Seanad Éireann debate -
Thursday, 4 Jun 1992

Vol. 133 No. 1

Adjournment Matters. - Urban Renewal Scheme.

Mr. Ross

I ask the Minister to reply to some of the specific points I will make. I know that the procedure is that the Minister has a script. This makes it rather difficult sometimes when one is speaking in the knowledge that what Minister often say is pre-written before they have heard what is going to be said. Therefore, I ask him to reply specifically to some of the points which I will make.

In moving this Adjournment motion, I am well aware of the fact, having been in touch with the Department, that the urban renewal scheme will cease in May 1993. Thus, there is a particular urgency about this proposal, because obviously it would have to be executed before that date. County Wicklow is particularly neglected in this area of urban renewal. It has been deprived while, at its expense, Dublin has benefited. I do not know, if I was making a political point, whether I could say that County Wicklow has suffered because it has no Minister in the area and as a result, this scheme has not been extended to the area.

Many people throughout the country, not just in County Wicklow, or in Bray or in Wicklow town, often ask why Dublin has benefited so enormously from the tax incentives which are available under the urban renewal scheme. I have a clear memory of the Temple Bar scheme and the tax concessions made when that scheme was launched last year. While there may be great virtue in that scheme, it certainly staggered those who heard it because of the extent of the concessions and the incentives given to an area which is not particularly deprived, and certainly was not deprived or neglected to the same extent that some areas of Wicklow town and Bray in County Wicklow have been neglected.

Perhaps the Department could provide me with figures on the cost benefit of an urban renewal scheme and the cost to the Exchequer. Many of the reasons given by the Department for not extending this scheme to certain areas is because it would cost the Exchequer too much money. It is very difficult to calculate because to some extent you are calculating a negative but presumably their decisions are based on economic considerations. I would be very grateful if I could have a figure on what this costs in certain areas and what the Exchequer believes it will benefit as a result.

Bray, County Wicklow, is a town which is in dire need of a commercial lift. It has suffered more than any of the Dublin areas in recent times for many reasons which I will go into very briefly. Businesses in the town have been closing; shops have been closing; unemployment is continuing to rise, it is now above the 4,000 level and is continually above the national average. The Minister may well say that Bray has already been granted certain urban renewal concessions. Indeed, the Maltings down to the bridge, the Town Hall and the International Leisure Bowl have all benefited. They have all been given this concession already but it is a drop in the ocean in comparison with what Bray needs.

Bray needs a commercial lift. At the moment it is a very depressed town. Day after day one hears tales of closures not only of businesses but of shops and of rising unemployment. I do not believe that is merely due to the introduction of the by-pass in recent months which may, indeed, have adversely affected business for the past few months. There is a far more fundamental problem in that Bray has been badly planned and good planning is necessary if it is to develop as a prosperous suburb. The town needs a kick-start. It badly needs a boost to employment prospects. It badly needs more industry. It badly needs the urban renewal scheme which would obviously provide the sort of injection that Bray needs at this moment. What has already been granted is minor. While we are grateful for it we need a good deal more if the town is to benefit in the way it should.

I would like to come to Wicklow town because this town does not benefit at all from the urban renewal scheme. Wicklow town has a chronic unemployment problem. It is ideally suited for the urban renewal scheme. It has a large number of very small industries in little pockets. Rather than being dependent on one large industry as are some Irish towns, it has many small industries in little pockets and that would make it ideal for designing certain areas for industry and giving tax concessions.

Wicklow town is geographically placed in a situation where the South Quay would also be ideal for designation for the urban renewal scheme. Again, Wicklow town has applied for such designation in the past with a very comprehensive presentation to the Department but it was not accepted. The South Quay would be ideal because it has access to the port and it has the infrastructure to support it. Wicklow town also has a large and disproportionate number of derelict sites. It is very difficult to know how many, but it is as many as 70 at the moment, which are ideally suited for this action and scheme. This is one of the reasons the scheme was introduced, that derelict sites could be utilised. It was disappointing to the urban council in Wicklow town that in the past when they made an application it was turned down. They felt, as I feel, that Wicklow town because of its geography and its layout, and because of the way it is planned, would be absolutely ideal for this scheme.

One of the problems with Wicklow town is that it has huge potential for developing industry. It has a growing population which is, unfortunately, not matched by an increase in business in the town. It has a huge commuter population but while that population lives there it comes to Dublin to do its spending. As a result, many of those who live there do not spend money which would benefit the town. I am suggesting to the Minister that if we developed industry by giving this injection to Bray and Wicklow the wealth earned in Wicklow, instead of being spent elsewhere, would be channelled into Wicklow town. The spin-off effect for both towns would be enormous in the area of unemployment and shopping and consumer spending. Instead of being neglected, deprived towns, which they are, while Dublin is benefiting, they would be vibrant, living and prosperous areas.

Minister of State at the Department of the Environment (Mr. Wallace)

I thank Senator Ross for the opportunity to respond here this afternoon.

Many of us have witnessed physical decay and economic and social decline in parts of our inner cities and towns. Peripheral locations have, in the past, attracted both businesses and people away from the inner core areas leaving behind derelict sites, run-down and unused buildings and a disappearing community. This, in turn, reinforces the perception that such areas have become bad risk areas for private investment.

It was to redress such decline that the urban renewal scheme was introduced. Through a generous package of taxation incentives and rates relief for new and reconstruction works in areas designated for urban renewal, the State is providing the incentives for development.

Briefly these incentives are on the commercial side capital allowance on new or reconstructed commercial buildings; double rent allowance for traders; and rates relief on new or improved buildings. The incentives on the residential side are owner-occupier residential allowance on new or refurbished dwellings; and section 23 relief on provision of new or refurbished private rented accommodation.

The scheme was introduced in 1986 and was initially limited to areas in our five main cities. Building on the success of the scheme, areas were designated in nine provincial centres in 1988. It was in 1990 that Bray along with seven other centres was designated for urban renewal.

The local authorities play an important pivotal role in co-ordinating and promoting urban renewal in their areas. Learning from the success and experience of other local authorities, Bray Urban District Council was able to identify, in the context of its developments plans, those areas most suitable for renewal. When the Government designated an area of 12 acres in the town made up of three separate lots, Bray Urban District Council was quick to respond.

I visited Bray just over two weeks ago to see at first hand what has been achieved under the urban renewal scheme. I must say that I was extremely impressed with what I saw. The urban council is justifiably proud of the superb reconstruction work carried out on the council chambers and offices on the Town Hall site. It is marvellous to see such sensitive and caring treatment given to important historic buildings. The overall project on this site will include a restaurant, shops and a new office development. A new bowling alley and leisure complex now stands on the site of the former International Hotel. Total investment on both these projects is estimated at £4.7 million. On the larger area, known locally as the Maltings site, plans are well advanced for a mixed development which will include offices, workshops and the restoration of some of the old mill buildings for use as a restaurant/public house.

In selecting these areas for urban renewal designation, attention was paid to the need for urban renewal and the potential for redevelopment. In addition to the construction jobs and full-time jobs created, these developments have operated as a catalyst for other developments outside the designated areas.

The key to the success of the urban renewal scheme is in partnership — partnership between the public and private sectors. The Government, through the incentives offered, provides the economic climate for investment. The local authorities co-ordinate and promote the scheme in their areas. Last but by no means least, the private sector provide the investment necessary for the development of our urban centres.

It is not just the developers who gain from urban renewal. The transformation of run-down and derelict areas in which people wish to live, work or spend their leisure time surely benefits all.

The incentives offered under the scheme are generous and involve substantial loss of revenue to the State. I am sure that it would be possible to identify additional areas in Bray or areas in Wicklow town that could benefit from the incentives available under the urban renewal scheme. Indeed, since coming to office I have become aware of the case made for designation by a large number of towns throughout the country.

However, even if budgetary constraints could be overlooked, it was never the intention of the scheme for designation to become the norm — rather the reverse is true. Small concentrated areas show more clearly the visible achievements of the scheme and demonstrate to potential developers and investors the advantages and attractiveness of development of our inner cities and towns.

If the scheme were to be over-extended the effects of the incentives would become dissipated with the result that we would not achieve any worthwhile urban renewal in areas most in need. It is because the scheme is so limited in its application, not only in terms of the number of towns designated but also in terms of the size of designated areas within selected towns, that Bray has been so successful in attracting development.

Evidence of the success of the scheme is in the level of development activity and investment generated in these areas previously considered devoid of development potential. Since the scheme was first introduced, projects with an estimated value of £393 million have been either already completed or are currently in progress with a further £328 million in planning.

It is at those projects still at the planning stage in the existing designated areas the scheme is primarily directed at this stage — to get them off the drawing board and into bricks and mortar. It was with this in mind that this year's Finance Act provided for a final one year extension to the existing time limit of 31 May 1993 for projects under way on that date. I firmly believe that designation of any additional areas at this stage would reduce the impact of the scheme in the areas already targeted.

In these circumstances, I would not consider it appropriate to extend the urban renweal schemes to additional areas at this time. However, I assure the Senator that I will, of course, consider any submission regarding additional areas in Bray or in Wicklow in any future review of the scheme.

Mr. Ross

I thank the Minister. I did not quite understand his last sentence but I would like to ask him a question. Do I understand that because the scheme achieved wonderful work in Bray — which it has done — because small concentrated areas were very suitable for this scheme, he would consider sympathetically any further applications made from Bray and Wicklow between now and May 1993?

Mr. Wallace

I did not say that. I made it very clear that there are no plans at present to extend the designated areas. The priority for the Government is to ensure that the projects that are still at planning stage are completed as quickly as possible, to avail of the incentive scheme before 1993.