asked the Minister for the Environment the steps he will now take to deal with the unemployment crisis in the construction industry; and if he will make a statement on the matter.
Ceisteanna—Questions. Oral Answers. - Construction Industry Unemployment Crisis.
12.
I am aware of the difficulties being experienced in the building industry, arising from the decline in private sector investment, the drop in the level of demand for certain kinds of construction activity as a result both of the recession and the completion of certain major projects, and the limitations on public expenditure generally.
In so far as the public capital programme is concerned, the level of investment has been maintained at the highest sustainable level. But the crisis in the public finances, which the Government inherited from the previous Administration, has meant that there has not been any possibility that public sector investment could be undertaken at a level that would offset the substantial fall that has occurred in private investment.
In so far as programmes coming under my Department's control are concerned, output this year in respect of housing, roads and sanitary services is likely to show an increase in real terms over 1982. The demand for private housing is holding up particularly well and is being sustained by a satisfactory flow of mortgage finance and the low deposit loan facilities available from the Housing Finance Agency. The apartments market still seems to be buoyant, boosted by the tax incentives available, and completions in the local authority sector are likely to be higher this year than in any year since 1979.
As regards the industry as a whole, cement sales have recovered well in the last four months or so and monthly sales are now running at a level very close to that achieved in 1982. As the Deputy may be aware, the volume of cement sales has been found over the years to be a useful indicator of the volume of overall building output.
Finally, the Deputy may be assured that in considering the question of public capital programme allocations for 1984, I will be giving careful consideration to the implications for the building industry. At the same time, investment in construction, as in other areas, must meet reasonable criteria in regard to return and effectiveness if it is not simply to increase the burden of debt and taxation that put us in the acute economic and financial situation in which we now find ourselves.
The Minister may have inherited the public capital programme but he did not inherit the unemployment level in the construction industry. That has continued to deteriorate rapidly during the past few months and I do not think he can blame anyone else for it. With regard to apartments, I gather the tax incentives will shortly run out. I wish to know if the present tax incentives will be continued in the next Finance Bill and perhaps the Minister can give us an assurance on that point. With regard to private housing, the Minister must be one of the few people who believe that that programme has been sustained. There is very little private housing proceeding at the moment and the land bank situation so far as corporations and councils are concerned is quite serious. I ask the Minister to consider having deferred payment arrangements in the private investment area, where perhaps they could continue to build private houses and pay at the end of the construction period. This is done on the continent. The Minister spoke about the satisfactory state of mortgage finance. Will he not accept that the present arrangements for mortgage finance are totally inadequate? It is very difficult for young married couples in particular to get the necessary mortgage to allow them to buy an average priced house. They find it difficult to get the finance required, which may be between £27,000 and £28,000.
I accept that the present difficulties in the building industry have come over a period of time. I do not think there is any point in attempting to score political points here because the industry is far too important.
The Minister did that.
I am merely pointing out the constraints that exist. I do not wish to get into a points scoring exercise. If the Deputy wants to do that, we can do it; but it is less helpful for the industry.
The Chair would prefer if it were done in a debate on the subject.
We would have a scoreless draw.
I can say to the Deputy and to the House that the Department and the Minister for the Environment are looking at a variety of ways in which the industry can be stimulated, but those are constrained by the overall situation in relation to public finance in which at the moment the State, through the taxpayers' money, are putting up 70p in every pound that is spent in the building industry.
In relation to the Minister's initial reply and the subsequent reply, would he accept, while the statement he made is very general, that the situation outlined by him is far from the reality as far as the Cork area is concerned where the construction industry has taken an unmerciful hammering for lack of capital? Would the Minister like to comment on the situation in Cork?
That seems to be a separate question.
It is a separate question.
It is an important one.
All I can say, in relation to what the Deputy has said, is that there have always been difficulties in the industry on all sides about the accuracy of statistics. The review and outlook document which we published and which is the substantive document in relation to the building industry, clearly states what the real difficulties of the industry are at the moment.
Would the Minister do an investigation into public housing? I believe some proposals were put forward by some developers and investors that public authority housing could be built, and rather than let massive redundancies continue when there is a well trained work force available, the houses could be built and the Department would pay at the end of construction rather than on a phased basis as at present. Would the Minister consider those proposals? What is his view and his Department's policy on those proposals?
As far as the Department are concerned we would certainly consider any reasonable proposals, but I would remind the Deputy that there is a legacy of allegedly low cost housing which was built in another time, which has turned out to be the most expensive part of the building stock that was ever constructed.
In relation to the building programme the Louth County Council had six houses plus four OPDs under construction——
That is a separate question.
We have a serious problem in relation to the plans for the early schemes which have been completed. They are going to and fro between the local authority and the Department. We believe this tactic is merely being used to delay the starting date for these schemes.
That is a matter for Louth County Council.
Would the Minister see if there is any way that he can expedite this and do away with the amount of delay involved with the plans going to and fro? I am sure this applies to other local authorities as well.
That is a separate question.
It is a separate question. I am not aware of it. I will look into it for the Deputy.