Fine Gael slaps down Kelly’s controversial rent cap plans
NO RISE IN LOCAL PROPERTY TAX UNTIL 2019
WIDELY TOUTED plans to help tenants struggling with the spiralling costs of renting homes in our cities failed to materialise in the Budget.
The Government’s decision not to announce any of the controversial plans was a public humiliation for EnvironmentMinister Alan Kelly, who had been widely perceived to be behind repeated briefings suggesting that rent comtrols would form a key part of government policy.
The Environment Minister has repeatedly claimed that solving the housing crisis – from homelessness to a lack of suitable homes to unaffordable rents – was his top priority.
But last night he was left red-faced over his failure to persuade Michael Noonan to introduce any substantial reforms.
Sources in Leinster House last night said Mr Kelly had effectively been ‘slapped down’ by the Finance Minister, something that was put directly to Mr Kelly by the Mail at his press conference last night.
Mr Kelly did not admit he had been rebuffed but instead took the credit for a NAMA scheme whereby the debt agency will deliver 20,000 homes over the next five years.
However, sources in Labour said there was to be a ‘rent certainty package’ unveiled in yesterday’s Budget only for major differences between Mr Noonan and Mr Kelly to scupper the plan.
Mr Kelly last night said his rent package was not one that should be linked to the Budget. ‘Rent certainty, the whole issue of rent and rent regulation really isn’t a budgetary issue, so there are discussions which are ongoing which will take place again next week in relation to additional measures,’ said Mr Kelly.
He hinted he has not given up on his plan yet. ‘We were looking at additional measures on the supply side [such as relief for landlords renting to rent supplement recipients or grants for vendors selling below market price] on top and you may very well see some further components of that coming out as the Finance Bill goes through the Oireachtas,’ said the Environment Minister.
‘As the minister with responsibility for rent regulation, this is certainly an issue that is top of my agenda, but it is not an issue that would be dealt with through a Budget.’
Last night Labour l eader and Tánaiste Joan Burton was asked about the lack of progress on rent certainty in the Budget. She said negotiations between departments were ‘ongoing’. Mr Noonan said he would work with the Department of the Environment to bring forward more housing initiatives soon. ‘We are making good progress between my officials and his officials, and we would hope that Alan Kelly will be able to make further announcements in the next five to six weeks at the outset,’ he said. But Fianna Fáil’s finance spokesman Michael McGrath rounded on the Coalition for inaction on housing and homelessness.
‘Isn’t it amazing that you did manage to reach agreement on getting yourselves a €900 tax cut, but you couldn’t reach agreement on helping people who do not have a roof over their heads tonight,’ he said.
Simon Community spokesman Niamh Randall last night spoke of her frustration, saying: ‘We are deeply disappointed there was not an announcement of introduction of rent certainty measures. These measures are essential in light of rapidly increasing market rents to offer tenants greater security of tenure.’ CHANGES to the Local Property Tax have been ruled out until 2019 at the earliest. The decision is in line with recommendations made by the Government-commissioned Thornhill report published yesterday.
Introduced at the behest of the Troika in 2013, the LPT relies on people self-valuing their properties to calculate what tax they owe.
But rising property prices since then have created a risk that homeowners could be hit with higher charges than envisioned when the tax was set.
Michael Noonan accepted this possibility yesterday when he deferred any changes to the tax for several years. He said the postponement also allows time to consider the report’s other recommendations. Andrew Nugent, president of the Society of Chartered Surveyors Ireland, welcomed the postponement as ‘prudent’.
‘It was part of the recommendations that we had made in our budget submissions so we would welcome that on behalf of householders,’ he said.
He added that it allows time to be properly structure the tax so that it is ‘balanced’ and doesn’t distort the property market.
Dr Peter Stafford, of Property Industry Ireland – an Ibec group representing property businesses – said the delay will help homeowners in the short-term, but that it should be ‘part of a wider overhaul of the taxation of property over its entire lifecycle to create a sustainable, predictable and fair property taxation regime’.
This is a breaker