asked the Minister for Local Government if he will state (a) the estimated life of a local authority house built in each of the years 1890, 1910, 1930, 1950 and 1960; and (b) how the value of such a house has been estimated in the case of sale to a tenant.
Ceisteanna — Questions. Oral Answers. - Local Authority Houses.
144.
There is no information in my Department which would enable me to reply to the first part of the Deputy's question. The life of any house depends to a large degree on the quality of the materials and workmanship used in its construction and the level of care and maintenance it receives over the years. Where a local authority decide to make a purchase scheme under section 90 of the Housing Act, 1966, they are obliged by law to base the selling price of houses in the scheme on either the market or replacement value of the houses. Where replacement value is used, due allowance is made for the age and standard of the houses. Whichever method the local authority used, therefore, the sale price will reflect the value of the house having regard to its age.
Surely the Minister will agree that on the erection of a house there is an estimated life for the house? His Department should be able to give the estimated life of the houses for each of the years to which I have referred. Is he aware that houses which cost £70 to build are being charged for at the rate of a couple of thousand pounds now to tenants who have been paying rent all their lives, on the grounds that the replacement value of the houses would be £3,000 or £4,000? I am trying to get some further information from the Minister.
I do not think it is practical to request such information.
Is the Minister aware that last week he gave me a reply to a query in this House by way of a long letter in which he said that differential rents would not be more than the cost of the erection of the houses to the local authorities? If that is so, surely the information which I am looking for should be available.
The differential rents schemes, as the Deputy knows, are devised in such a way that what the tenant pays relates to his household.
That is not what the letter says.
It also bears a relationship to the standard of the dwelling. The economic rent or the maximum rent, in the main, relates to the cost of providing and maintaining these houses. All new local authority dwellings being constructed and all new tenancies in recent years are let on the differential rents system. Some of the older houses to which the Deputy is referring would have been let originally on fixed rents and where there are new tenancies created the new tenant, of course, must now go on to the differential rent. In these cases a reasonable figure is decided on as the maximum rent and this varies from house to house and from scheme to scheme, depending on such factors as the age, quality and size of the house. The maximum rents vary greatly but in the main in new housing schemes now being constructed the rent schemes that are devised for them are based on the cost of providing and maintaining the house.
Surely the Minister is not trying to suggest that a house which cost £70 to build at the end of the last century and to which a new tenant has been appointed and in which the accommodation would be, perhaps, three bedrooms, one livingroom and a kitchen would, rentwise, be considered to be economic at £2 or £3 per week? That is what the Minister has said now.
I am saying that in relation to some houses, higher maximum rents would apply because building costs have increased greatly. The Deputy must bear in mind that local authority houses are built on a 50 year loan——
Yes, because that was estimated to be the life of the house. The Minister is now saying something that, a short while ago, he said he did not know.
The Deputy says something and associates it with a reply he gave to me. The houses were built originally on 50 year loans. Even though in some cases the construction costs were low, it must be remembered that local authorities and the State are still involved in paying off these loans and that at the end of a 50 year period perhaps three times the original cost of providing the house will have been paid.
Perhaps, with the permission of the Chair, the Minister and I could spend a half-hour some evening on the Adjournment of the Houses discussing this matter because the Minister cannot get away with that.