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JOINT COMMITTEE ON ENVIRONMENT AND LOCAL GOVERNMENT debate -
Wednesday, 28 Mar 2007

Affordable Housing: Discussion with Affordable Homes Partnership and Department of the Environment, Heritage and Local Government.

I welcome Mr. Des Dowling, assistant secretary, and Mr. John McCarthy, principal officer, at the Department of the Environment, Heritage and Local Government, and Mr. Des Geraghty, chairman, and Mr. John O'Connor, chief executive officer, of the Affordable Homes Partnership. I thank them all for attending today's meeting. The format of the meeting will involve an introduction by officials from the Department followed by a brief presentation by Mr. Geraghty. After the presentations there will be a brief question and answer session with the members.

Before the presentations begin, I draw attention to the fact that while members of the committee have absolute privilege the same privilege does not apply to witnesses appearing before the committee. Members are reminded of the long-standing parliamentary practice to the effect that Members should not comment on, criticise or make charges against a person outside the Houses or an official by name or in such a way as to make him or her identifiable.

Mr. Des Dowling

While Mr. Des Geraghty, chairperson of the Affordable Homes Partnership, will deliver the main presentation, I will give a brief background to the establishment of the partnership. As members will be aware, despite record supply of new homes over the past ten years, very strong demand for housing underpinned by a range of factors has resulted in significant upward pressure on house prices for a number of years. The price increases and consequent affordability pressures have been at their most acute in the greater Dublin area.

While a range of measures were in place to respond to this situation, in mid-2005 the Government decided that an additional impetus was required to galvanise and supplement the various affordable housing activities in the greater Dublin area. This took into account a range of analyses, including work undertaken for the four Dublin local authorities. Against that background, the Affordable Homes Partnership was established as a corporate body under the Local Government Services (Corporate Bodies) Act 1971. Designed as a small, tightly focused organisation which would work closely with the local authorities in the region, it has been tasked with accelerating and increasing the level of affordable housing in the greater Dublin area, with a particular focus on the Dublin metropolitan area.

Under its establishment order, the board of the partnership is appointed by the Minister for the Environment, Heritage and Local Government. Apart from the chairperson and the chief executive, the board comprises seven other members, including the managers of the four Dublin local authorities. To get the organisation established quickly, we were fortunate the former Dublin city manager made available to the partnership the services of one of the city council's experienced executive managers, Mr. John O'Connor, to act as interim chief executive. Mr. O'Connor has since been appointed as chief executive following a competitive recruitment process.

Supported through an Exchequer grant provided through the Vote of the Department of the Environment, Heritage and Local Government, the partnership has been working effectively since its establishment. The annual report and accounts for 2005, which have been presented to the committee, cover only the first five months of the partnership's operations. Nonetheless, they relate to a period when the partnership made considerable early progress and I record our thanks to the chairperson for the leadership he has provided to the organisation, the board, the chief executive and his team for the work they have been doing.

The chairperson, Mr. Geraghty, will now outline in more detail the functions of the partnership and the activities in which it has been involved.

Mr. Des Geraghty

I thank the Chairman and members of the committee for the opportunity to outline the work and activities of the Affordable Homes Partnership. The primary purpose of the partnership is to co-ordinate and drive the delivery of affordable homes in the greater Dublin area. We provide services for the local authorities in Dublin, Kildare, Meath and Wicklow and also for the Minister for the Environment, Heritage and Local Government. Our functions include co-ordinating and promoting the delivery of affordable housing; increasing the supply through land management initiatives, involving both public and private land; establishing a common approach to Part V, which is the mechanism under which up to 20% of private housing developments can be earmarked for social and affordable housing; and developing clear communications on the availability of affordable homes to the public.

Our primary focus is on the delivery of affordable homes. I stress homes rather than houses because it is not a property issue for us. A range of schemes has been introduced by the Department in this regard, including the shared ownership scheme, the 1999 affordable housing scheme, Part V and the affordable housing initiative. The partnership, along with the local authorities involved, took action to accelerate delivery in a number of ways. First, three small State land sites, which were made available by the Government, were exchanged for discounted housing. This eventually provided 497 homes. In addition, at the request of the Department, the partnership purchased 500 homes on the open market in the greater Dublin area. These will be provided at discounts of €100,000 to affordable home purchasers.

The most important factor in making housing affordable is the availability and cost of land. One specific land initiative taken by the partnership was to seek private land under a so-called call for lands exercise initiated in November 2005. This sought proposals from landowners to develop their lands to provide a minimum of 70% affordable homes. In January this year, we made recommendations to two local authorities for sites in Lucan and Killiney. These recommendations are subject to variations of the respective county development plans. These two sites have the potential to deliver approximately 1,100 affordable homes. These, along with other sites deemed appropriate, have the potential to deliver 4,000 homes, 70% of which would be affordable.

Part V is probably the most important initiative for the long-term delivery of both social housing and affordable housing. The partnership, along with the Department, undertook a significant amount of work to achieve a common approach to Part V. This involved consultation with both the construction industry and the local authorities. A comprehensive resource pack outlining best practice in this regard was issued last year, based on an approach agreed by both sides. It was difficult to come to such an agreement, but it was done successfully.

The partnership provides ongoing support for local areas in respect of Part V. The method of delivery is not particularly relevant for the public, specifically those seeking an opportunity to own a home who are unable to purchase on the open market. One of the partnership's most important functions is to provide information for the general public on affordable homes. In association with the Department, the partnership issued a user-friendly national guide to affordable homes last year. It has been widely utilised. The partnership continues to inform the public and make every effort to simplify the system. A common application form has been agreed by the local authorities in the greater Dublin area and there are plans to seek national agreement on the form. Various application forms have been used by local authorities up to now.

I reiterate that the partnership's aim is to make homes available at an affordable price to those who are looking for somewhere to live. I thank those who have supported and assisted the partnership to date. In particular, I thank the local authorities, with which we work closely, the Department of the Environment, Heritage and Local Government, other Departments and the Irish Home Builders Association, with which we deal on a regular basis.

I welcome the representatives of the Affordable Homes Partnership and the Department of the Environment, Heritage and Local Government. I am pleased that Mr. Geraghty and Mr. O'Connor have made such good progress with their work. I support anything that sustains and supports that work.

I would like to ask a couple of questions about the operation of the affordable homes system. Problems with affordable housing are being experienced outside the areas to which the Affordable Homes Partnership's remit extends. They are evident in my home county of Louth, for example, which was not mentioned in the partnership's briefing document. I would like the influence of the partnership to be extended in order that it can work with local authorities in urban and rural parts of County Louth and adjoining counties. The significant problem we face is that we are dealing with the first generation of Dubliners who cannot afford to live in their own city and county. I hope the work of the partnership will continue to address this shameful issue.

Mr. Geraghty has mentioned that the tremendous Gormanston site, near County Louth, is under consideration. Will he expand on the problems, if any, which might be encountered in developing the site? I would have thought that it was ideally located near a railway station and a motorway. If it is developed, its residents will be able to use the available transport corridor to get to and from work. Can anything else be done to make further progress with this plan? I am not criticising the partnership in any way.

The Minister recently announced that he intended to introduce legislation to take from developers and owners land which was zoned and serviced but not developed. I am familiar with a desktop academic study of land hoarding. Will the partnership outline its views on what we should do about such hoarding in the greater Dublin area?

The national inventory of the performance of local authorities in respect of affordable housing found that some authorities were excellent and others very poor. Perhaps this would be a more appropriate matter to raise with Mr. Dowling from the Department of the Environment, Heritage and Local Government. What will be done about the variations in local authorities' performances? Can a case be made for getting the Affordable Homes Partnership to bring the local authorities which are not meeting the relevant criteria into the 21st century? I hasten to add that a number of them are meeting the criteria. I meet many young people who are finding it impossible to buy homes for their families. Somebody who bought a house in Ardee for €190,000 two years ago told me at the weekend that an identical house across the road was on the market for €390,000. People from the area cannot afford to buy such houses or compete in the market. People from towns in County Louth are moving to the countryside where cheaper houses can be bought. While the people from Dublin who are buying houses in urban parts of the county are welcome, they are pushing locals out of such areas. Those who are being pushed out of Dublin because it is too expensive are displacing local people in turn. This serious issue should be the subject of a proper study.

I would like to make a significant criticism of Part V. I am increasingly encountering extended developments on smaller sites which are exempt from the Part V requirements. Legislative change is needed to ensure those who build five or more dwellings such as apartments should be subject to the Part V requirements, regardless of the size of the footprint of the site. I know of developers who initially expected to contribute a house from a development to the local authority, but then found they were exempt. We need to examine this matter. I understand developments of five or more houses built in rural areas not zoned for housing are exempt from the Part V requirements. It is an increasingly significant issue.

I read in a newspaper today that a survey had found that just 20% of those living in apartments in the greater Dublin area were happy to be living in such dwellings and expected to continue to live in such circumstances. It seems that we are continuing to increase the number of high rise and high density developments, even though the quality of such environments is not sustaining a proper quality of life for those who live in them. The officials in the Department of the Environment, Heritage and Local Government and those involved in the political system need to insist that developments are of a high quality and have decent facilities. Certain apartments, including some I saw advertised in a newspaper this week, are so small that one of the posters of the Minister, Deputy Roche, would not fit in the door. I am making a joke, obviously. I ask our guests to respond to some of the points I have made.

Mr. Geraghty

I will refer some of the points made by Deputy O'Dowd to my colleagues. I am conscious of the problems associated with commuting to Dublin. It is environmentally disastrous that so many are on the road so early. We know about the problems associated with commuting. I do not doubt that a lack of affordable housing has driven many from the Dublin area. When one considers that it is expected that the average annual industrial wage will be approximately €33,000 this year and that the average house price in the Dublin area is approximately €400,000, it is clear that housing is not affordable for people with relatively good and stable jobs. The Affordable Homes Partnership is conscious of commuting problems. I am pleased that the partnership has relationships with the authorities in counties Wicklow, Meath and Kildare. Our remit does not extend to County Louth, incidentally. We are considering the development of a site that has been designated by the Government in Gormanston which is quite close to County Louth. That is a big issue. Mr. John O'Connor might comment on that site.

There is an ongoing political debate on the "use it or lose it" approach to zoned lands. The partnership does not have the power to take in charge unused lands. I would like the Department of the Environment, Heritage and Local Government to address the matter. Perhaps Mr. Des Dowling will comment on it. Legislation is being considered in this respect. An argument can be made in favour of the "use it or lose it" approach to lands on which people are sitting. There were constant complaints that people were sitting on large tracts of land which were not being used for housing developments. When the partnership published an advertisement inviting people in possession of such lands to come forward, it received 35 responses. We are pursuing approximately 12 of those sites. We gave people with unused land an opportunity to have it developed. We should do so again to constantly test the extent of availability in this respect.

I do not doubt that the uneven performance of local authorities is a particular problem in the Dublin area. I do not think any local authority could have anticipated in its original development plans the increases in this country's population and, especially, the labour force. The figures demonstrate that there has been a dramatic increase in the number at work, the number of foreign nationals working in Ireland and the number of small families, etc. No local authority has kept ahead of the exponential increase in demand. Education is needed in this area. Local authorities assume they are making adequate provision for housing when this is not the case.

The figures show that demand is consistent. Irrespective of whether the housing market is depressed, demand for homes is not depressed. The distinction to be made is that the number looking for homes is substantial and growing but the slackening in demand is due to a lack of affordability. This creates further problems for local authorities in terms of demand for social housing and rented accommodation.

The Affordable Homes Partnership has examined options for speeding up and improving delivery mechanisms and incentives for delivery at local authority level. This process is not complete.

Part V has been the subject of legitimate criticism because it has been interpreted unevenly. One of the positive outcomes from our consultations has been the finding that developers and house builders are anxious to understand how the system works. The partnership, notably Mr. O'Connor, has drafted detailed documents setting out a critical path for using Part V to maximise return. We have also engaged in educational activity, for example, we have held seminars attended by local planners and officials to try to develop a uniform approach which developers and builders are anxious to have.

I, too, was interested in the article on dissatisfaction with apartment living in Dublin in one of today's newspapers. There is no doubt, given land demand and population growth, that there is no alternative to building apartments in Dublin. Nevertheless, a range of issues must be re-examined. These include the management of apartment complexes, the amenities available to apartment dwellers, apartment design, including whether they are large enough for families, and the requirement to ensure communities are mixed and a proper balance is achieved. Local authorities and everyone interested in housing must examine these issues to ensure we achieve balanced, mixed communities and avoid the development of more ghettos. These are objectives of the partnership. When I was growing up, social problems were rampant in many of the flat complexes in Dublin. The partnership works strenuously to ensure all developments in which it is involved contain a mix of social, affordable, private rented apartments and so forth.

Mr. O'Connor will discuss the Gormanston site. The partnership's brief does not extend to County Louth.

Mr. John O’Connor

As the Gormanston site is extremely large, the partnership is taking care to ensure it is used wisely and obtains the best value from it. The site's industrial zoning was retained in the recently adopted County Meath development plan. The partnership has been observing developments in respect of Bremore Port. If the port is developed, as expected, it will have major implications for the site. For this reason, the partnership will await the firming up of Meath County Council's zoning decision and continue to follow developments regarding the port to ensure we make best use of the site.

The Gormanston site is very large and, with a rail link and access to a motorway, an ideal location for housing. While I appreciate Mr. O'Connor's point regarding other activities, a start should be made on building housing on the site. One could not ask for a better location for homes.

Mr. Geraghty

We are very ambitious.

Mr. Dowling

I will try to be of assistance regarding a number of the points raised. It is correct that affordable housing provision generally has been a significant priority for the Department in recent times. We are conscious of the pressure faced by those seeking to acquire a house in the market, particularly first-time buyers. I am sure the position in County Louth is no different from that elsewhere. However, it is the case that these pressures have been greatest in urban areas. Deputy O'Dowd referred to particular pressures in his constituency.

In establishing the Affordable Homes Partnership the focus, in the first instance, was on the four local authority areas comprehended in the greater Dublin area and the three local authority areas adjoining it. While it was decided to prioritise in this way, that is not to say equal pressure to deliver was not to be placed on other local authorities. It would be fair for the joint committee to note that affordable housing was a new and developing area for local authorities because traditionally they had focused on social housing. Affordable housing emerged in recent years, although the shared ownership scheme among others date back some time.

As recognised in Sustaining Progress, a range of people who had traditionally been able to purchase their houses in the market were no longer able to do so. It is for this reason that local authorities and the Government have sought to enter this sector, on which there has been a gradual build up of experience and expertise. This has resulted in an expansion in the range of schemes and the approaches taken. The Department's emphasis has been on trying to ensure we get delivery under each of the schemes, rather than particular needs. This is where local authority performance is of relevance.

In the past month and a half the Department has met representatives from every local authority as part of the five-year action plan process. The five-year plans were put in place by the Department for a period commencing in 2004. The Department conducted a mid-term review of the process and, as I stated, held individual meetings with representatives of each local authority. We are compiling our assessment on that basis. The Department is heartened by what it has seen. The overall level of output has increased in recent years and we expect to achieve approximately 5,000 units of affordable housing across the various schemes. We want to further increase this figure which will increase this year compared to previous years. I do not underestimate the importance of achieving this objective.

The partnership agreement, Towards 2016, recognised what the Affordable Homes Partnership had achieved. As part of this, agreement was reached in Towards 2016 that the experience gained, particularly in the communications area, would be extended nationally. In that regard, the chairman and chief executive may wish to discuss some of the workshops and other events in which they have been involved around the country, not only to assist local authorities but, just as important, to assist the construction industry and developers and builders to be able to work effectively on the delivery of affordable housing. To some degree, this is a new area for the construction sector in terms of its engagement with local authorities on these matters. Some individual local authorities, notably in Dublin, Cork and Galway, have longer experience than others. We have been trying to utilise and spread this experience more widely.

Work on close to 4,500 affordable housing units is in progress, which is an indication that local authorities have been raising their game, so to speak, in respect of overall output. I may call on my colleague, Mr. McCarthy, to speak on some Part V issues members raised but I will first address a number of other points. On the question of taking a "use it or lose it" approach, a term used by the Minister to describe some proposed legislative measures in this area, I do not find it easy to develop the issue much further in that the Minister has made certain statements to the House regarding his intentions. These are also contained in the housing policy statement, Delivering Homes, Sustaining Communities. Legislation is being drafted, the precise format of which will be presented to the House in due course. I am not in a position to develop the detail here.

The point I made related to evidence of hoarding. Mr. Geraghty indicated the partnership had received a good response when it invited those it believed to be hoarding land to come forward. We must pursue the large amount of land still being hoarded. In the context of urban sprawl, the populations of Dublin, Cork, Limerick and Waterford, respectively, are declining, whereas population growth in the counties adjoining these cities is massive.

Our policies are not working. Fewer people live in Dublin city than were living there five years ago and more people have long distances to commute. We are not tackling the issue of affordable housing in areas where people grew up. I am not being personal. We are not seeking brownfield sites with enough determination and we are not tackling the issue of people hoarding land. That is the way it is and we need to do more about it.

Mr. Dowling

I can only respond by saying we must await legislation to address this matter. We want to maximise delivery and the range of schemes is intended to do that. Clearly, the question of acquiring additional land is key. The proposed legislation may have a role in this regard. As the Chairman has outlined, we can talk about the call for lands more fully. This was a further measure seeking to bring additional land into the equation, as that is critical.

Part V is important in that it piggybacks on housing development that is taking place. We can show an increasing trajectory there. It has been a significant challenge in urban centres. The range of housing generally in urban centres has not been as high as we would have liked in that period. That has expressed itself in terms of the significant price increases we have seen in recent years. Evidence is available to suggest that situation is changing as supply has caught up. We need to keep a watchful eye on the various measures we bring forward so that whatever supply comes forward, it is consistent with existing demand. There are high levels of supply but we have to take a fairly circumspect approach to how we bring forward this range of measures to address supply and bring land into the equation.

Does Mr. McCarthy wish to add anything?

Mr. Dowling

I could add a further point and Mr. McCarthy can reply on Part V. The other point on quality has been partly addressed by Mr. Geraghty. We are absolutely committed to ensuring housing that is delivered by us, that comes within our stewardship or which we can influence, is of the very best quality. That is the hallmark of the statement on housing policy to which I referred, Delivering Homes and Sustaining Communities. This is something which culminates in a range of work that was done under the NESC and which was also recognised in Towards 2016, that quantity and quality should not be mutually exclusive.

As will be evident from the national housing conference which took place on Monday and Tuesday, this is something which those involved in the sector, be they architects, planners and otherwise, also see as being critical, not because these are abstract matters but because they make a real difference to quality of life and to life opportunities people may be able to enjoy. We regard this as critical and the Department will do everything it can to ensure that in practice, when projects are being developed, quality is key.

I thank the Chairman. In regard to the Part V issue and the five unit threshold, the four or less or the 0.1 hectare rules, that was set at a practical level in order to be able to establish a 20% take under Part V. From a practical point of view, one really needs to have five units or more before one can take a Part V dividend.

To add to Mr. Dowling's point on the quality of apartments, while I am not fully competent to deal with it, in order to be helpful, elsewhere in the Department new draft guidelines have been published on apartment size, design, storage requirements etc. They were published in January for public consultation. I understand my colleagues are working to finalise those guidelines fairly quickly.

Significant developments of five units or more are not covered by Part V in cases where the site is smaller than the required area. The regulations currently allow a developer to meet Part V. I forget the specifications for the footprint size. A significant number of projects involving five units or more are coming in under that size and do not have to contribute to Part V. If any builder is constructing five units or more, he should have to meet Part V requirements, regardless of the footprint or the size of the site.

Mr. O’Connor

The figure is 0.1 of a hectare.

Yes, that is the figure.

Mr. O’Connor

Perhaps this requirement needs to be examined in light of the number of developments that do not qualify. A developer could be constructing ten or 20 apartments on certain sites. As it stands, they are exempt.

They are getting off scot free.

I join the Chairman, Deputy O'Dowd, and I am sure other members in welcoming the officials from the Department of the Environment, Heritage and Local Government and the chairman and chief executive of the Affordable Homes Partnership. I compliment the Affordable Homes Partnership on its work and achievements to date.

In particular, I wish to refer to the streamlining of the application system for affordable housing. Prior to the involvement of the Affordable Homes Partnership in this area, it was very difficult for people to even apply to local authorities for affordable homes. I have repeated experience of people going to local authorities who were unaware of what they were seeking. No application forms were available and even getting their names on a list was difficult. The Affordable Homes Partnership has made a big improvement on that. I also welcome that the focus is now on delivery.

I have a number of specific questions but I wish to preface them by saying affordable housing is an issue of particular concern in my constituency. Dún Laoghaire-Rathdown has the highest house prices in the country. We also have the fastest decline of population in the country. The provisional census figures published in July show a drop in population in many of the areas in my constituency of as high as 10% since 2002 compared to the figures from the previous census, and as high as 15% in some areas over a ten year period since 1996. This is directly related to the high cost of housing. What is happening is simple, young working families cannot afford to buy homes there. The closest to this area people who grew up there can buy a home is Arklow or Gorey. They then commute to their workplace. This is an enormous problem.

Some of my questions relate to what needs to be done to resolve the issue. I will address my first question to Mr. Dowling. The three types of affordable housing we currently have are the 1999 scheme, the Part V provision and the affordable housing initiative. Will Mr. Dowling give me a figure for the number of dwellings that have been delivered under each of those schemes to date? I accept there has been some overlap, but I want separate discrete figures. When I speak about housing delivered, I refer to housing delivered and occupied. I do not refer to those that are in progress.

I wish to raise three concerns in respect of the initiatives being taken by the affordable homes partnership. Perhaps Mr. Geraghty or Mr. O'Connor will respond to them. The first has to do with price. This comes back to the point I made about my constituency. Saying one will deliver an affordable home at €100,000 less than the market price of the dwelling is fine if the market price of the dwelling is even €300,000. In that case, an affordable home will be delivered for €200,000, but it is a different story if the price is €400,000 or €450,000. In that case, the price being asked for what are termed affordable homes becomes unaffordable, as is the case in my constituency. A family-sized unit costs €350,000 and upwards. What can be done about this?

Let us consider the exchange of sites, including the Harcourt Terrace and Broc House sites. When these sites were being exchanged, it was argued that we were getting more units than would have been permissible otherwise. How do we avoid the exchange of expensive, premium sites for sites for affordable homes that are quite a distance from the city centre? I understand the latter sites are in Clondalkin and the commuter belt in general. There is a danger we will end up locating affordable homes exclusively in the suburbs rather than in the city. What can be done to avoid this?

Let us consider the call for land. In respect of the 35 responses received, and especially the 12 that were shortlisted, how many of the sites in question were on land already zoned for residential development? What can be done to prevent a cute landowner who cannot get his land rezoned and who has had a long history of having rezoning applications turned down by the local authority from presenting the same land as a site for affordable homes?

Developers have run rings around the Part V guidelines. Is there a mechanism for checking the track record of a developer or landowner to determine whether he has been doing so? A developer or landowner who has been involved in developments in recent years but who has been ducking and dodging the Part V regulations and attempting to buy his way out of them should be told to get stuffed if he presents an application on foot of a call for land.

Mr. Geraghty

The Deputy has raised a number of major issues and I will do my best to address them. I agree completely that prices in the Dublin area are just too high. During the national partnership negotiations, I became aware that the difference between moderate pay increases and rising house prices was so disproportionate that it would become increasingly difficult for young workers and families to live in the Dublin area; hence, the move to the suburbs. On the basis of an average price of €400,000 in Dublin and our discount of €100,000, one must pay €300,000. I agree this is not affordable. However, if one subtracts €100,000 from the price, one is at least reducing the repayment cost to the family by approximately €600 per month. When one considers affordability, one must consider not only the capital cost but also the monthly repayments. The latter comprise the real burden, and in this respect, interest rate rises have been causing problems. A reduction in repayments of €600 is not insignificant.

In most cases, two incomes rather than one are being used to purchase a house. I do not approve of this particularly but have no control over it. One must assume that if individuals are to purchase houses in the Dublin area, two incomes will be required and therefore one cannot extrapolate on the basis of a single income. I understand from the Department of Finance that the average industrial wage for this year is expected to be €33,000. On the basis of this statistic, there is no question but that two incomes are required.

We have no direct control over the market and, in respect of affordable housing, we must consider how to operate within the existing market in the greater Dublin area. Circumstances could be improved if more local authority and State lands on which to build were made available. The cost of the land on which we build is always more than one third of the overall cost and can be up to half in some areas of the city. This is a matter for the Oireachtas.

Given that the average price is €400,000, it is very difficult, from a taxpayer's point of view, to determine how to subsidise the cost to first-time buyers more than we do at present. If each family were subsidised by €200,000 per unit, for example, enormous sums would be required overall, thereby presenting great difficulties. The land issue, which is probably the most important, must be addressed by the Oireachtas.

There is a softening of prices at present, as some have described it. Interest rates seem to be the most significant factor in this regard, in addition to uncertainty over stamp duty and other factors. However, the demand for housing has not softened. In other words, the need is not softening.

We have had to make judgment calls on the exchange of sites. One could envisage 29 or 30 units on a site such as that on Harcourt Terrace, but one could obtain 193 units in the Clondalkin area at the same cost. I believe our judgment in this regard was correct. That one must commute to Clondalkin rather than the city is a moot point. I would prefer if we could get more sites and Deputy Gilmore will realise it is impossible to obtain land in the Dún Laoghaire-Rathdown area. Most of the land becoming available is in south Dublin or Fingal. There are great difficulties in the inner city and, in this regard, I do not include apartments and infill. We must focus therefore on landbanks.

One of our duties is considering the inventory of lands available for the local authorities. If we are to reduce the price significantly, we will require more land owned by the local authorities or the State. We are sensitive to the issue of individuals being pushed out to the commuter belt. We are adamant in insisting on affordable accommodation in all areas and we have therefore made proposals for the Dún Laoghaire-Rathdown area, as we have for Fingal, South Dublin and the inner city. There are quite a few affordable housing projects ongoing in the inner city. I am anxious that future criteria to determine eligibility for affordable housing will include locals, people who work in their localities, individuals awaiting homes for a significant period and key workers. Key workers should not be forced to commute long distances. The criteria are controversial because there is ongoing discussion about the use of a lottery as a system of allocation. We have a preference for those living and working in their area, those linked to the area and those on waiting lists for a long period.

I would like Mr. O'Connor to deal with the specific issues pertaining to the call for lands. Suffice it to say the attraction for the developer, in responding to a call for land, is that he might get planning permission. On the question of presenting sites, I have no doubt that the sites we obtain have been in existence for some time. It is not a question of their becoming unavailable. There will be discussion on sites that have been discussed by local authorities. Heretofore, there was inadequate provision for housing needs in many development plans and area plans, certainly those covering the greater Dublin area. This must be addressed as we proceed.

On the question of Part V, I am on record as having said that emphasis should be placed on the delivery of homes. The question of handing over money should be considered last. However, I discovered it was considered first in a number of cases and that developers were offering money immediately. Mr. O'Connor will outline how the work we have been doing with the local authorities locally and nationally has emphasised that the best option is to secure accommodation for those who require it, preferably on the site in question. We prefer it to be on that site because that is how mixed development is achieved. Pushing people into areas which are seen as more suitable for affordable housing creates new ghettoes and we do not want to do that. The preference is for the delivery of accommodation where the development is taking place. That is a hard battle and there has been a legal case in Dún Laoghaire-Rathdown on the issue. I prefer that no money be handed over and that accommodation be provided where possible. The legislation, however, provides for money to be paid in certain circumstances. Mr. O'Connor will deal specifically with the call for lands because we have looked deeply into the proposals that were made.

Mr. O’Connor

When purchasing apartments or houses, we did not deal with any developers who had not complied with Part V. That is one way we dealt with people who did not comply.

A total of 35 sites were proposed in the call for land but only a handful of them were zoned residential because if land was zoned residential, the developer or landowner was unlikely to propose it would be 70% affordable housing. Those sites that were zoned residential were limited, like the one in Killiney. All the sites were zoned in some manner but the judgment we made related to sites that were likely to be rezoned in five or ten years' time. We recommended an earlier rezoning to achieve affordable housing now, where the developer would get 40% of the value of the site compared to a full rezoning of the site. We selected sites close to existing residential developments and transport infrastructure that were considered suitable. None of the sites was perfect but we considered that, sooner or later, they would be rezoned residential.

Will Mr. Dowling answer the question?

Mr. Dowling

We would have a similar understanding of the difficulty in areas such as Dún Laoghaire-Rathdown, where costs have been much higher and the pressures have been greatest. We work closely, as does the Affordable Homes Partnership, with each of the managers of the four authorities and we have seen increases in the output from Dún Laoghaire-Rathdown.

We can fill in more detail on the numbers by looking at the last period of the national development plan for each of the schemes. Under the 1999 scheme, there were 5,224 homes, under shared ownership there were 7,385 and under Part V, which started delivering in 2002, there were 3,070 units. Now we are getting output from State lands under the affordable housing initiative in Sustaining Progress and that figure comes to 625 for 2006. That gives a total figure of 16,304.

Looking closely at the figures, there are variations. Shared ownership has risen and fallen over that period since 1999. Part V has had an increasing trajectory and we expect it to continue to grow. The 1999 scheme has risen and fallen and State lands are new. We would like access to State lands in the areas of greatest need but that is not always the case. In the lands available to us, we have sought the best judgment that will bring forward delivery and I will come back to this in the context of land swaps.

The shared ownership scheme arose during a time when the real focus was on trying to supplement those who hoped to buy a second-hand home but could only afford to buy a portion of it. This was when interest rates were much higher. With the reductions in interest rates over the period when the scheme was initiated, it is often more attractive for people to strain a little harder, or it is less attractive and more expensive under shared ownership if their income is in a certain range. We have been looking at the terms of the scheme to ensure it fulfils its original purpose.

One of the new approaches we announced in the housing policy statement is an incremental purchase scheme that would be more attractive than shared ownership from that viewpoint and that would be available to people who would otherwise go into social housing but who are in income groups that would allow them to afford this. That shows how we are trying to update the schemes in the light of changed circumstances.

The 1999 scheme was dependent on local authorities bringing their own land forward and developing it themselves as affordable housing or entering a joint venture with a developer or builder. Depending on the land available, that has gone up and down. In 2002, 882 units were delivered under the scheme, whereas there were 743 units in 2006, according to provisional figures. In 2003, however, there were 1,524 because we managed to bring a significant number of projects forward. I expect the figure to be higher this year because we have been pushing the scheme and trying to get local authorities to bring forward projects. We may get close to 1,000 if we can get delivery under each of those projects.

On the State land scheme, we would like access to land in the areas of most acute need but it is not always available to us.

On land swaps, where the focus is on delivery, if we can get housing now as opposed to waiting for development on-site, taking into account the time for planning permission, it is far better for individuals who are waiting to be able to move in earlier, particularly when, as Mr. Geraghty said, the alternative is a much smaller number of units. This is difficult because if the site is in a particular area, there are those who would say the delivery should benefit those who live in that area. We must take a broader view and look to all the delivery mechanisms to meet the needs in any area. In Dublin significant delivery comes through Part V. We will consider that because we do not have access to sites from another estate in the city.

Local authorities undertook an exercise at our request to examine an active land management strategy. At the end of 2005 the assessment was that nationally it was possible to deliver approximately 44,000 units if all the land was brought into use for housing. We will push local authorities to bring forward that land for housing purposes.

I welcome the witnesses to this meeting. I am worried that the Affordable Homes Partnership is being used as the fall guy in respect of the lands it hopes to build on, in particular the lands in Killiney and Lucan. Both parcels of land require variations in the development plan. That is controversial. The zoning of the lands in Killiney does not allow for an increase in floor area. I am worried that the partnership is being used as a pawn in a much larger game to open up land parcels for development. I support the partnership's aim. However, I am being clobbered for it. With good reason people are saying that these lands are not zoned for an increase in floor area. It is a fair point and I wonder why affordable housing is being given the scraps on that land?

I am concerned too about ghettoisation or stratification. A total of 1,100 units on two sites is a large number, particularly on the Lucan site. I am worried because in the past decade the Department of the Environment, Heritage and Local Government has issued strong guidelines on combatting ghettoisation and ensuring that there is not a high number of local authority units on one site.

The same worries apply to affordable housing. One does not want a large group of people in the same income bracket on the same site. I worry too that the land swaps for example, Broc House and Harcourt Terrace push the affordable housing on to land far from the centre of Dublin. I have not done the maths on the sites, I am trying to read the small print on the partnership's hand-out but I imagine it could have got a good number of affordable units on to the Harcourt Terrace and Broc House lands. I worry that it is taking the money and running to west Dublin in many instances.

I have a wider concern about the apartment standards because so many of the partnership's units are apartments. The international norm for a two-bed apartment is in the region of 120 sq.m. The latest standards establish an 80 sq. m. standard for new two-bed apartments in Dublin which is too small for family life.

I am also worried about the external space standards. I participated in the recent National Housing Conference which included a site visit to Adamstown and Balgaddy where a woman mentioned the lack of outdoor play space for her kids. As I stood there two boy racers shot past, over the speed bumps at 50 mph or 60 mph while the woman's children were out on their bikes and younger kids were walking around. This issue is bigger than the partnership's brief and is for the Department of the Environment, Heritage and Local Government to address. I want to ensure that we do not repeat the mistakes made 30 years ago. We may be storing up problems for the future.

There have been various commitments, including the partnership agreement and other ministerial announcements but we are not meeting the targets set. The partnership mentioned obstacles in getting access to State lands. The Department of Defence has had significant lands sitting derelict for many decades in the middle of Dublin. We do not need a standing army of several battalions between the canals of Dublin. We can simply acquire those lands and build decent quality modern homes there. Will the partnership expand on the difficulties, particularly with the Department of Defence, whether in respect of the north or south inner city, or land close to the city centre? There is a great deal of surplus land that could have been used for decent homes in the seven or eight years since several of these initiatives began.

Mr. Geraghty

I would not like to give the impression that we are not developing affordable accommodation near the city. We are developing in Infirmary Road, Jamestown Road, Finglas, O'Deveney Gardens. The Affordable Homes Partnership will not refuse State or local authority land wherever it becomes available. Time is also a factor because in some cases it can take four or five years to develop a site or get houses or we can get an immediate turnkey development which is the case in those swaps. I made a judgment call on the Harcourt Terrace site that we go for the land swap and pushed it strongly on the board because the added value was good. We would not do that in most cases but there were three sites of such value that we could turn them into significantly more houses. That is not generally the case; in many other cases we go for development on the site.

There is much to be desired in the concept of apartment living in Ireland. Everyone wants a front and back garden and to live in a house but we must get used to apartment living. We must consider size, accessibility and all the other elements of good design. I do not wish to comment on derelict State land but we will actively consider turning any that comes to us into accommodation.

I feel strongly about the question of ghettoes. As a key policy we have opted for integrated communities. Even in an estate that is 70% affordable housing there will be 30% speculative houses which can be sold to anyone. Even with 1,100 people in a development this is not a ghetto of unemployed people with social problems. They might be the local garda, nurse, plumber or teacher. When one considers the income levels one has to have now to buy in the Dublin area, for affordable housing we are talking about active workers with families in the local communities. I have no fear that where affordable accommodation is designated there will be a large concentration all the people with social problems and very low incomes. Social housing is geared to people with much lower incomes. In the Dublin area, whatever about rural areas, affordable housing is really targetted at the ordinary industrial earner, civil servant or teacher, so there will be a mixed community. We must be sensitive about this issue.

One of the arguments for our house purchase scheme is that it is an ideal way to achieve integrated communities. One would get ten or 12 affordable houses into one scheme, 14 or 20 in another. This did not lead to large concentrations of affordable houses in existing sites. It also meant we could insist the affordable house was the same quality as the spec-built house next door. We do not want to see any differentiation of social class between a person purchasing an affordable house and a person purchasing a spec-built house.

Mr. O’Connor

Regarding the call for lands, the sites have not got a full residential zoning such as the one in Killiney. It is a judgment call as to whether it is in the better interest to share a variation value between the landowner and the community in general. There are new apartment standards, as Mr. McCarthy said, and they need to be reviewed. In apartment design, the provision of external play spaces for children is an important standard. The lack of it has been a shortfall in many developments.

There were two sites on Harcourt Terrace that were exchanged for 408 homes spread across Tallaght, Lucan and Clondalkin. The two Harcourt Terrace sites have the potential for 66 apartment units.

Is that the floor area or the site area of the Harcourt Terrace site?

Mr. O’Connor

The area of the Harcourt Terrace site is just over an acre. On some of the lands one would not be permitted to build residential homes. Some of the Harcourt Terrace site is protected in terms of adjoining houses which limits what can be built on the site. It has the potential for 66 apartment units. The Department of Defence has provided a significant amount of land under the affordable housing initiative. These include lands on Infirmary Road beside the Phoenix Park, St. Bricin's, which was transferred to Dublin City Council, Gormanston and Magee Barracks, a 65 acre site, in Kildare town.

Mr. Dowling

It may be just as well to supplement what was said on the proportion within the call for lands. At policy level some consideration had to be given to this. Mr. Geraghty has commented on the income profile of people applying for affordable housing. That was the key point in determining whether it was sustainable. It is a judgment call in these situations. We wanted to maximise the delivery of units and to ensure the proposition would be attractive to someone who has land. If it is pushed higher it will not be attractive.

Mr. Geraghty has described spec-building or private housing developments. To some degree from a developer's point of view it must cross-finance the affordable component of it. At policy level, we felt that 70%, given the range of income groups that would be captured in that, was reasonable. The partnership within its own deliberations would have to take account of the location of these sites and what the mix would be in the broader area.

The Deputy will be familiar with some of the debate that took place at the recent housing conference. Some of the debate related to the consultation paper which the Department has issued on apartment size. We are interested to get a range of views on this to determine a final guideline. It is a developing area and we must ensure we are getting apartments that make living cities. The emphasis is on sustainable communities, not as an abstract concept but as environments in which people want to live. We, as officials, must ask ourselves are these areas in which we would wish to live.

The whole question of play space is critical, not just in the context of private housing development but in the social housing area. The Minister recently launched revised guidelines on this, Quality for Housing. We strongly want to push the highest quality of housing for all tenures and social housing should not be of a different or lower standard to that in the private market. It was pleasing that among the developments that were given prizes at the joint housing conference under the auspices of the RAI, a number of them had social housing components. We are anxious to ensure whatever targets are established will be met. These have been given a particular expression in Towards 2016 which contains a commitment to deliver 17,000 units over the next three years. From the figures that are coming through to us from local authorities I expect we will reach the 5,000 mark. I would also like to believe we can achieve more.

I congratulate the partnership on a first-class presentation. Mr. Des Geraghty has clearly identified the shortcomings in much of the housing legislation. Many developers may not put a price on affordable housing units in an estate until they find out the buy-out price from the local authority. Local authorities are allowing builders and developers to use the legislation to their advantage to get planning permission. For example, in a luxury 200 house development, 20% goes for Part V. If the developer had to give 20% of the total development the problem would be solved. The national application form should cover the country

Local authorities are facilitating developing water and sewerage systems to support developers when they have lands they are not developing for local authority and affordable housing.

Mr. Dowling

The general thrust of the Deputy's contribution is that we must maximise output. We will obviously take into account people's views on the legislation. Our emphasis has been to ensure that it is implemented as passed by the Houses of the Oireachtas. That has been the thrust of our approach. This was a new area and it has taken a while for older planning permission to work through. However, now that it is there, we are seeing a trajectory of growth, from 46 affordable housing units in 2002 to 1,600 or so last year. The social housing component rose to 2,198 from Part V.

Regarding the question of units versus cash, as our chairman, Des Geraghty, has pointed out, like the Department and the Ministers, he has been at pains in his contact with local authorities to emphasise that. In practice, the equivalent of only approximately 15% of potential output could be attributed to a cash component. While cash as a concept attracts a certain amount of attention, in practice it is units that we are getting under Part V. We will continue to push. I am not sure if that answers all the Deputy's questions fully.

Where one has built 400 houses, there might not be one affordable house in the location. There is no safeguard. If three builders put up 400 houses in a town or village and the local authority accepts the finance, one is still left with an affordable housing problem since one has no houses for those who have to leave their localities.

Mr. Dowling

That is correct. The first thing is that Part V is development led, so output is in response to what is happening generally in private housing development. However, the key matter is that if land or cash is taken in exchange as the Part V contribution, it is absolutely essential that it be put back into social or affordable housing by the local authority in the area concerned. We emphasise in the guidance to local authorities in our engagement with them that at an early point in the negotiations with developers, they should have a clear strategy regarding their aims based on local needs so that they achieve a match between need and housing.

For whom are the so-called affordable houses affordable? A few weeks ago, the affordable homes partnership advertised 500 units that it had bought on the open market. Those houses were to be sold in various places, including south Dublin County, Citywest and Adamstown, Meath and Kildare. If my memory serves me right, the prices ranged from €240,000 to €280,000. They were two and three-bedroom properties, and the minimum income in the case of a single person or couple was €45,000. I commented on that in the Seanad at the time when I said:

Some weeks ago, the affordable homes partnership advertised 500 housing units which it bought on the open market, being offered to buyers now as so-called affordable homes. The minimum income which must be earned to apply for any of those 500 houses is €45,000.

I wish to clarify this. The Affordable Homes Partnership subsequently wrote to Senator O'Rourke about my comments. In the letter, a copy of which I received today, it stated that it had been suggested that it was the only form of initiative by the partnership and the only house price type available. I did not say that, however. A few years ago, houses were available for €171,000 in the Lucan area.

My point was that for those 500 houses the income limit was €45,000, and that is becoming a trend. For example, in Adamstown the price range suggested for two and three-bedroom properties is €283,000 to €315,000. The income limits for those houses will almost certainly be much the same. As I said in the Seanad at the time, a teacher, a garda, a nurse, a bus driver or a journalist of a few years' experience would not be able to afford so-called affordable housing. The letter sent to Senator O'Rourke stated that anyone earning less than €40,000 can apply for an affordable home as a single applicant, as catered for within the affordable housing scheme 1999. Where are those houses? The reality is that they are simply not being provided. What is coming down the line and the houses under the affordable housing zoned land seem likely to have a similar income limit. One need not be single to have a home income of under €45,000. Where are the affordable homes for such people? At this rate, they will end up in a cardboard box. That is a legitimate concern to raise.

I have made inquiries in that regard. If I had an income of €40,000, what loan might I expect from lending institutions? Generously multiplying an income of €40,000 by five would give me €200,000. According to the general information that lending institutions give people, that is the amount of money that might be forwarded. Affordable houses are now becoming unaffordable for much of the population, including the people whom one wishes to see in local communities in Dublin.

I also commented that affordable housing is becoming the new brown envelope to get land zoned for housing that could not be so zoned through the normal processes. I stand over that absolutely. I made the following point in the Seanad:

The affordable homes partnership has asked developers to submit proposals for unzoned land in order for it to get the land rezoned in return for so-called affordable housing. Developers can buy cheap high-amenity lands, have them rezoned and make many hundreds of millions of euro on their investments, which is a scandal. [...] Affordable housing has become the new brown envelope. Developers get land rezoned and maintain the speculative approach to the housing market and land prices.

I stand by that comment. It is clear that I used the phrase "the new brown envelope" with this meaning. Developers are quick to catch on to any new trick to make their millions. They have now seen a new opening since brown envelopes are obviously no longer being passed as they once were. I know that most people are honest and that not everyone would take one.

My point concerned land that developers cannot get zoned on the basis of sustainable planning and development through the county development plan process. Now those developers are seizing the opportunity to get it zoned by saying that so-called affordable housing will be built on it. The chairperson of the Affordable Homes Partnership gave the example of St. Edmundsbury, Lucan, saying that 30% of houses would be speculative and 70% would be so-called social and affordable housing. Selling a house for €315,000 on high-amenity lands where developers could not buy or sell houses is speculative and they will make their money from it.

I am not blaming individuals but Government policy. The Government set up the Affordable Homes Partnership, but it is not delivering affordable housing. The scheme was originally announced in 1998. While it was supposed to be wonderful, its promise never materialised. They called for proposals from developers for unzoned land. A conflict of interest is involved as county managers are in the Affordable Homes Partnership while they also make recommendations to councils on whether to rezone land. I wonder about the entire set-up of the partnership.

That is not the fault of those involved, who have a job to do. In practice, high amenity and green belt lands that developers could not get zoned are now being put forward to the Affordable Homes Partnership. It was obvious that it would happen. Take the land at St. Edmundsbury, Woodville in Lucan, for example. This is a last ditch attempt to cash in on land on which a profit was not being made by taking the normal route in line with the county development plan. The chief executive said that lands were likely to be zoned. In fact that is not the case. There have been several attempts to get the land zoned at St. Edmundsbury, Woodville, and it is high amenity zoning because it is located in the Liffey Valley. In the last local elections four councillors including the Labour Party candidate were elected on the understanding they would protect those lands from housing. The developers knew they could not get that land zoned, so they seized their opportunity when the affordable homes partnership advertised for unzoned lands.

The way the affordable homes partnership has been set up as regards this call for unzoned lands promotes speculation by developers because, basically, they can buy unzoned, high amenity, green belt or agricultural land on the cheap, have it zoned and make hundreds of millions of euro. That promotes speculation and ultimately increased house prices, which militates against the whole reason for setting up the affordable partnership scheme. It is a circular process. The affordable homes partnership is involved in promoting speculative development, consolidating the system as it is and ultimately increasing house prices for the benefit of developers, not the community. As regards the proposed St. Edmundsbury project, nothing is being offered by the developer which was not on offer before, the pitches, sites for a school — which happens anyway — etc. Development should take place on land already zoned for housing. An example is Adamstown in Lucan where the developers had to erect a train station with the first 1,000 houses or they could not build any more. They had to erect permanent school buildings and social and affordable housing comprised 15% of the development.

I made the statement in that context and I stand over it, absolutely. I have a couple of other questions. Since St. Edmundsbury is in my area I know most about this. One is talking about 1,600 so-called affordable houses on site in Lucan. I checked to see how may people were on the waiting list for affordable housing in the South County Dublin Council area. Currently the figure is 785 for the entire local authority area for people approved and on the waiting list. A further 250 applicants are due to be included on the list, bringing the total to more than 1,000 currently who have applied for affordable housing to South County Dublin Council, and obviously most of those people are from the area.

When the south County Dublin part of the affordable housing initiative was advertised there were 250 applicants. It should be emphasised that houses are not affordable, and most people on that list probably cannot afford to buy in any event. Why does the Department believe there is a need to do this? The logic does not stand up in terms of the waiting list. This is absolutely great for developers since it means they get the land zoned which they previously had failed to achieve since the 1980s, and really make profits. I have raised the conflict of interest issue, which I believe arises, and the county manager in my local authority emphasised that he would absent himself from affordable homes partnership meetings when any land was being discussed to do with his area, yet he sits in on council meetings where these matters are being discussed and makes recommendations for or against. I am not going to pre-empt what decisions he takes, but I still believe a conflict of interest exists and the statutory instrument which was set up in this regard is flawed.

In addition this procedure is anti local democracy. At least the development plan is done in an holistic manner and the whole county is looked at. There is a set procedure and people know where they stand. This is being done outside the development plan, however, and is ad hoc piecemeal planning. It is not sustainable planning. Unlike the county councils nobody in the affordable homes partnership is directly elected by the community. At least councillors are democratically elected and involved in the county development plan, which is closely monitored, and people can vote them in or out. This was done in my area, incidentally, where no Fianna Fáil candidate was elected in the last council elections. Much of that has to do with the unsustainable planning patterns of the past and the controversies surrounding planning decisions.

The county manager recently made a statement about the capacity of land already zoned for housing in south County Dublin and how many houses could be built. Basically, he was shooting down a proposal by a someone to develop his own land at Newcastle, This developer was not lucky enough to be able to avail of the affordable housing scheme.

I ask the Senator to be careful as regards naming the county manager because he is not here to defend himself.

I was just clarifying something as regards the county manager, since he said he would absent himself from certain meetings. I am not saying anything that might reflect against the county manager. I am just saying the legislation is flawed since I believe it establishes a conflict of interest.

My county manager, in reply to a question concerning a report on the county development plan, which is a public statement, said there was a capacity, as of June 2006, to build another 39,000 houses in south County Dublin. A couple of weeks ago in reply to a question from a councillor he said sufficient land for housing was zoned in the county for another few years. Therefore there is no shortage of land zoned for housing in south County Dublin. I know this is an issue for Government policy, but developers should be made to deliver on land already zoned for housing. They should be made to fulfil their obligations in that regard and it is not happening. This gives them another way out and I have another question to ask in that regard. The issue has been raised in my community. My opinion remains unaffected. I do not believe the land at St. Edmundsbury should be rezoned for housing, whether luxury or affordable homes, and especially for so-called affordable housing. However, some people are concerned that because this development has 70% affordable housing, that satisfies requirements under Part V. Is there any chance the obligation of a developer to build affordable housing on other sites could be transferred to those? I am not asking for an opinion or a gentlemen's agreement. I want to know where it is stipulated in law that the developer may not transfer his or her obligations. The land at St. Edmundsbury and in other places which are green belt and high amenity, is zoned that way for a reason. Communities, councillors and county managers decided that certain lands should be protected from housing for a reason. We need green lungs in the midst of development. For example, in the Lucan-Clondalkin area, Adamstown has approximately 10,000 housing units, most of which are built. There is Clonburris, Balgaddy and Liffey Valley Shopping Centre, where again somewhere between 8,000 and 10,000 houses are to be built. There are many other areas around and there is no shortage of land zoned for housing. I believe that promotes the very problems which the affordable homes partnership was set up to deal with in the first place.

Mr. Dowling

I want to talk about policy matters and then, perhaps, the Affordable Homes Partnership chairman, Mr. Des Geraghty, can deal with the detail. It is important to say that the Department will not comment on particular lands. These are matters for individual local authorities and councils. It is useful to note, in part in any event, that the deliberations of the committee this afternoon have been on the issue of land. This would be part of the context for the establishment of the partnership, the recognition that the availability of land is absolutely critical. While further zoned land may be available and we expect to get Part V social or affordable housing on that, equally the emphasis here has been on trying to achieve delivery as quickly as possible, and indeed to maximise this. Hence the suggestion that this was an additional route to take, particularly if a 70% component could be achieved.

While there is a certain story to be told as regards the numbers the Senator has mentioned, in practice any affordable housing that has come onstream has been fully taken up. Again, perhaps the emphasis here has been on trying to increase the overall supply of housing and achieve the targets that have been set. This appears to be one way to do that, where there is a need. Any of the houses which the partnership has sourced, through whatever means, have been taken up by individuals seeking to get into the housing market. We place the emphasis on adding to that supply. The decisions on individual developments are taken by the council. The Affordable Homes Partnership is a corporate body, but it only makes a recommendation so I would not accept that there is any conflict of interest in the way the body is established or in its membership. It is right for the relevant county managers to be on the board to advise the partnership in making those recommendations, but after that it is a matter for the councils concerned to make a decision on zoning, in accordance with legislation passed by the Houses.

Mr. Geraghty

The Senator raised many points, some of which were statements rather than questions and I disagree with her on a lot of them. We would like to have the lowest possible price and we must make the best possible use of public money. When we talk about a discount of €100,000, that is not an unsubstantial amount. Ideally, if the market price softened, that discount would be even more meaningful. With good political decisions, the price of housing will be at a more affordable level and the discount will then be more significant. There is no doubt that it is getting more difficult in certain parts of the city to give an adequate discount to provide an affordable home. We advertised two and three bedroom houses for less than €200,000, so it cannot be said that we are not trying to cater for all income groups. However, it is a fact that people who are earning €40,000 and who would have been able to afford a house in the past, are now entering the affordable homes area.

We do not see a single magic solution to everybody's housing needs. Some couples are earning enough so that the combination of their income will make a house affordable. In a way, Mr. Dowling provided the answer. When they are made available and are advertised, then people come forward. If people feel they are not affordable, then somebody is finding the money. The key is not just the capital cost of the house, but the repayments that must be made. The interest charged is a major factor. The decision in the last budget to double mortgage interest relief could make a significant contribution to that affordability factor in monthly repayments. A discount of €100,000 equates to a reduction of €600 per month. That is not as good as I would like, but I still want to defend it as a contribution.

On the question of zoning, I would like to clarify one or two things regarding the Lucan area. Statements were made in the Seanad on this issue. We have not recommended the construction of houses on special amenity land.

Just to clarify-----

Mr. Geraghty

Will the Senator let me finish? We have been attacked in public on this issue, so we are entitled to answer. The Oireachtas designated an area around Lucan as a special amenity area. We are not building on it. It is proposed that the land will go to the local authority as a special amenity area to be handed over as part of the agreement. The area on which we propose to build is not designated by the Oireachtas as a special amenity area. A private hospital is being built on some of that land and there is already a hospital on it. The zoning allows for Traveller accommodation to be built on it and for quarrying to take place there. We have been misrepresented on the issue of the special amenity area. I am very much in favour of the preservation of the Liffey Valley special amenity area and we are supporting that.

I must defend my board and myself from the allegation of a conflict of interest. We have not personally involved ourselves in this. The call for land comes and is dealt with in a particular fashion by professional planners and the chief executive. It is brought before the board and, in fairness to the county and city managers, they have no say until it is voted on by the board. I thought it quite unfair that many attacks were made on the city manager about a conflict of interest. The city managers must deal with what comes before the board following a process. That process is transparent and I will defend it. I was offended that a remark was made about brown paper bags. Nobody in our organisation saw any brown paper bags. That would not be tolerated and will never be tolerated while I am in the organisation.

The city and county managers have a very difficult job. I found no place where people were welcoming us in to build new houses. When we try to get social and affordable houses built, there is a battle to convince people of their merit, even those whose own children are on the list for houses. That is a fact of life and we will have to deal with it. I do not feel there is a conflict of interest because we can only bring these proposals to the local authority. At the end of the day, the local authority makes the decision, not the Affordable Homes Partnership. We have no planning powers. We can recommend a decision, but the councillors make the decision. That is in the planning system. We must work within that and I am happy to do so.

Public debate is fine, but misrepresentation is not. The suggestion that the Affordable Homes Partnership is promoting speculative development is grossly unfair. I have never been associated with speculative development in my life and I never will. I would argue that we are trying to share the value of land that was purchased for speculative reasons with the community, by getting more affordable accommodation on it. If it was just developed for speculative housing, the margin of profit would be enormous. If 70% of it is provided in discounted social and affordable housing, then we are sharing the value of the rezoning with the community. That is controversial, just like any other rezoning. However, as I pointed out in my opening remarks, inadequate provision was made for housing in many areas. If all this land is available, as the Senator suggests, then we are happy to build on it. We have no particular prejudice about who comes forward with the land. If the local authority offers land in the Lucan area for affordable housing, we have no problem co-operating with that development. I challenge the Senator's assumption that there is a great amount of land available. Some land has been rezoned and our job is to try to bring it forward for housing development.

We will continue to monitor the market as it develops. If there is a softening of prices, we will hope that the discounts are better. In some areas they will vary. The discount will be far more than €100,000 in the Dún Laoghaire-Rathdown area to bring the price down to an affordable level. It is very difficult to ask the taxpayer to fund around €200,000 for each individual house. We must find ways of delivery that are more affordable and that use land that is available. We have been trying to address different income levels with our offers. There has been no shortage of takers to date, suggesting that there are people out there who want those affordable houses.

Mr. O’Connor

Mr. Geraghty has covered the issues. The recommendations are made to the elected representatives at the end of the day. The elected members of the eastern local authority will make the decision in the normal planning and rezoning system.

I will allow Senator Tuffy to ask a brief question which will merit a response from the other side. It is my intention to finish the meeting at 4 p.m. as we have already had two hours of discussion and members have other commitments.

I wish to clarify the expression "the new brown envelope". It was used as a metaphor. My point is that affordable housing is being used by developers as a way to secure permission to develop lands which would not be zoned for residential housing in county development plans on the grounds of sustainability. The legislation which established the Affordable Homes Partnership is flawed to allow that to happen, which in turn allows speculative development. I am not referring literally to brown envelopes, but suggesting that affordable housing is the new brown envelope. I am sure others can come up with other examples. It is a fact that "affordable homes" is the new buzz term among developers.

Mr. Geraghty

I accept the Senator's clarification that the term she used was metaphorical. What I am saying is not a metaphor. There are no brown envelopes in our organisation, nor will there be.

I thank Mr. Dowling, Mr. McCarthy, Mr. Geraghty and Mr. O'Connor for taking the time to attend our meeting today. The discussion has been most informative and worthwhile. At our next meeting we will consider a motion to allow the Dublin Docklands Authority to prepare a draft section 25 planning scheme for an area of the Poolbeg Peninsula.

The joint committee adjourned at 4 p.m. until 10 a.m. on Thursday, 5 April 2007.
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