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Dáil Éireann debate -
Tuesday, 2 Nov 1965

Vol. 218 No. 5

Housing Bill, 1965: Committee Stage (Resumed).

Question again proposed: "That section 44, as amended, stand part of the Bill."

If an urban housing authority houses an applicant from a county council area on compassionate grounds, can the two-thirds subsidy be withheld on the ground that he could, in fact, have been housed by the county council? I draw the Minister's attention to sub-clause (a) (v) :—

for the accommodation of persons who are in need of housing on medical, compassionate or other similar grounds if the circumstances of the persons would not permit them to be otherwise housed.

If an urban authority housed them and they were from a county council area would that debar the urban authority of the two-thirds subsidy because it could be said that they could have been housed by the county council?

It has happened and it could happen and it could be so in future.

Is the urban authority entitled to the two-thirds subsidy if they otherwise qualify? That is the point I am making.

The qualification will be in relation to the person and to the house rather than to where he came from.

I was just a little afraid on account of this last qualification, that is, "or other similar grounds if the circumstances of the persons would not permit them to be otherwise housed." They could be otherwise housed. They could be housed by the county council.

But they will not be.

If they lived long enough they might be. In the case I had in mind they were not. They were housed by the urban housing authority and I think that "No" has been said already to two-thirds subsidy.

When we finished the other evening we had been dealing with the question of caravans and the Minister was to have a look at the situation because I felt that in the case of people who were put into caravans, the caravans being temporary dwellings, even if owned by the local authority, they should qualify for a two-thirds subsidy if they were being rehoused because these caravans could be used by the local authority again for housing and no one could claim that the persons were properly housed. I should like the Minister to reply to that point. There is another angle to this question of subsidy to which I should like the Minister to advert. Is the subsidy on loan charges as laid down in the Act or is it as it is being administered by the Department? Loan charges at present administered by the Department represent two-thirds of the loss on the housing scheme. That is not what the Act says but that is exactly what is being done. When the highest rent which can be charged to a tenant is, in fact, fixed, then the Department pay two-thirds of the difference. I suggest that the Department should pay two-thirds of the loan charges and that the question of rent should not be fixed until the loan charges are made known.

I also want the Minister to make clear whether or not the system which is adopted by some local authorities of applying the money they get for loan charges for one scheme of houses to another scheme of houses or to the general rate is legal or should be allowed to continue. Perhaps the Minister would comment on that matter before we go further with the Bill?

In so far as the caravan question is concerned, where caravans are provided and they have received or are receiving or are about to receive two-thirds subsidy in the provision of those caravans then a person who lived in such a caravan for some time and moved from there to a house would move in the normal way within the council's estate by way of transfer. If, on the other hand, a person was removed from a caravan through an operation of the local authority, this would create a different situation. But, taking it in the normal way, where they have been housed in a caravan, the caravan has been subsidised, and ultimately they come to get a house, as distinct from a caravan, in part of the local authority's housing estate, their movement from the caravan to the house would be on the basis of transfer.

Is the Minister suggesting that the caravans provided by some local authorities have, in fact, been subsidised to the extent of two-thirds or is he referring to the development of the caravan sites? As far as I am aware, no subsidy whatever has been paid by the Minister's Department for caravans provided. The Minister's officials, I understand, have said that they could be provided only if the council provided them out of the rates. Deputy Clinton may know something about it.

When I raised the question of caravans initially I had in mind a number of types of caravans. The Minister said he had some difficulty in relation to caravans because of the various types. We had a number of families well able to pay for a local authority house but we had no local authority house to give them and it would be a considerable time before we would be in a position to put these people into houses. We have rented caravans for them but they pay the full rent at the present time. That will be the position of the subsidy when we are moving them out of rented caravans into houses.

There are several other types of caravan which people have provided for themselves, through their own thrift and endeavour or through the help of friends, while they are awaiting houses. The people in respect of whom I am seeking this two-thirds subsidy are people who are in caravans because we cannot give them houses and who would not be in caravans if we could. Surely it is right and proper that the full subsidy should be paid in such cases. I have not got a clear answer from the Minister on that.

Perhaps I might clarify it a bit more. No subsidy has been paid in respect of any caravan up to this moment but a decision has been taken in principle to pay subsidy in respect of caravans that meet certain requirements as to standard. This would not be known, naturally, to Deputies and possibly this may clarify my statement in regard to my mind in this matter. There is a decision to pay subsidy in respect of caravans subject to requirements as to standard.

The Minister has not covered cases of people being rehoused from caravans. What will the subsidy be in such cases?

Will the Minister say he is prepared to pay two-thirds subsidy where people are in caravans because there are no houses available?

That surely would be wider than even Deputy Clinton would wish. Somebody who was moved out of a house because of some operation of a local authority—condemned, dangerous and so forth—and who was later provided with a house out of a caravan is subject to a subsidy. If a two-thirds subsidy were payable at the time of that person's removal from the old house, the fact that in the interim the person may have gone into a caravan will not alter the qualification for a two-thirds subsidy in respect of the new house.

If the Minister puts that to the managers it is a reasonable approach.

It is not only reasonable but logical.

I have come up against this difficulty. Two or three families have been living in a local authority house. They built a wooden hut at the back and the subsidy was refused. Surely a good case cannot be made for refusing the subsidy in such a case. Because of it the people were charged the full economic rent.

I am considering and shall be giving further consideration to this subletting problem in all its aspects, including huts in gardens. I should also mention that in the future the emphasis will be on the need for rehousing, which takes us away from past and present operations in regard to categories. This, plus the new emphasis on need, should together be capable of meeting possible objections at the moment.

Would the Minister give me an assurance on the query I put to him earlier—I do not think he heard it—on the situation where a local authority build a housing scheme. The position now is that a two-thirds subsidy or a one-third subsidy, as the case may be, is paid on the deficit rather than the cost. I suggest that as the Act reads the situation should be that the subsidy is paid and then the rent is fixed on the basis of the deficit. The present system is a reversal of that. What happens is that the rent is fixed and then the deficit is ascertained and the subsidy paid on that. That is only one aspect. The second is the question of switching of subsidies from one scheme to another. Should the local authority be allowed to switch subsidies from one housing scheme, after they have fixed rent, to another housing scheme? Could the Minister clarify that position?

I should like to tell the House that on both of the matters the Deputy has now raised a circular will be issued to the local authorities in the very near future which will clarify the situation and the changes we intend making in regard to both of these matters. In so far as the deficit mentioned by Deputy Tully is concerned, we have made certain headway in our consideration of it and our decision will be incorporated in the circular. It will be of an advantageous type.

We are now passing a new Housing Bill. It is practically on the same lines as the last Housing Act which stated almost the same thing as this Bill does but it was not interpreted in that way by the local authorities or the Minister. Can the Minister not now tell the House the manner in which this is expected to be operated rather than let us be told it at local authority level later? Should not the Minister tell the House during consideration of the Bill if the present system is to be continued or whether the subsidy should be paid on the loss rather than after the rent has been fixed?

It is a fair enough request but I should like to say that this is not laid down in any Housing Act. It is not a statutory obligation and has not been so at any time. The changes I am talking about in regard to the deficit are that this matter of paying the subsidy on a deficit principle will be abandoned or ignored—will cease to operate—in so far as rural housing schemes sanctioned before 1960 are concerned and urban schemes sanctioned before 1953. That is generally what local authorities will be informed in the circular to which I have referred.

Before we leave the section, I should like to see this, if possible, written into the legislation between now and Report Stage because none of us has had very pleasant experiences in relation to interpretation. It should be made completely explicit here. I ask the Minister, if he can, to explain subsection (8) because I cannot read anything into it. It is not clear to me.

This is a subsection enabling us to prescribe the subsidisable limits—the maximum amount on which subsidies may be paid.

Is this the £1,650 limit?

It relates to ceilings.

It relates to the powers to fix ceilings.

The Minister says it is not laid down in any Act, but in subsection (2), in the case of qualified dwellings, the subsection says that the contribution shall not exceed 66? per cent of such annual loan charges. Will the Minister say how that is related to the system whereby the subsidy is 66? per cent of the deficit? Why does it not state it, if that is what is meant? Why should we have this in while we are told by both the Department and the local authorities that there is a two-thirds subsidy for those living in condemned houses and a one-third subsidy for others. The Minister says it is not in the Act. Here it is, clear enough, in the subsection I have just referred to. Yet, we have continued this system whereby the Minister does not, in fact, give two-thirds subsidy or one-third subsidy. He waits until the local authority fix the rent and then he fixes the subsidy on the loss of the houses.

The Minister is aware of what happens after that. In many cases, the subsidy may not be paid for 12 months and it will be paid only at the rate of £300 a year. It is related to some other works on the housing scheme. The result is that some fantastic things have happened at local level. Either two-thirds is a fact or it is not a fact. If it is a fact, OK, and if it is not a fact, the Minister should say it straight out so that we will know what we are facing. The Minister should say that it does not mean a thing at all if that is so and that there is a different system under which this takes place.

It says "not exceeding two-thirds".

"Not exceeding two-thirds" is the expression used. The Minister is aware—if he does not believe it I will turn up speeches made by him in which the two-thirds subsidy is referred to—that if the Department does not mean that, then the ability to pay is what affects the subsidy and that, of course, alters the whole thing. If that is so, then the question of one-third and two-third subsidy should be carefully considered. There is no point in saying two-thirds in certain circumstances and then coming along afterwards and saying it is a maximum of two-thirds.

It is a maximum of two-thirds.

Does this in fact mean it is two-thirds subsidy of the deficit? If it is, then we should have it down in black and white. Is it two-thirds of the money required to build a house or two-thirds of the deficit that operates? If the Minister does not know, he can get all the evidence that is required very quickly.

It is up to two-thirds of the prescribed figure, which means quite a different thing from two-thirds of the actual cost of the house.

If that is so, why should two-thirds be laid down for certain types and one-third for others? You say "up to two-thirds", and you could cover that by the one phrase. Let me be very honest about this. There is a bit of hooking going on between the Department of Local Government and the various local authorities on the administration of this subsidy for a number of years and this is an opportunity to try to get it straightened out. I would like to know also is it right that the subsidy should not be applied to a housing scheme for which it was intended because that is what is happening.

It baffles me why we are using a system here which is just as complicated at that in relation to rent control and rent restriction in relation to private houses. It is fair to say—perhaps it is an underestimation to say it—that the average cost of a unit of housing accommodation in Dublin at the moment, taking small flats with large flats and small houses with large houses, will run to a minimum of £2,600. I am simply taking that figure as being an easy one for mathematical purposes. As I understand this section and subsection (8) to which Deputy Clinton has drawn attention, the effect is somewhat like this: at the moment there is a ceiling of £1,650 on which the Department of Local Government will pay a subsidy, which means that the State will pay a subsidy of two-thirds of the loan charges on £1,650 and will pay nothing towards the loan charges on the additional £1,000 required.

The effect of that is this. The State will pay—again I am using a rate of interest for convenient mathematics— 6 per cent, which we know is less than that being charged. The interest which the State will pay will be £66 per annum. I think I am right in that. The local authorities and the Dublin Corporation will be required to pay one-third of the local charges, or £1,650, which will be £33 and 100 per cent of the local charges on the remaining £1,000, producing £66 a year. Therefore, in the end, the effect of this is that the State is paying 50 per cent for the local charges and the local authorities are paying 50 per cent also.

As the cost of building has increased, the effect has been to reduce the proportion of the local charges being borne by the State. As costs are likely to increase rather than decrease in the future, the proportion the local authorities will have to bear—the tenants, under the new edict will be obliged to bear this—will increase continuously. We have no reason, from experience of past performances, to believe that the Department will raise their ceiling at the same pace as building costs may increase. Instead of having all this confusing and complicated mathematics to arrive at a fair distribution of the burden of interest rates, I wonder why we do not take our courage in our hands and say we will have a 50 per cent contribution in respect of the total cost and be done with it once and for all? I would like to know why this will not be done? It will work out, ultimately, at the same real cost to each of the contributing parties.

It would be easier to work out.

I referred to this during the Second Reading debate. It is completely ridiculous to say we are giving two-thirds of the loan charges. We are not giving anything like that. At the moment, in Dublin County, we are giving 50 per cent and I would not be prepared, like Deputy Ryan, to settle for 50 per cent. Nevertheless, I consider we should have one figure, if at all possible, and none of this argument at all times about what sort of caravan, what sort of house or what sort of applicant wherever local authority housing is provided. It will be a question of need in the future; need will be the yardstick. If we agree on the need for housing, it would be much better to eliminate all arguments and have a flat percentage of the actual cost of housing.

We have got tenders in Dublin County for housing at £2,300. That does not include the cost of the site or its development. The ceiling here is £1,650. It is quite obvious we will pay 100 per cent on anything up to £1,000. The thing is unrealistic and it is unrealistic to talk about two-thirds subsidy. When people make inquiries, they are told the State is giving two-thirds. Of course they are not. They are not giving 50 per cent and it is time the Minister, for his own satisfaction, did something about it.

So many questions have been asked that it is rather difficult to answer without leaving some out. Deputy James Tully spoke about deficits and the principle of deficit. As far as I understand the principle—it is quite involved—it was designed to ensure that local authorities did not make a profit out of this operation. In addition to this, it has also had the effect that there has been little encouragement to them in the past to get more money into the housing account. Theoretically, where the balance was favourable, the State should have gained; but, in fact, in most cases the balance is unfavourable. The change, about which we will be notifying local authorities in a circular, is that in future if there is a surplus on the housing account, the benefit will go to the local authority for the relief of rates and will not as at present be credited to the central authority. We are losing nothing here because we never got anything. I do not mind if Deputy Tully shakes his head because I think there is something here for the local authorities. This change will be in respect of urban houses, approval for which issued before a certain date in 1953, and in respect of rural houses, approval for which issued before some date in 1960. This is not as empty as Deputy Tully appears to think it is.

There is nothing in it.

You asked for this. I did not volunteer it. Deputy Tully also raised the question of the switching of subsidies. The subsidy is allowed in respect of the provision of a particular house. The first tenant, who would be the qualifying tenant, may disappear out of the house and it may be occupied by God knows who. However, the actual subsidy in respect of the house does not alter.

In cases where the subsidy applies to a scheme of houses and is paid in bulk, I assume the same applies?

Very often a bulking of the subsidy takes place in a scheme. Subsidies of 33? and higher are bulked together and a graded rent scheme or something on that line is devised on that basis. Having taken credit as a whole for the subsidy due to them, the local authority does not pass on the benefit to the individual who qualifies for the higher or the lower subsidy.

They may even pass it on to other schemes?

They may. If by doing so the local authority can better administer their housing estates as a whole, I do not think we should be too concerned as to which house is drawing which amount. Nobody suffers any hardship.

The tenant suffers.

Local authorities should be encouraged rather than discouraged to do this. I am not quite clear what the Deputy's objection is. I pass on now to the matter raised by Deputy Clinton that we should split the difference and say the figure is 50 per cent.

55 per cent.

To our mind 66? is a better proportion than 50 per cent. If we had to take a fixed percentage, we would probably have to reduce the figure to 50 per cent rather than increase it.

Of the actual cost?

Whether it is the actual cost or not, if we were to give a flat figure, obviously it would have to be lower. It is true in respect of Dublin city and county and some other areas the application of the figure of 66? under the general regulations and the prescribed figure for subsidisable costs means that, in effect, they are getting only 50 per cent. But it is also true that other local authorities have been able to build at lower costs and benefit by the 66? per cent. If we were to fix a flat figure, we would be penalising those people while not improving the position in Dublin and the other highcost centres. It is for this reason we retain the description not exceeding the higher figure rather than fixing a lower percentage. That is why I think we should not pursue the other course.

I can see the danger the Minister speaks of. In parts of the country, because labour costs are lower, it has been possible to derive greater advantage by accepting the 66? because the ceiling was much nearer the actual cost than in Dublin. But I am not asking for a figure that would represent the same thing. I would like to see a flat figure—one subsidy—rather than having all this argument about what qualifies and what does not qualify. Anybody in need of a house, anybody for whom a house is built, should qualify for a fixed subsidy. If that subsidy were fixed at a level that would not injure the districts the Minister has in mind, it would give us as much, if not more, than we have at present. The two-thirds and the £1,650 were fixed some time ago. Since then prices have been increasing and there is now justification for some advance on the 66?. If we decide to have one figure—not one-third or two-thirds but in between —it should represent an improvement, eliminate administrative difficulties and provide a more satisfactory arrangement for local authorities as a whole.

The Minister referred to the fact that he intends to alter the system of subsidy in a certain way for the purpose of allowing a housing authority, to put it plainly, to make some money on the deal. The Minister must be aware that this is not possible. At the moment the system is operated exactly as he states. The Minister waits until the rent is fixed and then pays two-thirds of the loan charges. I should like him to explain how he proposes to deal with the situation in order to allow the local authority to make money on the deal because, unless he does what is set down here and pays a stipulated sum, either one-third or two-thirds, there is no hope of anybody making any money on the deal.

The Minister is far too honest to deny that the Department have, by switching things round to suit themselves, got their housing carried on with the least possible expense to the Department. They, first of all, make a regulation stating that the amount can be two-thirds for certain people and one-third for certain others. Then there is a limit put. We are now reaching the stage very fast, as Deputy Clinton has pointed out, at which it will not be possible to get a subsidy on local authority houses because, if the information I have got about rural cottages recently advertised is correct, it means the limit for urban houses is now being reached by contractors contracting for single-roomed rural cottages costing £1,650. A few years ago the same cottage was quoted at £800, £900, £1,000, £1,100, £1,200.

Is the Deputy talking now of serviced or unserviced cottages?

Serviced, but it does not matter. The houses now are serviced and the price has run over the upper limit. That means, and I do not know if local authorities appreciate the fact, that before very long—probably in this year, if there are any houses built, and I put a question mark there—these houses will not qualify for the subsidy because they will be over £1,650.

They qualify up to £1,650.

But not over that figure, and that means the cost will be far greater to the tenant and more than the tenant can bear.

It will not be two-thirds.

It certainly will not. Is the Minister aware of any case anywhere in the country in which a two-thirds subsidy was paid on any house within the past five years? Certainly I am not aware of any and I went to great trouble to find out.

Yes. I will get the Deputy one.

The Minister also says it is quite in order to switch subsidy.

Not switch it, no.

The one-third subsidy and the two-thirds subsidy can all be lumped together and a common rent fixed. The Minister went further and said that it will be quite in order when a scheme is completed and the rents fixed, according as the people come from overcrowded or condemned houses, for the local authority to switch the subsidy they get on the scheme of houses to another scheme catering for a different type of person altogether. So long as their housing property is OK, the Minister does not mind what way they switch the subsidies around. That defeats the idea of the subsidy altogether. The idea was the Department would pay a certain subsidy so that people living in condemned or overcrowded houses could be properly housed. The Minister now says that that subsidy need not be applied to that particular type of house; it can be applied to a different scheme altogether. Not intentionally, perhaps, the Minister is, I think, trying to get away from the question we first asked: is it intended to do away with the present system altogether of one-third for those in normal houses and two-thirds for those in condemned or overcrowded houses?

The Minister has made the point about the new system which will enable local authorities to make money on the deal. I do not believe local authorities will be able to make money out of this. Secondly, I do not think the Department should do this sort of thing. The Department should state the amount of money they are prepared to pay and the rent should be fixed after the money is paid. The opposite is the case. The rent is fixed first and then the Department put in their subsidy and, instead of paying pounds, they are actually paying shillings and pence.

I do not agree with Deputy Tully, though both of us are probably moving in the same direction. Surely it is the ability of the tenant to pay the rent that is the important factor? If there is an obligation to pay a supplement, either State or local authority, surely it is not unreasonable that the tenant should pay according to his ability? What is wrong then in fixing the rent in advance of the payment? I believe rents should be fixed on the basis of the ability of the tenants to pay. The big question is: are they fixed in that way? They should be. If they are, then the amount coming is not really an issue. Once a decision has been taken on the amount of rent based on the ability of the tenant, then the State and the local authority make up the difference. That is the only fair basis. What Deputy Tully has said is indicative of a certain mentality all too often encountered; we will see what we get from the Government; we will see what we can provide from the rates and then we will see what we will charge the tenant. The first question should be what can the tenant pay and, after that, the difference can be found between the State and the local authority.

It is not true that the subsidy is taken from one house and put on to another house, but, in regard to certain priorities and certain operations on the part of local authorities, we are prepared to provide certain subsidies not exceeding 66? per cent on a figure up to £1,650, or whatever it may be. Thereafter, we are not primarily concerned, and should not, I think, concern ourselves in central Government with the actual use of the subsidy provided. We give it to the local authority and they then, in their wisdom, can apply it as they think fit. It is advisable they should look on housing in toto rather than as separate, unrelated schemes. The total subsidy should be regarded as revenue coming in and what we pay by way of subsidy should be regarded as total revenue from State sources and the total rents should be regarded as the other contributory factor and they themselves are contributing a third part from the rates.

I can see nothing wrong with this; in fact, I can see many things that would be helpful to the local authorities in this approach. They are to be encouraged in this direction rather than discouraged provided they have due regard at all times to their primary and greatest responsibility which is to provide houses for the least well off living in the worst housing conditions. The important thing is how the local authority house their people, how they charge their people for the housing they give them, always bearing in mind the burden on the ratepayers.

The ability of the tenant to pay is a matter of paramount importance. It is not unreasonable that the tenant of the house should be expected to pay but those who are not able to pay what their graded rents may now be should have those rents reduced so that they can afford to pay them. This is where I and many of our local authority people differ at the moment but I do not think we shall always differ. We shall be of one mind on this question in the not too distant future.

I would like some enlightenment from the Minister on the question of the 66? per cent of the loan charges. While this has been there for quite a long time from the point of view of subsidising local authorities and is supposed to be paid in cases where the tenants of the house come under the Housing of the Working Classes Acts, there is also in being an administrative practice which reduces the 66? per cent very considerably. I should like some enlightenment from the Minister as to how he proposes to depart from what has been the position.

Taking the city of Dublin as an example, it is a good many years since anyone was housed who was not really entitled to be housed on the 66? per cent basis. Because of certain physical development and a failure which to a great extent may be attributed to lack of control in the national body, for quite a number of years the only people housed in the city of Dublin were people who were living in overcrowded conditions, who were living in houses unfit for habitation, who were living in dwellings which became dangerous and had to be removed, or were living in circumstances where members of the family were suffering from tuberculosis and were certified as having to be housed.

In recent years while the cost of housing has been going up fairly steadily and while the 66? per cent might be considered a reasonable rate of assistance in relation to a house costing £1,650, when the house costs £2,200 or £2,300, the 66? per cent depreciates very rapidly, so that we have reached a situation that in no case practically has the percentage of the actual cost of a modern house been paid. There is also the question as to whether the 66? per cent relates merely to loan charges on dwellings or whether it should also include the cost or acquisition and development. Take the situation where dwellings such as flats are provided. We are aware of the fact that the maximum on which the 66? per cent was paid for flats went up to £2,200. At the same time, the cost of constructing the flat went away up over £4,000. Therefore, a subsidy of 66? per cent on a maximum of £2,200 when applied to a flat which has cost £4,400 really amounts to 50 per cent. Therefore, if people are to be provided with dwellings which they can reasonably afford to rent, the difference has to be found by the local authority, and this sliding scale has been continuing to the disadvantage of the tenant and prospective tenants and to the disadvantage of the people who contribute to the local rates. It is not a fair picture to talk in terms of a subsidy from national funds of 66? per cent unless in the normal housing case that subsidy amounts to that percentage of the cost.

I do not think it is reasonable at this stage, as far as my own local authority is concerned anyway, to talk in terms, under the section, of 33? per cent in other cases than those set down in subsections (3), (4) and (5). All those being housed in local authority dwellings by Dublin Corporation and, I suppose, by every other local authority, are people who are being housed only because they are not able to provide suitable dwellings from their own resources. For the past three years, the bulk of them have come from dangerous buildings. If and when that situation improves, we can go on to housing people from unfit dwellings, people certified by the medical officer to be in need of houses and also families living in overcrowded conditions. Personally, I do not see any argument in favour of continuing this one-third for other cases, but I should like at this stage to interrupt my remarks in order to give the Minister an opportunity of indicating whether he proposes to lift that ceiling and place it at £1,650 and £2,200 but on the actual cost and whether the 66? per cent is to apply to the actual cost of providing the dwelling and all that that entails.

To give a flat answer to a direct question, I may say that I have no intention of relating the 66? per cent to the actual cost, for the reason that the costs are much too high, higher than they should be, and Deputy Larkin is quite well aware of this, particularly in the operations of his local authority. It applies with like emphasis to other local authorities but not with equal emphasis to the operations of all local authorities. There is no doubt that there are variations in costs that cannot be accounted for, either as to labour or material or anything else. I certainly would not follow the spiral of costs right up to the £4,000, or £5,000, or £6,000 brackets for providing a flat in Dublin or anywhere else, no matter what amount of money I had at my disposal, because I do not think that adding fuel to the fire is going to damp it down. That is the only reason we have the 66? per cent tagged down and I have no intention of going after prices.

We have already appealed to the Minister to do what Deputy Larkin is looking for and I wonder if he could not meet us in some way. He accepted the fact that this ceiling of £1,650 has operated to the disadvantage of the Dublin region and other similar regions to a much greater extent than it has operated to the disadvantage of the remainder of the country. He accepted this in a practical way in the private sector, realising that houses are costing a good deal more in Dublin and certain other regions than in the country as a whole, by allowing an extra £200 loan in these regions. Whatever the Minister thinks about costs being too high, and perhaps we could agree with him, they are secured as a result of competitive tender and those are open to the whole country. The local authorities can do no more than that. Often we advertise twice for tenders. Perhaps the Minister may be dissatisfied with the first tenders. This has often gone on for a long period and the last stage is much worse than the first because all the time costs are increasing. If they are not competitive tenders, they are the keenest prices we can get. In those circumstances, would the Minister not consider, in regard to the regions where he knows that this is a fact, that houses are costing too much, increasing that ceiling by at least a couple of hundred pounds? That would be meeting the situation half-way?

I would hate to see the situation becoming clouded because it appears as if, in the discussion of the last quarter of an hour, we have accepted the fact that the two-thirds subsidy is being paid.

My argument is that the two-thirds subsidy is not being paid and that in fact it is two-thirds of the deficit that is being paid. The Minister will have to make up his mind on that.

On the two issues.

Deputy Clinton is correct in saying that it is necessary to increase the ceiling above the £1,600. If the two-thirds subsidy is not to be paid, it does not matter a lot because it is on the deficit that the subsidy is being paid, if any is being paid at all, and having the Department write to a manager telling him what he can do, instead of writing it into this section, will not improve the matter. All relevant matters should be discussed in this Bill and the Minister should supply Members of the House with copies of that circular before it goes to the managers because many of us here are members of local authorities and when we go down to these local authorities, we are told this is what the Department of Local Government say and it does not matter what the Minister says across the floor of this House. That does not count because it is what the manager has that we will have to go by. I would ask the Minister to do something about the payment of the subsidy on the actual cost of the house.

I want to speak now after Deputy Tully because I have been missing out what has been said by other speakers half the time and only partly replying. In regard to this question of the deficit, no matter what Deputy Tully may say, the fact is that the subsidy is not paid on the deficit. Let me put it this way: of all the subsidies paid, taking the country as a whole, over 90 per cent in fact is the high subsidy and less than ten per cent is the low subsidy. Out of a total subsidy payment of £2,700,000, only £40,000 arises or has any bearing in regard to the deficit. That is the figure and if this is not so, then we are missing £660,000 somewhere.

You are losing a lot more than that.

The sum of £40,000 is all that arises on this question of the deficit. The subsidy is not related to the deficit.

I have in my possession a document which shows how the subsidy is paid in my county.

I should be glad to have it.

I will make the Minister a present of a copy of it. If what the Minister says is correct, more people are being codded over this whole thing than the Members of this House. I cannot see how the Minister can say that the deficit does not come into this. He said earlier that the local authorities cannot make any money on it. If in fact the rent is fixed before the subsidy is declared, if the houses are built and the rent is fixed and what is left over is considered for subsidy purposes, how can the Minister say that the deficit does not come into it? Yet the Minister says it does not come into it.

That is not it. The ratio of the deficit to the total subsidy is as £40,000 is to £2,700,000. Whatever way it comes in, it is as infinitesimal as the £40,000 is to the £2,700,000.

If the Minister says that is so, I must take his word.

I should like to have a look at the document to which the Deputy referred.

That is not my information and it is not my experience. The Minister referred earlier to the question of the one-third subsidy and the two-thirds subsidy. If I understood him rightly, he asked how would the local authority be expected to relate the subsidy to a particular house, and said that it was to the income that the rent should be related. He also said there was not much inducement, without the operation of this section, to take people out of condemned houses. What is the whole idea of having a one-third subsidy or a two-thirds subsidy, if, in fact, the only factor to be taken into consideration when the rent is being fixed is the income of the person concerned? I do not know what advice the Minister has got, or what particulars he has with him. I am sure he has fairly good information, but I am quite satisfied that the two sets of facts do not run together. There must be a mistake either in one or the other. Luckily, this Bill will not be finished with too soon and we will have an opportunity of having another look at the section.

I should like to follow the line taken by Deputy Tully. I am satisfied that in my local authority the approach followed is the approach outlined by Deputy Tully. As I understand the position—and I would be very pleased to know that I am wrong —if in respect of houses built last year in Coolock the manager fixed rents which were full economic rents, there would not be one single red cent of subsidy in respect of those houses. There would be no subsidy on those dwellings. As I understand the position also in each scheme, in the operation of finding out what subsidy will be got from the State, some of the people on both sides of the fence are developing into experts, because each scheme has to be examined, and the financial effects following from the rents to be paid by the tenants have to be measured.

The representatives of the local authority have to trot down to the Department with each and every scheme to discuss them in detail, and a decision as to what subsidy will be granted to the local authority concerned is made only when all the income and expenditure are shown. This means that in relation to a local authority such as Dublin Corporation dozens and dozens of schemes have to be examined and re-examined practically every year. In respect of a scheme of houses built last year or the year before, no one in the local authority can know what the actual subsidy to be paid from Central Government funds will be. The theory is that it will be 66? per cent up to a maximum.

Deputy Tully, other Deputies and I have been raising two different aspects of this matter. One is the question of the justification for relating the subsidy in a more realistic manner to the cost of producing houses. The Minister has been frank with us this afternoon. He told us that the prices of dwellings have gone up, and have gone up unjustifiably to a great extent. I should like to know what the Minister has been doing in this regard. What protection has he been trying to provide for people who are affected by this unjustified increase in prices. I have not seen very much evidence of any great activity on his part, or on the part of the Department in this regard. Every proposal by a local authority to build any kind of dwelling requires and gets the sanction of the Minister before the contract is given out. There is again the general question of the failure to do anything about the price of houses for another section of the people who are faced with this problem.

There is another aspect of this matter of the subsidies. In regard to subsidies to local authorities for the provision of housing, why is it necessary to continue the present elaborate and most confusing method? If the Minister is going to give a subsidy of 66? or 50 per cent to the local authority, why can it not be done by way of deduction? It might well ease the administration problem fairly considerably if a different method were used. At present if a local authority decide they want to build 300 dwellings, they get sanction to build in due course, and they get sanction to raise a mortgage from the Local Loans Fund. If those 300 dwellings qualify for the 66? per cent subsidy, surely it would be more sensible to think in terms of trying to introduce a short cut and not have the process of the local authority being lent the money required and having to pay it back into the Local Loans Fund in a most elaborate and unnecessary procedure.

The Minister answered my question quite frankly in regard to the section. Even if this 66? per cent subsidy were paid in full—which is subject to very serious doubt—he does not intend that that figure shall be the maximum. He made it clear that he has no intention of increasing the maximum. It is quite clear to me, and it must be clear to everyone inside and outside this House, that the Minister is endeavouring to use pressure to compel local authorities to increase the level of their rents; in other words, to compel the city manager or the county manager to impose higher rents. The initiative towards this end is coming directly from the Minister and from no one else.

In this matter, might I remind the Minister of the problem facing the local authority in Dublin at this present time in housing ordinary families who come under the old term, which is now going out, the Housing of the Working Classes Act? In many cases, they are compelled to provide dwellings for them some miles away from the place of employment. In such circumstances, the additional cost falling on the members of the family, where the father has to go to work five or six miles away, or the cost falling on the other members, the children attending school, and so on, is no little financial burden on the average family.

This seems to be a Second Reading speech on the section, and family earnings do not enter into it.

The question of loan charges is very important in this regard. In order to provide some easement for the families affected by these circumstances, the Minister should, in looking at the loan charges, do as has been suggested by Deputy Tully. He should make sure that the full percentage of subsidy set out in the Bill is actually given to local authorities and, because of the necessity to provide assistance to all the thousands of families affected by this, he should consider increasing the maximum and not leave the present maxima of 66? per cent, £1,650 and £2,200 in the Bill. Unless that 66? per cent is related to the actual cost, then a subsidy of that amount in respect of a flat in an area where it may cost £30,000 or £40,000 to acquire the site alone and where the development costs may be very heavy indeed means that either the local ratepayers have to bear an added burden or the tenants will be required to pay rents which they can by no stretch of imagination meet.

I want to raise a further point, particularly in regard to the question of flats. In the city of Dublin, there are many buildings that require replacement. Many of them are privately-owned. Many of them are publicly-owned. Some of them were re-built in 1940, reconditioned dwellings which, now again, unfortunately, have become tenements. These need to be replaced. If they are to be replaced by flats, is it suggested that the people living in those dwellings could meet the types of rent which would arise from the Minister's directive and from the contents of this Housing Bill? The result of failure to deal with this matter in a realistic way and in a way that takes into regard living conditions and the need to improve these living conditions means inevitably that all the millions of money spent in trying to provide accommodation will, to some extent, be wasted because we should be creating conditions which would encourage overcrowding in corporation dwellings. I want, again, in regard to this matter, to ask the Minister to re-examine this particular situation in the light of the need to increase the maximum and to re-examine it particularly in the light of the problems of providing dwellings in the central city areas where people need to live in order to be near their work.

I think Deputy Larkin is less than fair to the Minister's statement that he would not increase the subsidy maximum. Practically everybody who spoke here this evening said that building costs are too high and one hears the same argument outside. The builders complain that the costs are too high because of labour costs. The workers say that excessive profits are being made or perhaps there is profiteering in land. Somewhere among all the accusations lies the truth. The Minister should try to stop the spiral in house prices and give increased grants. The present Minister helped out my local authority, Dublin Corporation, by including the sub-tenants in the full subsidy. For many years, we got no subsidy in respect of them and if you housed a sub-tenants, you did it at a cost to the rates and not a Government subsidy. Deputy Larkin mentions rents generally, but the corporation have introduced no new scheme of rents since 1950. Certain charges have been added for rates, and so on, but the new scheme has not been adopted yet.

Consider the frightful rents being charged by private landlords. I merely mention that point to stress the very urgent need to press forward with the building programme so that each family entitled to a house or flat may get it, irrespective of how it is financed. Years ago, the corporation may have seemed very generous in housing people but we are coming to realise now that in fact we have been penalising a very needy section of our people. Take a man in this city with two children. We cannot house them. Even though he may be a semi-skilled labourer, drawing £11 a week, we have not a house for him. Yet, somebody with more children, but who is much more affluent, will be given a house without question.

We cannot have a general debate on housing on this section.

I was just referring to the matter of subsidy. While the Minister's blank refusal to increase the subsidy may, to some, seem harsh, at the same time there is a lot of sense in his attitude.

I support Deputy Clinton's request that the Minister meet the difficulty in Dublin and areas of greater pressure by giving a greater subsidy in respect of those areas. Subsection (8) permits the Minister to do so because he may, in the preparation of these regulations, consider different provisions for different areas. That would appear to justify a higher ceiling in areas of greater demand.

I should like to think, in one way, that the interest subsidy paid by the State was a significant factor in the cost of house building. If that had any effect, good, bad or indifferent, I would be amazed. I do not think it in any way creates any pressure on the cost of house building whether the State gives a complete subsidy or no subsidy at all. The pressures which determine building costs are entirely different. Therefore, I can see no benefit at all in the Minister's attempted justification of the preservation of the present levels when he says that he will not increase the cost of building by making a greater contribution towards the loan subsidies. I can find other reasons, such as that the Minister might not wish at a time when there is a credit squeeze to increase the burden the State has to meet. Rather than that, however, he advances as a reason something which cannot remotely be said to have any bearing on building costs, that is to say, upon the tenders and prices which we receive from people who are invited to build. These have something to do with other factors but certainly not to the contribution which the State may make. We might, perhaps, relieve the position in Dublin and areas of greater pressure if the Minister were to provide additional assistance in those areas.

I believe that the interpretation of this section stands or falls on subsection (4) (b)—"conditions as to building standards." I was wondering what progress the Minister's Department has made in having the national code of building regulations under the Planning and Development Act of 1963 framed. I believe it would be of great importance in the interpretation of this section. I should like the Minister to clarify the position for me.

In answering Deputies Larkin and Andrews, and particularly Deputy Larkin, on this question of house prices being too high, I shall not enter into any argument as to whether or not prices are too high but I think everybody is fully agreed that there is more being paid or asked for than in fact the product is worth today. The question is: what am I doing about it. I hope I have been doing some little about it, which is more than can be said for most of those who ask me the question. A review of standards and designs is currently going on in my Department and An Foras Forbartha are endeavouring to reduce the loan costs.

Some of those I saw built were higher.

If there are a lot of blackbirds, Deputy Tully will always see a white one somewhere. In addition, I have initiated proposals from system builders and have rationalised building systems. A number of these proposals have been examined and I think the majority of new houses have benefited from them. I might say that up to 100 such proposals were submitted from one source or another indicating various forms of construction.

In reply to Deputy Andrews, another matter to which we are currently attending, is this question of national building standards. That has for some considerable number of months past been pursued with the utmost vigour to try to produce this new building code for the good of all concerned, not the least of which will be the bringing about of uniformity of approach throughout the country as well as a beneficial effect in regard to prices in certain respects. Further, modular coordination—which is another matter which shows itself to be of great value in other countries—is being pursued by a working party for some considerable time. I expect to have a report from them in the not too distant future. I should add that consideration, and indeed sympathetic consideration, of any further proposition to reduce costs while maintaining standards will be welcomed. This is something enunciated by me quite a number of years ago. Indeed it is just four years ago that I first went out on this limb, seeking new methods and ways of doing this rather than adopting the traditional method maintained for hundreds of years.

I have also introduced during these past few years, grants for prototype builders which I thought would have the merit of speeding erection and reducing costs while maintaining reasonable standards of accommodation.

We have also, in my Department, engaged ourselves on the question of site costs as they relate particularly to the built-up and urban areas, and are providing, in this measure before the House, site subsidy for the first time. Refusal to sanction exorbitant tenders after all sorts of pressure over a number of years has not been the least of the charges and, in some cases, I have been charged that it cost more because prices had gone up in the meantime. It is rather too easy a conclusion to draw that just because this happens in one or two cases, the general overall effect has been wasted. If I and my colleagues were to accept all tenders, no matter how exorbitant, it would be ridiculous.

I have also been trying to encourage builders of private houses to build houses of moderate standards as distinct from the dressed-up versions which were produced in greater number because there were sufficient people around with more than sufficient to pay and indeed more than many of them could really afford. This effort is, I think, even at this moment paying off, in that a number of our builders have in fact moved over to the production of less pretentious houses and are bringing prices down to the level of the people who require them rather than up to the level of those who can afford to pay exorbitant prices, as has been the practice in the market for the past four or five years. That is an answer, in some degree, to Deputy Larkin's charges as to what I am doing about these things.

Getting back to this really important matter which is related to the section, the question of subsidy and its relationship to rents, rates and taxes, I wonder has Deputy Larkin stopped to consider that the rates of Dublin this year are probably paying about £1 million towards the builders of the housing estates of Dublin Corporation. The Dublin local authority's house rents scheme is, I know, in the melting pot at the moment awaiting some changes because of the very poor comparison with other parts of the country. Further under the differential rents scheme the maximum rent in Dublin is 25/-. Deputy Tully shakes his head and I do not blame him. If he fell down, I should not be surprised but this is, in fact, generally the case.

The Minister said the maximum, not the average.

The maximum rent under the differential rents scheme.

That is crazy.

There is something wrong there.

I am not wrong. I am right.

These are not rates the Minister is thinking of?

No, I am thinking of rents.

The differential rents may contain a rates element which runs it up very much higher.

It is weekly payments we are talking about.

Let me put it this way. If I give you Cork, Limerick and Waterford in the same context, perhaps it may highlight the situation whether you agree the figure covers this, that or the other. The Cork maximum would be 65/-; Limerick, 62/8; Waterford, 53/- and Dublin on that table, would read 25/-. I do not want you to believe me, I am simply stating the figures which you can believe if you wish. It makes no difference to me. The difference is to the Dublin housing authority.

Is there a rate element in it?

They are all plus rates. That is why I say comparatively the figures are, Cork, 65/-; Limerick, 62/-; Waterford, 53/- and Dublin 25/- and that has to be taken against the background of £1 million on the rates and £800,000 from the taxpayer and a huge backlog of housing yet to be provided. How and by whom can the houses be paid for? Is there some source yet not fully tapped to enable the Dublin housing authority, the Corporation, to go on with an expanding programme of housing? The charge that I am directing the managers to increase rents is terribly far from the truth.

The Minister said it.

Let me finish. If any corporation or county council believe their rates can bear more than they are at present bearing—and I have not heard of them saying they can, for any purpose—they can put on another 2/6 or 3/- for housing and keep their rents realistic. I am not going to say: "You must put up the rents and take down the rates". This is a matter for the ratepayers' representatives which all Deputies are, who are members of local authorities. It must be their decision and I cannot make it for them. Am I to accept it if Deputy Larkin passes the bill across to me that I am the person responsible for having rents increased? I am simply outlining the figures for the Deputy's housing authority and saying why I believe it is inevitable, in all justice and equity, that rents in the differential rents schemes in Dublin must be brought up to realistic figures so that the housing authority will be enabled financially by greater contributions from those who are able to pay, to provide houses for the great number yet unprovided for and who are not able to pay even the minimum rent.

If we do not do this, the whole system of providing houses will collapse. For that reason, I say the taxpayer is paying his share and the ratepayer, according to everybody, is paying more than his share, and until the housing authorities have demonstrated by a realistic re-appraisal of rents that their tenants cannot pay any more, that those who are better off are paying what they can afford, I do not see how we can make a case to either taxpayers or ratepayers that they should contribute more.

There are three parties involved, the tenants, the ratepayers and the taxpayers, and if two are carrying a great burden or as much as they can be expected to carry, one is entitled to examine realistically the position of the third party and see how much they can carry. If it can be demonstrated that they cannot carry any more, then we can look around for some other solution, but until that is done there is very little case for coming here and blaming the Minister for Local Government for putting up rents. Do not put them up and do not raise the rates and you stop building. That is the answer, not to say that the Minister for Local Government is making you put up rents. What I am doing is pointing out some of the ways you must travel if you are to succeed in providing the housing that is required.

Would the Minister say whether he stated in this House that if local authorities did not increase their rents, he would have to reconsider the question of further subsidy of new housing in the area? Was that not, in fact, said, that if the local authorities did not increase the rents, he would prevent them from building more houses? Was that not, in effect, telling the local authorities that they must make the tenants pay more? The Minister can clothe it in any words he likes but luckily we can remember what was said a few months back. The Minister may try to get out of it——

I am not trying to get out of anything but I do not want to be carrying a can I did not provide.

The Minister will carry this can——

No, I shall not.

He said in this House that if the local authorities did not bring up their rents, he would not give further subsidies for housing in the area.

Could we have, at the Deputy's convenience, the volume and column?

I shall be delighted to provide it but I cannot do so now. I am stating from memory what he said. The Minister has not denied it and so I assume we may——

No, the Deputy may not assume anything.

Did the Minister say it or did he not?

If the Deputy is quoting from memory, how does he expect the Minister to say yes or no?

I am asking the Minister a straight question: did he say it or not?

The Deputy will not get an answer, yes or no, to that.

Let the public judge it. There is another issue. Many people apparently think in the same way as the Minister. They talk about the ratepayers and about the tenants as if they were two different types of people. The Minister seems to forget that the biggest ratepayers in most of the local authority areas are, in fact, tenants of local authority houses and they are paying without any remission of any kind more rates for the accommodation they have than anybody else. The person who builds his own house gets his grant and partial rates remission for ten years but the local authority tenant who is put into a house pays what is now recognised as hefty rent and rates from the first day he goes in. The Minister should look at the facts and not give the impression that these tenants are parasites living on the backs of certain other people who are carrying them.

We who are members of local authorities have been looking at this situation for a long time and we know the situation. The Minister says the maximum differential rent in Dublin is 25/- a week. The Minister says that. I am sure he will be able to prove it; he did not prove it. He just stated it in the very same way as I stated what he said——

That is a different matter—what I said and what you think I said.

The Minister made a statement without putting any evidence before the House to back it up——

Let the Deputy disprove it.

We hope to disprove it before this session is through.

You will not succeed.

If with the differential rent being paid in Dublin we take the rates being paid by the local authority tenant and compare that with the out of pocket payment for the accommodation of a house by the other areas that the Minister talked about here, a different picture would be presented. The Minister should be fair to unfortunate people all over the country who have been carrying more than they are able to bear.

It is in an effort to be fair to those people that I talk as I do.

Progress reported; Committee to sit again.
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