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Dáil Éireann debate -
Thursday, 7 May 2009

Vol. 682 No. 1

Priority Questions.

Water Quality.

Phil Hogan

Question:

1 Deputy Phil Hogan asked the Minister for the Environment, Heritage and Local Government his views on whether water quality management structures here are adequate in view of the latest report on drinking water from the Environmental Protection Agency; if the investment programme in water infrastructure is being delivered in an efficient and cost effective manner; his strategies to combat e.coli contamination of drinking water supplies; and if he will make a statement on the matter. [18403/09]

Some €1.6 billion has been invested by the Government in drinking water infrastructure in the period since 2000 and substantial additional funding is being provided this year from the total Exchequer provision of €500 million for the water services investment programme. In the period since 2000, additional drinking water treatment capacity and additional water storage capacity equivalent to the needs of a population of 855,000 and 1.5 million, respectively, has been provided. A review of the water services investment programme is being undertaken this year to ensure that investment continues to be targeted at priority works. A value for money study on the programme will be also completed this year.

Under the European Communities (Drinking Water) (No. 2) Regulations 2007, water services authority drinking water supplies are subject to supervision by the EPA. Additional resources have been provided to the agency to back up its new enforcement powers. Under these regulations, water services authorities are obliged to ensure that any failure to meet quality standards in a water supply is investigated immediately to determine the cause. My Department has been also working closely with water services authorities, which are generally responsible for the management of public drinking water supplies, and the EPA to ensure that the management structures for the supply of drinking water are of the highest standard.

The recently published report, The Quality of Drinking Water in Ireland — A Report for the Years 2007 and 2008, shows that overall the quality of our drinking water is good and that further progress has been made in improving quality in recent years. The report indicates that the number of detections of e.coli in 2007 was down compared with 2006. To ensure the effectiveness of the disinfection procedures required to remove e.coli from water supplies, the agency has recommended the installation of chlorine monitors and alarms on all water supplies. My Department has been working intensively with local authorities in recent months to ensure that all public and group water supplies are equipped with monitors and alarms. I understand that good progress has been made and the remaining supplies will be equipped in the coming months.

I thank the Minister for his reply. The EPA report is a serious indictment of the manner in which people cannot rely on the safety of drinking water in many parts of the country. According to the report 118,000 people had to boil their drinking water last year. Notwithstanding that, the Minister achieved a reasonable level of support from the Government in October for the 2009 Estimates he had shaved a little — some €40 million — off when it came to April. Galway of course has been high profile, but there are other areas that might not have got the attention they deserve. I seek an assurance that the people in areas affected will not need to continue to boil water for drinking or buy bottled water in shops. Fine Gael recently suggested making some investments under the Irish water company that we proposed to establish. Does the Minister have any similar plans? I ask the Minister to study our proposal. If there is an agreement between us on that proposal, would it be of assistance in ensuring that we get more schemes operational in the next year in order to meet our water framework directive requirements that are fast coming down the track?

I agree with the Deputy that it is very important to invest in good quality drinking water. I consider this as an absolute necessity. In a country such as ours there is no reason for people to be drinking contaminated water. While I accept there have been boil notices, I am pleased that there has been a reduction in the number of such notices. The EPA has identified 341 public water supplies that it has put on its remedial action list. These supplies require detailed profiling from catchment to consumer to determine whether the supply needs to be replaced or upgraded, or where operational practices need to be improved to ensure the water supplied to the general public is clean and wholesome.

That a water supply is on the list does not necessarily mean the water produced by the supply is unsafe to drink. Where a health-related parameter is exceeded, the EPA and the HSE must be notified and follow-up action must be taken. A water supply is included on the remedial action list for one or more of the following reasons: failure to meet the e.coli standard at some point in the past two years; inadequate treatment, for example no treatment other than chlorination, poor turbidity removal or excessive levels of aluminium in the treated water; showing elevated levels of nitrate; being unable to meet the new bromate or THL standards that came into force at the end of 2008; monitoring results or compliance checks by the EPA that indicate a lack of operational control at the treatment plant and the supplies identified by the Health Service Executive where improvements are required. This is the list on which we are working, and I consider it a priority list. We are doing everything we can in this regard.

The Deputy has stated that there was a slight shaving off. While that is true, the most important thing is that, despite very severe economic difficulties, we have increased the budget for water services infrastructure. That will remain the case because water quality is a priority. It is a priority for the people who need to drink water and use it. We also need to do this because we want to avoid fines. I believe the Deputy has raised this matter in committee meetings.

How many river basin management strategies require to be drawn up? How many have been drawn up to date? When does the Minister expect to complete the rest?

That comes under the water framework directive. As the Deputy knows that directive is still out for consultation. As soon as it returns we will have further results in that regard and I would be happy to communicate that information to the Deputy at that time.

Social and Affordable Housing.

Ciaran Lynch

Question:

2 Deputy Ciarán Lynch asked the Minister for the Environment, Heritage and Local Government the anticipated overall cost over a 20-year period of the scheme for local authorities to lease new houses for social housing; the anticipated cost per unit of a 20-year lease; the mechanism that will be used to determine the rate at which property will be leased; the way the rental income from such property will be used; the anticipated cost of maintenance and upkeep of leased properties; the way this cost will be provided for; and if he will make a statement on the matter. [18432/09]

I assume the Deputy is referring to the new long-term leasing scheme I announced recently. Some €20 million has been set aside by my Department in 2009 to support the leasing of at least 2,000 houses by local authorities for social housing purposes. The cost of the scheme in future years will be dependent on the number of homes leased, the rental payments involved and the length of time for which leases are procured. It is intended that authorities will procure dwellings for periods of ten to 20 years.

The cost to a local authority of a leased unit is determined by a variety of factors, including type and size, location and the average rent of properties in the area. Costs can be also influenced by rent reviews, which my Department has advised should follow market conditions.

The primary focus in negotiating leasing costs will be the delivery of value for money and I expect that authorities should be able to secure leasing costs of at least 20% below market value. This reflects the element of risk, such as the vacancies, and management and maintenance responsibilities, being transferred to the housing authority. The property owner will remain responsible for any structural matters.

On that basis, by way of illustration, a Dublin authority might lease a dwelling at €1,000 per month, assuming a current market rent of €1,250 for a 3-bedroom property. Over a 20-year period, on a fixed-price basis, this would cost the authority approximately €240,000 as compared with the current average cost of €330,000 to purchase a new home in the Dublin area. This of course excludes the financing cost to purchase such a unit. When this is factored in, the total cost to the State would be more than €520,000, which would be more than double the cost of leasing the unit.

Social housing tenants accommodated in leased properties will be charged a differential rent in the normal manner. This rent will be used by the authority to defray the costs of management and maintenance of the property.

I thank the Minister of State for his response, which indicates that the average lease arrangement will cost €10,000 per year, which works out at €200,000 over the 20-year lease period and that the rent accrued during this period will be offset against the maintenance of the properties. Based on a rent of €100 per week on the differential, this goes into sums of nearly €100,000 over the period of the property lease. The sums involved in the Minister of State's proposal amount to approximately €300,000 per unit on a lease basis over 20 years, after which time the property will be handed back to the developer at an increased market value. The maths do not add up.

Will the Minister of State review the situation? He has confirmed my suspicion that the rents being accrued by the properties will, instead of going to local authorities, be ring-fenced in the leasing arrangements. The market and cost values of the properties are significantly different. The Minister of State would have spent less had he chased their cost value. He might even have got them for below the €200,000 he cited, perhaps for €150,000 or €140,000. Is this a proposal to help people on social housing lists or is it a bail out for developers who cannot get rid of properties? Is the State stepping in to stand over them?

There are two points. The Deputy contradicted the figures made available to me.

No, I stated——

They are clear, in that the cost for the number of years in question will be approximately €240,000 for the provision of a house to someone on a local authority housing list. To purchase and finance a house over the same period would require €520,000. These are the figures on today's costs, which are available on the website.

The old hairy chestnut of bailing out builders has been pegged out time and again. Were we to buy houses tomorrow morning, who would provide them other than builders? This year, builders will provide the houses my Department has supplied €1.2 billion to construct and acquire. This is the long and the short of it. There is no bail out. My job is to try to get as many houses as possible for the 55,000 people on our housing lists. Were I to take the road mentioned by the Deputy, I would need €4 billion to deal with 20,000 houses.

That amount is for 20,000 houses, but we are only discussing 2,000 houses.

I do not have that kind of money.

The Minister of State has been flogging that figure for quite some time, but his sums are wrong.

I have an opportunity to get value for money and to reduce the numbers on our housing lists through long-term leases at a price that has not been seen in years. This is what those on the lists want. I would not be doing my duty were I not to examine options to deal with our major housing lists.

Deputy Ciarán Lynch must be brief.

Will the Minister of State confirm in the House that he will spend €400 million in the next 20 years to lease 2,000 houses and that the rent accrued during that period will be ring-fenced for those properties' maintenance?

The scheme is for 2009. As the Deputy probably knows, I have been open to new ideas since taking over responsibility for housing. My Department is examining the possibility of an extension to the——

That is not the question that I asked.

The Minister of State should finish.

I cannot say whether the Deputy's figure will turn out to be exact, as the scheme may vary come 1 January 2010. For example, we might decide to move to rent to purchase. Today's options allow us to avail of properties on the market, in respect of which I have set aside €20 million. People can rest assured that this option will be supported over the ten or 20 years. Since we are in discussions, I may vary the scheme. For example, I could include the incremental purchase scheme. These are some of my considerations and I will inform the House as soon as I make decisions on them.

The leasing arrangements have no opt-out clauses. They are ten year or 20 year leases. Other schemes are different, but the Minister of State is committing the taxpayer to paying €400 million over 20 years. It is unbelievable and inexplicable that the properties' rents will not be held by the local authorities. Rather, they will be ring-fenced so that the developers can maintain their profits.

The Minister of State can say just one word because we must move on.

This year, I will provide a minimum of 2,000 extra houses for families on local authority housing lists. This is where the €20 million will go. It is good value for money. The uptake from local authorities is excellent, as is the general public's support.

Local Authority Funding.

Phil Hogan

Question:

3 Deputy Phil Hogan asked the Minister for the Environment, Heritage and Local Government the implications that circular 03/2009, which restricts local government finance, has on current infrastructure projects; and if he will make a statement on the matter. [18404/09]

In February, my Department set out details of the financial requirements for local authorities relating to the overall management of their capital and current accounts. These requirements flow directly from the requirements for Government finances as a whole to be managed in accordance with the Stability and Growth Pact established under the Maastricht treaty and the associated limitation on budget deficits. In this regard, the Government set a limit of €200 million for the contribution that the local government sector can make to the deterioration in the general government balance in any one year. This is not a new requirement for 2009, but the downturn in the economy and the substantial pressure on funding require a sharp focus in all sectors, including local authorities, on tight control and management of public finances.

To stay within the overall limit for the general government balance, it is necessary for local authorities to manage their finances so as to keep their current and capital accounts in balance for 2009. Within this broad requirement, there is provision for borrowing by local authorities for capital infrastructure. In aggregate and allowing for repayment of €50 million in existing loan principal, loan sanctions amounting to €250 million are being allocated for capital projects on a prioritised basis this year. I appreciate that these requirements impose a particular degree of financial discipline on local authorities. However, it is essential that all levels of government contribute to the necessary action to restore order and stability to the public finances.

These requirements do not conflict with the continuing emphasis on capital investment in necessary infrastructure critical to economic recovery and sustaining the economy at local level. The Government and local authorities will continue to progress capital investment projects that can maximise economic, social and environmental returns. Accordingly, the prioritisation of investment opportunities and the targeting of available resources to labour intensive activity and the support of economic recovery will continue to be the key focus of capital expenditure in the local government sector.

The overall level of resources applied by local authorities remains significant and, taking account of Exchequer and local sources of finance, it is expected that total capital investment by these authorities, notably in housing and infrastructure as well as other community supports, will exceed €6 billion in 2009.

My Department will continue to work closely with local authorities to ensure that, within the overall financial limits to be met, decisions on these matters will be taken in a way that gives the necessary prioritisation to environmental, economic and social infrastructure as part of the overall contribution to economic recovery.

The Department and the Minister have advised all local authorities that they are required to ensure expenditure is funded by income received or due within this year. This is a serious instruction. Will the Minister spell out its implications for schemes that have been announced for 2009 and contracts that have been signalled to local authorities for 2009? Will they go ahead this year?

There has been controversy in some quarters, but only four local authorities are affected in terms of development levies etc. The figure amounts to approximately 14% of total spend. As the overall capital spend is approximately €6 billion, I do not anticipate a significant impact.

I will supply some details. The general state of the economy and the need for prudent management and control of the public finances impose a deeper level of discipline in and management of all areas of public investment. Local authorities, like other parts of the public service, must manage their operations within these constraints. In this context, a key requirement is to advance and manage projects in a way that takes account of environmental, economic and social priorities.

The overall capital spend will be in excess of €6 billion and local authorities will contribute significantly to economic renewal. The spend comprises an investment of €2 billion in housing, more than €1 billion on roads and several hundred million euro each on water, the environment and local amenities. I do not anticipate a major problem. There will be some degree of difficulty, but it can be exaggerated in some quarters. However, I do not anticipate there will be a huge difficulty regarding some of the main infrastructural projects such as, for example, those discussed earlier like water infrastructure.

Fingal County Council has €70 million in development levies available to it that it cannot spend because of the restriction the Minister has imposed and the announcement that has been made. Will the Minister review the position of those local authorities that have funds available, such as Fingal County Council, with a view to maximising their output for contractual obligations on essential water and infrastructural facilities that all Members wish to proceed?

The local authorities and their managers in particular are in constant contact with my Department. As this is done on an aggregate basis, it must be calculated to ensure that certain local authorities can borrow sufficiently and this probably constitutes a bigger problem. I understand that only four local authorities are in a position to spend those development levies. However, and I believe the Deputy's party agrees, it is essential to exercise financial prudence and fiscal rectitude in all those matters.

Welcome to the real world.

I have been reading the highly interesting document on local government that Deputy Hogan published today on the Internet. However, the Government must abide by what has been set down in the Stability and Growth Pact under the Maastricht treaty. As the Deputy is aware, Ireland has received considerable latitude from Brussels in respect of exceeding the 3% limit, and we have gone far beyond it. However, we must abide by the pact and those criteria are set down both by Brussels and subsequently by the Department of Finance.

Economic Development.

Phil Hogan

Question:

4 Deputy Phil Hogan asked the Minister for the Environment, Heritage and Local Government his views on new policies on the way local government can play a more central role in supporting local business and employment; and if he will make a statement on the matter. [18405/09]

Local authorities have a central role to play in supporting economic development and enterprise at local level. They do this in a number of ways including through their capital and current budgets, economic planning and development and the provision of goods and services, as well as community infrastructure.

More recently, local authorities have taken direct action to reduce the burden on business and promote employment, including by keeping the increase in commercial rates for 2009 to just over 1% on average and undertaking an examination of their costs to maximise efficiencies. In addition, local authorities have been working with my Department and the Department of Enterprise, Trade and Employment on support for businesses and employment at local level. In this context, the Tánaiste and I recently met the County and City Managers' Association. Arising from this meeting, a number of steps were agreed including developing arrangements for engagement at national level between local authorities and the enterprise agencies. At local level, local authorities will focus on streamlining the way in which they respond to businesses in areas such as planning, water and roads. Local authorities also work closely with all relevant agencies at local level, including through their leadership of the multi-agency county and city development boards in respect of economic planning and the promotion of enterprise at local level.

I am satisfied that with the steps being taken, local government is well placed to play a key role in supporting local business and employment in these challenging economic times. I will, however, ensure that my Department, in consultation with the Department of Enterprise, Trade and Employment, continues to engage with local authorities to achieve the best ongoing support for enterprise at local level.

I wish to make three suggestions to the Minister and I ask him to support Fine Gael on these three matters. Does he support the establishment of a business and employment section in each local authority to bring together all the agencies that are involved in enterprise, some of which reside in various Departments and more of which operate through local authorities? However, no co-ordination takes place between them. Does the Minister agree it is now essential to bring together all those groups to make a concerted effort at local level to enhance the prospects of employment?

Second, will the Minister ask local authorities and the managers he meets on a regular basis to freeze commercial rates for the next five years? The easiest option available to such managers is to increase commercial rates to balance the books and councillors sometimes fall into that trap. Third, there is an issue regarding five years being the termination date for planning applications for major works. It is essential to extend this limit to seven years to reduce costs to applicants and to remove the existing backlog in An Bord Pleanála.

As for the Deputy's point on commercial rate increases, at my request commercial rates have been kept down and the increases for 2009 were approximately 1%.

The Minister will note I also issued a letter in that regard last October.

Yes. It is significant that 34 local authorities held their rates at 2008 levels. This constitutes significant progress because, as the Deputy appreciates, the business sector is under extreme pressure and I am highly aware of that.

I have undertaken a number of measures and some of the Deputy's suggestions are constructive. I have asked local authorities to examine rigorously their costs to maximise efficiencies, which in turn will have a positive impact on business, and to focus on streamlining the ways they deal with business in areas such as planning and water. For example, Galway County Council has established a business support unit, which is exactly what the Deputy has suggested, and I have asked other local authorities to do likewise. I have asked them to lead on the soon to be completed reviews by county and city development boards on strategies to promote economic development in their own areas and to take steps to ensure that reductions in staffing levels do not focus on front line service. As for overall capital investment by local authorities, as I noted in my response to the previous question, this will exceed €6 billion this year.

I have also taken a number of specific actions to promote economic development. I have asked local authorities to do all they can to reduce development contributions or to defer the payments. My Department is facilitating discussions between certain local authorities in the greater Dublin area and An Bord Pleanála with a view to those authorities acting on an agency basis for the board in processing some of the board's caseload. The Deputy may recall we discussed this issue at committee level. I expect this arrangement will be in place shortly. As I stated in my initial response, the Tánaiste and I met the county and city managers to talk about reducing the cost to business. I have asked the county and city councils to streamline the manner in which they deal with businesses, including, as I stated, the support units. Finally, each county and city development board, led by local government, has now established an economic subgroup to promote economic and enterprise development. In many instances, this group also acts as a special taskforce to provide a co-ordinated response to business closures in their area.

The Minister will agree there is a very disjointed approach to promoting enterprise in local authority areas at present because of the current plethora of agencies. I ask the Minister to bring forward proposals, together with his colleague, the Minister for Community, Rural and Gaeltacht Affairs, Deputy Ó Cuív, to bring them together to a greater extent under local government.

In respect of An Bord Pleanála, a huge backlog of potential employment generating proposals has built up before the board, which must be released from decision-making. Does the Minister agree that to assist in removing the backlog, existing planning permissions that last five years could be extended to seven years? This proposal might meet some of the requirements in respect of major infrastructural projects.

On the Deputy's last point, this matter can be addressed in the forthcoming planning and development Bill. However, this must be considered carefully. One cannot give a full blank cheque as all the existing permissions must meet the new energy standards. In addition, one also must consider carefully what constitutes good planning and whether such proposals fit in. Overall, however, and I have received representations from colleagues from all parties in this regard, it makes sense that if one wishes to continue to stimulate economic activity, something should be done in that regard and certain planning permissions should be extended. For example, permissions relating to renewable energy are perfect candidates.

Urban Renewal Schemes.

Terence Flanagan

Question:

5 Deputy Terence Flanagan asked the Minister for the Environment, Heritage and Local Government the housing regeneration and maintenance projects which will be delivered in 2009; the projects which have been shelved due to budget cutbacks; and if he will make a statement on the matter. [18406/09]

As I announced last week, my Department will once again be supporting an ambitious programme of housing regeneration, remedial and energy efficiency improvement works this year with almost €230 million in Exchequer resources being provided from a number of funding streams within the overall housing programme. Within the regeneration programme, the redevelopment of Ballymun and regeneration initiatives in Limerick, Dublin, Cork and Waterford cities will continue to receive support, while works will commence at Mitchel's Crescent, Tralee. Planning for projects at Cranmore, Sligo and Cox's Demesne, Dundalk will also receive support. Overall, funding for regeneration projects in 2009 is being increased by 5% to €135.9 million. Funding for the remedial works programme will increase by 3% this year to €54.9 million, supporting 47 projects, including two new projects at Mullaghmat in Monaghan and Townspark in Navan. Following a call for new remedial works proposals late last year, six further projects have received approval in principle, and I expect progress to be made on these over the course of this year. Housing authorities have also been asked to revise plans on an additional 16 projects, with a view to inclusion in the programme in due course.

In addition, a further 2,100 local authority dwellings will benefit from the final year of the national central heating programme in 2009. A new programme to improve the energy efficiency of local authority housing will also get under way this year, with some €20 million being provided towards the cost of improving the energy efficiency rating of vacant local authority units prior to being relet. A number of pilot retrofitting projects will also be funded. Housing authorities will continue to fund a range of housing maintenance and improvement activities from their own resources and this is expected to be approximately €100 million.

I thank the Minister for his response. The record of the Government on social housing is appalling. This is no direct reflection on the Minister of State but many projects are underfunded. In the recent budget there was a €314 million cut in the social housing budget and people in communities awaiting regeneration are suffering. They are living in appalling housing developments. Deputy Catherine Byrne referred to rental accommodation two weeks ago as kips. These should not be out there. Five PPPs, which were given to one property developer, were abandoned last year. The Minister announced a review of PPPs. What is the result of that review?

The Minister of State referred to Ballymun regeneration, a project that came in massively over budget and late. What lessons have been learned from this? Many towers in Ballymun are in an appalling state. There is much crime and community gardaí do not police the areas. These are no-go areas and it is important that we get these areas regenerated as soon as possible.

In our programme of housing support in 2008, we supported some 19,000 households, a substantial figure. While there is trimming back of €290 million in the housing capital budget for this year, that figure would meet between 400 and 500 houses. I am providing for 2,000 extra houses under the leasing programme. There will be a net gain of 1,500 or 1,600 houses under the social housing programme.

Regarding standards, there are laws and local authorities are obliged to deal with inspections. I understand an increase in inspections has taken place.

Deputy Flanagan referred to Ballymun, which is an example of success. I supported that success by allocating €45 million to Ballymun for 2009. An enormous amount of development has taken place, six of the landmark towers have been demolished and 2,800 of the existing flats are demolished or are under contract to be demolished. Some 1,400 new homes are there, along with a new street, two hotels and a whole neighbourhood of facilities and amenities. The new IKEA store will open in July with 500 new jobs. Ballymun is a success story to date although it may have taken longer than expected and gone over budget. We can aspire to finish it to a high standard.

The PPP model has been debated in this House. One of the first matters on my desk after being appointed Minister of State last May was that PPP projects were under scrutiny because developers were not in a position to go ahead with them due to the downturn in their finances and the economy. A review has taken place and Dublin City Council has come forward with new proposals for St. Michael's Estate. My Department is examining these proposals at this time. I am hopeful progress will be made in the coming year.

I have also set aside moneys for works to be carried out, namely, the relocation of people from O'Devaney Gardens flats. Dublin City Council is working on this and examining other areas of development in those complexes. I do not want those areas to go back to monotenure developments. This is a difficulty for the city council because these monotenure developments caused social problems. A mix of public and private developments is important. Private development is not coming forward but hopefully that will change. I do not want to allow monotenure development to take place. I want a mix of sustainable communities so that we do not generate the social problems we are dealing with in other regeneration areas.

I thank the Minister for his comprehensive response. Local authorities were asked to resubmit a cost-benefit analysis. Can the Minister of State give us an update? One area earmarked for regeneration in my constituency is the Buttercup estate in Darndale. Can the Minister of State re-examine this? It has gone on for many years and regeneration should have taken place by now. It is the only estate in Darndale that has been forgotten.

The Minister of State has set aside €500 million for the home choice loan scheme. Can the Minister of State set aside some of the money to deal with regeneration and social housing problems?

The areas we continue to support are Ballymun, Bridgefoot Street, Queen Seán Treacy House and Lourdes House in Dublin city. We also have regeneration projects in Cork, Waterford, Limerick, while Sligo and Cox's Demesne in Dundalk are at the planning stage. Tralee town council has a new project. I will check up on the estate in Deputy Flanagan's constituency.

The sum of €500 million is a facility under the housing finance agencies. It is for local authority loans and is not money set aside in a package. Money up to that limit can be drawn down under the home choice loan. It is available to local authorities if those type of people draw down these loans, not to me. I am not in a position to grab the money and put it elsewhere.

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