There is growing criticism among Government backbenchers of the levy announced in the budget on the sale of concrete products in order to help pay for the cost of fixing homes affected by mica.
The move was announced by Minister for Finance Paschal Donohoe on Tuesday and is expected to raise €80 million a year, but backbenchers in both Fianna Fáil and Fine Gael have warned that it will only increase the cost of building houses.
The Department of Finance confirmed on Wednesday night that the total cost of the mica compensation scheme was expected to be €2.7 billion, which has already been included in the State’s accounts for this year, as per European Union rules.
There was sharp criticism of the new levy at last night’s Fine Gael parliamentary party meeting, while TDs who spoke to The Irish Times earlier also voiced their concerns. *
Cork North Central Fianna Fáil TD Pádraig O’Sullivan said: “At a time when house prices are already inflated I don’t think it is an appropriate measure as in all likelihood builders and developers will pass on the costs to consumers.
“This is one of the few regrettable things in the budget and I think it should be revisited.”
Limerick city TD Willie O’Dea said the measure “should be postponed at a minimum”.
Tipperary TD Jackie Cahill said he supported the idea of a levy on concrete blocks but raised concern about the timing.
Fine Gael TD for Dublin Fingal Alan Farrell said he wanted to wait to see the detail of the levy but “I have my concerns regarding the proposal”.
Former minister of state and Fine Gael TD for Carlow-Kilkenny John Paul Phelan rounded on the Department of Finance — where his party colleague Paschal Donohoe is Minister. “Only in Ireland would we introduce a levy on concrete in a housing shortage crisis and think it’s okay,” he said. “Classic Department of Finance ‘cutting off their noses to spite their face’.”
Fine Gael TD for Mayo Alan Dillon said he was “very surprised to see it included”.
In the Dáil, Regional Independent TD Seán Canney described the levy as ill-timed and ill-judged, saying it would penalise young people trying to build or buy their first home as well as local authorities trying to build social housing.
Labour Party leader Ivana Bacik also criticised the concrete levy, saying her party favoured a levy on construction company profits instead to help fund redress for housing defects.
The Society of Chartered Surveyors Ireland said the levy would add up to €4,000 to the cost of a new semidetached house and would “challenge the viability and affordability of new homes”.
Meanwhile, Taoiseach Micheál Martin has hinted that the annual €500 rent tax credit introduced in the budget will be boosted in future years.
He told Wednesday night’s Fianna Fáil parliamentary party meeting that his party had “delivered the renters’ tax credit which is now embedded and we have a platform to build on it from next year”.
Both parliamentary party meetings heard much praise for the Budget, with the Fianna Fáil meeting described by one attendee as the “most positive in years”.
* This article was amended on September 29th, 2022.