Vol. 962 No. 8
1. Deputy Barry Cowen asked the Minister for Housing, Planning and Local Government the impact the potential reclassification of approved housing bodies as general Government debt will have on Government housing policy and if he will make a statement on the matter. [52432/17]
We can see that local authorities are not building houses at the rate one would hope. In quarter 2 of 2017, 76% of completions were by approved housing bodies. Of the sites started at that time, 63% were by approved housing bodies. There appears to be an over-reliance on approved housing bodies. I know the question has been put to EUROSTAT, which is investigating the fact that these bodies and the funding associated with them are off-balance sheet. If that is proven to be the case, what provision have local authorities made to ramp up the provision of local authority housing by local authorities themselves? Looking at the statistics it appears to be Government policy to predominantly allow approved housing bodies to be the ones building homes currently rather than local authorities.
The Central Statistics Office, CSO, is responsible under EU law for the reporting of Government finance statistics, including deficit and debt. It is currently undertaking a review to determine whether the approved housing body, AHB, sector or part of it should be included as part of the general Government sector and whether AHBs should be classified as on-balance sheet or off-balance sheet for Government accounting purposes in accordance with EU rules.
Under a previous review of the sector in 2014, the CSO classified these entities as being outside of the general Government sector. It indicated at the time that the status of these bodies would be reviewed if there was a change in the relationship with the housing authorities, that is, local authorities, or any other Government body. In October 2016, EUROSTAT requested the CSO to review the classification of AHBs expressing the view that the role of Government financing should be given greater weight in the classification decision than had been the case at the time of the 2014 review.
My Department has been engaging with the CSO on the review while respecting the independence of that office. We are keeping the matter of the potential reclassification of the AHB sector or part of it and its implications under continuous assessment and the Cabinet was also briefed on the issue in July 2017. However, until the CSO's examination is completed and the factors underlying the position to be adopted by the CSO become clear, I will not be in a position to assess the full impact of any decision arising from the review.
It is not the case that there is an over-reliance on AHBs. We have stressed at every local authority meeting with councillors of all parties and officials that we expect local authorities to be the lead in delivering housing. The AHB sector accounts for about one third of the planned delivery over the next four or five years under Rebuilding Ireland. That is very clear with less than 17,000 direct build, acquire or lease units through all the various schemes.
Regarding the pipeline of projects, the Deputy's concern is what the local authorities will do if this becomes an issue. We have clearly told local authorities to bring forward a greater pipeline of projects across the board. They have a pipeline of about 12,000 units. To put the Deputy's mind at ease on this issue, we have asked them to at least treble that so we have asked them to put them into the projects pipeline so the capacity to deliver will not be affected by any decision by the CSO or EUROSTAT on this issue in the year ahead. To be very clear, local authorities are the main body to deliver social housing on behalf of the State.
I have a direct question. In the event of this being adjudicated to be off-balance sheet by EUROSTAT, can the fiscal space cope with the increase in funding that would be required? The Minister of State has intimated to us that he is asking local authorities to redouble their efforts and ensure that they are the lead agency regarding the provision of houses and that funding is not an issue or an obstacle to them becoming that lead agency and providing the sort of units and numbers of units we deserve. That is one thing. It is the public pronouncement we hear week after week but if we look at the facts associated with the Government's programme, we will see that 76% of what is being built in quarter 2 of 2017 is by AHBs. With regard to sites that have commenced in quarter two of 2017, 63% are by AHBs and with regard to what is being tendered for, the percentage relating to AHBs is 73%, so the facts do not bear out the Minister of State's pronouncements. The facts will have to come into line with pronouncements eventually.
If, despite the Minister of State's pronouncements, commitments and what he has told us on a continuous basis, there is no capacity there to address this then let us find a different way to proceed. The Minister of State spoke about re-purposing NAMA at one time with a view to it possibly contracting builders to provide local authority houses and for them to be leased over 70 years or whatever the case may be, but we have heard no more about that. We heard in the budget about €750 million being provided for builders to provide social housing units but we have heard no more about that either. The Government might be getting the kickback in respect of its announcements but the people on the ground are not seeing results. We are not seeing action to match the rhetoric.
I disagree with that. AHBs are partners in the delivery of social housing. We are very clear on this. The target is over 50,000 social houses built on behalf of the State in the years ahead. Local authorities will account for the majority of those house while AHBs will account for about 17,000 in total across all the various schemes. They have about 5,000 units coming through the pipeline on 300 sites but over 720 sites are being planned that will deliver over 12,000 houses by local authorities.
I agree with Deputy Cowen that we want the local authorities to do more in this space. We have asked them to do so and their capacity has been strengthened in terms of resources, people, and finance. We have also put in place a new delivery team and agreed a new timeline of 59 weeks to be on-site with the housing, which is also in line with the private sector. This puts the local authorities in the position of being able to deliver the quantities of housing that they used to many years ago. Deputy Cowen is asking what happens if EUROSTAT makes a decision. The local authorities have been asked to increase their capacity every year over the next number of years. We will, then, be in a position to deliver our targets; that is not a concern for us. If the local authorities decide to operate either on- or off-balance sheet then we can deal with that. Capacity is being put back into the system to deliver housing. There will be an issue with funding and with the administration of balance sheets but we can deal with that. We will wait for the decision in the years ahead.
The statistics bear out my contention that the Government is putting all its eggs, or at least 75% of them, into the one basket of approved housing bodies for delivering units to those on the ground. I accept that many people who are waiting on housing and who want to see progress on this matter do not care where the houses come from as long as they get one and as long as there is potential for hope. In the event of the Department's statistics indicating that this is on-balance sheet, has the Minister the funds available to meet the shortfall in terms of what he can provide? This shortfall will obviously become apparent at this point. The mantra put forward by the Minister and his colleagues is that money is not an object. It is certainly not an object when it comes to his commitment at this stage because it has taken between two to three years to get from inception to delivery. If this were happening at a greater pace, which I hope it will, can the Minister confirm that there is funding available to meet the shortfall so that local authorities can take up the mantle that the Minister says he wants them to? The Minister says that he wants the local authorities to be at the forefront of this but, based on the statistics, which do not lie, they are not there at the moment.
I want to deal with this myth that I have heard repeatedly from many of Fianna Fáil's own councillors as I go around the country, namely, that local authorities are not being made responsible for, or being put in the position to drive, local authority and social housing. They absolutely are. We are not solely dependent on approved housing bodies, even if Fianna Fáil Deputies and councillors keep repeating this. This is not the case. I ask Deputy Cowen to look at the projections for the next three or four years. The approved housing body sector has been allocated less than one third of responsibility for this matter in the plans ahead. Let me very clear on this because it something that I hear repeatedly. It is a five-year plan and I urge Deputy Cowen to look at it. Yes, we have made it very clear that the fiscal space can deal with this, both in terms of the existing approved housing bodies and in terms of what we are looking at now, which is future funding.
A total of 73% of those who have tendered-----
The Minister of State is to continue without interruption.
It is probably a while since Deputy Cowen read the Action Plan for Housing but he should take a look at it. It shows where the money is allocated and who is doing what.
It is probably a while since the Minister and the Minister of State have done anything about housing.
Stop that now Deputy Cowen.
Approved housing bodies are responsible for less than a third of units. We have asked local authorities to take the lead across the board and I again want to emphasise that they are all delivering social housing and that the supply of social housing has gone up for the last two years and now this year again. It will continue to go up in the years ahead. What we are trying to do is to achieve the target that everybody here wants to hear, which is 10,000 houses delivered per year. We will achieve this.
2. Deputy Eoin Ó Broin asked the Minister for Housing, Planning and Local Government his plans to introduce a scheme for genuinely affordable rental and purchase housing in 2018; and the funding allocated and targets for units to be delivered. [52319/17]
Thousands of working families and individuals are caught in an affordability trap whereby they can afford neither to rent nor to purchase a home. I have asked on a number of occasions for the Government to outline its definitions of affordable rental and affordable purchase; its targets in this regard for 2018; and the timeline for introducing an affordable housing scheme. Despite all the spin and announcements, we are still not getting answers to these very simple questions so I hope the Minister will oblige me in this regard this morning.
The Government acknowledges the affordability pressures faced by households with low to moderate incomes in particular parts of the country. It is precisely for that reason that Rebuilding Ireland has prioritised the supply of new homes to meet current and pent-up demand as well as helping to moderate house prices and rents. For households in the lowest income brackets, I am prioritising the social housing programme, with an additional capital allocation of €500 million over and above the €5.35 billion already committed under Rebuilding Ireland, to increase the overall delivery to 50,000 social housing homes by 2021. These households can also avail of other supports such as the housing assistance payment scheme.
The Government has also put in place a range of measures to make housing more affordable. These include planning reforms, infrastructure funding to get key sites moving, the introduction of rent pressure zones, and mixed-tenure housing projects on publicly-owned land with two major sites in Dublin, encompassing some 1,500 new homes, progressing through procurement.
Based on all relevant indicators, it is clear that the supply-based measures are having a positive impact. Notwithstanding this, further measures are being developed, including with regard to apartment development viability. I am also considering the wider issue of housing affordability as part of the targeted review of Rebuilding Ireland, including the deployment of the funding of €25 million announced in budget 2018 to unlock local authority-owned lands specifically for affordable housing. I expect to be making a further announcement on this shortly.
The Minister's answer is truly remarkable. While I know that he has only been in office for six months, I am really beginning to question whether or not he understands the extent of this particular issue and the extent of the pressures that people are under. According to every indicator, rents and house prices are increasing quarter on quarter and year on year. We are talking about the housing needs of working families on incomes somewhere between €35,000 and €75,000 a year. As I keep telling the Minister, supply alone will not resolve the problem without guarantees of affordability. The difficulty is that the measures that the Minister has just outlined combine to a total of €1.1 billion over three years to assist private sector delivery, with no guarantee of affordability. The scheme that the Minister has been promising to announce for a number of weeks now pledges approximately €25 million as compared to €1.1 billion. I again ask the questions and if the Minister does not have the answers then I ask that he be honest and tell us that. What is the Minister's definition of affordable rental? What is his definition of affordable sale? What are his targets for the delivery of those two streams of affordable housing for 2018? When will he introduce the necessary legislation to give effect to the affordable housing scheme that he promised both in the programme for Government and in Rebuilding Ireland?
I was quite clear about this both in my answer and in committee. We are about to announce an affordability scheme and it is being designed at the moment. I have met with bodies like Ó Cualann which have carried out affordability projects through running co-operative housing with local authorities, so as to see how we can draw up our own affordability scheme criteria. It is important to acknowledge here that we need to get the criteria right for accessing affordable homes. We are bringing back affordability. It had been stood down as part of social and affordable housing and we are now bringing it back. The most important thing is that the houses get built, and when they are built we will then have a scheme in place for every local authority to access. The allocation of €25 million announced in the budget is for 2018 and 2019 and will deliver at least 650 affordable homes using local authority sites. That is but the minimum of what we expect to deliver from that €25 million. I ask the Deputy to look at the Local Infrastructure Housing Activation Fund, LIHAF, funding to date. Of the €200 million allocated under LIHAF 1, 30% of the sites involved will include affordability schemes that can be accessed under the new affordability criteria scheme when it is announced. LIHAF 2 will have the same provisions available to it.
With further regard to other sites, we do not limit local authorities in making arrangements for particular sites. If we look at what is going to be happening at O'Devaney Gardens, for example, additional affordability will be in place there, while an additional 15% of affordable housing is going to go up on the Poolbeg site. All these new homes will be affordable homes accessed by the new scheme which is currently being designed. The most important thing is that the homes are getting built. I hope to announce in the coming weeks the affordability scheme and the actual criteria for how it can be accessed. As I said before in committee, we are considering things like income limits as ways of deciding who would be eligible to get access for that scheme..
What we now know, then, is that 300 affordable homes will possibly be available next year and a further 300 possibly available the year after.
A possible 300.
That is remarkable. Fine Gael has been in government for a year and a half. It signed a programme for Government 18 months ago that promised a cost-rental and an affordable housing scheme. I have no idea what the Minister means when he says that the LIHAF developments will include affordability. The last time he answered that question he told us that in Dublin, for example, that could mean €320,000, which is clearly not affordable by any measure. While I look forward to the Minister's announcement, Government needs to come forward and say that there is going to be a stream of rental accommodation and a stream of purchase accommodation that is accessible to people on incomes between €35,000 and approximately €75,000 for couples. The Minister needs to tell us exactly how many of those units will be delivered next year and the year after. If he comes back in two or three weeks' time to tell us that this figure amounts to 300 units based on the €25 million, €15 million of which will be spent next year, then that will be a mark of abject failure on his part. Once again he will have let down those working families who are in desperate need of affordable accommodation.
I ask Deputy Ó Broin not to deliberately misinterpret what I just said. What I said was that the €25 million that was secured from budget 2018 and 2019 would deliver a minimum of 650 homes. I also said that with regard to other sites, Poolbeg, for example, we will have an additional 15% of affordable units which will deliver approximately 350 homes.
There is also an increase in O'Devaney Gardens. A number of schemes under LIHAF 1 will have affordability carve-outs in the affordable-to-rent and affordable-to-buy areas.
All we are asking is for the Minister to tell us the prices and the numbers. It is very simple.
The income criteria that will allow people to access these homes are being worked out in the context of the affordability scheme I am going to announce. We know that in 70% of LIHAF sites, two-bedroom and three-bedroom homes will come in under €320,000. The vast majority of them will come in under €300,000.
I do not think €300,000 is affordable.
I ask the Deputy not to interrupt me. Of course affordability depends on a person's income. We intend to bring back the affordability measures that existed previously in the context of social and affordable housing. We will bring in a scheme for the cohort of people who are not eligible for social housing because their incomes are just above the limits and who cannot afford to buy because of the current rates of property price increases. I will announce the details of this affordability scheme very shortly.
3. Deputy Barry Cowen asked the Minister for Housing, Planning and Local Government the criteria used in the calculation of returned voids; the number returned in 2015, 2016 and to date in 2017; and if he will make a statement on the matter. [52433/17]
There is nothing more irritating for people than to see voids not being used. The Government has told us it is dealing with this issue by putting more people into such properties. It has provided certain numbers. What criteria are used when returned voids are being calculated? How many returned voids were there in 2015, 2016 and to date in 2017? I want to get a clear handle on that so I can appreciate whether what the Minister is saying is correct. There are contradictions in the information emanating from various bodies.
Vacant social houses, which are categorised as voids, need far greater repairs than normal reletting works to bring them to a suitable letting condition. They are vacant pending that work. Strong funding support has been given to all local authorities to remediate vacant social housing so the homes involved can be let again as soon as possible. This Exchequer funding is in addition to the funding provided by local authorities to bring vacant properties back into use. The works that are carried out focus on returning vacant social homes to use as quickly as possible and on remediation work that brings long-term benefits. Insulation retrofitting, for example, means that when a house is let again, it has high levels of comfort and reduced heating costs for the incoming tenant. Almost €100 million in Exchequer funding has been made available to local authorities since the introduction of the voids programme. Over 8,000 homes have been remediated since 2014. The number of vacant homes returned to productive use was 2,696 in 2015 and 2,090 in 2016. The number of vacant homes returned to productive use so far in 2017 is 1,228. In addition to vacant social homes, there is a regular turnover of short-term vacancies in the social housing stock of local authorities. A modest amount of work is needed in such cases. In general, such vacancies are addressed by local authorities from their own resources.
According to the Minister, departmental statistics indicate that 8,517 long-term voids have been returned to use since 2014. According to the National Oversight and Audit Commission, NOAC, there were 4,202 voids in local authority housing stock in 2014, of which 1,082 were vacant pending regeneration - this includes O'Devaney Gardens - and 1,455 were in Dublin. If NOAC has said that the number of vacant properties was approximately 4,000 in 2014, how can the Minister say that 8,000 vacant houses have been remediated? In County Offaly, to take an example pertinent to our constituencies, 48 voids were recorded by NOAC in 2014, but departmental statistics suggest that 138 vacant properties were returned to use in 2017. In County Wicklow, ten voids were recorded by NOAC in 2014, but departmental statistics suggest that 97 vacant properties were returned to use in 2017. How can the Minister square this circle? The indication and implication is that huge work has been done to return 8,000 houses to use, but we know from NOAC that just 4,000 properties were void three years ago. We have to respect NOAC as the independent State organisation that has been put in place to adjudicate on such matters. This discrepancy can be added to the hazy Government statistics we have seen in recent years regarding the number of starts. When we looked at the figures emanating from other sources, those statistics were proven to have been built on sand.
We both acknowledge that the voids programme is an important piece of work. It is much cheaper for a local authority to get an empty social housing property that has been vacant, and could be vacant for a long time, back into use than it is to build a new property. When such homes become part of the social housing stock, people can be housed in them. It is important, in the interests of smart investment of public funding, to ensure local authorities are doing their work and managing their stock efficiently. The voids programme has brought over 8,000 units, which might otherwise not be in use today, back into social housing use. The difference between the NOAC figures and what we are doing is that the money we provide as funding for the voids programme is separate from what NOAC is counting. Some of the houses NOAC counted in 2014 might have been part of the 2016 and 2017 voids programmes. There is no discrepancy between the numbers. We fund the voids programme for local authorities to bring vacant units back into use. In my initial reply, I gave the Deputy the numbers for 2015, 2016 and to date in 2017. Over 8,000 homes have been remediated since 2014. We still have a voids programme to complete under Rebuilding Ireland over the next three years. This will bring more voids back into use. As we get towards the end of Rebuilding Ireland, that number will decrease dramatically as we reach a point where most voids are back in use and local authorities are managing their stock much more efficiently.
We all share the aspiration that there should be no voids in circulation. This scheme has received €85 million in Government funding. There appears to be double-counting. If the Minister cannot explain this sharp divergence orally, maybe he will put it in writing. The figure provided by an independent body is half the figure provided by the Department. It does not add up. We need to know. If there is doubt, the Minister should bring clarity. There is too much at stake, including a great deal of money, for this to be hanging over us. It took long enough to get to the bottom of the statistics in respect of housing starts, when ESB figures were being used. Some €85 million has been set aside for these purposes. In 2014, NOAC told us that there were 4,000 void units. The Minister has told us that 8,000 such units have been put back into use. Despite his best intentions, I am afraid the explanation he has just given me does not cut it. If it is not possible to provide an explanation of this sharp divergence orally, I ask for it to be provided in writing. An independent authority with Government jurisdiction is giving one figure and a Department is giving a figure that is twice as big. Some €85 million is at stake.
We have put more than €100 million into the voids programme. The NOAC report counted voids at a point in time. We have given figures in respect of the voids we have funded through the local authorities to get such properties back into use. Of course that includes properties that became vacant after NOAC did its work in 2014. There is no discrepancy between the figures. We follow the money to see how it gets voids back into use. The important thing is that the voids are not being left vacant. They are being brought back into social housing use. NOAC did its work at a point in time in 2014. Since then, more houses have become vacant. We have funded local authorities to get those houses back into use.
4. Deputy Michael Healy-Rae asked the Minister for Housing, Planning and Local Government his plans with regard to the housing crisis (details supplied); and if he will make a statement on the matter. [52461/17]
It could be perceived that I possibly have a conflict with regard to the discussion on this question. The housing crisis and the associated problems are well known. We need to talk about solutions. How we can address these problems? What can we do on the ground to provide proper living facilities for people who are in crisis and are facing so much uncertainty in their living arrangements? I am dealing predominately with people who are on their own and need living units. I have heard it being discussed that the Government is considering the return of bedsits. There is nothing wrong with a bedsit if it is properly done. The main requirement I would have with regard to bedsits is that everyone is entitled to private bathroom and showering facilities, rather than shared facilities of the kind used many years ago. I do not want to see a return to that type of situation.
Arising from a commitment I gave in October, my Department established a technical working group to update national policy advice on apartment developments and to identify and assess innovative solutions to our current accommodation pressures over and above conventional housing and apartment developments. The work of this group is nearing completion and will feed into the publication of new statutory guidelines for planning authorities by the end of the year. This will clarify planning policy in the build-to-rent sector, including the scope for innovative shared accommodation models where residents have their own living accommodation and bathrooms but may share larger kitchen facilities and communal recreation, meeting and working areas.
Bedsits were permitted in the past, but we have now moved on to rental accommodation standards which require that residents can avail of their own toilet and washing facilities, as opposed to shared facilities. The number of bedsits has reduced significantly in recent years. I am considering how remaining units might be brought into use, while respecting modern standards. As the Deputy has pointed out, we need a broad range of housing solutions to meet the various aspects of our current housing challenges and the changing accommodation needs of people at different stages of their lives. We need to free ourselves from the mindset that everyone should live in a conventional three-bedroom house or self-contained apartment at every stage of their lives. We know that alternative models work in other cities. The work that is under way to update our guidelines is designed to provide a framework for such models to work in Ireland.
A small unit may be very comfortable and easy to maintain for a person living on their own, or a couple. What exactly is the Government proposing to do to reduce the guidelines nationally for the size required and actually encourage people to provide such units, which will be well ventilated, easy to heat and have nice modern bathrooms? People with mobility problems should also be considered, and those progressing such developments should always try to ensure that there is a balance to cater for people with medical issues.
This has been going on for months and there have been many delays. The Minister mentioned the end of the year. The Dáil is finishing next week, presumably. Can the Minister clearly state whether the guidelines will be published for the benefit of people who wish to provide such units? We have heard a lot of talk. This is a crisis. Will the Minister say if he is announcing the guidelines next week?
When we talk about what we are trying to do with the guidelines and standards for apartment development and new types of living we are not just talking about the immediate crisis. We are actually making sure that we can future-proof the growth of the country out to the 2040s. This ties in with the national planning framework which is being developed at the moment. It is my intention to make sure that these new standards are in place and that all the necessary assessments will have been carried out by the time the new planning framework is published. At the moment we are working towards the finalisation of the national planning framework, but we are also very close to publishing the new guidelines for apartment building. They will look at the 2015 guidelines as they currently stand and the changes that will be made, to cover things such as car parking spaces. The guidelines may also cover the size of apartments and the number of studio apartments in an overall development. Aside from those guidelines we are looking at build-to-rent guidelines, which is one of the new, innovative developments I spoke about which exist in other cities. We can have different guidelines in a build-to-rent sector because people are not buying these properties for life but are living in them for two or three years, or perhaps longer, which means that different requirements to those in operation for bought properties are possible.
On the specific issue raised by the Deputy in terms of the return of bedsits, people are worried because they are associated with low standards. Both the Deputy and I would agree that people should have access to their own exclusive washing and toilet facilities, and so what we are looking at as part of the guidelines is how we can achieve that in a different way to what has been done in the past. We are also looking at what role there might be for the repair and leasing scheme in terms of social housing. We will have those details very shortly.
I appreciate the Minister's response, but why is it that when a person becomes a Minister they find it more difficult to give a straight answer? The Minister spoke about the end of the year. Is he talking about next week? People want to work. They want to provide units. A lot of operations around this country are on hold. The pause button has been pressed, because everyone is waiting to see what the Government will do. I have been asking the Minister about this matter over a long period of time on behalf of people who are coming to me to say that they are ready to go and ready to put in a planning application, but who want to know under what constraints they will have to operate.
The Minister knows that when we are talking about housing we are talking about people who might come up from the countryside who get a job in Dublin. That person might be happy to live in a bedsit for a number of years until they are established and get up the rank a bit, save a bit of money and are able to provide different accommodation for themselves. It is all about using common sense. The outright ban on bedsits is wrong and it is costing us in terms of the provision of housing units which could be completed to high standards.
I believe people would be happy to live in a bedsit as long as they had exclusive access to their own washing facilities.
I agree.
To do that will require a change in the guidelines. I accept that we have had to take a brief pause here, but we are talking about the development of our country for the next 20 years and it is important that we get these new guidelines right, so that when they come into operation people will know exactly what the standards are and what they are building to for the next five, ten and 15 years. There is a huge amount of investment happening already. We know from our interactions with the private sector that there is a huge amount of interest in what the new guidelines will be, and that a potentially significant number of applications will come in off the back of those guidelines. The guidelines will be published very shortly. My hope is to bring something to Cabinet the week after next. I understand that since I announced this in October there has been a brief period of pause. I believe that people can wait a week or two more to make sure that we can get the right guidelines out and implement them in tandem with the publication of the national planning framework.
5. Deputy Catherine Murphy asked the Minister for Housing, Planning and Local Government his department's expenditure on all rental supports (details supplied) for 2017; the projected expenditure on same for 2018, by rental support heading; and if he will make a statement on the matter. [52462/17]
I want to get information on the various housing support schemes, including the housing assistance payment, HAP, the rental accommodation scheme, RAS, and long-term leasing, to try and make sense of them for this year and next year. It would be useful to have projections into the future, because it would demonstrate whether or not this is a sustainable approach, even in the medium term.
Rebuilding Ireland sets out that some 87,000 households will have their housing needs met by local authorities, using either the Rental Accommodation Scheme, RAS, or the Housing Assistance Payment, HAP, over the period to 2021.
Exchequer funding for HAP in 2017 is €152.7 million. This will meet the continuing costs of existing HAP households at the start of the year and support well in excess of 15,000 additional households under the scheme in 2017. Funding for the HAP in 2018 will increase to €301 million, supporting an additional 17,000 households under the scheme next year.
Funding for the RAS in 2017 is €134 million, supporting over 20,000 households under the scheme. Similar funding will be provided for 2018, providing for 600 new transfers and ongoing costs. The decreasing number of annual transfers from rent supplement to the RAS is indicative of the increasing number of transfers from rent supplement to the HAP.
Long-term leasing is also an important component of the suite of delivery options available to local authorities in meeting housing needs, the costs of which are met from my Department's Social Housing Current Expenditure Programme, SHCEP. Exchequer funding for the SHCEP in 2017 is €84 million, supporting the ongoing costs of over 8,000 homes secured from a range of delivery mechanisms. This funding also provides for new houses coming into the scheme in 2017, of which 600 are targeted to be long term leases from private owners. An allocation of €115 million has been secured for 2018 which will support ongoing costs of the programme, together with additional social housing homes coming into the scheme next year, of which 2,000 are to be delivered under long-term leasing.
Responsibility for the operation of the rent supplement scheme rests with my colleague, the Minister for Employment Affairs and Social Protection.
A large amount of money has been announced for Rebuilding Ireland. We are trying to desegregate the capital from the current. Increasingly we are seeing the current amount growing, and given the amount of precarious employment, including zero-hour contracts, low-hour contracts and temporary employment, more people will qualify. The number is growing, and the housing model becomes unsustainable into the future because more and more money will be used for the current side as opposed to the capital side. It becomes an unsustainable housing model which really supports private landlords as opposed to a longer term approach. I accept that we are in the middle of a crisis and it will take time to get out of that. However, we are going to make it more difficult to get out of if the money is all spent and committed into the future, which is the way that this has been approached.
With regard to the numbers, separating the RAS from the HAP is important because some people are simply moving from one to the other and so perhaps the numbers are being duplicated.
We are spending taxpayers' money on Rebuilding Ireland, building more houses and looking after people who are homeless. There is going to be a 46% increase in spending next year from the commitments we got in the budget. That amounts to €1.9 billion. Some €1.4 billion of that will be capital spending on social house building. That will deliver approximately 5,900 social housing homes through buildings and acquisitions. That covers local authority building, housing body building, Part 5 builds, void conversions and acquisitions. It amounts to 5,900 new houses being added to the permanent social housing stock. An additional 2,000 will be long-term leased for 25 to 30 years. Again, this is permanent social housing stock. In total there will be almost 8,000 homes next year which will be social housing providing secure homes and sustainable tenancies for people.
Clearly the HAP plays a big role in meeting these targets as well. There has been a lot of criticism about the HAP but there are a couple of things about it that are important to know. It gives flexibility to tenants who want that flexibility, and, from an administrative point of view, it saves costs for local authorities in terms of the new functions put in place. This means there is more money to go into other social housing supports. It also leads to better rental inspection standards because of the regulations in place for the HAP, and this is important. In the final two years of the Rebuilding Ireland plan, in 2020 and 2021, our reliance on the HAP for social housing will be less than our reliance on social house building, buying and long-term leasing.
There is an argument that spending to save is another approach. If social or affordable housing units were built there would be a quicker saving on that side and a more sustainable approach. We should be able to rely on the figures from the Department rather than doubt them, and there continues to be a doubt about some of the figures. I will table some parliamentary questions that might explore this further.
It continues to be said that there is sufficient flexibility to meet market demands. This does not bear fruit when we actually look at growing rents and the amount of money available. It is a double-edged sword because we do not want people who do not qualify for the HAP to face rent increases, which are not sustainable either. I dispute that it is flexible enough, and the reason it is not flexible enough is because of insufficient supply. There is no solution other than building on a much larger scale than has been announced. The Minister spoke about 46% more, but this is from a low base. It gives an impression rather than being the scale that is needed.
Building is happening at quite a dramatic scale. When I publish the figures for the work we have done on the social housing side for this year it will show us exceeding almost all of our targets. We also have ambitious plans for 2018. I ask the Deputy not to casually question the Department's numbers. This is important-----
I am not casually questioning them.
Seriously questioning them.
If they are wrong we are right to question them.
Of course it is important to ask questions when we publish the data, but it is also important not to casually think we may have a problem with numbers.
We do.
We publish our numbers regularly.
We have a problem with the numbers.
The Minister without interruption.
We regularly have a problem with numbers.
We publish our numbers regularly. We think it is important that we all work from the same data.
With regard to flexibility around the HAP payments, of course there is flexibility to go to an additional 20% above what the HAP allows for in terms of market rent. In Kildare, this has happened in approximately 39% of cases, and payments have gone to 14% above what was the rent at the time. It shows that the HAP is working in terms of providing flexibility. Almost all of the indicators we have for social house building and for private house building show a very positive increase. Planning permissions have increased by almost 50%, construction commencement notices have increased by almost 30%, and we have a greater number of ESB connections, not just in Dublin but around the country.
That is not reliable.
All of these indicators are positive in terms of increased activity.
