FF backbench anger looms over house grant

The Taoiseach and the Minister for Finance will today face down backbench anger over the decision to abolish the first-time house…

The Taoiseach and the Minister for Finance will today face down backbench anger over the decision to abolish the first-time house buyers' grant in the Estimates.

A motion on the issue, which has resulted in a wave of dissent among Fianna Fáil TDs, will be debated at the weekly meeting of the Parliamentary Party.

The Minister for Finance, Mr McCreevy, last night issued a stern warning to all Ministers ahead of the meeting warning that overspending in Government Departments next year will not be tolerated and no top-ups will be granted.

He said it was ultimately up to each Minister to manage his or her budget next year and to secure the best possible value for money from that allocation.

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However, with the Taoiseach making it clear there will be no reversal of the house-grant decision, the best TDs can hope is that Mr McCreevy will give a commitment to make it up to first-time buyers in the Budget by way of tax relief.

While a number of TDs yesterday reiterated their anger at the move, not one contacted by The Irish Times said they were prepared to vote against the Estimates motion, which will be taken in the Dáil tomorrow night.

The Labour Party has proposed an amendment to the Government motion condemning the house-grant decision and the Estimates in general.

"This is not the issue to go out on," one Fianna Fáil TD said. "If Charlie McCreevy can do something for the first-time house buyers in the Budget, we can stomach this decision. At least we will have something to go back to our constituents on".

TDs who have spoken out against the move include Mr Noel O'Flynn from Cork North Central and his consituency colleague, Mr Billy Kelleher, Mr John McGuinness, of Carlow-Kilkenny, the first-term North Tipperary deputy, Ms Maire Hoctor, Mr Brendan Smith from Cavan-Monaghan, Mr Ned O'Keeffe of Cork East and Mr G.V. Wright of Dublin North.

However, Mr Wright's constituency colleague, Mr Jim Glennon, yesterday defended the move and described the Labour Party motion condemning the abolition of the first-time buyer's housing grant as "hypocritical".

The grant issue will also be raised at today's meeting of the Progressive Democrats Parliamentary Party.

The PD Galway West TD, Mr Noel Grealish, has described the measures as "shocking" and has said he will be asking the Tanaiste and the Minister for Justice, Mr McDowell, to seek a reversal of the decision at Cabinet.

His party colleague, Ms Fiona O'Malley, also expressed reservations about the move on Monday, saying she would have preferred to see "other tax incentives that benefit developers go".

However, she said yesterday the PDs had been elected to make tough decisions.

Meanwhile, any hopes for first-time house buyers who have paid a booking deposit of qualifying for the grant were dashed by the Taoiseach in the Dáil yesterday.

He said that the grant would only be honoured for house-buyers who had already signed contracts or begun building.

The Labour Party environment spokesman, Mr Eamon Gilmore, claimed that applicants for the grant were being refused following the announcement of the scheme's abolition last Thursday.

He said the abolition of the grant could not take legal effect until it was ratified by the Dáil.

But Mr Ahern said anyone who had signed a contract to purchase or build had until December 4th to apply.

The Taoiseach, who came under fire from the Opposition in the Dáil over the Estimates, said the Government's first priority was to get back to a sustainable rate of spending in order to avoid a long-term crisis.

The Fine Gael leader, Mr Enda Kenny, claimed that politics had been "debased" by broken promises.

And the Labour Party leader, Mr Pat Rabbitte, accused the Government of lying to the country on the state of the finances.