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Dáil Éireann debate -
Thursday, 19 Jan 2017

Vol. 935 No. 2

Priority Questions

Housing Provision

Barry Cowen

Question:

1. Deputy Barry Cowen asked the Minister for Housing, Planning, Community and Local Government his views on whether the number of social housing project approvals in 2016 was low and if new social housing construction targets are wide of those set out in his Department's action plan. [2284/17]

On foot of a question I tabled recently to the Minister, Deputy Coveney, in regard to the number of approvals last year I was directed to refer to the Department's website, which I did. According to the information on the website there were 3,366 approvals, and since January 2015 there have been 2,700 approvals in respect of local authorities and 590 in respect of approved housing bodies. In regard to the commitment to construction this year, it is estimated that approximately 2,700 local authority units will be constructed this year, which means there is a gap of 600 given only 300 units were constructed last year. In terms of the ramping up of construction to meet demand and of allowing local authorities to be the main provider in terms of addressing the supply deficit, the aforementioned data does not indicate that this is happening. We would expect to see more units built this year. Perhaps the Minister would comment on why in terms of construction we are relying this year on approvals since 2015.

I thank the Deputy for the opportunity to clarify the situation. Social housing projects approved continued apace in 2016, adding to the sizeable pipeline in place to deliver significant additional social housing in support of the objectives set out in the Rebuilding Ireland action plan. Through major announcements in May 2015, July 2015 and January 2016 almost €680 million has allocated for over 3,900 social housing new builds, turn-key developments and acquisitions. These initial announcements under the social housing strategy provided the first significant impetus for reviving the social housing construction programme, the scale of which had declined significantly, as we all know, in preceding years.

Since I became Minister for Housing, Planning, Community and Local Government last May, approximately 200 further direct construction and turn-key projects, representing some 3,600 new units, supported by Exchequer investment of €500 million, have been added to the programme. Unlike previous approvals which were announced in a number of large batches, projects are now approved as they progress through the approval process in order to expedite delivery. In other words, approvals are not batched but approved as they come through. The effect of these approvals has been to build a strong pipeline of social housing build projects. Taking the main local authority housing construction programme as an example, there are approximately 255 projects, including 20 turn-key projects, at various stages in the programme, with capacity to deliver more than 4,000 new social homes. These range from large-scale new developments to smaller infill projects. On rapid-build projects, 350 units are now advancing through various stages of delivery, including construction, across a number of Dublin sites. This will be added to, with an additional 650 units this year and a further 500 units in 2018.

Under the capital assistance scheme, there are over 100 approved housing body projects in the pipeline which will deliver approximately 1,000 units. As a further example, under the PPP programme, almost 1,000 new social units are in planning with local authorities. The momentum of approvals will continue in 2017 in order to add to the pipeline and provide the basis for delivering on the increased Rebuilding Ireland targets. Data on the full pipeline of projects are currently being updated. The intention is that this will be finalised and published in conjunction with the next Rebuilding Ireland quarterly implementation report in the coming weeks.

I thank the Minister for his response. I wish to get to the nub of this. What is being constructed this year relates in the main to approvals of two years ago. In my constituency, for example, two sets of 30 units were approved two years ago in two locations but no ground has been cut yet. The public needs to see improvements. We are told the number of stages from approval to completion has been cut from eight to four. I accept that and hope we will see improvements because of it. They have yet to become crystal clear. I have asked departmental officials about this at the committee meeting this week. I hope the Minister will insist on making the information available as soon as possible in order for us to see examples of improvements. Can the Minister tell us in the coming weeks what new approvals were granted by the Department in 2016 alone? This knowledge would allow us to monitor the progress made from initial approval to construction and completion. There are many short-term measures that will not have the desired effect that have to be taken up, but those in question are medium-term to long-term measures that will help to address the supply issue. I accept that but the public has to see that there is progress and that improvements are being made. Fantastic plans and proposals were made by the previous Minister also but they did not come to fruition because of the logjams in the Department and local authorities. I ask the Minister to make the information available regularly.

I take the point. It takes time to proceed from approval to the delivery and occupation of a social house. Obviously, the rapid-build projects are an effort to try to make this happen faster. Some of the preparation and approval times in terms of Part 8 requirements for rapid-build projects have been problematic. Once such a project moves to site, it moves a lot faster than a conventional build. That is why we are pursuing this approach. It is only part of the social housing delivery programme.

We are happy to give as much detail as anybody wants on what has been approved. What I have not been doing is trying to put into one basket many different projects to try to launch them with a big splash every few months. Instead, we try to get every project that is ready for approval through the system as fast as we can. We are approving projects almost on a weekly basis. We were doing so towards the end of last year. We can give a list of all the approvals that have been made.

One reason we have committed to quarterly updates on the Rebuilding Ireland programme is so people can see whether we have fallen behind on targets. If so, it will become self-evident. If it is seen that we are ahead on targets, the appropriate momentum will be gathered.

I look forward to it. I simply want to be able to say to the public and those attending my constituency office, in addition to others, that progress is being made, that things are being done differently and that the Government is in a position to ensure that what is being put into the sector by way of providing public housing is delivered. I need to be able to track approvals to construction and not be dealing with circumstances such as those in which the ground has not yet been cut for a development approved in my constituency two years ago, despite the best intentions in the world, I am led to believe. This is replicated around the country. We do not want to see that repeated, especially at this time of crisis when there is an emergency. People need to see an urgent response giving the matter the attention it deserves in order for results to be forthcoming.

It is important to say we are ahead of target for 2016. The target for delivery across build, acquisition and long-term leasing for social housing in 2016 had been 4,240. The actual number was 1,000 more than that. This year, we obviously need to try to stay ahead of target as best we can. The Deputy, since he knows the local authority system, knows as well as I do that some local authorities are better than others at delivering with a sense of urgency. My job is to work in partnership with the local authorities to ensure the delays are not in my Department and to address in as timely a manner as possible any barriers, delays or issues slowing down approvals and the movement from approval and tendering to building. That will involve a combination of measures, from streamlining the planning system and new technologies for rapid-build solutions to getting approvals a lot faster in my Department through having face-to-face meetings rather than e-mails and letters. All this is happening but it takes a little time to build capacity in the system and essentially go from building virtually no local authority houses to building as many as we need to build annually. We are in the process of gearing up towards achieving a much more respectable figure.

Homeless Persons Data

Eoin Ó Broin

Question:

2. Deputy Eoin Ó Broin asked the Minister for Housing, Planning, Community and Local Government the reason the November homelessness report published on 30 December 2016 does not include all those persons in State-funded emergency accommodation; if he will ensure that the figures will in future include those persons in domestic violence emergency accommodation funded by Tusla and those in the Department of Social Protection new communities unit-funded emergency accommodation and that the reports will be published earlier each month and on a Dáil sitting day to allow for adequate scrutiny; and if he will commit to further implementing the seven-point plan agreed with Home Sweet Home in January 2017 to tackle homelessness. [2286/17]

The figures the Minister's Department produces every month on homelessness are not accurate. They do not include adults and children in Tusla-funded domestic violence shelters or step-down accommodation. They do not include non-Irish nationals in emergency accommodation funded by the new communities unit. Crucially, they do not include those families trapped in direct provision having got their stamp 4 status but who are unable to secure alternative accommodation.

Tusla and the Department of Social Protection cannot currently give Members numbers for those first two categories but we know there are 400 families in direct provision who should not be there but who are essentially using direct provision as emergency accommodation. I have asked about this previously in a parliamentary question. The substance of my question today concerns whether the Minister and his Department will take a lead role in collating all the relevant data so the monthly records the Department publishes will give us an accurate picture of the number of families in all State-funded emergency accommodation.

It is important to distinguish between numbers in emergency accommodation and support accommodation and the numbers who are officially homeless. Sometimes the numbers are not the same. Sometimes people need to be in temporary care, perhaps because of domestic violence or mental health issues. It is not necessarily the case that the number in State care is the same as the number of people who have declared themselves homeless. Sometimes it is, however.

The official homelessness data reports, as published by the Department every month, are provided by housing authorities and produced using the pathway accommodation and support system, PASS, a single integrated national data information system on State-funded emergency accommodation arrangements overseen by housing authorities. The reports do not capture details of individuals utilising State-funded emergency accommodation arrangements which are not overseen by housing authorities, such as clients of domestic violence refuges or the new communities unit. This has always been very clear. The compilation, management and publication of data in regard to those clients are a matter for Tusla. The Deputy has not managed to obtain the data he has asked for in that regard.

For my part, I am satisfied with the quality, timeliness and format of the PASS reporting procedure. The system was put in place only a few years ago. It is not too long ago since we got homelessness figures only once per year. We now have them once per month. When they were being put together, we looked for figures from the various areas to which the Deputy is referring. It was either deemed inappropriate in terms of homelessness numbers or the figures were not readily available.

I take the point the Deputy is making but it is important when assessing numbers and trends to ascertain whether things are moving in the right direction to be consistent in how one calculates data. That is why I do not believe it is a good idea to switch from the PASS, which is by and large working. If there are other issues we need to address and if there are homeless people in other accommodation, we need to determine how best to deal with it. Introducing a new form of calculation is not necessarily the best course of action.

On the second part of the Deputy's question, on the Home Sweet Home campaign, I would like the opportunity to address it when I next get to contribute.

The Minister will have another minute.

That is a very disappointing response. The Minister is essentially admitting these figures are not accurate but he is not willing to change their method of collation. None of the three categories of people I talked about pertains to people in care. If a family is put out of its home as a result of domestic violence, it is put into a domestic violence emergency accommodation shelter. That is emergency accommodation for the homeless. If a family or individuals are put into emergency accommodation or bed-and-breakfast accommodation funded through the new communities unit, they are put into emergency accommodation.

The 400 families in direct provision that have stamp 4 status are not in care.

I am not saying that the figures would make a difference - there is no reason that the Minister could not have his Department's figures alongside those from Tusla and so on - but we do not have an adequate picture of the number of adults and children who are homeless. How can the Minister then develop a strategy for combating the long-term housing needs of these categories, which is the primary responsibility of his Department, without including them? The figures that the Minister has provided to the House are substantially better than those of some years ago. The fact that we get them monthly and in this form is good, but these three categories of family are homeless. Unless they are mentioned in the overall figures, we will not have an adequate picture and our response will not be adequate.

My responsibilities are towards the areas that I control. I will speak to the other Ministers involved. I have a long briefing note. When these data were being put together initially, there were discussions around adding figures, particularly those from domestic violence refuges. It was not possible to do that at the time.

Regarding the new community units, a series of other considerations need to be factored in that are not necessarily covered by citing simple numbers. Some people may be in different types of circumstance and with different entitlements depending on, for example, whether they are here to stay. In some ways, this could inaccurately skew the figures. My key issue is the need for accuracy and a consistent method of calculation so that we can determine whether trends are improving.

I would like the opportunity to clarify a number of matters regarding the Home Sweet Home campaign. The Deputy referred-----

Might we take up the final minute with this reply?

I would like to contribute again, but I would not mind if the Minister used his two minutes afterwards.

The Deputy can contribute and the Minister can give a composite response in the last minute. We are well behind time.

I will respond in my final segment.

We are ahead of time. We started early.

Hold on. We are still only allowed 1 hour and 30 minutes.

The figures are not accurate. That is the problem. I will raise a further point, and I look forward to hearing the Minister's response on Home Sweet Home. For the second month in a row, a number of other Deputies and I were disappointed by the timing of the release of the figures. It is difficult not to draw the conclusion that, when the Minister releases figures on 30 December without any press release on the website or, as far as I know from speaking with some members of the media, issued to the press, it is an attempt to bury bad news. I am not accusing the Minister of that, but it is the impression given. During the week in question, two significant news stories were issued by the Department's press office that promoted the Department's good work. I had no difficulty with that, but we must ensure that data are released at a time when Deputies have an opportunity to scrutinise them and the media or the general public is not away on holidays just before New Year's Eve. To ensure that people do not get the impression that the Minister is trying to bury bad news, I am asking for a commitment that he will publish the figures earlier and preferably on Dáil sitting days or days on which we have the opportunity to scrutinise them adequately.

Regarding the numbers, various comments have been made, including by the Deputy, that are not accurate. The Dublin figures return to us separately from the rest of the country. We wait until we have the national figure before we publish anything. If I got figures on a Friday and waited until Tuesday to publish them because Tuesday was a Dáil sitting day, I would still be accused of delaying.

There was no attempt to hide anything and if there had been, I would probably have waited until 1 or 2 January when there would have been no focus on the figures at all. Instead, we published them before then.

Normally, we get the figures towards the end of the third week or so of the month after the one for which we have data. Most of the time, we try to get the figures out as soon as we can, but I must ensure that I can stand over them and that they are verified and so on.

Regarding the Deputy's reference to a seven-point plan that was agreed with the Home Sweet Home campaign, I will put what actually happened on the record. We had a long conversation about a number of those points and there was agreement on them, but it is important to point out that I did not see that seven-point plan press release in its final draft, never mind approve it, before it was announced and released. It was a reflection of the approximately seven-hour conversation on a range of issues that we had held on the previous Friday. At the end of that conversation, an attempt was made to have an agreed statement, but it was not agreed. The following Wednesday or Thursday, an announcement was made as if I had made an agreement in writing with the Home Sweet Home campaign. That simply was not true.

What is true is that much of what was in the statement was agreed at our meeting. Unfortunately, people were claiming credit for certain things. I am not really interested in that. Rather, I am interested in the accuracy of the change that is happening in terms of supporting homeless people. It is true to say that we will have an extra 100 emergency beds in Dublin in the coming weeks, probably through two or three new hostels. It is true to say that we will look after the short and long-term needs of people who are accommodated outside Apollo House. It is true to say that we will improve community services for homeless people. It is true to say that, by the middle of this year, we will not allow families to be accommodated in commercial hotels. I understand that there will be a monthly meeting, if Home Sweet Home wants one, with Dublin City Council.

The Minister has exceeded his time by two minutes. I have been overly generous. That is my problem.

My point is that we should not try to turn this into a political campaign around who managed to get concessions and who did not. The truth is that most of those commitments had already been made. I gave a reassurance to Home Sweet Home that they would be implemented. That is the only point that I would like to make in terms of accuracy, as no written agreement was signed off on by both sides.

I am trying to be fair to everyone. The Minister exceeded his time by two and a half minutes. There may be opportunities later, so I will ask the Minister and Deputies to be conscious of the time factor and that others are waiting.

National Spatial Strategy

Barry Cowen

Question:

3. Deputy Barry Cowen asked the Minister for Housing, Planning, Community and Local Government his plans to reform the national spatial plan; if he will confirm media reports that he plans to designate a number of economic gateways and hubs in his new plan and focus these designations solely on cities; and if he will make a statement on the matter. [2285/17]

Media reports over Christmas indicated that the Minister's replacement for the national spatial strategy would centre on cities as growth areas. That would not accommodate many regions, for example, the midlands and north west. In recognising the strategy's potential, the Mahon tribunal wanted it placed on a statutory basis. There is a review of the capital development plan, but surely it should not be undertaken in isolation when we do not have a commitment on the national spatial strategy or its successor? They should be undertaken in tandem so as to ensure that those regions are central to a new capital development plan.

I welcome the opportunity to provide clarity on this issue because there has been some media coverage, particularly in the north west, that is inaccurate. Comments were made by the chief executive that were not accurate either.

In a few weeks' time, we will launch a consultation process around a new national planning framework, called "Ireland 2040 - A National Planning Framework". There will be extensive consultation in different parts of the country, including the north west and midlands. On 2 February, we will publish an issues paper to start that consultation and get the conversation going. It will then be up to various parts of the country to outline where they want to see their regions, towns, rural counties and so on going in the next two decades. Hopefully, we will have finalised a new national planning framework by early autumn after a series of extensive consultations with all stakeholders who wish to be involved.

Nothing is cast in stone. Although the Minister for Public Expenditure and Reform, Deputy Donohoe, will outline his plans for the new capital plan, I would be surprised if the work on the new national planning framework did not impact on Government decision making in terms of how we prioritise spending.

I thank the Minister for his response. Will he further elaborate on the timeframe for the consultation process and the review of the national capital development plan? I can only speak for my own area, but I am sure that the same applies in the likes of the north west, including Sligo and Letterkenny, and in Shannon in the west. Athlone, Mullingar and Tullamore are interested in developing our region, which is best placed as a growth centre, so that benefits might accrue to it in its entirety.

With regard to its potential, that can only be realised in the context of a national spatial strategy and a national development plan which recognises both and works in parallel to one another, allowing infrastructural deficits to be addressed as well as deficiencies in other areas. It is imperative to address the deficiencies in infrastructure and other areas in order for the potential of those areas to be realised. Both the national development plan and the national spatial strategy must be singing off the one hymn sheet in order for various hierarchical regional development plans thereafter to achieve the potential based on their inclusion in the two plans.

This will be the most ambitious attempt ever by a Government to plan for the development of the country in the medium to long term. We are planning for Ireland in 2040 when there will be an extra million people and twice as many over the age of 65. We must accommodate that growth, expansion and opportunity through a combination of a new city strategy as well as a very progressive strategy for rural areas and ensuring we maximise the potential of regional development in various parts of the country. It will be a complex and ambitious attempt by Government to plan in a much more long-term way, which will then impact on everything from county and city development plans, industrial policy and investment policy in terms of capital investment. That is what we are attempting to do and it will not be a case of there being one for everyone in the audience. We will try to ensure that every region has the capacity to fulfil its potential in the context of a national plan.

We will launch the plan on 2 February in Maynooth University and we will then have an initial consultation until around Easter. We will try to introduce a pre-draft, as it were, and then have a second consultation process when people can consider and comment on the draft. We will seek to try to finalise it around September to October at which point it will come to the Oireachtas for approval. This will not simply be a Government document and commitment. We will look for the endorsement of the Oireachtas as a whole so that, in effect, we have a national plan in terms of the direction in which we want to take the country between now and 2040, which is why I hope all parties will contribute in a very significant way to putting together the overall plan.

I do not necessarily want an approach that involves there being something for everybody in the audience, but what I do want to ensure, which was very evident and obvious during the course of the election campaign last year, is that we have an Ireland for all. We do not want an Ireland for the cities or for Dublin and Cork; we want an Ireland for all. The best way in which we can help the regions is with a spatial strategy that allows those regions the potential to grow, expand and provide for those who live in them to stay living them and perhaps for others to move into them. It is imperative for the Minister to indicate here and now that any review of the national development plan or the national capital investment plan is done in parallel to a procedure which either reaffirms the basic principles contained in the existing national spatial strategy or at least one which reflects a new spatial strategy which can be called whatever the Minister wishes thereafter. I wish him the best of luck with it. It is in all our interests that it is successful. I am adamant that the regions need every possible support and commitment contained in both the capital investment plan and the spatial strategy in order that they can work together, and thereafter, the regions, the local development organisations, county councils, local authorities and industry will strive to meet the demands placed on them and on the Government in order to further regional development.

I am fully committed to ensuring the regions are very much part of this plan. The problem with the previous national spatial strategy is that it has not come to fruition. It has not even come close.

I beg to differ.

A total of 20 towns were earmarked for growth. They were to be the 20 fastest growing towns in the country and not one of them has been in the top 20 towns in terms of growth since the national spatial strategy was put in place.

I beg to differ.

Even though there was some good thinking in that plan, it was not followed through in terms of ensuring the aspirations of the national spatial strategy were met by means of the hubs and spokes and regional drivers of growth. It was good thinking but it has not come to fruition because of the dominance of Dublin in particular in terms of its magnetism for job creation and population. We have seen enormous growth in many towns and villages where that was never planned for and we must ensure that does not happen in the future. I agree with Deputy Cowen that this time around we need to make sure that we have, in effect, a new spatial strategy and a new national plan that will ensure we drive investment, growth and opportunity into all parts of Ireland. The process we will go through to get us there will allow us to achieve that.

Rural Resettlement Scheme

Michael Harty

Question:

4. Deputy Michael Harty asked the Minister for Housing, Planning, Community and Local Government his proposals regarding a new rural resettlement scheme to promote the advantages of rural living and ease the housing pressure in high demand urban areas, as indicated as a one year action in A Programme for a Partnership Government. [2287/17]

I wish to ask the Minister what proposals he intends to make in terms of a new rural resettlement scheme to promote the advantages of rural living. It was outlined as a one-year strategy in the programme for Government. Rather than being merely a rural resettlement scheme I wish to introduce a new concept of a rural revitalisation scheme which would help to reinvigorate rural communities and to bring people back into rural areas.

I thank Deputy Harty for raising this issue. We agree that it is not just a rural resettlement programme that we need but that the focus should be on the revitalisation and rebuilding of rural areas. That is what we are trying to achieve. The aim is set out both in the programme for Government and in Rebuilding Ireland. We want to facilitate people who want to live in a rural area, especially if they are on the social housing list, but it will be a choice for people. We will facilitate people’s choice through a range of schemes. We will endeavour to make that happen if we can at all.

As the Deputy is aware, my colleague, the Minister for Arts, Heritage, Regional, Rural and Gaeltacht Affairs, has overall responsibility for regional and rural matters and will shortly be publishing a broadly based rural development strategy, in the context of A Programme for a Partnership Government, which I hope will be launched next week. For our part, the Government's housing strategy, Rebuilding Ireland: An Action Plan for Housing and Homelessness, includes a range of measures supportive of the regeneration and renewal of towns and villages across rural Ireland, which is exactly what Deputy Harty said needs to happen and, consequently, ensuring a vibrant population in those places.

It is our aim that all steps are taken to secure the re-use of vacant and underutilised properties for residential purposes, particularly in the many towns and villages in rural Ireland that contain a significant number of empty houses. That also involves having a purpose to those towns and villages and to make them attractive for people to come back to live in them and to utilise existing buildings.

Action 5.1 of the action plan commits to the development of a national vacant housing re-use strategy and we intend to examine the potential to widen the geographical range of social housing location options available to persons seeking such accommodation. The strategy will examine the potential for bringing existing but vacant housing back into beneficial use and we intend to examine mechanisms to match such accommodation potential to prospective applicants for social housing, including through choice-based letting approaches and the HAP scheme, which now operates nationally. Other important initiatives include the repair and leasing and the buy and renew schemes, which will see upfront financial assistance being made available to upgrade empty but substandard accommodation, after which the property will be used for social housing purposes. Acquisition and leasing options are also available to local authorities. We will have examiners on local authorities to encourage the take-up of such options. The Department, in conjunction with the Minister, Deputy Heather Humphreys and the Minister of State, Deputy Michael Ring in the Department of Arts, Heritage, Regional, Rural and Gaeltacht Affairs, are working to make the plans attractive and to ensure they work. The first instalment will be announced by the Minister, Deputy Heather Humphreys, next week.

I fully agree with Deputy Harty about the benefits of such a scheme and the necessity of it but it must be done in a co-ordinated way and in accordance with people's choice, which is what we are trying to facilitate.

One of the greatest assets rural Ireland has is vacant property and, unfortunately, one of the assets it lacks is people. There are great disparities around the country in terms of the availability of housing. I envisage that such a scheme will only solve a small percentage of the housing shortage in greater urban areas but it will have a beneficial effect on the situation and it will also address depopulation in rural areas.

There are many vacant properties in our county towns, villages and town lands so it is very important to factor this into the housing strategy. A rural resettlement programme was part of the programme for Government housing sector. As I said, "resettlement" is not a word we like to use. It is rural revitalisation, coming from the bottom up where communities proactively come together and identify housing, housing is made available to county councils and the Department of Housing, Planning, Community and Local Government and supports are put around those houses that would attract people to come to a community and revitalise it. It is very important that the Government give serious consideration to this.

That is exactly what we are doing. We want to give this very serious consideration. The Department has an urban renewal and regeneration working group that has been working with local authority chief executives over the past couple of months to devise new schemes and ideas. In addition, the Department works alongside the Department of Arts, Heritage, Regional, Rural and Gaeltacht Affairs. We will have a list of actions and a toolkit that will make living in these areas an option for people and make it attractive. Finance will be provided to restore some of these vacant buildings privately and for social housing but it is not just about that. Ireland in 2040: A National Planning Framework set out the economic reasons to live in these rural areas and regenerate them and that is what we must do. Housing and its benefits is one aspect of it. Using vacant stock is pillar five of Rebuilding Ireland, which will be relaunched shortly with a major focus on tackling vacant buildings. It is also involves long-term planning. People need to know that there is a future in these areas and the economic purpose of each of those towns and villages we spoke about. That is what we are trying to do. We need to make that happen. We think local authorities are central to making this happen but they must have the toolkit at their disposal to be able to do that and that is what we will implement.

When I speak about rural revitalisation, what I mean is that communities would come together and identify the needs of that community and property within it. Obviously, it is a voluntary process. We are not talking about resettlement. We are talking about revitalisation where people would voluntarily come to live in rural Ireland and be received into a community with a huge amount of volunteerism. They are people who could rejuvenate Ireland. We want a bottom-up approach meeting a top-down approach where the Government, either through the Department of Housing, Planning, Community and Local Government or the Department of Arts, Heritage, Regional, Rural and Gaeltacht Affairs, would form an organisation or structure where people in urban areas could find out where they could relocate to if they so wished and create a new life for themselves with access to smaller schools, open spaces and outdoor living - a different concept - because people become very claustrophobic and introverted in urban areas where they are homeless. It is a conceptual thing where people would move in their mind as well as physically from an urban environment to a rural environment and see the positive aspects of it.

The action plan for rural development that will be launched next week will facilitate that. Our Department is feeding into that and has already fed into that. We have had numerous meetings at official and ministerial level. The Minister and I, along with the Minister for Arts, Heritage, Regional, Rural and Gaeltacht Affairs and the Minister of State for regional economic development, Deputy Ring, have had numerous discussions around this to make it happen. It is about breathing life back into these areas but also guaranteeing a life into the future because the problems in many of these towns and villages in rural areas did not just happen as a result of the recession or the downturn in construction over the past seven, eight or ten years. This has been going back 20 or 30 years so we need a co-ordinated way to make this happen and local authorities engaging with local bodies and agencies to make it happen is central. We also need long-term thinking of the kind found in Ireland in 2040: A National Planning Framework to make sure it is sustainable into the future and that it is not just a temporary solution to a housing difficulty we have because that is the wrong way to approach it. Yes, there are loads of vacant buildings and if people want to live there, that is a major part of what we can do. We have a budget allocated to make that happen but it is far more than that. The plan launched next week will be interesting and will be the basis upon which we will work. Our Departments are working very closely on this because it is the right thing to do and is in the programme for Government. We can achieve what Deputy Harty has set out. That is our aim so we are at one on that.

Housing Provision

Stephen Donnelly

Question:

5. Deputy Stephen S. Donnelly asked the Minister for Housing, Planning, Community and Local Government his views on whether the current level of investment in the construction of commercial property is having an impact on the development of residential property, in particular in the greater Dublin area; and if he will make a statement on the matter. [2400/17]

At the moment in Dublin, the analysis of the commercial property market shows us that we are dealing with a bubble in commercial property that exceeds the bubble we saw in 2006 and 2007. There is all manner of downsides to this. There are very few winners. The only winners are some foreign landlords and even they will become losers if and when the bubble bursts. Specific to the Minister's portfolio, I think we are all agreed that there needs to be more residential development in Dublin as well as many other places. However, because there is so much more profit to be made in Dublin from commercial property development because of this bubble than there is from residential property development, what I am hearing from investors and developers is that they will, of course, direct their assets to commercial which, therefore, crowds out residential developments. Is the Minister aware of this, does he think it is a serious issue and does he think there needs to be a push back to have these foreign landlords and commercial property developers pay tax in this country to stop crowding out residential development?

Undoubtedly, we have seen an extraordinary acceleration in investment in and delivery of commercial property not just in Dublin but in Cork. On one level, that is a really good thing because those commercial properties are filling up. It is part of facilitating a significant amount of foreign direct investment jobs and the expansion of the number of Irish companies across the capital. I have read the paper produced by the Deputy on this issue in response to the Finance Bill. The rents being paid for commercial property in parts of Dublin compare with some of the other top capitals in Europe.

The Deputy asked whether this is crowding out and preventing investment going into residential build. I am not sure there is a crowding out effect. I think there is certainly a more attractive option for investment in commercial property than in residential property but the way to address that is the key issue. What we are trying to do is to ensure that the viability of residential investment is significantly improved. In terms of sites and zoning, there is enough planning permission for Dublin for 27,000 residential properties today but there are only 4,500 or so under construction. The sites are there but for a whole series of reasons, some of them are not being moved on. It is encouraging to see that in the last quarter of last year, planning permissions for apartment complexes in Dublin, of which we need a lot, were up 300% so we are starting to see an appetite for risk and investment in residential property in Dublin. We have seen extraordinary increases in rent for residential properties which has changed that appetite. We are now introducing a brake on that rental inflation through the introduction of rent pressure zones. We need to make sure the incentive remains in place to ensure that money is investing significantly in residential property.

There is undoubtedly extraordinary viability in building commercial property as investment in Dublin right now but I am not sure that if that had not happened, we would have seen a faster acceleration in terms of residential property. Perhaps it might have happened but I do not think so. There is no shortage of capital globally to invest in good propositions. They have simply chosen to invest in commercial property because of the economics of building commercial property in Dublin. This has been the case for the past two to three years. We are starting to see that appetite grow in the context of investing in residential property. We have put €200 million into an infrastructure fund, reduced development charges significantly and streamlined the planning process.

I do not know either, which is why I asked the question.

We do not know how much crowding out is happening, but there is a bunch of things we do know. We know that the profits per square metre or per acre of development land for commercial property in Cork and Dublin vastly exceed the profits to be made from residential. We know that some of this is being driven by a tax-free status that has been given to property developers for highly dubious reasons.

We know that commercial rents for SMEs in Dublin have doubled in the past two to three years and, of course, we have seen a massive explosion in residential rents. We know that many bad things are happening because of this commercial property bubble. However, we do not know how bad the potential crowding out is. We know it is likely given normal incentives for a developer to hold land. The Minister has said there is a swathe of land for 27,000 residential units in Dublin and yet only 4,000 are being done. Part of the reason may be that people, knowing they can make five times more money from office than residential, are holding it in order to try to get a change of planning.

There is a property bubble, which now appears to include Cork. We know there are adverse effects. It is reasonable to assume that one of those is the crowding out of residential development.

The Deputy should conclude.

I thank the Leas-Cheann Comhairle for his patience.

I will finish on this. Would the Minister consider commissioning a reasonably quick report to investigate this and assess the level of crowding out that might be happening?

We need a lot of extra commercial property in Dublin and in other cities. IDA Ireland has indicated that accessing suitable properties is now a big issue. There is a pipeline of companies that want to come to Ireland and provide good jobs here. One of the challenges is being able to build office and other commercial accommodation for them quickly enough in areas such as Dublin and Cork. There are very few good-quality office developments that are not being filled.

I do not think we should approach increasing residential property investment and provision by reducing the delivery of commercial developments. The straight answer is that we need both. We have a lot of zoned land, much of it with planning permissions in place. We know a significant number of planning applications are up for decision to ramp up significantly the provision of residential property. Last year about 15,000 residential properties were finished, which is about 1,000 more than people were anticipating last summer. I think we will be ahead of expectations again this year.

Sorry, Minister-----

We are seeing a correction happening quite quickly.

I call Deputy Donnelly for a short supplementary question.

I agree we need to strike a balance. The problem is the profits for commercial development so vastly outweigh the profits for residential development that we are not getting that balance. We agree there has to be a balance between high-quality grade-A office space and other commercial space, and good homes for people to live in. However, if a developer can make five to ten times more by building an office block than by building three-bedroom semi-detached houses, he will build the office block.

I have plenty of anecdotal evidence that developers are choosing not to develop residential because of the profits. On that basis would it not make sense for the Minister to commission a short report to look into the potential harm that the commercial property development bubble is causing?

A brief answer, Minister, please.

I will look at that, but I will not to commit to that report on the floor of the House now. I will look at it and come back to the Deputy.

It is important not to draw conclusions from a Dublin market and make national decisions on that basis. We have a real shortage of good-quality commercial accommodation outside Dublin at the moment and we need to attract the investment to deliver that. The kinds of return available in Dublin are not available in many other cities, which is why I believe many companies should consider expanding outside Dublin to places such as Cork, Limerick, Waterford, Galway and so on-----

----- and Wicklow, where they can lease similar property for 40% less.

We have seen virtual stagnation in residential property delivery until recent months. We are starting to see a big change in that now. There is a series of strategies to build on the small momentum that is now there.

I am not sure that by trying to reduce the momentum on the commercial property side we will necessarily get a corresponding increase in residential, given where land is zoned, not zoned and so on and given the availability of finance at the moment at relatively low cost for-----

I have to interrupt the Minister now.

----- decent commercial properties.

There are 40 minutes left and we are about to start Other Questions. Every other Deputy is here and we will be lucky to get through about six of those questions. I am not referring to those who have not asked a question, but I ask those who have and the Ministers to watch the clock.

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