| 8.7°C Dublin

Chance to rein in developers

THE crisis in Irish financial institutions is an opportunity to end the malign influence of property development/speculation on how we are governed.

The long-running source of economic and political instability has now resulted in us, citizens in a republic, being loaded with unknown liabilities that may last for years, just as we are still paying levies on insurance premia 25 years later arising from the collapse of PMPA.

The current weakness of Irish-owned financial institutions as a result of lending for property development is a factor driving the government guarantee scheme.

Government's smug dependence on taxes arising from property transactions from a bloated house-building workforce, has undermined public finances with a speed that has shocked the governing class.

Low standards arising from softness on property development pervades much else directly under the control of local and national government, for example house building standards, provision of clean water, planning of primary schools and so on.

It is now time to change the view that we can build a common prosperity by selling land and buildings to one another.

Fortunately, part of the solution has already been worked out for us.

In 1971, the then Fianna Fail government appointed John Kenny, a High Court judge to consider, "in the interests of the common good, possible measures for (a) controlling the price of land required for housing and other forms of development, (b) ensuring that all or a substantial part of the increase in the value of land attributable to the decisions and operations of public authorities . . . shall be secured for the benefit of the community".

In the interests of the common good, let us limit the scope for excess by government and financial institutions by controlling the price of building as Judge Kenny recommended.

If it needs a referendum to copperfasten the constitutionality of any legislation for the measures needed, then this is just as important as a second referendum on the Lisbon Treaty.

Daily Digest Newsletter

Get ahead of the day with the morning headlines at 7.30am and Fionnán Sheahan's exclusive take on the day's news every afternoon, with our free daily newsletter.

This field is required

This is the least the governing class can do now that we, through the Government, have given huge guarantees to sectors that have overreached their abilities.

We do not deserve the hard landing that the networks of government, financial institutions and property development have now made for us.