andMr. Quinn asked the Minister for the Environment if he is aware that the average deposit in 1979, nett of the £1,000 grant, for a first time owner-occupier was approximately £3,600 and that this has increased to a nett cash requirement of £4,200 by the first quarter of 1980; and if he will indicate how he proposes to reduce the cost of housing for first time owner-occupiers in order to implement the Government policy as set out in White Papers since 1977.

32.

andMr. Quinn asked the Minister for the Environment if he is aware that the £1,000 grant in 1977 amounted to approximately 25 per cent of the average deposit on a house bought with a building society loan and that on the first quarter of 1980 it had been reduced to less than 20 per cent of such a deposit; and if he will indicate the reasons why it has been so reduced and the measures, if any, he proposes to restore and increase the value of the grant to first-time house purchasers in order that they can achieve the Government objective of home ownership as set out in various Government White Papers since 1977.

With the permission of the Ceann Comhairle, I propose to take Questions Nos. 31 and 32 together.

I am aware of the figures quoted by the Deputies which have been extracted from the recently published NESC report on economic and social policy.

The measures taken by the Government since July 1977 to promote owner-occupation of new houses and in particular the steps taken to assist first-time owner-occupiers have largely been successful. This is reflected in the fact that the number of non-local authority house completions has increased from 16,700 in 1976 to 20,300 last year. The corresponding figure for this year is likely to be a record. The number of grants paid for first-time owner-occupiers increased from 7,200 in 1978 to 8,100 last year. The number of grants paid during the first 11 months of this year showed an increase of 1,000 on the corresponding period last year. The proportion of first-time owner-occupiers of new houses obtaining house purchase loans from the main lending agencies increased from 62 per cent in 1978 to 66 per cent during the first nine months of this year.

Apart from the £1,000 grant, the Government have introduced a number of financial incentives during the past three years to promote owner-occupation of new houses, as follows:—

(1) The SDA loan and income limits were increased on three occasions by a total of 166 per cent and 134 per cent, respectively;

(2) A temporary subsidy was introduced this year which enabled building societies to increase their investment rates and let mortgage rates stand at 14.15 per cent. With the general downward movement of interest rates, there is now no need for the subsidy;

(3) The amount of personal interest, including house mortgage interest, qualifying for income tax relief has been increased from £2,000 to £4,800;

(4) Since 1979, a grant is available to meet portion of the administrative costs of the National Association of Building Cooperatives;

(5) The subsidisable cost limit on each housing site provided by local authorities for modestly-priced private housing was increased from £900 to £1,500.

In contrast, the number of new house grants paid in 1977 was less than half the total paid in 1973. This was due mainly to the introduction by the Coalition Government in 1976 of an income and valuation limit for the purpose of qualifying for the grant. Furthermore, the following examples show the lack of concern of the Coalition Government as regards the owner-occupation of new houses:—

(a) The number of non-local authority houses completed declined from 18,600 in 1973 to 16,700 in 1976;

(b) The SDA loan and income limits remained static between September 1973 and July 1977 despite the fact that house prices and earnings more than doubled during this period;

(c) During their four years in office, they never introduced any incentive to promote non-profit housing activity;

(d) The subsidisable cost limit on sites provided by local authorities for private housing remained unchanged between 1972 and 1977.

The adequacy of the measures necessary to promote owner-occupation of new houses generally and assist the first-time owner-occupier in particular is being kept under review by the present Government.

I compliment the Minister on his knowledge of history but I would have preferred an answer to the question. Does the Minister agree with the NESC report to which he refers that the overall picture is one of increasing difficulty for new house purchasers and would he indicate also what action he proposed to make in the matter as distinct from looking at the record of more successful Ministers?

When I came to the Department in January I increased the loan subsidy from £9,000 to £12,000 in respect of new houses and I increased the limit from £4,000 to £5,500. Let us be clear about this. I was told at the time by the people opposite that these increases were not sufficient but I can tell those people now that the changes have proved highly successful and that there has been an unprecedented flow of applications to the various local authorities for these loans. In addition, house-purchase finance is being reviewed in accordance with paragraph 49——

Of the manifesto.

——of the national understanding. The government are very much committed to the concept of home ownership.

Many thousands of people are waiting for loans.

When the people opposite were in office the situation in respect of loans was so bad that one would need to be on the dole in order to qualify for a loan.

There are 140,000 on the dole now.

Let the people opposite take their medicine.

That is all that is left for anyone to take now.

The people need homes.

(Cavan-Monaghan): Can the Minister tell us what has been the increase in house prices since 1976? On national average has there not been an increase during that period from £13,000 to £26,000? I should like the Minister, despite all his boasting, to explain his attitude in terminating the house improvement grants?

The latter part of the supplementary is a separate question.

The Minister has given many separate answers. Perhaps he will have the courage to answer this separate question.

There are thousands of people in this city who will not be housed because of what the Minister has done.

Let me put the facts on record. In the first nine months of this year 18,501 private houses were built. Yet the Opposition have the audacity to attack me now.

The odd house must be the one that was built in Donegal.

During their three years in office the Coalition failed to raise the income limit.

(Cavan-Monaghan): Would the Minister answer the question I put to him, that is, whether he agrees that on average the price of new houses has increased since 1976 from £13,000 to £26,000? When he is boasting about increasing loans he should not forget that the price of a house has doubled in that time. Is there any intention on the part of the Government to restore the improvement grants so that people who cannot afford to build new houses might be in a position to improve those that need improving?

The conversion grants in respect of heating have been abolished also.

The SDA loan incomes have been increased on three occasions since our return to office. On one occasion they were increased by 166 per cent and by 134 per cent in another case. House prices have not increased to that extent.

The Deputy should not lose his temper.

When I made the allocations to the local authorities I was unable to say whether they would be sufficient but I am able to say now that there has been an unprecedented flow of applications into all local authorities. When the Coalition were in office activity in this area was at a standstill.

(Cavan-Monaghan): We did not abolish the grants.

The Coalition introduced a means test which resulted in a situation in which an applicant would need to be on the dole to qualify for any of these grants.

Is the Minister aware of the very considerable hardship being caused to people because of the delays in paying this very small grant? Is it intended to take steps to ensure that this situation is rectified?

What is the Deputy talking about?

I am talking about the £1,000 grant, though there are delays in the payment of other grants, too.

That is a separate question, but I can tell the Deputy that there are no holdups in the payment of grants.

The Minister is living in cloud cuckoo land.

Would the Minister accept paragraph 5.23 of the NESC Report, that is, that paragraph relating to the subject matter of my question? Does the Minister accept that as being accurate?

I am not accepting anything from the Deputy. I have given him the facts.

The Government actually paid for this. They published it.

What did the Minister from the Labour Party do when the National Coalition were in office? He did not raise the income limits. The Deputy has to digest the facts I have given him.

The remaining questions will appear on tomorrow's Order Paper.