A rural renewal scheme for the Upper Shannon region has been amended to ensure that people who want to live in the area will get the same tax benefits as developers catering for the rental market. The refurbishment of derelict houses will also be encouraged, but fears remain that the scheme could lead to over-development in environmentally sensitive areas.
Concern was expressed last month by both the Western Development Commission and the Heritage Council that tax incentives contained in the Upper Shannon Rural Renewal Scheme would do little to tackle the problem of rural depopulation.
It was pointed out that half of the derelict houses coming on to the market in Counties Leitrim and Roscommon were being bought as holiday homes or by retired people, while at the same time many primary schools were in danger of losing a teacher due to falling numbers.
After discussions with the Department of Finance, the chief executive of the Western Development Commission, Mr Liam Scollan, said this week that proposals put forward by the WDC had been included in the Finance Bill. The scheme was originally contained in last year's Finance Act and elements of it relating to industrial and commercial tax incentives are still awaiting approval from the EU.
Mr Scollan said many of the original proposals were not suited to a rural area, but that the amended legislation was a step forward in encouraging the growth of rural population. The new provisions allow owner-occupiers to avail of tax reliefs against all their income, including wages and salaries. A person buying a house will be able to write off 50 per cent of the cost against tax over 10 years, while someone refurbishing a derelict house will be able to write off 100 per cent of the cost over 10 years.
House size restrictions have also been increased, although the WDC has argued that these should be lifted altogether. The Heritage Council feared these limits would lead to the sub-division or abandonment of larger country houses.
However, the amendments encouraging owner-occupancy will not allay fears that the scheme could result in over-development in environmentally sensitive areas, as developers building houses for the rental market will also be able to avail of 50 per cent tax allowances. Large-scale developments of holiday homes such as those seen in seaside towns, sparked by a similar tax scheme, could prove disastrous in the region's relatively untouched countryside.
The Heritage Council has called on the Government to set up a task force, with local authority representation, to devise an integrated plan for the region, and for an environmental assessment to be carried out.
Mr Scollan has also backed the idea of a task force and said existing planning controls were not sufficient to protect the area. "The scheme needs to operate within a proper planning framework, so that if people are building or refurbishing houses they would have to do it to set standards and in places that do not cause damage to the environment," he said.
In order to protect the sensitive environment of the west from over-development, there was a need for greater planning controls, and this was an issue for the Government to address, Mr Scollan added.
Tax reliefs should also be extended to help encourage organic farming, for which the area is naturally suited, Mr Scollan said. The Upper Shannon region covered by the scheme includes Leitrim and Longford and parts of Sligo, Roscommon and Cavan. The Western Development Commission has also asked the Government to extend the scheme up until 2006, rather than ending it in 2001 as currently planned.