their plans over the line, including Children’s Minister Katherine Zappone, whose department has yet to be given budget figures for next year.
