It is at this time of year that the Government and individual Ministers start flying kites about what might appear in the budget.

One kite floated in the newspapers this week was that the Minister for Finance, Deputy Donohoe, is considering a capital gains tax break to charge less than half of the regular amount in tax due on the sales or development of vacant property. During the mismanagement of the economy in the 2000s, our tax system became riddled with special exemptions and inducements to private developers. It narrowed and weakened our tax base which collapsed in 2008. Tax revenue fell by 30% which is not normal in any developed economy, yet the Minister for Finance seems prepared to again consider the same failed strategy. He should not.

A second flaw in this approach is that tax breaks create perverse incentives. Instead of business investing on the basis of developing goods and services to meet people's needs in our society, tax breaks drive money to be invested in a tax product which offers the best return. We saw the results of this in poorly planned and poorly constructed buildings right throughout the Celtic tiger period.

The third problem with the Minister's approach, as published, is that it is all carrot and no stick. After 15 years of a prolonged housing boom from the 1990s, we still had a situation with trees growing out of crumbling derelict buildings all around our towns and city centres. This is only possible if it is more profitable to hoard land and to release properties and land slowly, one site at a time, to maximise speculative gain. There is no penalty for the owners of properties from doing just that.

The only way to end land hoarding and speculation is to introduce taxes and duties on property owners. All over Europe, social democratic market economies place stringent requirements on property owners to maintain and develop their properties. Put simply, owners of vacant property should use it or lose it. People's urgent need for housing cannot wait. Any serious economic analysis quickly reveals that tax breaks are the wrong way to boost housing supply. That was the failed strategy of the past.

Will the Tánaiste confirm that property tax breaks will not be proposed in the upcoming budget in order that we do not repeat the failed and disastrous policies of the past?

As the Deputy well knows, as a former Minister for Public Expenditure and Reform, the debate around the choices for a budget generally happen around budget day. There are all sorts of speculation and kite flying, mainly not from Ministers but from other people trying to provoke a response from the Government to get an idea what is and is not going to happen on budget day. I suspect this is another example of that.

Undoubtedly, the budget will be focused on housing and trying to help increase supply. The Government has committed a significant amount of capital resources to driving supply, and it is working. We have changed the planning system, and it is working. We have changed our approach towards student accommodation, and it is working. We are seeing a dramatic increase in supply of all types of housing, namely, affordable, social, student and others. That needs to continue and to accelerate to deal with the housing crisis and pressures that we have.

That goes for vacant sites and properties too. That is why we are introducing a vacant site levy which will increase after the first year. It will be a real driver to ensure sites are not purchased to be held on to for the medium term in a speculative way but, instead, will be used to deliver housing. I will not confirm or deny any decisions the Minister for Finance will propose to Cabinet. I certainly have not had any discussion on the issue that the Deputy raised. I suspect there will be much debate and speculation in advance of budget day. I am confident we have a Minister for Finance who is cautious, informed and will not do anything that would damage the property market but will, instead, focus on sustainable ways of increasing supply at the pace we need.

The Tánaiste is correct that I have experience of the run-up to budgets over time. It is my experience that Ministers do test run proposals to see how they will fly. We all have experience of that. When I see a particular proposal attached to a particular Minister's name, I know what it is, namely, test flying.

We need to be clear. If this budget is to be about housing, it cannot be about the policy platforms which delivered an economic collapse. The solution to housing we can debate separately but it is largely a question of supply. The Government has suggested giving public lands, which we had to defend to keep in public ownership in the past, to private developers and an approach whereby 60% of the housing will be, by definition, unaffordable if only 40% is going to be affordable. This is the wrong way to go. If that is to be compounded by giving further tax incentives and tax breaks to the developers, then we have learned nothing over the decade of economic collapse. Will the Tánaiste express his own view that this is not the way to go?

We have learned much over the past seven years. The Deputy will remember much of the debates and the hard decisions which needed to be made in difficult circumstances in the build-up to budgets, particularly five, six and seven years ago when he, as then Minister for Public Expenditure and Reform, had to make difficult choices. I am glad to say we are not in that situation any longer but we still have choices to make because we still have challenges. While the economy has recovered, society has significant pressures. Housing is one of those issues and health reform is another. We have other issues to which we need to respond in this budget, namely, Brexit and the challenges it poses.

The Government has learned the lessons of some of the policy mistakes of the past, especially those linked to property. We will not be repeating them.