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Dáil
‹ Order of Business

Upward-only commercial rents

Summary

Peadar Tóibín urges action on upward-only rent reviews after the Bewley’s judgment, arguing they damage businesses and employment. The Taoiseach says the judgment must be studied but maintains formal legal advice found legislative intervention constitutionally impossible; exchanges follow over Government commitments and legal advice.

The programme for Government included a commitment to legislate for the end of upward-only rents. Yesterday's court judgment in a case involving Bewley's of Grafton Street means that rents can only rise and cannot fall to the market value. It seems that low and middle income earners can have their wages dictated to by the markets, but this does not apply to the landlords who own these properties.

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Seán Barrett An Ceann Comhairle Fine Gael

What Bill is the Deputy talking about?

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I am referring to the commitment in the programme for Government to legislate with regard to upward-only rents. The point is that this is a competitive disadvantage to the State. It costs jobs and exports. Indeed, a large number of businesses around the country have gone out of business as a result of upward-only rents.

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Seán Barrett An Ceann Comhairle Fine Gael

Deputy Tóibín has made his point.

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We often hear about the need for a focus on competitive advantages. This is an example of an advantage that the Taoiseach should consider. Sinn Féin has proposed its own legislation in this area. The legislation brought forward by Senator Quinn has been passed by the Seanad. When will the Taoiseach revisit this matter? I suggest that the advice received from the Attorney General on the constitutionality of this legislation should be tested so that the difficulties being encountered by small and medium-sized enterprises throughout the State can be alleviated.

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Enda Kenny The Taoiseach Fine Gael

Sinn Féin brought forward a proposition for a wealth tax too, but it has abolished it because it can see the consequences of such a tax.

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That is not true.

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What about the land tax?

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Enda Kenny The Taoiseach Fine Gael

The Supreme Court has made a decision in this case. Its judgment needs to be examined carefully. The case before the court rested solely on the interpretation of a single clause in the 1987 lease between Ickendell, which is the landlord, and Bewley's, which is the tenant.

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It is a fairly standard clause.

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Enda Kenny The Taoiseach Fine Gael

Last year, the High Court interpreted that clause to mean the rent payable to Bewley's must be allowed to fall to reflect market values. The Supreme Court ruled that the lease in question provided for an upward-only rent review. It also said that the case arose from the specific terms of the lease and not from an issue of general application. The judgment needs to be studied. A commitment to review upward-only rent reviews was included in the programme for Government.

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And in the election manifesto.

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There were many things in it.

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Enda Kenny The Taoiseach Fine Gael

However, we found that this was constitutionally impossible.

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Who gave the advice before the election?

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Enda Kenny The Taoiseach Fine Gael

I am not committing to anything because that is the formal legal advice we have had.

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Who provided the advice before the election?

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Enda Kenny The Taoiseach Fine Gael

However, I undertake-----

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Who was the legal adviser to the Labour Party before the election?

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Seán Barrett An Ceann Comhairle Fine Gael

Would you stay quiet, please?

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Enda Kenny The Taoiseach Fine Gael

Despite the noise from people on the other side-----

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It is not noise.

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The Taoiseach and his colleagues made plenty of noise.

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Enda Kenny The Taoiseach Fine Gael

-----who were responsible for assuming one could run a country on property inflation-----

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They are called facts.

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Enda Kenny The Taoiseach Fine Gael

They drove this country over the edge.

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That is what you proposed. That was your proposal.

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Who advised you before the election?

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You could not spend enough.

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Enda Kenny The Taoiseach Fine Gael

I will study this judgment very carefully to see what general application it might have.

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What about Roscommon hospital? What about third level fees?

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Enda Kenny The Taoiseach Fine Gael

When we tried to legislate for reductions in cases of upward-only reviews, we found that it was constitutionally not possible on the basis of the formal legal advice.

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Excuses, excuses.

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The Government cannot do it after all of that.

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