Before we resume for Leaders' Questions, Members and all in attendance are asked to exercise personal responsibility in respect of protecting themselves and others from the risk of contracting Covid-19. Members are strongly advised to practice good hand hygiene and observe the chequerboard seating arrangement. They should also maintain an appropriate level of social distancing during and after the sitting. Masks, preferably of medical grade, should be worn at all times during the sitting, except when speaking. I ask for Members' full co-operation, as usual, in this regard. I thank Members.
Ceisteanna ó Cheannairí - Leaders' Questions
House prices, as the Tánaiste knows, are out of control and homeownership continues to be in decline. He and his partners have been in government for ten years and during that period, house prices have increased by 42%. In Dublin city the increase is a shocking 88%. Thanks to Fine Gael housing policy it is now more difficult to buy a home than ever before. Fine Gael claims to the be the party of homeownership and to represent people who get up early in the morning to go to work. However, under its watch fewer working people than ever can afford to put a roof over their heads. Couples are paying sky-high rents while struggling to save for a deposit. Single people, even those on good incomes, are completely locked out of the market. Those who are separated or divorced and have lost the family home are facing the steep climb of a 20% deposit. Families who lost their home after the crash are facing a future of insecure and expensive renting. Despite the Fine Gael's promise of making homeownership a reality it has done the very opposite. Pro-developer help-to-buy tax breaks and shared equity loans have pushed up house prices. Not a single affordable home was delivered through any central Government scheme while the Tánaiste was Taoiseach. Just a handful of affordable homes to by will be delivered this year. Budget 2022 included an embarrassingly low level of investment in affordable homes to buy next year.
As if all this was not bad enough, we now learn that house prices in Dublin are set to increase by as much as 25% in the coming years. Dublin City Council, as part of its development plan review, commissioned KPMG to assess both the future need and cost of housing in the city. The report revealed by Killian Woods in the Business Post last Sunday was truly frightening. Average house prices are set to rise every year from now until 2028 to a staggering €575,000. You would need an income of €148,000 to buy a home at that price. Even if you availed of the full shared equity loan payment of €90,000 you would still need a household income of €122,000 to afford that home. At these prices, the vast majority of people will not be able to buy a home in the capital. Meanwhile, the same report says rents in Dublin will continue to soar. By 2028 the median rent could be as has as €2,412 per month, according to the report. For this to be affordable, you would need a take-home pay of over €7,000 per month. This report is based on the most up-to-date data from the Central Statistics Office, CSO, and the Economic and Social Research Institute, ESRI. It was published after the Tánaiste and his colleagues announced their new housing plan and proves beyond any doubt their housing policy is a failure.
My questions are very simple. Do the Tánaiste and the Government accept the findings of this significant KPMG report and what are they going to do, that they are not already proposing, to bring house prices down so working people can afford to put a roof over their heads in the capital in the years to come?
I thank the Deputy. I am afraid I have not had a chance to see the report yet. I have seen some media coverage of it but I have not read it myself. It is not my practice to comment on a report until I have had a chance to read it or at least read the executive summary, which I have not at this stage. It seems the premise of the Deputy's question is the report must be correct and therefore things are definitely going to turn out that way. I definitely do not accept that. How things turn out will depend on a number of factors, including what happens with our economy with respect to wages, employment and many other things and also what happens with housing policy. So I am not sure whether that report is predictive or not but it certainly does not have to be.
One thing I absolutely agree with the Deputy on is that house prices in Ireland are very high. They are too high and are out of reach for very many people who are not able build a home. The most effective thing we can do to bring prices under control is additional supply. Supply on its own will not bring down house prices but we will not bring down prices without additional supply because there is a very high demand for housing in a country with a growing population and a population in which new households are being formed all the time. Supply is therefore the crucial element of bringing house prices under control but not the only element. We need additional supply because of the huge deficit of housing we have due to our having had a prolonged period where very few homes were built due to the collapse of the banking system and the construction sector over ten years ago. We need homes of all types. We need social housing for people on the housing list. That also helps free up homes for others to rent and buy. We need public housing, such as cost rental, which is now happening for the first time. Government-led affordable housing schemes which were not happening years ago are happening now. There is additional private housing as well. We need homes of all types, including one-beds, two-beds and more but we especially need one- and two-beds, given the shape of our population relative to the type of housing available.
It is encouraging we are seeing an increase in housing supply in the past 12 months, notwithstanding the fact we are experiencing a pandemic and there have been restrictions on supplies and construction. About 30,000 new homes have gone to construction in the past year. That is really encouraging because we know from reports we need to get to around 35,000 or 40,000 additional homes per year for supply to meet demand. It seems we are getting there. It will be a while before we get there but it seems we are getting there. I know the Deputy will want to join me in recognising the fact we have seen a very big increase in the supply of new homes in recent years, notwithstanding the objections of some to many of those developments.
This Government is committed to homeownership, as is my party. We have set a target of trying to get back to 70% homeownership in the State. Sinn Féin does not agree with that target. If it does then I am sure Deputy Ó Broin will say so. How do we do it? There is the help-to-buy scheme, which he opposes. I disagree with him. Between 20,000 and 30,000 young people, families, couples and single people who have been helped to get their deposit with that scheme would not agree with the Deputy. It would be a shame if a Sinn Féin-led Government were to take that away because we think it has helped many people to buy their first home. The shared equity loan scheme is going to become a reality. The Deputy may oppose it but people in his constituency and mine will vote with their feet in their hundreds and take up this scheme. Instead of paying a lot of rent every month they are going to be paying a mortgage towards a home they can buy. Another area is the Rebuilding Ireland home loan or the local authority home loan. This gives people a mortgage when they cannot get one from the banks. Again, that is a very successful scheme and one we need to expand. The fourth aspect is of course supply. Ultimately, we will not get house prices under control or increase homeownership unless we have adequate supply. That is why I appeal once again to the Deputy's party to stop opposing housing developments and to support them, because that is what people need.
I thank the Tánaiste. What he does not seem to understand is the KPMG report is based on this Government meeting the targets outlined in its recent housing plan. What the report, which is based on the most up-to-date information from the CSO and ESRI and all the Government's target projections for social, affordable and private housing, is saying very clearly to the Government is that even if all that happens house prices are still going to increase by 25%. I appreciate it is not the Tánaiste's portfolio but I am genuinely surprised somebody who prepares Leaders' Questions did not give him some indication of whether the report is worthy of consideration or not.
The central problem here is the Government is not doing the one thing it needs to do. It is not investing enough in the direct delivery of genuinely affordable homes. Next year, only €130 million will be invested by this Government in affordable homes. Its target is 1,250. We need about 8,000 genuinely affordable homes every year to reverse the trend in this report. It gives me little comfort, and I suspect it gives the people who are desperate to own their own home little comfort, that while the Tánaiste claims to be on their side everything the Government is doing, as confirmed in this KPMG report, shows house prices will continue to rise. Will the Government at least consider reviewing and increasing the direct investment in affordable homes so the paltry targets in its new housing plan can be revised upwards?
Government investment in housing happens in many different ways. There is investment in forms of public housing like, for example, cost rental, which the Deputy did not mention in his remarks. That is now a reality and a scheme people can avail of. We need much more of that. The Deputy will see affordable housing schemes led by Government being rolled out across the country over the next few months. The first have happened already. There is also investment in social housing.
I welcome that it is now widely acknowledged that we are seeing record levels of investment in social housing by this Government. It was not that long ago, in 2015 or 2016, when only 600 new social homes were being built in the country every year. That was when my party came into Government and Deputy Simon Coveney took over the Department of Housing, Planning, Community and Local Government. Under this Government, approximately 10,000 new social homes are being provided every year, possibly even more. That is a step change. We are seeing housing waiting lists go down and hundreds of people and families receiving social housing every month. That is not just for their benefit. It is to their benefit as it takes them off the housing list, but it also has a wider societal benefit because it frees up other homes for people to rent and buy. It is, therefore, an investment that assists everyone.
We are all braced to see if the National Public Health Emergency Team, NPHET, recommend further restrictions later today to suppress Covid. Media reports suggest that the level of socialising during the Christmas period could be the target of that advice. We are told this could extend to new limits on the numbers allowed in hospitality settings, reduced booking sizes and even reduced opening hours. This amounts to death by a thousand cuts for the hospitality and entertainment sectors. The late night sector has already been, in effect, shut down after just about three weeks of being open. The hospitality, entertainment and tourism sectors are struggling to cope with the wave of cancellations after NPHET and the Government appealed to people to reduce their social contacts.
While the advice was undoubtedly necessary to stem the steep increase in Covid cases, it came with a very real cost. Previously, when public health advice put limits on the ability of businesses to trade, the Government stepped in with business supports. This was in recognition of the fact that businesses were acting to their financial detriment in an effort to protect public health. However, the situation we now find ourselves in is different. The public has heeded the advice and restrictions are being announced, but the supports to cushion the financial blow of these restrictions are either being withdrawn or eroded. There is an inherent hypocrisy in this on the part of the Government. Restrictions are still deemed necessary to suppress Covid transmission, but supports for workers and businesses are being phased out.
The Tánaiste enthuses about personal responsibility as a means of suppressing Covid, but what about the Government's responsibility? The pandemic unemployment payment, PUP, has long been closed to new entrants and has already been cut twice to its current level of €250. The employment wage subsidy scheme, EWSS, which has been a vital lifeline for business, has now been slashed. Wage subsidies that were paid to nearly 30,000 employees were cut yesterday just a few weeks before Christmas. Previously, there were four rates of €203, €250, €303 and €350 a week, but these have now been reduced to two flat rates of €150 and €203.
Why did the Government proceed with these cuts, given the restrictions are still being announced? Why is there not a targeted approach? Is there now some kind of Darwinian survival-of-the-fittest approach towards the businesses that can withstand this new fourth wave and what it will bring to some of the ones that will survive? Will the Tánaiste commit to restoring EWSS rates for those businesses that can demonstrate they need continued support and PUP for those workers who have lost their jobs because of public health advice?
I thank the Deputy for her questions. As she knows, NPHET will meet today. It will formulate its advice after that meeting and a letter will be written to the Minister for Health. Once the Government has received advice from NPHET, it will consider it and make a decision on its implementation. As part of those considerations, we will have to make decisions regarding the pandemic unemployment payment, the employment wage subsidy scheme and other financial supports that businesses may need. It is prudent to see what the advice will be and how it will impact on people and businesses before deciding what our response will be in respect of financial support for workers and business. I do not want to pre-empt the outcome of that meeting, which has not even happened yet.
It is important to say the pandemic unemployment payment has given people vital income support throughout this pandemic. I was present the day it was invented, along with then Minister for Employment Affairs and Social Protection, Regina Doherty, and then Minister for Finance and Public Expenditure and Reform, Paschal Donohoe. I am glad we did it. It made a big difference and was very necessary. At peak, 650,000 people were in receipt of it; we are down to approximately 60,000 people now. If it is the case that people end up being laid off or are made redundant over the course of the next few weeks, and I am not saying that will happen, we will need to respond to that. It would not be fair to say to those people, some of whom are potentially being laid off for the second or third time, that all we have for them is the traditional jobseeker's payment. That is my view.
We have to give close consideration to what we may do about the employment wage subsidy scheme. It should be borne in mind that 2.4 million people are now at work in Ireland, which is close to more than ever before, believe it or not. Most business owners I encounter tell me they are struggling to find staff. That is the economic context in which we are now operating. Most of the companies that benefit from the wage subsidy scheme are not in the hospitality, arts and entertainment sectors. We have to bear that in mind too. It would appear that one of the difficulties with the employment wage subsidy scheme is that it cannot be broken down on a sectoral basis. We will get more information from the Revenue Commissioners on that.
It is important that anything we do is targeted at workers who may be affected and at businesses in the affected sectors. It should not necessarily be a cross-economy approach for sectors that may not need these financial supports anymore, which are ultimately very expensive and at cost to the taxpayer. The employment wage subsidy scheme, for example, costs €400 million a month, which is a huge amount of money. We need to make sure anything we do is targeted at the businesses and sectors that need support and not those that do not.
People, in their droves, heeded the advice from NPHET and the Government to reduce their contacts. People have been cancelling, for example, Christmas parties, going to events and so on. One of the people who contacted me, and I am sure people in the same situation are contacting the Tánaiste, told me that 80% of his or her bookings have vanished, with the expectation that another 20% will go in the coming days. This individual said it is a very stressful time for his or her employees. This person is talking about possibly having to close the business and whether it will survive Christmas. This was going to be the month that would help that business over the lean months in early new year. The person who contacted me talked about the increases in utility bills, food costs, overheads such as insurance, and all of that.
I am not saying these payments should not be targeted. There needs to be targeted supports for these sectors, which enrich our towns, villages and tourism offering. In essence, the problem is we cannot afford to lose these businesses but they cannot afford to keep the doors open either. Will the Tánaiste commit to giving particular consideration to those industries that are already seeing a serious hit, even without the advice coming from NPHET?
I am happy to give that commitment to the Deputy today. How we realise that commitment and what form it takes will depend on the advice we receive today from NPHET. It did not make sense to the Government to announce a set of financial supports for businesses on Tuesday, only to receive advice from NPHET on Thursday and then change supports again on Friday. It made sense to wait to see what the advice from NPHET is today. We will do that.
I acknowledge the truth in what the Deputy said, which is that even though we have not closed any businesses, people are voting with their feet. A huge number of bookings have been cancelled in restaurants and bars, as have a large number of parties and events. People are even cancelling trips away, in the country and abroad. That is having a significant economic impact on those businesses and workers. For the hospitality sector, Christmas is the harvest. It is the time businesses essentially make money to get them through a tough period, usually in the early part of the new year. The Government recognises that, but exactly what we do regarding EWSS, PUP, the Covid restrictions support scheme, CRSS, commercial rates and all those things has to be targeted. We are at the point where we will be able to make decisions in the next couple of days.
The LEADER programme is a key rural development for supporting the economic, social and environmental development of our communities and provides the resources necessary for rural communities to support their own development and create capacity at local level. For more than 30 years, this LEADER programme, delivered by the local development companies, has maximised the drawdown of the money available and the impact of the EU funds to create jobs in rural Ireland and develop rural communities in keeping with the LEADER approach. This programme has been evaluated as an excellent and successful funding mechanism by the European Union institutions.
The aim of the LEADER programme 2023 to 2027, as identified in the draft CAP strategic plan, is to continue to support community-led local development and this approach to rural development, by animating and funding initiatives that emerge at local level to address local challenges and needs. It is very worrying to think that the draft CAP strategic plan, which is now out there in the domain, is allocating an indicative budget of €180 million. This is a reduction of €250 million from the previous programme and €425 million from the 2013 programme.
Many rural communities have benefitted enormously from this LEADER programme. We are flying in the face of rural development and the rural future if we reduce the LEADER funding, when we have highlighted it in Our Rural Future as a key enabler to developing rural Ireland. Many people have benefited and many jobs have been created throughout the country from this. Even in the Tánaiste's time as Minister for Social Protection, he saw some of the great work that was being done as he travelled the country.
It is important we look at this funding and how much money we are now giving out, bearing in mind that inflation has not been taken into account. If one adds up what is happening here, we are less than halving the funding available in the next five years from what was available in 2009 to 2013. It is worrying and a wrong indication to be giving. I ask the Tánaiste to look at the funding and look to make sure we are providing an adequate source of funding to a scheme that is successful, has the management skills from the local development companies on the ground, has built up the expertise and is creating real changes in our communities.
I thank Deputy Canney for raising the important issue of LEADER programmes. All of us in this House are fully aware of the value and impact of the LEADER programme in towns, villages and parishes across Ireland and especially rural Ireland. Having had the opportunity to travel to most parts of the country, from Caherlistrane to Cahersiveen, I have seen first-hand the positive impact LEADER funding has on communities and I am pleased to see that a small, rural part of my constituency, the Westmanstown and Strawberry Beds area, will be included in the LEADER programme for the next period.
As we know, it is a locally-led, bottom-up scheme which meets the needs of local communities and businesses. The bottom-up approach has formed part of the policy framework for rural development in Ireland since its inception in the early 1990s and will continue to be an important element of Ireland's new Common Agricultural Policy strategic plan. The Department of Rural and Community Development, under the leadership of the Minister, Deputy Humphreys, is engaged in designing a new LEADER programme as part of the CAP strategic plan, CSP, for 2023 to 2027 and stakeholder consultation will be an important element of this.
In the 2014 to 2020 CAP programme period, €250 million was allocated to LEADER. From the period 2021 to 2027, this funding allocation will be maintained. This is comprised of €70 million being provided from the transitional period from 2021-22 and the recently announced indicative allocation of €180 million for the period 2022 to 2027. Rather than a decrease in LEADER funding, the Department of Rural and Community Development would strongly argue we are ring-fencing funding at €250 million and that is evidence of the Government's continued commitment to the programme.
The Government will continue to invest in rural Ireland and rural development. Capital funding allocations for the Department of Rural and Community Development have seen an increase from €88 million in 2018, when the Department was formed, to €205 million in 2025, under the national development plan. It is important to acknowledge we can fund rural development through many programmes and not just LEADER and that more than doubling of funding from 2018 to 2025 is in an indication of that.
The Tánaiste is taking some figures and telling me that €250 million is available in the programme, but when one takes the yearly average over seven years, the average annual allocation in the proposed CAP will be €36 million. In 2014 to 2020, it was €50 million per annum. The Tánaiste said he is including the two transition years so it is a seven-year span. Effectively, we are in reduction mode. What will that mean? It will mean that rural communities will be deprived of critical capacity-building supports and funding for vital enterprise, tourism and community-led projects. More than 5,000 projects have been supported in the most recent programme period. Weaker communities and certain groups will be left behind, including youth, women, older people and many social enterprises, which LEADER has been able to support to date. We need to look at the figures of how much will be given per annum over the next five years.
Some €70 million has been allocated to the transitional programme for LEADER for 2021-22. This transitional funding is in place due to delays at EU level in agreeing the new regulations for the CAP period running to 2027 and it has been ensured there is no gap in LEADER funding or provision due to the delay in agreeing the new CAP. An additional indicative indication of €180 million for LEADER has recently been announced, bringing the total allocation for 2021 to 2027 to €250 million. The Department of Rural and Community Development continues to invest heavily in rural Ireland and rural development and it is important we acknowledge that rural programmes are funded from many different schemes. LEADER is one, a very important one, but just one of those schemes. The budget for 2022 sees an increase in funding for rural development in the round, with some €200 million in funding being allocated to the Department's programmes. These include town and village renewal, CLÁR, ARAS, LEADER, the walks scheme and of course, the rural development fund. Under the national development plan, Project Ireland 2040, capital funding for the Department will be almost €600 million for the period running from 2023 to 2025, the remainder of this Government's term in office.
I am glad to get the opportunity today to raise this and ask the Tánaiste for increased funding to deal with local improvement scheme applications in Kerry next year. It is only just around the corner. Some 678 schemes are on the list and were applied for in 2018. More than 90 of them are on a list since 2007 and were included in the 2018 scheme. These are public roads which were never taken in charge by the local authority. They are not private roads. Some 20 or more homes are on many of these roads and nine or more farmers are using them on a daily basis to access their homes.
We got an increased allocation of approximately €480,000 last year which brought us up to €1,187,099. We got 19 roads done last year, to a high standard, by Kerry County Council, which does a very good job. However, there has been no element of funding for emergency hardship schemes which was always made available through the local improvement scheme, LIS. The people who live on these roads pay all their taxes; road, property, PAYE and income tax.
They pay their way and they have no public transport. Farmers pay water charges and have to pay more to get their cars through the NCT because of damage and more wear and tear on bad roads. All I ask on behalf of the people of Kerry is fair play. Smaller counties with fewer applications are getting more funding to do their roads. I will not name them as I do not want to put any other county down to put Kerry up. I ask for fairness for the people of Kerry.
I ask the Government to be fair to people in these rural areas. People living on these roads are entitled to good roads to their door, the same as people in Dublin 4. These roads are not private; they are public. There are carers, nurses and doctors using them to get to people who are sick on a daily basis or several times a day to keep people living at home. This is a serious matter. They have no option other than to use these roads. They want to stay living in these places as long as they can but we must do our bit to help them. Over the years, the Department made 80% of the funding available. They will pay their contribution. They have never refused to do so. I thank the Tánaiste.
I thank the Deputy. The local improvement scheme is an important transport scheme. It provides for the improvement of roads all over the country which are not formally taken in charge by the local authority but which, were they in urban areas, probably would be because they access multiple households and, in some cases, multiple farms and businesses. A total of €10.5 million was provided for the scheme in 2021, which was double the allocation seen, for example, ten years ago. An extra €10.5 million was also granted during the year. Kerry County Council got an increase based on what it applied for when invited.
I cannot give any commitments for next year but I will talk to the Minister, Deputy Humphreys, about this. I know Deputies Danny Healy-Rae, Michael Healy-Rae, Griffin and Foley are all ad idem that they would like to see additional funding for the LIS in Kerry and across the country through the course of 2022.
I undertake to speak to the Ministers, Deputy Humphreys and Michael McGrath, about that because we will see unspent capital funding by many Departments this year and probably next year. The LIS is a good scheme to divert money into during the course of the year. If a Department cannot spend its capital allocation for some reason, perhaps because a big project is delayed or there is some issue like that, the LIS is the perfect scheme to divert money into so allocations do not go unspent. I thank that will happen next year.
I thank the Tánaiste. In the past, we did 111 roads in two consecutive years. Kerry County Council has the capacity to deal with any funding that is left over and all the Deputies from Kerry will work together. I have raised this matter several times. If we only get 19 roads done every year, it will take us 35 or 36 years to get through the 678 roads left on the list. There are places like Kilcummin, Gneeveguilla, Scartaglin, Currow, Currans, Farranfore and Firies and all around south Kerry with multiple roads to be dealt with. These people need fair play. They pay everything they are asked to pay. I named out all the taxes they pay. They need assistance and fair play. Urban areas have all different modes of transport and fine roads but these people are left behind. Since 2007, there are 90 of these. If we have to wait 38 years, I will not be around. Deputy Griffin might, but many of us here will not be there if it takes that long. I ask for fair play. Other counties are doing better and we have to come up the line.
I thought for a minute the Deputy was going to name all 638 roads.
Do not tempt fate.
I know most of them.
I would say you do.
There was a prolonged period during the recession when the LIS was suspended. Things have changed and the budget last year was €10 million, with an additional €10 million. It was probably the highest budget for the LIS in many years. I am not sure why Kerry did not get more roads done. I do not know the intricacies and details of that.
We did not get the money.
It is important that local authorities make submissions for additional money. There will be a budget for the LIS next year. It is important that the work gets started in the spring or summer and is not left until the end of the year when sometimes it is too late. I envisage through the course of 2022 that if we see there are underspends in particular Departments and those Departments are not able to proceed with certain capital works, this is an ideal scheme, among others, to put additional money into. I encourage local authorities to get ready for that and have projects ready to bid for additional funding, should it become available.
I thank the Tánaiste and I thank Deputy Ring for reactivating the scheme.
That concludes Leaders' Questions more or less on time, so congratulations to everyone.