The Government has been accused of dashing the hopes of young people in Fingal hoping to get a foot on the property ladder.

The Dail heard on Tuesday that the Rebuilding Ireland Home Loan scheme had suddenly run out of money – with local authorities directed to stop taking applications.

The scheme offered loans to single people earning under €50,000 a year or couples with €75,000 a year who had been turned down for a mortgage by the banks.

Cllr Duncan Smith (Lab), who is chair of the Fingal Housing Special Policy Committee, called on the Minister for Housing to increase the resources.

He said: “Fingal has led in the delivery of this scheme and it was really starting to make an impact despite the tight criteria.

“It is aimed at low-income families who’ve been refused by two banks. Families trying to access these loans will typically be paying high rents for insecure accommodation and are not eligible for social housing.

“These loans are often their last chance to get a permanent, secure home for their families. This is a massive dropping of the ball by the Government.”

Fianna Fail housing spokesperson Darragh O’Brien TD said the Housing Minister’s interest in the scheme “lasted only as long as the publicity”.

He added: “Once again, it appears that the entire focus of Fine Gael was on generating publicity rather than developing and resourcing an actual policy that would have an impact in the real world.

“Just two weeks ago the Minister referred to the home loan scheme when I raised concerns but failed to acknowledge any issues, despite now knowing that at least one local authority had flagged funding problems.

“This raises two possibilities – the Minister deliberately withheld important information, or he is just not on top of his brief.

“The Minister needs to quickly clarify when he discovered that the scheme was running out of funding? He also needs to quickly clarify why local authorities were kept in the dark.”

Senator Lorraine Clifford-Lee (FF) also voiced her fury. She stated: “I am beyond furious that the Rebuilding Ireland Home Loan scheme has been put on hold due to lack of funds.

“This scheme offered a glimmer of hope to working families who are locked out of the housing market. I wonder how the Government will try to spin their way out of this.”