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Dáil Éireann debate -
Thursday, 6 Jul 1950

Vol. 122 No. 5

Committee on Finance. - Housing (Amendment) Bill, 1950—Second Stage.

I move: "That the Bill be now read a Second Time."

The general purposes of the Bill are to remedy certain defects in existing housing legislation which have come to light from experience, to supplement the existing statutory powers of local authorities in relation to housing, to amend the law governing the administration of State assistance towards private enterprise housing and to confer a number of new powers on both the Minister and the local authorities for the purpose of securing a more effective implementation of the housing programme.

Even under the existing law, our housing activities in both central and local administration have been now so accelerated that we expect in the present year to re-establish the levels of output in housing which had been reached before the world war and its aftermath caused practically a complete shut down in the work of rehousing. It is, I know, the wish of all parties that these levels should not only be reached and maintained but that they should be raised. The practical object of this Bill is to clear the way for this purpose and provide a better legislative basis for that comprehensive expansion in operations which both local authorities and private persons are now prepared to undertake.

During the past year, Deputies showed a keen and, from my point of view, a welcome interest in housing progress. In addition to the views and suggestions put forward to me in this House from time to time, I have also had the advantage of having discussed with many representative bodies, mainly local authorities, in the past year a considerable number of matters affected by anomalies, restrictions or deficiencies in the present housing code. As the contents of the present Bill are largely based on the experience thus gained, I have every reason to believe that it will meet with general acceptance.

I propose to explain first the provisions of the Bill dealing with the matters administered primarily or directly by the Minister for Local Government. The main items in this category relate to the conditions and procedure governing the making of State grants to private enterprise engaged in erecting or reconstructing houses. Private enterprise is a considerable part of the national housing effort and since 1924, its importance as a contributory factor towards solving the housing problem has been recognised in successive Acts. The Bill makes a number of important changes in the existing law dealing with this subject.

Section 8 provides for the abolition of the existing prohibition on the payment of second grants towards reconstruction work, provided a period of 15 years has elapsed since the date of completion of erection or reconstruction of the house for which the first grant was given. "Reconstruction" for the purposes of the second grant must involve the provision of a new roof or the increasing of the extent of the accommodation afforded by the house. Applications involving works of ordinary maintenance will not be considered.

A number of applications for second grants have been received in recent years and it is felt that a strong case exists for the removal of the existing restriction. As the statutes under which reconstruction grants were made available date back to 1924, it is reasonable to assume that a substantial number of houses dealt with in the succeeding decade are now in need of further alterations or repairs necessary to prolong their habitability. It is not intended that reconstruction grants will be paid at the end of 15 years as a matter of course and applications will be carefully examined in every instance to ensure that the work of reconstruction is necessary for the purpose of rendering the houses more suitable for human habitation.

It is proposed in Section 11 to remove the statutory requirements laid down in Section 5 (3) (e) of the 1932 Act, which provides that a grant shall not be paid in respect of the reconstruction of a house unless, before reconstruction commences, such house was certified by an officer appointed by the Minister to be suitable for reconstruction. The effect will be that the work may be certified subsequent to its commencement. The enforcement of the existing requirement has resulted in considerable administrative difficulties, and has also created hardship in cases where applicants proceeded with work in ignorance of the law. It is felt that adequate safeguards dealing with such cases can be better provided for administratively than under an inflexible statutory restriction.

Section 9 of the Bill proposes to include property which was the subject of an award under the Neutrality (War Damage to Property) Act, 1941, in the categories for which grants under the Housing Acts will not be made available. Compensation payable under the Neutrality (War Damage to Property) Act, 1941, was made conditional on the owner erecting new buildings, and it is desired to ensure that State assistance in such cases will not be duplicated.

It is also proposed in Section 15 to amend the Act of 1948, by raising from £35 to £50 the maximum aggregate of the rateable value of the agricultural holding of an applicant for a reconstruction grant, thus ensuring in effect that over 90 per cent. of the farming class will become eligible for these grants.

Section 7 of the Bill provides for a new type of reconstruction grant in urban and rural areas. In urban areas the grant will be available to persons having control of working-class dwellings not exceeding £12 valuation and in rural areas it will be available to persons having control of houses with a similar valuation limit who are not already eligible for the existing reconstruction grants on the grounds that they are not agricultural labourers or persons who derive their living solely or mainly from agriculture.

Persons thus being made eligible for such grants include such classes as domestic servants, fishermen, serving soldiers, nurses, midwives, teachers, and local and State servants. The exclusion of these classes in the past undoubtedly created undesirable anomalies and it is felt that the removal of the bar on eligibility is long overdue. The cost of reconstruction will be met equally by the applicant, the local authority and the State, subject to the contributions of the local authority and the State not exceeding £80 each. It will not be obligatory on the local authority to make a grant. If they decline to do so the State will not withhold its own grant on this account, except in the cases of the four county boroughs and the Borough of Dún Laoghaire. The general purpose of the provision is to forestall decay and to avert obsolescence of property. Obsolescence in towns of all sizes is a matter which might impose heavy future liabilities on both the State and local authorities and it is important that existing houses of the working-class type should last as long as possible. The operation of this provision will, I hope, result in a reduction of capital expenditure on new housing.

Under the Housing (Amendment) Act, 1948, grants are payable to private persons and public utility societies for the erection of houses for owner-occupation. That Act terminated the system of grants for speculative building and replaced it by a system which required a private person to enter into a contract for the erection of a house as a condition precedent to the payment of a grant. At present, therefore, grants cannot be given for the purchase of a completed house; nor if the contract is entered into after the commencement of the building operations. It has been strongly represented to me on numerous occasions that these restrictions have had an adverse effect on private building activities, and have resulted in the creation of a number of serious difficulties and hardships both for the intending purchaser and the builder.

The purchaser is required to enter into commitments at the stage when the only visual evidence of his house is represented by plans or drawings, the details of which he may not fully understand. The builder, on the other hand, is forced to await individual orders before he can commence or continue building operations. He is thus compelled to develop a site in stages, with resultant delays in his building programme and possible increases in cost.

The law, as it stands, also precludes the transfer of a grant where an intending purchaser is unable, for one reason or another, to fulfil his contract. The builder may thus be left with a completed house on his hands and the person for whom the house is intended may also be involved in serious difficulties.

It is now proposed under Section 6 of the Bill, that grants will in future be payable to persons purchasing new houses for their own occupation. The prospective purchaser will thus be in a position to pick and choose in an open market. He will be relieved of all anxiety in regard to the selection of site, preparation of plans, etc., before the construction of the house is begun and will be enabled to see the finished product before he decides to buy. The builder can initiate his plans to the full projected scale and he will not be hampered in his operations by any uncertainty in regard to grants not being available on eventual sale, if the houses will comply with the necessary standards of space and construction.

It is not proposed to alter the present scales of grants for new houses nor is it intended to interfere further with the statutory requirements governing the construction of grant houses, except in so far as the maximum floor area of the house is concerned. The existing maximum is 1,250 square feet and Section 13 of the Bill proposes that this maximum be extended to 1,400 square feet. This extension is desirable to meet the requirements of large families. Experience has shown that it is a matter of difficulty to design a satisfactory house for the larger family within the existing limit of 1,250 square feet. It is not considered that the new limit will result in considerable extension of the classes claiming grants. It is felt, rather, that persons with large families in a position to build houses up to the existing maximum of 1,250 square feet will be enabled to purchase a reasonably larger type of house for the accommodation of their families.

The Bill also proposes that Irish nationals purchasing houses to which Section 6 relates will be exempt from payment of the increase in the stamp duty imposed by the Finance (No. 2) Act, 1947.

Section 10 of the Bill is intended to remove doubts in regard to the validity of payment of grants under Section 16 of the Housing (Amendment) Act, 1948, as extended, in circumstances where a house is occupied by the legal successor in title of an applicant who dies between the date of application for a grant and the completion of construction or reconstruction. In so far as new houses are concerned, this difficulty will be resolved in future cases by the application of the provisions of Section 6 of the Bill.

The Bill further proposes in the First Schedule to abolish the limitations imposed by successive Housing Acts in the past, on the aggregate amount of payments of housing grants. These limitations have made it necessary for me and for my predecessors to come before the House from time to time seeking legislative authority for extensions of the prescribed limits. The present limit is £1,750,000 fixed by Section 1 of the Housing (Amendment) Act, 1949. The annual amounts to be expended will, of course, be subject to the control of the Dáil as they will form part of the annual Vote for the Department.

At present the existing scales of grants apply to houses completed before the 1st April, 1952. I do not propose to make any change in this respect but policy regarding the scales of grants applicable to houses completed after the existing terminal date will be placed before this House in due course and in sufficient time to enable prospective applicants contemplating building after the 1st April, 1952, to know clearly how they will stand in regard to grants.

Retrospective grant payments under Section 17 of the Act of 1948, related to houses erected within the period 1st November, 1945, to 1st November, 1947. This section was inserted at a late stage in the passage of the 1947 Bill, and it was inadvertently omitted at that time to provide for the remission of rates in respect of these houses such as was granted in every other case where a grant was made under the Housing Acts. This omission is being rectified by Section 14 of this Bill. Rates remissions for new houses built under Section 6 of the Bill are also proposed.

I now proceed to the provisions of the Bill which deal with matters primarily and directly dealt with by local authorities.

Section 16 proposes to confer powers on local authorities to acquire land compulsorily to enable them to lease or sell plots to private persons and public utility societies. It has been held that local authorities already possess powers in this respect, but the matter is not altogether free from doubt and the new section will make the position quite clear and will remove any difficulties which tend to deter local authorities from acquiring land for these purposes. Deputies are doubtless aware of the high costs and difficulty of acquisition of suitable sites in most urban areas at present. These factors have reacted unfavourably on the efforts of private individuals and public utility societies to provide houses. The common-sense approach to this problem is to enable housing authorities to acquire and develop such lands as may be needed not only for their own housing operations, but also for the needs of other classes, particularly those who are eligible for State grants and Small Dwellings Acquisition Acts loans. I have every hope that the effective operation of this provision will tend towards better planning and control of general urban development as well as resulting in a better balance of classes in the new community settlements.

Section 19 provides that where lands acquired and cottages erected under the Labourers Acts are brought within an urban area, as a result of the extension of borough or other urban boundaries, such lands and cottages will be dealt with as if they had been provided by the urban district council under the Housing of the Working Classes Act. This will regularise the procedure in such matters as the selection of tenants for vacant houses of this class. The right of an existing tenant to purchase under the Labourers Act, 1936, will, however, be safeguarded.

Section 22 of the Bill will give extended powers to rural authorities in dealing with lands acquired under the Labourers Acts. Section 16 of the 1885 Act enables rural authorities to acquire lands to be used for the purpose of allotments by agricultural labourers. These lands, when acquired, however, must be held for all time for use as allotments. It is felt that a general discretion should be given to rural authorities to use such lands at any time they consider necessary for any of their powers under the Labourers Acts. The need for this discretion is of particular importance in non-municipal towns where suitable sites for building are not always available.

It is intended to repeal the final sentence of Section 6 of the Labourers (Ireland) Act, 1883, which requires housing authorities acquiring land for the erection of labourers' cottages to "avoid all interference with demesne and amenity of residence of the owner of the lands proposed to be taken, or with any home farm or lands immediately adjoining and customarily occupied with such residence".

The exemption of these categories from compulsory acquisition has seriously interfered with the efforts of some housing authorities to secure suitable sites. The exemption represents a special type of statutory protection of limited application not applying to the general class of agricultural holder in this country. While the terms of this statutory protection are absolute, the interpretation of the terms "demesne", "amenity of residence" and "home farm" has caused much litigation which has not, however, left the matter in any clearer position. The introduction of these exemptions in the 1883 Act was effected by an amendment. They represented an exclusive type of privilege which cannot be defended in present-day circumstances.

The existing procedure to be followed by housing authorities proceeding with the compulsory acquisition of land contains adequate safeguards for the protection of the rights of property owners as a whole. Owners are given an opportunity to appeal to the Minister against compulsory acquisition proposals which are considered by them to be unreasonable. The Minister is required to hold a public local inquiry in any case in which an objection is lodged by an owner of property, and the latter can then appear or be represented at the inquiry to support his objection. It is felt, therefore, that no case exists at present for the continuance of the type of privilege afforded under the 1883 Act and that owners of demesne lands should be treated similarly to ordinary property owners.

A similar protection of a less absolute type from compulsory acquisition by urban authorities is given by Section 9 of the Housing (Ireland) Act, 1919, to every home farm, park, garden, or pleasure ground required for the amenity or convenience of any dwelling-house. It is likewise proposed to repeal this section.

Section 25 of the Bill proposes to give a general power to the Minister to correct obvious mistakes in Compulsory Purchase Orders proposed under the Labourers Acts and to dispense with the services of notices, advertisements, etc., in the circumstances where he is satisfied that the interests of property owners will not be prejudiced by such dispensation. This power is similar to that already applicable to orders made by urban authorities under Section 45 of the Housing (Miscellaneous Provisions) Act, 1931. No new principle is, therefore, involved in the extension of these powers to rural areas.

Section 16 will empower all housing authorities to provide houses for letting or for sale to classes other than the present "working classes" or "agricultural labourer" class. These houses will be eligible for grants on the scales at present applicable to private persons erecting new houses for their own occupation. It is not intended that this type of house should be provided until a local authority has first satisfied the needs of the working classes and the agricultural labourer classes in their districts. The question of providing for the most urgent and needy classes must receive priority.

Houses erected under the new provisions should be self-supporting. There will thus be no financial loss to the local authority and when the loan repayments are amortised the houses should prove to be a valuable source of revenue to the local authority if it desires to retain them.

Under Section 20 of the Bill it is proposed to provide for the application of the provisions of Part II of the Housing (Miscellaneous Provisions) Act, 1931, to rural housing authorities so as to enable county councils to deal effectively with unhealthy areas in non-municipal towns and villages. This amendment will enable the clearance order procedure to operate in rural areas as it does in urban areas. County councils are not at present empowered to make clearance orders dealing with unhealthy areas nor are they empowered to purchase compulsorily unfit property on the same terms as those applicable to urban housing authorities; that is, the estimated value of the site less the cost of clearance. There is no valid reason for this restriction on the powers of rural housing authorities. The conditions in many of the small non-municipal towns are often as bad as, if not worse than, those obtaining in urban areas and it is clearly desirable that rural authorities should be placed on the same footing as urban authorities for the purpose of dealing with unhealthy areas.

Section 21 of the Bill provides for an extension of the powers of rural housing authorities to enable them to provide houses for letting to persons other than agricultural labourers living in rural areas, non-municipal towns, and, in some instances, in town commissioners' areas. This extension is very necessary. As the law stands, rural housing authorities are restricted in their operations under the Labourers Acts to the provision of cottages for persons who come within the extended definition of an agricultural labourer. While this definition is undoubtedly wide, it does not embrace all types of workers and, in the result, categories such as serving soldiers, pensioners, midwives, etc., living in unincorporated towns and villages, are not eligible for local authority houses. This anomaly presents considerable difficulties in the larger non-municipal towns where persons of these classes are fairly considerable in number, and where they may be living in overcrowded conditions or in insanitary dwellings.

The extension of the powers of rural housing authorities in the manner suggested will enable them to give equal consideration to all classes of workers, irrespective of occupations, whose need for housing accomodation is established. It is the intention to apply the same rates of subsidy, payable in respect of cottages provided under the Labourers Acts, to houses to be built under this provision.

In Section 17 it is proposed to amend Section 30 of the Housing (Amendment) Act, 1948, to enable all urban housing authorities to provide reserved houses for occupation by persons of a particular class. The 1948 Act restricted this power to county boroughs, boroughs and urban areas with a population of over 12,000. The original intention of this section was to provide houses for classes such as newly-weds and aged couples, who might not require accommodation of a normal size required for larger family units. In my opinion this method of providing for the needs of newly-weds and aged couples represents an excellent and economical procedure and it should be extended to the other urban areas. In fact, some councils in the areas at present not covered by the provision have expressed a desire to provide for these classes in this manner.

The Bill also proposes certain amendments of the small Dwellings Acquisition Acts. There have been many criticisms of certain provisions of these Acts and the present circumstances justify a number of important amendments. Section 27 amends the definition of the market value of the premises which forms the basis on which local authorities make advances to applicants under the Acts. At present the market value is related solely to the estimated value which the house would realise in an open sale. Representations have been made to me by public representatives, builders and individual borrowers that strict adherence to this principle on the part of local authorities has resulted in unduly conservative advances being made. It has been represented that the result of this policy has been to create hardship to the person with limited resources who desires to avail himself of the borrowing facilities afforded under the Acts.

The proposed amendment will relate the market value of a new house to the reasonable cost of construction. This will enable local authorities to give more liberal advances in the future, and if builders are prepared to keep prices at a reasonable level, there will be nothing to prevent the advances being fixed at percentages corresponding to equivalent proportions of the selling price.

It is also proposed to enable county councils to operate the Acts in urban areas where the urban district councils are unable or unwilling to make advances. This amendment is intended to cover the case of the smaller urban districts with low valuations and slender resources.

It is proposed to repeal sub-section 9 (4) of the Act of 1899, which prevents local authorities from operating the Act for a period of five years following any financial year in which the loss under the Acts equals or exceeds the sum of one halfpenny in the £ in a county borough or one penny in the £ in an urban district. This provision has operated unsatisfactorily in some urban areas and it is felt that there is no need for its retention in present circumstances.

Section 28 of the Bill removes any doubts on the powers of housing authorities to base their loans under the Small Dwellings Acquisition Acts on a provisional valuation basis, that is, the market value estimated at the time the plans for the house are submitted by the applicant to the local authority. It has been suggested that local authorities could fix a valuation for the purpose of the loan only when the house was completed. Such an interpretation would lead to hardship and the matter is accordingly now being placed beyond doubt.

Section 29 of the Bill introduces a principle of a minimum cash contribution of 5 per cent. of the market value of the house to be made by the applicant out of his own resources. Thus, in the case of a house valued at say £1,400 the applicant will be expected to make a cash contribution of not less than £70. The State grant plus the loan to be made by the housing authority under the Act should normally be sufficient to make up the balance of the purchase price, if the builder's price and the local authority's valuation show a reasonable correspondence with each other.

These amendments of the Small Dwellings Acquisition Acts are, in general, intended to promote the smoother working of the Acts and to eliminate as far as possible the various causes of complaints which have been made in recent years, particularly in regard to the position of the borrower.

Section 26 provides for the continuance in operation of the Labourers Acts for a period of five years expiring on 31st December, 1955. The intention here is to avoid having to provide each year as at present in the Expiring Laws Act for the continuance of the 1883 Act. It is hoped in the intervening period to effect a consolidation of the Labourers Acts code and also the other enactments relating to housing.

Finally, two further amendments of the Housing Acts of a miscellaneous type are included in the Bill. It is proposed in Section 18 to extend the period in which the demolition or use otherwise than as dwellings of urban habitable houses, except with the permission of the local authority, is prohibited, from 31st December, 1950, to 31st December, 1960. It is felt that, in view of the general shortage of houses, all proposals involving demolition or conversion for purposes other than use as dwellings should continue to be subject to control by housing authorities.

Section 12 of the Bill is intended to remedy a defect in existing legislation where it is not quite clear that, as a condition for payment of subsidy or grant, the existing requirement that appropriate rates of wages or conditions of labour generally recognised by trade unions shall be paid or observed, applies at all stages of the construction of a house.

This completes my outline of the main features of the Bill which, as I have already stated, is designed primarily to secure the elimination of the more obvious defects in existing legislation, and to supplement and extend, where necessary, the existing powers and duties of all housing authorities.

I feel assured that the passing of the Bill will be of considerable assistance in pressing forward the general campaign for better housing in this country, and that its passage will be welcomed by all classes of the community who desire to participate in the national housing drive. There is no need for me to elaborate on the benefits that will accrue to the country as a whole by the earliest possible solution of the housing problem. These are well known to all of you and it is with confidence, therefore, that I recommend this measure for the early and sympathetic consideration of the House.

I move the adjournment of the debate.

Debate adjourned.