#Budget18: Fianna Fáil hits out at Government's plans

#Budget18: Fianna Fáil hits out at Government's plans

Fianna Fáil finance spokesperson Michael McGrath has hit out at the Government's retention of the help to buy scheme, writes Fiachra Ó Cionnaith.

Deputy McGrath saying a report due to be published today shows it has had little to no effect on helping to calm the market.

In a Dáil speech responding to Finance Minister Paschal Donohoe's budget announcements which largely side-stepped direct criticism of the budget, Mr McGrath said he has serious concerns over the continuation of the policy.

Citing a report from Indecon economic consultants which Mr Donohoe has committed to publishing today, Mr McGrath said the report has found "to date there is no evidence the scheme has impacted on overall prices of new homes for first time buyers".

Mr McGrath said this was the sole reason for the help to buy scheme - which was introduced by then housing minister Simon Coveney last year and sees first time buyers receive up to €20,000 for purchasing a home up to €500,000.

However, he said despite the fanfare when it was introduced last year, the policy has done little to nothing to calm the housing market crisis.

"The report has concluded that the abolition of the scheme at this time 'would create uncertainty and damage confidence, and would likely impact on the levels of new builds'.

"The report finds that to date there is no evidence that the scheme has impact on overall prcies of new homes for first time buyers. The authors also find the measure does not appear to have had any significant overall impact to date on the level of supply.

#Budget18: Fianna Fáil hits out at Government's plans

"Indecon expressed concern in the report's conclusions that the failure to carry out a cost benefit analysis before the scheme was introduced should not be seen as a precedent for other measures. I hope this is a warning the Government will heed," he said.

Mr McGrath's budget speech response otherwise largely avoided direct criticism of the Government's financial plan, in part due to the fact Fianna Fáil has had a key role in drawing up the financial package.

However, with the risk of a general election in the next 18 months apparent, he took the opportunity to underline what Fianna Fáil claims are its wins in budget 2018, including:

* reductions in the USC

* an increase in the tax credit for more than 150,000 people who are self-employed

* €55m in money for the national treatment purchase fund

* extra funding for social housing

* a further €5 increase in social welfare payments

* and a reduction in the pupil teacher ratio to ensure no classroom has more than 26 children in it

Mr McGrath welcomed the budget plans for the rainy day fund, and action on the housing crisis.

However, he stressed that - with the budget coming on World Homeless Day - the issue remains a "dark shadow" on the State which must be tackled immediately.

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