Irish News

Sunday 21 September 2014

Kenny rejects property bubble fears

Published 14/05/2014 | 14:02

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Taoiseach Enda Kenny

Taoiseach Enda Kenny has dismissed fears his plans to jump-start the construction industry will create another property bubble.

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Vowing to create up to 60,000 jobs over the next six years for unemployed builders, Mr Kenny said he was not leading the country towards another boom.

"There are 100,000 people on the live register involved in the construction industry: plasterers, block layers, chippies, tilers, roofers and everything else," he said.

"We want so to see that these people get an opportunity to get back into the world of work."

The Government strategy - which will include 75 measures to get builders back to work - will involve top quality and affordable new housing, he vowed.

Other measures in the so-called Construction 2020 plan include:

:: a taskforce to resolve a lack of housing in Dublin with financial breaks for developers to build projects already passed for planning but which have not got off the ground.

:: incentives for the development of vacant sites around the country, including tweaked commercial rates.

:: a taskforce on bank financing for construction companies.

:: the release of 2 billion euro by Nama to help developers complete or commence building projects.

:: the Government exploring a mortgage insurance, or help-to-buy scheme, for first time buyers.

Rejecting concerns the first-time buyer scheme could further inflate house prices, Mr Kenny said t he plan was not about contractors, bankers, developers or greed but about creating jobs and housing.

Ireland should be building between 25,000 and 30,000 new homes a year but only completed 8,000 last year, he said.

But Fianna Fail finance spokesman Michael McGrath said the proposed scheme is nothing more than a pre-election gimmick that does not tackle the real problems faced by first time buyers.

"I am led to the conclusion that the (Finance) Minister's real agenda is to drive up house prices, which will again have the effect of putting home ownership out of reach for many would-be first-time buyers, and to shore up the balance sheets of banks," he added.

Sinn Fein leader Gerry Adams said the plan read like "an extract from the election stunt section of the Fianna Fail handbook of strokes and other scams".

"It doesn't make any sense at all in dealing with the (housing) crisis," he said.

Mr Adams said that fears it could lead to inflated house prices were well-founded.

However, the Construction Industry Federation (CIF) said the strategy has the potential to provide a considerable boost to construction and create thousands of new jobs.

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