Government insists pledges around emergency home loans scheme will be met

Government insists pledges around emergency home loans scheme will be met

The Government has insisted it has enough money to fund emergency mortgage help promised to more than 1,500 struggling families despite opposition warnings it is already at least €100m over-budget.

Taoiseach Leo Varadkar and a spokesperson for Housing Minister Eoghan Murphy denied the scheme is struggling to cope with demand but admitted officials have asked the Central Bank to approve a "second tranche" of funds.

At the launch in January 2018, Mr Murphy said under the new Rebuilding Ireland home loan scheme people who have already been turned down by banks for mortgages could still be given the green light to buy a home.

The scheme, which came with a €200m war chest, was open to any individual who earns less than €50,000 a year or any couple earning less than €75,000 a year.

However, Freedom of Information Act documents published by RTE have shown the fund is already running out of money, with the Department of Housing's press office being informed of the crisis in late January.

In a statement, a spokesperson for Housing Minister Eoghan Murphy insisted the scheme still has enough money to pay for the mortgage promises given to 1,500 people.

The spokesperson confirmed 575 people have already drawn down loans on the back of the scheme, while 1,000 others have been approved.

He said while the total approvals cost amounts to €310m it is, in reality, reduced to €248m when "duplicate" applications by one individual are taken into account, and that to date €104m has been drawn down and a further €96m is available.

The spokesperson insisted that despite the internal FOI document showing the department's press office was told of the funding gap two months ago, "the funding provided to date is adequate for existing approvals".

However opposition parties dismissed the Government denials the scheme has already ran out of money, with Fianna Fáil housing spokesperson Darragh O'Brien warning the scheme is at least €100m in the red.

"There are 1,500 people approved, and from what we can make out the scheme is already over-subscribed by €100m.

"The key question is what is the value of the applications still being processed, because they don't have enough money to fund them," he said.

Raising the concerns during the latest Dáil leaders questions debate, Fianna Fáil leader Micheal Martin accused Taoiseach Leo Varadkar of deliberately keeping the public in the dark over the situation after it emerged PR officers were told of the crisis in late January.

He asked: "Why can't the minister and the Government just be honest with people on these issues? Why all the secrecy, why can't you guys not just be straight with people and upfront with people, instead of hoping people won't find out. We're all going through this charade while you guys just prance around the place."

Mr Varadkar responded by insisting the Government is not hiding information from the public, and rejected claims money will not be available for people promised help.

He said the Department of Finance and the Central Bank are reviewing the scheme's budget and will make a decision in the coming weeks on whether to increase its €200m funds.

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