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Dáil Éireann debate -
Tuesday, 12 Mar 2013

Vol. 796 No. 1

Priority Questions

Housing Grant Payments

Barry Cowen


74. Deputy Barry Cowen asked the Minister for the Environment, Community and Local Government if he will provide a breakdown by county of funding provided for the housing aid for elderly persons scheme and the housing adaptation grant for people with a disability in 2010, 2011, 2012 and 2013; the impact of these changes on his disability strategy; and if he will make a statement on the matter. [12863/13]

Brian Stanley


75. Deputy Brian Stanley asked the Minister for the Environment, Community and Local Government in view of the overall cut of 11% to his Department's 2013 budget, the reason his Department imposed a cut of 76% in funding for housing grants for elderly and disabled to Laois County Council; and if he will make a statement on the matter. [12867/13]

I propose to take Questions Nos. 74 and 75 together.

I am keenly aware of the challenges we face in delivering housing supports to a range of vulnerable households and groups. The difficulties facing the State's finances and the necessity to reduce public expenditure to sustainable levels are impacting on capital programmes all across the public service. My Department's housing programme is no exception. Deputies will be aware that the amount of capital funding available has decreased significantly in recent years along the lines highlighted in the medium-term Exchequer framework for infrastructure and capital investment 2012-16. Regrettably, these steps are necessary to bring stability to the public finances. As a result, capital spending on housing programmes in 2013 is down on last year.

Reduced capital budgets inevitably give rise to difficult choices and decisions in allocating the available funding. This means balancing the available capital across a range of important areas and spreading these scarce resources in a way that meets the needs of those concerned to the best extent possible. In addition to the private housing grants, the housing capital budget needs to cover important measures such as regeneration, estate-wide improvements, energy retrofitting and meeting the housing needs of older people and people with physical, intellectual and mental health disabilities. I am allocating €167 million for these measures in 2013.

The Government's housing strategy for people with a disability 2011-16 aims to support community based independent living for people with disabilities. My continued support for special needs housing provision will assist in this regard. The strategy recognises the role of the adaptation grant schemes as part of a broader framework of supports. I am reviewing the terms of the grant schemes and will monitor operations to ensure effective implementation of the strategy generally.

This year I am allocating 12.4% of the housing budget, some € 34.2 million in all , to the grant schemes compared to 13.2% in 2012. In allocating the available funding across all 34 city and county councils, I did so in as transparent and as fair a way as possible. In framing the 2013 allocations my Department wrote to each local authority requesting details of the numbers and value of grants where work had been approved to commence. Between them, local authorities reported contractual commitments in respect of approved grants totalling €18 million. Local authorities were always encouraged to maintain continuity in approving and paying grants and commitments carried forward into the new financial year always had first call on the available funding. This year each authority was allocated the full amount of its contractual commitments. Only one local authority, Laois County Council, reported a zero commitment for grants approved.

The balance of the available funding was allocated on the basis of each authority's share of the new applications on hand in January 2013. I believe this is a fair way of apportioning the funding. I appreciate this approach has resulted in lower than expected allocations for some authorities. Should particular difficulties arise in some local authorities in the course of 2013, I have a contingency in place to deal with this. I have set aside a small capital reserve and I will consider applications from local authorities for a supplementary allocation once the initial allocation has been exhausted.

A detailed table setting out the information on the combined Exchequer plus local authority own resources allocations for the years 2010 to 2013, inclusive, will be circulated with the Official Report.

Local Authority

2010 Allocation

2011 Allocation

2012 Allocation

2013 Allocation
































































































North Tipperary




















South Dublin





South Tipperary

























Cork City





Dublin City





Galway City





Limerick City





Waterford City





Sligo Borough Council




( with Sligo Co Co figure for 2013)

I thank the Minister of State for her response. These cuts were made in the same week as those to the mobility allowance. It is amazing, insensitive, callous and targeting vulnerable people in the most ridiculous way. I heard the Minister of State say there are cuts across the board not just in her line responsibility but in every Department. When I measure that against some commentaries we heard in recent weeks, it is different, however. We had the deal on the promissory note, which we welcomed, but we doubted if it would have any immediate impact on the ground. That has since been borne out. With all the talk about the country having turned the corner and green shoots of recovery, these kinds of cuts hit at the heart of our society. I know Laois County Council gave a commitment to these grants by virtue of their available funding. This has been reduced over several years because of the demands and constraints on its budget. Letters were sent out in the county earlier this year in which many people were told they would have to wait three to five years for these grants.

Could we have a question, please?

Will this mean it will now be five to seven years? The range of cuts is from 29% to 70%. Is the Government's disability strategy in tatters by virtue of the cuts that have been made across a range of services? If a commitment was made in the programme for Government to implement a disability strategy, where stands it now? When will the strategy be redrawn? What can people seeking these grants expect? Has the retrofit scheme that was involved in many budgets over the past number of years been exhausted to such an extent that the Minister can now look at this area to fill the gap?

We are faced with the inevitable cuts in terms of the amount of money available. That is the reality in which we have to live. I have got a small contingency fund and I am satisfied every local authority has enough funding to meet their commitments made in the previous year. During the second quarter our officials intend to speak to the local authorities about these grants. After that we will have a good idea of how they stand. We will then look to allocate the amount of money left over.

I am anxious to reform this scheme and examine the upper limit allowed in the grant which is quite high. I am examining lowering the upper limit so it can be spread over more applicants. We have already introduced a reform measure for the retrofit scheme. Before the money was for voids up to this year but from this year on there will be retrofitting done on occupied local authority accommodation. I am trying to use moneys as wisely as I possibly can, albeit with a limited amount.

These grants cut to the heart of housing policy, but we should be trying to keep disabled and elderly people in their own homes. The fact is that this is happening at the same time as the cut to the mobility grant, and it follows cuts in the respite grant and household benefit package in the past two years. It amounts to tightening the noose and making things more difficult for the cohort of people who have a disability but who are trying to live independently, as well as elderly people.

I know of grants amounting to as little as €2,000 that are being used to keep people in their homes. It can cost as little as €2,600 or €2,700 for a simple straightforward stair-lift. Typically, only a small amount of money is needed to keep people living independently. Let us consider it from a Government point of view: surely we should try to keep people in their own homes. That is logical and sensible as it is where they want to be, but even when considered from an economic point of view, it is where we want to keep them.

The allocation for Laois County Council is down 76%. The Minister of State indicated that she wanted to ensure the council had enough to honour the commitments it had entered into on 1 January, but Laois County Council does not allow anyone to enter into commitments on 1 January until it secures the allocation. The Minister of State should examine the record for what is a relatively small county. She will find that the council has been using this grant well, spreading it over a large number of people to benefit the maximum number and prioritising it in a careful and systematic way. If the council was not doing that I would be giving out about it. It is important. The council is being punished for doing exactly that.

The overall cut in the budget of the Department was approximately 11%. I realise that is difficult for the Department, but the cut to this grant in Laois was 76%. Does the Minister of State agree that this is having a negative impact on Laois? The fact is that Laois County Council has kept its house in order well and it has been running a good ship, yet it is being penalised for this. This is one of the things Laois County Council does particularly well. Does the Minister of State agree that this should be examined again?

I agree with Deputy Stanley that we want to keep people in their homes if at all possible and that relatively small amounts of money sometimes make the difference. That is why I am examining the upper limit, which is €30,000. We cannot change the limit for those who have already been approved, but it may be different in future. We are looking at it on an immediate basis to determine whether it would make sense to reduce the upper limit in order to spread a greater number of grants of smaller amounts in order to keep more people in their homes. I agree fully with Deputy Stanley in this regard. I remarked that we have a contingency fund and we will certainly be examining Laois as well as other counties in some months' time to determine whether it is appropriate that they should get further funding. I understand the position in Laois is different to that in other counties.

Will the Minister of State briefly explain the position? The allocation last year was so many million euro, but how much is the contingency fund this year after an 11% cut? My impression of the contingency fund, from the way it has been explained, is that massive, stinging cuts have been imposed throughout the country - up to 76% in some counties - and it seems the Department has decided to take the flak and put a contingency fund in place to pacify a few of those who cry the loudest, perhaps some of those in our own best constituencies throughout the country. This gives the impression that there is some appeasement, but that is far from the case.

We are dealing with a cohort of people who do not have the clout or representation that many others do, and who are left in a terrible predicament. In my county, as in many others, there is a five-year waiting list and the council is doing its best to spread the fund. Any further spreading will make no difference. The Minister of State must sit down and get this back on track. These are areas where a difference was being made.

There are 116 people on a waiting list in Laois and a further 24 cases are listed as very urgent.

They instructed constituents, clients and contractors to submit all bills and have everything paid, signed off and in order by 30 December. I ask the Minister of State to examine this case. Laois County Council did not come in on 1 January without applications. A bundle of applications are partially or almost complete; some 116 are fully complete, in addition to 24 that are urgent and seven that are going to be approved immediately on an emergency basis. Approximately 150 cases are serious and need to be dealt with. I ask the Minister of State to bear in mind that we are not beginning with a clear slate.

I reject any suggestion of favouritism. This was done using a clear and transparent formula, whereby the cases approved received money first and the remainder was divided on an equal basis according to the amounts requested from the various local authorities. The contingency fund of €2 million is available to allow us to address any case that may arise in the second quarter of the year.

Priory Hall Development

Finian McGrath


76. Deputy Finian McGrath asked the Minister for the Environment, Community and Local Government if he will support the residents of Priory Hall, Dublin, as a matter of priority. [12905/13]

I am supportive of the Priory Hall residents and my Department is supporting the efforts of Dublin City Council in that regard. At my request, the Department has previously assisted the council, in consultation with NAMA, to secure alternative temporary accommodation for many of the residents. My Department has to date contributed in excess of €500,000 towards the costs necessarily incurred by Dublin City Council, in the context of a judgment of the High Court, in providing temporary accommodation for households evacuated from Priory Hall.

The resolution process in respect of the problems associated with this development which I understand is ongoing arose in the context of legal proceedings which were adjourned to afford relevant parties the opportunity to work together under the chairmanship of the retired President of the High Court, Mr. Justice Finnegan, to identify a way forward on the complex problems at Priory Hall. Given that the matter is before the courts, it would be inappropriate for me to comment further other than to continue to urge all concerned to afford Mr. Justice Finnegan the opportunity to complete the task he is undertaking.

Dublin City Council is the designated authority with powers to enforce the statutory requirements arising under the Fire Safety Act, the Building Control Acts and the Planning and Development Acts, all of which are at issue in Priory Hall. The council is also the designated housing authority under the Housing Acts. Neither I nor my Department has a direct role or responsibility in the exercise of these statutory responsibilities. I am aware of the significant efforts made by the council, with the assistance of my Department, to provide for the needs of residents to date. I understand that the council will continue to work proactively on behalf of the residents towards achieving the much needed resolution of the issues at Priory Hall.

Once again I raise the plight of the residents of Priory Hall in my new constituency of Dublin Bay North. As the Minister will be aware, more than 250 families were forced to leave their homes to seek alternative accommodation owing to safety concerns. I note with interest that he has said he is supportive of the residents. All involved, from the Minister and the Government to Dublin City Council, need to up their game to support them. Does he or the Government really understand their anguish and hurt? They urgently need homes and justice. Does he realise that many people on the northside of Dublin believe the residents of Priory Hall are the Palestinians of the northside? They are ignored and have been exploited and treated in a despicable manner. I urge the Minister to get on with the job and show more support to the residents. When is the Finnegan report due to issue?

In his usual flowery language the Deputy has sought to put responsibility where it is not. Surely he is not advocating that the Government should intervene in a court process. The matter is before the courts and Mr. Justice Finnegan has been allowed an opportunity by all parties to come up with a report. I share the Deputy's frustration at the length of time it is taking, but that is not the issue in hand. I understand Mr. Justice Finnegan has been making progress with financial institutions in resolving the issues involved.

In the meantime, I have been very much involved with the Department in ensuring that Dublin City Council is supportive of the residents in their temporary accommodation as far as possible.

I agree with the Minister with regard to the courts. However, the Government and the Minister need to be seen to be more supportive of the former Priory Hall residents. Some owners have moratoriums in place, but others are still liable for repayments on mortgages of up to €250,000. One of the residents, Stephanie Meehan, said that she and her partner bought their apartment at the time with the intention of making it their family home but that the situation has been very upsetting for them. From the minute they moved in, they had problems. Their windows leaked and the balconies were built on an inward tilt, so that if there was any heavy rain, it rolled into the apartment.

We need to be more supportive of these people. They were exploited and abused by developers and now they are being ignored by a lot of people.

They are not being ignored by me. I agree with the comments made by Deputy McGrath. There is certainly impatience and frustration on the part of the residents and that is understandable. They have inherited a situation not of their making because of the very lax building control regulations the Department had in place at the time. We will publish new regulations within the next week to ensure the likes of Priory Hall will not happen again and will minimise the opportunities for unscrupulous builders, developers and professionals to allow consumers to be treated this way in future. In the background, I will continue to support financially and every other way, the people in Dublin City Council who are directly responsible through the courts for the residents of Priory Hall.

Leader Programmes Funding

Éamon Ó Cuív


77. Deputy Éamon Ó Cuív asked the Minister for the Environment, Community and Local Government the reason his Department has not approved any Leader projects since 29 January 2013; the amount of money left to approved projects under the Leader programme by 31 December 2013; and if he will make a statement on the matter. [12864/13]

In late 2011, the European Commission approved a change in the maximum co-funding rate from 55% to 85% for axes 3 and 4 of Ireland’s rural development programme 2007-2013. Prior to this the axes 3 and 4 rural development measures were co-funded at a rate of 55% by the EU, with the remaining 45% coming from national Exchequer resources. The 2011 agreement reduced the national Exchequer input to 15% on a net basis for 2012 and 2013, without a concomitant increase in the amount of funding to be provided by the EU. This resulted in a reduction in the overall programme complement from €427 million to approximately €314 million on the basis of the programme achieving full spend by the end of 2013.

In this context the original project allocations given to each local development company, LDC, contracted to deliver the Leader elements of the rural development programme required readjustment. We are currently carrying out an exercise to determine the level of project commitments across all LDCs and all rural development programme measures in order to complete the rebalancing of the programme in as equitable a way as possible. In addition, given the levels of spending by the LDCs from 2009 to date, it is very unlikely that full spend will be achieved by the end of 2013. The co-funding rate will revert to 55% for all expenditure beyond the end of 2013 and as a consequence of this the overall programme requirement will also change.

Until such time as this careful rebalancing exercise has been satisfactorily completed, it is not possible to be definitive regarding the remaining funding available for project commitments under axis 3 and of the rural development programme. However, I expect this exercise to be completed shortly.

Would the Minister agree that the Department believes that the overall programme complement will be approximately €370 million and that this will give a project complement of approximately €296 million? Does he agree that he will have to allow for projects that will be approved and will not happen and that these could probably amount to €40 million? Does he agree that at the moment, the total commitment is for only €183 million, which means that at a minimum well in excess of €100 million remains to be committed? Does he agree that all of these commitments must be entered into by the end of 2013?

I agree with the figures mentioned. There is a requirement to look at the balance of funding now, arising from the big increase in the number of applications that have come in during the past few months. Officials have wisely decided to have a look at those applications to see what level of funding will be required to meet them if they are successful and to see what funds will remain for the rest of the year. We are anxious to spend as much of the money as we possibly can between now and the end of the year. I expect that within the next ten days - by the end of next week - we will be in a better position to see the precise level of funding available for community projects between now and the end of the year.

The Minister agrees with his Department's figures that point to a worst case scenario in which €100 million will have to be committed between now and the end of the year. Does he agree that he should allow approvals to proceed as normal? There is plenty of headroom there. If we hold up the Leader companies, we might be unable to draw down all the European funds under this programme. This could have a knock-on effect on the drawdown of funds under the Department of Agriculture, Food and the Marine. Does the Minister agree that it was wrong to stop these commitments? We are so far short of the full level of possible commitments that there is no danger of overspending on this programme. Does the Minister accept that not all of the approved projects will happen in reality? Backup projects need to be approved before the end of the year to take their place. Does the Minister agree that the actual spend to date - €82 million, which is a very low figure - is more than €200 million less than the total amount of money in the programme? In fact, the Minister has made a big mistake in this programme, as he has in many other areas.

Unlike the Deputy, I did not cost people an additional €45 when they had to register their septic tanks. That is what happened to people in his constituency, the west and elsewhere when the Deputy changed his mind very quickly. Like the Deputy, I am anxious to ensure we spend as much money as possible under these programmes. Some of the various axes under which funding is provided might be overspent. Some of the other measures might be underspent. We are carrying out a prudent assessment of where the funds are, in terms of the applications that have come in over recent months. Having served as a Minister, I am sure the Deputy will be careful to avoid criticising the prudent approach being taken by the Department of the Environment, Community and Local Government. The Department is anxious to ensure it reorients and readjusts its spend to cater for the big demand that exists in our communities. It will facilitate approvals as quickly as it can. There have been many large-scale approvals since Christmas. That is certainly welcome. We expect that many projects can be approved in every Leader company area in the next couple of months, with a view to having the fund drawn down by the end of the year.

Mortgage to Rent Scheme

Stephen Donnelly


78. Deputy Stephen S. Donnelly asked the Minister for the Environment, Community and Local Government his position regarding local authorities taking on houses with distressed mortgages, for example, a house worth €200,000 with a €400,000 mortgage which will not be paid, the council takes on a new mortgage with the same lender at the market value of €200,000 and rents the property back to the initial occupiers, potentially with a buy-back mechanism; the analysis that has been conducted to date on the viability of potential options; the level of activity that has taken place to date in this area; and if he will make a statement on the matter. [13040/13]

On foot of the recommendations of the Keane report on mortgage arrears, the Government launched a mortgage to rent scheme on a pilot basis in February 2012. The scheme, which was extended nationally in June 2012, targets low-income families with unsustainable mortgage situations and little or no prospect of a significant change in circumstances in the foreseeable future. The scheme ensures the family remains in its home. Ownership is transferred to an approved housing body which rents it to the original owner. The eligibility requirements are in line with other forms of social housing support.

Householders seeking to avail of the mortgage to rent scheme must have been involved in the mortgage arrears resolution process with their lenders and have agreed they can no longer afford to pay their mortgage loans now or in the future; must own the property they live in, with a current market value of less than €220,000 in the Dublin area or less than €180,000 in the rest of the country; must have their property in good condition, in a suitable location and appropriate to their current needs; must not own any other property or have assets in excess of €20,000; must have household income not exceeding €25,000, €30,000 or €35,000 a year, depending on the part of the country they live in - household income in this context is net of taxes and social insurance; and must have a long-term right to remain in Ireland. The treatment of any mortgage shortfall or residual debt will be a matter for bilateral resolution between the borrower and lender.

To date, 828 cases have been submitted by lenders. Of these, 459 cases are being processed and 220 borrowers have been engaged with or are in the process of being engaged with by the lenders. Sales have been agreed on 20 properties and eight of these sales have been completed. The number of completed transactions is low but significant progress has been made. All of the main lenders and so-called sub-prime lenders are fully engaged and have instituted the necessary internal processes. It is important to bear in mind that the transition from being a home owner to a social housing tenant is a major one for families.

Additional information not given on the floor of the House

Mortgage to rent or other such interventions cannot be rushed for any party. For example, the process provides a 60-day decision period and a 28-day cooling off period within the timeframe of the scheme. My Department estimates that the overall timeframe per case from start to completed transaction will be up to eight months. This compares favourably to the timeframes in other jurisdictions operating similar schemes. Households benefiting from mortgage to rent have the option to repurchase the home within a five-year period if their circumstances allow. A mortgage to rent option for local authority borrowers in arrears has been piloted in two local authority areas, Westmeath County Council and Dublin City Council, and will be extended nationally in the coming months.

The Government is being played by the banks again. We saw the Keane report in front of the finance committee for a long time and the Government has been in place for over two years, yet the relevant figure is that 20 of these transfers have been completed. We know that nearly one in five residential mortgages is either in arrears or has been restructured, mainly to an interest only arrangement. The banks are telling the Government that they are engaged in this process, but they are not. If the Minister of State talks to the people who are trying to negotiate with the banks on a daily basis to reach these deals, they will tell her that the banks are not engaged in this process, although perhaps one or two of them are.

Deputy Stephen S. Donnelly: The Government, in my opinion, is being played by the banks here again. We saw the Keane report in front of the finance committee a long time ago and this Government has been in place for over two years now and, yet, the relevant figure is that 20 of these have been done. We know that nea5r

Will the Deputy, please, frame a question?

The key figure is 20. Two years on 20 of these transfers have taken place. There is huge potential in her portfolio for the Minister of State to do something about this. Based on what the Secretary General at the Department of Finance, Mr. John Moran, said and the legislation the Minister for Justice and Equality, Deputy Alan Shatter, is about to bring forward, we know that the number of repossessions is going to go up. Mr. Moran stated he wants them at international levels; therefore, we know that the banks are to be allowed to make many people homeless and the State will have to pick up the tab. There is a huge opportunity for us to have a win-win, whereby the State wins because it does not pay dead money to landlords and instead pays it on assets of which it has taken control, while the family get to stay in their house and the bank receives a secure amount. Is the Minister of State satisfied that, two years on, 20 transfers have taken place? That is a somewhat loaded question, as I am sure she is not satisfied. What can she do to massively accelerate this process and engage with and force the banks to act? They may be telling her that they are engaging, but I guarantee her that, if she talks to the people dealing with these issues, they will say the vast majority of banks, with one or two good exceptions, are not doing anything.

First, I stress that dealing with the issue of mortgage arrears is a major priority for the Government. It is not true to say the Government is not engaged in the process.

A great deal of progress has been made across the board in terms of the personal insolvency legislation and the constant pressure exerted on the banks, as has again been reiterated in the past week. The mortgage-to-rent scheme is part of this, but it is to deal with the most distressed mortgages. There are a number of criteria, including that people have to qualify for social housing and the homes must be under a certain value. It is a very big decision for a family to make that they are no longer going to own their home and are actually going to rent it. This takes time. For example, we reckon the legal process takes on average eight months. It is a totally innovative scheme which we had to invent and it only came into action last year. I am anxious to see more cases going through. While I accept the number that has gone through is very low, we have 300 cases in train and expect at least 250 to get over the line this year. Again, I stress it is a difficult situation for families and that it is a slow and long process. While we now have engagement with the banks, we will continue to keep the pressure on.

In two years we have had 20 transfers. The Minister of State has said this is a difficult decision for families. It is not. These are families who are about to be chucked out on the street and the decision is whether they want to be chucked out on the street or stay in their house. It is a not a difficult decision for a family to make.

The ones who are slowing down the process are the banks. I know the Government is keen on it, including the Ministers, Deputies Alan Shatter and Phil Hogan, as well as the Minister of State, Deputy Jan O'Sullivan. I appeal to the Ministers to recognise that the reason the number is 20 is the Government is being gamed by the banks. However, they are the ones which are slowing down this process and speaking out of both sides of their mouths. The Ministers should have a think about this. They should think about what they can do to progress this number, not from 20 to 100, but to make this a viable solution. My second appeal is that the Government relax the conditions, some of which, when combined, are nuts. What we want is for housing officers to be able to make the right economic decisions and relax some of the conditions. There are many who would benefit from this process, meaning the State would benefit, but they do not meet the criteria. They might have higher incomes, but because of the house involved, the size of the mortgage and all of the other criteria used, they do not qualify. The process has huge potential.

It was mainly the sub-prime lenders who engaged in this process at the very beginning. We have now got all of the banks to engage, which is an achievement. I accept that it is a slow process and we want to make it quicker; therefore, we are keeping the pressure on.

Every single one of these is a cost to the State as well so it is not the case that we can get them for nothing.

It is because we must acquire them.

The State has to house the family anyway if it is made homeless.

I could argue that with the Deputy but I know we do not have time today; there are certain conditions under which one qualifies for social housing. Not everybody qualifies for social housing so there are restrictions attached to the scheme and we are moving it as quickly as we can.