Seanad Éireann debate -
Wednesday, 6 Feb 2002

Vol. 169 No. 1

Housing Provision: Motion.

Ms Quill

I move:

That Seanad Éireann acknowledges the very real achievements of the Government in the housing area as evidenced by–

– the record levels of new housing output achieved in each year since 1977,

– reducing the level of house price increases from about 40% per annum to avoid 5% per annum,

– improving the position of the first time buyer in the housing market,

– introducing for the first time a multi-annual and greatly expanded local authority housing programme, which has led to the highest level of activity under this programme for 15 years,

– increasing voluntary housing output to the highest levels ever,

– improving the range, availability and effectiveness of housing measures targeted at the needs of the disabled, elderly persons and the homeless,

– putting in place an Integrated Strategy on Homelessness,

– introducing measures to secure a strong and well regulated private rented sector, including the establishment of the Private Rented Tenancies Board;

and supports the continued action and commitment by the Government to expand the supply of housing across all tenures and to improve access by all income groups to suitable housing accommodation.

Cuirim fíorchaoin fáilte roimh an Aire Stáit go dtí an Teach and cuirim fáilte ar leith roimh an díospóireacht seo ar chúrsaí tithíochta. Molaim an rún ar son an Pháirtí Daonlathaigh.

An old principle in education in my day was that if one did not see the dark, one would never appreciate the light. If we are to understand fully how things have improved in the course of the past five years, we would do well to remind ourselves of how things were in this country five years ago.

In 1997 the housing situation was grim. House price inflation was spiralling out of control with the annual increase in house prices reaching a staggering 40% in 1998. First time buyers and low income households were being priced out of the market day by day. The shared ownership scheme was grossly underdeveloped. Planning delays and bottlenecks in planning were the norm. Local authorities had a haphazard, stop-go approach to house building. Families lived in squalor in substandard housing developments such as those in Ballymun and in its equivalent, although not quite as bad, high rise flats in Cork city. They were built substandard and were not properly maintained. They were not fit housing for young people. That is how it was. The supply of private rented accommodation was beginning to dry up. The supply of zoned and serviced land was very low. The housing situation was very bad five years ago.

It is only against that background that we can evaluate the nature of the progress that has been made in the interim. I cite the planned policy based approach of the Minister of State in respect of which he enlisted the support of the best expertise available in the area of housing provision. He listened and learned and as a result put in place long-term sustainable policies on the provision of housing in terms of private, public and the voluntary housing sectors. That is a measure for which he should be commended more than any other. His comprehensive planned approach has not alone borne fruit in this five year period but it will continue to bear fruit in the future because that is the only way to move forward.

Accordingly, local authorities are required to plan on a strategic, long-term basis. They are required to assess the housing needs in their areas in a scientific way and to put in place three year strategic plans. To enable them to have a continuity of work, they now have access to multi-annual budgets. That is a huge improvement.

I have been a member of a local authority for more than 20 years and I am aware of the haphazard, stop-go approach that was a feature of the past. That is gone now. Local authorities are enabled and required to plan, like people running a business, on a long-term basis and to base their plans on scientific data. The budgets are put in place to enable them to do that. That single measure has transformed the approach to housing in local authority areas.

The planning bottlenecks and the delays in planning departments, which were a feature of the past, have been addressed and additional staff have been made available. The Department and the Minister have also recognised other needs in terms of the provision of technical and other expertise to local authorities. That has been put in place. The delays that derived from shortages of staff and, perhaps, lack of best practice are now out of the way. That is a significant change of long-term value put in place by this Minister.

Social and affordable housing has received an enormous shot in the arm in the course of the last five years. That has come about in a number of ways. Social and affordable housing is a mechanism which enables a range of families to become home owners. I welcome the fact that the Minister has put in place a long-term framework for funding and has removed bureaucratic obstacles to enable social and affordable housing to multiply and develop. There has been a dramatic and highly significant increase in the provision of housing under these schemes. That must be warmly welcomed.

There has been a significant increase in the income limits for shared ownership. It was a great scheme but the limits were ludicrous. If one were at the threshold three years ago to benefit under the scheme, one would not have been able to afford to purchase. A realistic limit is now in place and, accordingly, more people are enabled to provide a roof for themselves and their families under this laudable scheme. To assist the process, this Minister has put in place a site subsidy for local authority houses to speed up the provision of funding.

Perhaps the most noticeable and significant trend is the downward spiral in house prices. The annual increase for last year is approximately 5.6% nationally and 6.7% in Dublin. The relevant increases in the secondhand market are 3.4% and 4.8%. That is a huge benefit to people who, four and five years ago, found the price of housing beyond their grasp despite having good jobs and incomes. The spiralling costs meant they simply could not bid for a house. They could not secure a mortgage or pay the deposit. That has levelled out now but it did not happen by accident. It is the result of a combination of well thought out tax based and provision based policies. It is a huge benefit.

The changes that have been made in the provision of rented accommodation are significant, particularly for students who had a tough time in this regard. There are changes in the last Finance Act which enable them to secure more readily available housing. More than anything, I commend the Minister on the new initiatives he has taken in encouraging and driving the voluntary sector. There is better provision made for the elderly and the disabled within the housing schemes being developed by the voluntary sector than has ever been made since the foundation of the State. I commend the Minister for that, not to mention what he is doing in terms of the strategy for homelessness.

Mr. Gibbons

I second the motion. Senator Quill gave a detailed outline of the huge improvements that have taken place in housing over the last five years.

Let us look at the situation that prevailed five years ago with regard to housing demand. As a result of our economy growing and people having more disposable income, the demand for housing rose at an enormous rate, a rate we had never seen before. That led to a situation where the inflation rate in the price of housing was running as high as 40% per annum. It had a huge effect on people's ability to secure housing. There were houses available but the cost was spiralling out of control, to the extent that many people were excluded from the market.

Fortunately, however, the Minister took a planned approach. Rather than just throwing money at the problem, which several Governments had done in the past, he discussed the issue, identified the constraints and worked on alleviating them. He focused the injection of capital into those areas and we can now see the results filtering through. The Bacon reports identified the problems and the Minister focused on them. However, some of the effects of implementing those policies created more problems. Fortunately, the Minister had the vision and approach to confront and correct them, in so far as it was possible and in so far as one could project what the effect would be. That is the essence of good government. It is approaching a problem, identifying how one can alleviate it and doing it. The Minister is to be commended for doing that over the last five years. Consequently, the inflation in house prices is reducing rapidly each year. That is making houses more affordable, particularly for first time buyers.

One of the problems of the last four years was that the cost of housing in the Dublin area had got out of hand. Many people moved to towns outside Dublin and commuted daily to Dublin to work. That is extremely evident in Carlow. Entire housing estates are occupied by people who are working in Dublin and its environs. These people are most welcome in Carlow and, in time, they will integrate into the community and make it their home. However, some of them would have preferred to have been able to afford a house in Dublin or its suburbs rather than commute each day. The improvements that have been introduced by the Minister mean that this will not occur to the same extent in the future.

One of the problems confronted by the Minister was the lack of serviced land. It was always a problem in this country but, fortunately, it no longer is. Land is being serviced on an ongoing basis. A huge amount of money has been pumped into it and will continue to be under the national development plan. There is now a land base for building.

Another problem about which we heard on umpteen occasions in this House and which arose at every local authority meeting was the difficulty people had getting their planning applications through the system. There were delays on an ongoing basis because of the lack of personnel in the planning offices of every local authority in the country, but that has been addressed. Professionals have been put in place to speed up the process, which has to be welcomed.

There is one area I would like the Minister of State to take a close look at; I have mentioned it here before and believe it is very important. We need to employ many more architects in the planning offices of every local authority. Unfortunately, they are manned to too great an extent by engineers. We need people who understand housing and how housing relates to people as distinct from being physical objects. Some of the social problems we have encountered as a result of poor housing could be identified at an earlier stage if we went down that road. Even though I have a personal interest as a landscape architect, we need to employ landscape architects in this area because it is all about the space in which we live.

I encourage the Minister of State as he continues this work – no doubt he will continue it after the general election – to take note of those issues and to try to implement the changes on an ongoing and planned basis as he has been doing. I suggest that the Members opposite should sit back and think about what has been done and have the courage to compliment the Minister of State on the great job he is doing.

Mr. Coogan

I move amendment No. 1:

To delete all words after "That" and substitute the following:

Seanad Éireann condemns the Government for its continued failure to resolve the crisis in the housing sector, both in private rented accommodation and in social housing, which is reflected in the growing numbers on the housing lists and the increasing number of homeless.

I was surprised to find this motion before us. I do not understand the reason for it. As Senator Walsh will verify, we have seen this motion before in the last 12 months. Somebody must be misreading what is happening out there and keeps putting this forward to praise the Minister of State. The facts are different. I suggest that, if one is going to war, one should pick the battlefield but not one on which one has lost before the battle starts. The truth is that I could go through the statements in the motion and take the ground out from under each one individually. Senator Quill and I rarely fall out but on this issue we do—

Miss Quill

There is always a first time.

Mr. Coogan

The increase in the supply of local authority housing is due to plans that were put in place over five years ago. One cannot say one year that one is building houses, put the figures on paper and say they will be built next year. Housing is not built like that.

Mr. Molloy

There was not—

Mr. Coogan

The Minister of State will get his opportunity and there will be many opportunities in Galway West to contest this issue. When we look there, we see that the number of people on the housing list has increased, since 1999, from 750 to 1,300. These facts speak for themselves.

Mr. Molloy

That is growth—

Mr. Coogan

In Cork the increase is from 2,000 to 4,000.

Acting Chairman (Mr. Farrell): Senator Coogan should address his remarks through the Chair.

Mr. Coogan

I apologise but if the Minister of State continues to interrupt me I will have to react. It is within my rights to do so.

The first point raised on the recorded level of new housing output achieved since 1997 fails to note that these were at the planning stage in 1994-95. No one thinks one can build a house in a day and Senator Gibbons spoke about the delays in planning. Local authorities experience these delays as well as everyone else. The Minister of State should consider how long it takes to build 100 houses and when they will be on stream. To accept praise for something that was put in place before the Minister of State was in office is unfair.

The motion notes the reduction in the level of house price increases from 40% per annum to 5% per annum. They have come down from such a high base, but they are still up there. That is the reality for children who are coming of age and going out to buy a house. One should try and buy one in Galway, but not if one is a person who left college three years previously. I guarantee that one would not get one. The numbers on local authority housing lists are increasing because people cannot afford housing. There are other factors involved to which I will return.

As I have said to the Minister of State before, an integrated policy is lacking. There is no policy. There is an ad hoc reaction. Parts of the Bacon report are taken out and other parts thrown in. Changes were made in house rental subsidies. There were incentives to encourage people to build apartment blocks but the Minister of State changed his mind and introduced the changes we were suggesting. There is no disputing that the number of people applying for local authority housing has increased dramatically. There is no denying that house prices have increased. All we have been doing is tinkering with the problem, playing around with it and hoping it will go away, but it will not because there is no integrated policy.

Senator Gibbons is correct that we must think about designs of houses because of the demographic breakdown of the country. There has been a 20% increase as a proportion of the population of people between the ages of 25 and 34. These are people who will not have children. We will have to take that into account. There are empty nesters. Have we taken that into account? There are people who have substantial houses with four or five bedrooms, their children have gone away and their houses are difficult to keep. Could we not encourage these people to find some other location which would have the same or better quality of life more appropriate to their needs and let their house go onto the market? We should intervene at this stage.

The Tánaiste and Minister for Enterprise, Trade and Employment said at the last election that children planning to leave their home place should consider staying at home. Perhaps that is correct and we should encourage them to stay on, but people want their independence. There is an idea in Ireland that we must all have our own house. It takes a leap of faith to believe in renting for life or second and third generation mortgages. We must change our attitudes and our plans.

One of the recommendations of the Bacon report states:

It would be appropriate that the next national development plan should address the issue of achieving a better geographical balance of economic activity with an associated more even distribution of population, affording a high priority to achieving it. The preparation of a national spatial development strategy would facilitate and assist with development policy in this regard. It is recommended such a strategy should be formulated and published. A comprehensive land use analysis relating to the Dublin and mid-Eastern region should be undertaken in the meantime. This should be sponsored under the direction of the Minister for the Environment and Local Government.

I put it to the Minister of State that the national plan seems to have stopped dead. We should get people to leave the centre of Dublin where the pressure is and develop new towns. We should change house design. We should be imaginative about it and find answers that are different from those that we have come up with so far.

I cannot understand why this motion was tabled, unless it is an attempt to praise the Minister of State before the election as a result of the poll in Galway West. I am afraid he picked the wrong battlefield.

Miss Quill

It is putting the facts on the record.

Mr. Coogan

The Senator is from Cork. Is not the case that the housing lists have doubled in Cork and nearly doubled in Galway?

Miss Quill

That is because of all the employment, all the new jobs and all the people who came home to take them up.

Mr. Coogan

There is no national strategy attached to it. Does the Senator want to crowd everybody into a few locations? That will just create further problems. Let us get the right development plan because there is none at present. Although I do not understand why this motion is before us, I am delighted to put a few matters on the record.

Mrs. Ridge

I second the amendment. I wish to share time with my esteemed colleague, Senator Costello, if that is acceptable.

Acting Chairman

Is that agreed? Agreed.

Mrs. Ridge

It might be just as well because I am winding myself up almost to explode. I do not know whether that is with laughter or with rage. I must be living on a different planet from everyone else because I cannot believe that the party of probity, the Progressive Democrats, would so indulge themselves. Self praise is no praise. Either their guilelessness or their gall is breathtaking. I can only assume that they have all become so rarefied and posh that they have no contact with a very large segment of the population – I meet those people all the time, perhaps because I represent a marginalised and specially designated area.

It is wonderful that the motion states "Seanad Éireann acknowledges very real achievements of the Government in the housing area." I cannot so acknowledge as it is a lie. My information from Focus Ireland indicates that 148,000 people are homeless. In that case how could I praise the record levels of new housing? Who is being housed? Who can afford it?

I am amazed that two particularly delightful and highly intelligent colleagues have put down this motion. I do not know who asked them to do it because they could not have thought it up themselves. I see no reason the Minister should bask in a rosy glow about housing conditions. Although he will glare at me and complain, it is obvious he concentrates too much on west Galway, which must have become a very wealthy area since I was last there, bearing in mind that I visit the area frequently.

The motion refers to a greatly expanded local authority housing programme. In my area the housing programme for this year produced 80 houses, but there are more than 4,500 applicants on the waiting list. It is nice to read that in five years' time we may have caught up with it, but we never will. The figures out today show increasing fertility and there was a very high number of births this year. We are dabbling when we should be attacking and I am amazed that we have not recognised as one of the major tragedies of our time the incidence of homelessness among young people. I have said that in this House before and I will say it again. Apart from the lighting, the streets outside this House resemble Dickensian London. Crossing the Ha'penny Bridge in the rain the other day I saw two young, homeless men lying on white, striped woolly blankets. Do Members remember that our mothers had them before duvets came in? Are we codding ourselves? We are a society that produces strategies and policies, but we do not seem to be capable of carrying them out or enforcing them. We have a derisory programme.

At a health board meeting yesterday I was told that in the refurbished Clancy Barracks we will have a cold-weather hostel. I thought we had seen the light and realised that in Ireland you cannot say it is summer just because it is 21 June. It could very well be freezing on that date. Under these programmes we will continue in a vein we thought we had discontinued. We are going to evict the homeless on 30 April and invite them back in, God help us, at the beginning of November. For the six intervening months they will have enjoyed incessant sunshine and will return tanned and fit. Who is codding whom?

We agreed that local authorities would take cognisance of their role in the provision of accommodation. There is a lady working, I presume, very hard in Leeson Street, but that has not filtered down to the people who need help. Long ago, when I was much younger, there was a major housing crisis in this city and the then Government very wisely opened Griffith Barracks on the South Circular Road. It provided emergency shelter. It is estimated that in my local authority area alone, in which live 250,000 people, there are 200 homeless every night. They have still to go through the same rigmarole. There are new offices which provide information, but they will not provide a bed. Senators are inviting not only displeasure, but complete ridicule when they talk about that.

Society is now blatantly two-tier. Civil servants and teachers may be climbing back up to be able to afford houses, but they cannot do so yet. For the first time in the history of the State what are called the stabilising influences cannot afford to buy houses and that is very sad. I certainly do not agree with the motion.

Mr. Costello

I am sorry I cannot wait for my own time slot, but I have a prior arrangement to speak at a public meeting at 6.30 p.m. I thought that one of my colleagues would be here. I thank Fine Gael colleagues for giving me a couple of minutes.

I have great respect for the Progressive Democrats as a party which has endeavoured to break the mould. It has good intentions in this matter, as in many others. I find it difficult, however, to accept the veracity of what is stated here. You cannot say that much of it is inaccurate, but that does not disguise the fact that we have a housing crisis. The Minister will deny that such a crisis exists, but when in the last century, no matter how bad times were, could young marrying couples not afford to get homes of their own? This is the first time that has been the case, despite the Celtic tiger. There is a whole generation of young people raising families in private rented accommodation where they are being bled to the last by a free market. That is not the way to build a stable home environment.

Homelessness has trebled in Dublin since the Government took office and a family cannot now expect to get a home from the local authority without spending at least one year on the waiting list. A family will spend at least 12 months in a hostel or bed and breakfast accommodation, or in moving from one place to another, and that is completely unsatisfactory. Increasingly those coming to my clinics are homeless or looking for accommodation and I estimate that each one costs the State roughly €30,000 before he or she is provided with a place to live. That is unacceptable.

I agree wholeheartedly with the introduction of measures to secure a strong and well regulated private rented sector as described in the motion, but that has not happened. The private rented sector has run amok. It is evicting at will the people coming from the homeless sector. It can evict them at the stroke of a pen to accommodate those from whom a better return can be got, generally those on the short-term housing lists of Dublin City Council. There is a crisis that is not being addressed. There is a housing crisis for those who would before have got housing without bother, there is a homelessness crisis and there is an overcrowding crisis. There is a whole new sector providing hostel and bed and breakfast accommodation and it is completely unsupervised. Those who are getting that accommodation are not those who are most in need of it. They are often those in low-paid employment. There is no proper regulation of hostels and bed and breakfast accommodation and there are no standards. There is a new category of landlord and entrepreneur to service that scene and I am getting very worried about that. The private rented sector and hostel and bed and breakfast accommodation are burgeoning to cater to those on local authority and health board lists and the Minister should address that.

I am very unhappy the Minister thinks that going ahead with more of the same will solve the problem. It will not. The problem is out of control and the Minister must recognise that and address it.

Mr. Walsh

Cuirim fáilte roimh an Aire go dtí an Teach anocht agus glacaim leis an rún atá á phlé freisin. This is an important topic. As a committed republican, I have always seen two fundamental aspects to the ethos of republicanism, one of which is that people are entitled to shelter. The second is that people are entitled to use their God given talents to provide for themselves and their families. That entails job creation. If republicanism counts for anything, then we must address ourselves assiduously on a continuing basis to that task.

The motion before the House clearly illustrates the very good work that has been undertaken by the Minister during the past four and a half years in his Department. I suppose it is understandable that people from the Opposition would take an opposing view and dismiss some of the facts that have been placed before us, but on an issue as important as housing it is essential that we, as politicians, whether we are in Opposition or in Government, do not take an approach which is along the lines of not letting the truth get in the way of a good propaganda story. In this instance the facts speak for themselves. On the claim by Senator Costello that this private rental sector body has been set up on an ad hoc basis, in fact the body is functioning at present and is arranging arbitration in certain instances. I am surprised that members of the Opposition are not aware that mediators are being appointed to adjudicate in certain disputes.

The private rental sector has a very significant role to play in the provision of accommodation. Many of our tax incentives have been geared towards generating additional capacity in the private rental sector and that is good. What we need is a balanced approach to the housing supply side and every effort is being made to achieve that.

It is interesting that the supply unit, which was established by the Minister, has generated 11,000 hectares of land with the capacity to provide 285,000 housing units. The Minister's serviced land initiative involves 165,000 housing units with a capital spend of €63 million for the current year. That speaks for itself. We have seen in the past the need to service the land in order to generate the number of housing units required.

On the strategic development zones which were established, we have heard a great deal about the supply side, particularly in the Dublin area. Three sites were designated by the Government as part of this residential development in June 2001. The three areas designated – in Fingal, in a section of Meath County Council in the Navan area and a section of South Dublin County Council in the Lucan area – have the potential to provide 12,000 housing units, which is quite significant in the context of supply. Much good work has been done in that area.

We had great discussions in this House in the past 18 months or so on the Planning and Development Act, 2000. At the time, I stated that one of the most courageous initiatives taken in legislation was Part V of that Act, which provided that up to 20% of the land involved in any planning application can be made available for social housing. This was acknowledged by all sides in this House. That also addresses social integration which should be a necessary part of our housing programme. That is something of which one should not lose sight. In fairness, I remind the House that many members of the Opposition were loud in their praise of that section when it was introduced.

The issue of house prices has certainly been a bone of contention for this Government almost from the outset. Economists failed to predict the significant increase in the growth rate which we have enjoyed over several years. A fallout from that was a capacity problem on infrastructure generally and housing was one of those areas affected. The serviced land initiative and various other initiatives taken by the Minister have been quite effective in tackling that problem, which many people at the time said was almost insoluble – they said that market forces should dictate.

Because of the intervention in the marketplace, house prices, which were increasing at an enormous rate of some 40% in 1998, are now back to somewhat more realistic levels. In 2001, new house prices increased by about 5.6% nationally and secondhand house prices increased by 3.4%. Therefore the initiatives taken have been effective.

That was a difficult challenge for a Government and it now appears to be under control, but it is imperative because there is a strong tradition of house ownership in this country and many people in all walks of life aspire to that. It is important that we make that ambition realisable. Certainly the type of house price increases in the mid-1990s, up to about 1998 or 1999, would have driven home ownership out of the range of fairly well to do middle class people.

The number of local authority houses has been very significantly increased. There is a target to build some 25,000 local authority units between 2000 and 2003. That is interesting because ultimately this comes down to resourcing. The funding provided in 1997 was €228 million. In 2002, it is €755 million. Between 1992 and 1997, there were 16,0000 units built and the corresponding number of units for the period from 1998 to 2002 is 21,000 units.

When my local authority did its last housing assessment we found, much to my surprise, that because of the increased investment in recent years, and with houses under construction and houses planned, we were able to transfer everybody on the three-bedroom house list to the priority list. That was a remarkable achievement.

The demographic changes in society need to be looked at because the demand for two-bedroom houses has outstripped the demand for three-bedroom houses. It is all about effective management. Often I find that officials at local authority level can take a somewhat sanguine approach. There is obviously a demand for two-bedroom houses among single parent families, but I have also seen cases where, due to marriage breakdown, the husband holds on to a three-bedroom house and the family must be accommodated in another three-bedroom house because of the circumstances. We need to be able to manage those situations more effectively from the housing stock point of view and it is something which should be looked at.

The voluntary housing sector has increased very significantly. It is interesting that this sector now manages something like 15,000 units, with a further 7,600 under construction. The regeneration of Ballymun is something of which the Government can be proud.

While homelessness continues to be a problem and will always be a problem in my opinion, genuine efforts are being made to address it. Funding has been increased from €4.4 million in 1997 to €31 million in 2002.

I referred to affordable housing previously. Measures undertaken include the shared ownership scheme; estate management; remedial works schemes, where inadequate local authority housing has enjoyed very significant investment; and disabled person's grants. It should be acknowledged by all that very significant progress has been made under the Minister of State's stewardship. While there is more to be done, the same application continuing in that Department will see genuine overall improvements.

Mr. O'Toole

I am delighted to have the opportunity to talk on the issue of housing. I welcome the Minister of State, Deputy Molloy, to the House and acknowledge his intention to remain in the Houses of the Oireachtas for the next couple of years. He would have been a sad loss and I am glad to learn he is running for election again.

We have discussed housing many times over the past five years and the same problems, which have been restated tonight, have been highlighted. Progress has been made through Government policy and the national development plan. The motion loses the run of itself. There is no mention that there has been an improvement. All the problems have not been solved. I note that over 50,000 houses were completed last year. That was a record. I also note that figures from the Central Statistics Office for the last quarter of 2001 forecast that housing completions would fall to 45,000 this year and 40,000 in 2003. The target under the national development plan was 50,000 per annum. That shortfall would see us return to the problems we had in the past. I do not know if that is the case in the aftermath of the budget. I have not had time to study the impact that had on figures for housing starts.

There were two significant moves in the two most recent budgets which were helpful in the area of housing. Budget 2000 allowed homeowners to rent or let a room and earn up to £6,000 that would be tax exempt. That was very useful in helping people pay for their properties. I ask the Minister of State to talk to the Minister for Finance with a view to extending that scheme in a controlled way. There are some restrictions in the scheme that can be dealt with.

Last November there was no movement in the housing market and many builders went out of business. Apart from normal human sympathy, it was difficult to have real sympathy for them. During the past three years builders bought land from developers at any price. There were no business plans, costings or studying of the market. It was a case of buying at any price, building the houses as cheaply as possible, selling them for the highest possible price and screwing the consumer. It was difficult to have sympathy for those who operated on that basis when they were suddenly unable to sell their houses. That will have helped focus the minds of many people in the construction industry. At that time I spoke to people in the industry and outlined to them the difficulties that were there.

The Bacon report was published and was, correctly, implemented by Government. The impact of the report was to take investors out of the market – I am speaking as a member of the ICTU. Many people talk a lot of nonsense about the housing market. The reality is that the housing market needs approximately 18% to 20% of purchasers to be investors. There is a rental market and it has to be a quality market. That is a reality and anyone who denies it is not living in the real world. We have to allow investors to operate. We need to regulate and it is important that we do that in a qualitative rather than quantitative way. I thought the budget decision took a "one size fits all" approach. I discussed it with the Minister for Finance and had as much luck talking to him as I would have had talking to the wall. He told me the way he was going to proceed, that he wanted to keep it simple and not complicate matters, and that is what he did.

I thought what I suggested was infinitely reasonable. I suggested that the Minister soften the impact of the Bacon report but not in a way that would bring the investor back into competition with the first-time buyer or homeowner. Surely that was a reasonable objective and one that we would all share. That could have been done very easily. I suggested we look at where the investor would be most comfortable in the market, probably the apartment sector. I suggested the Bacon restrictions be released from that sector of the market, or from particular areas, and in that way first-time buyers would be protected and allowed into the market, but that was not done. Auctioneers now get telephone calls from investors who are interested in buying up to 40 apartments in a block that is being developed in order to get into the market. That will see us return to some of the problems we had last year.

We had a year when the implications of the Bacon report were fully felt. We had another year with new budgetary measures. Let us consider them to be the two extremes of the arc of a pendulum. Can we look at the next budget with a view to tailoring that down a little and giving a little more space to the first-time buyer? We should direct that which is positive for the investor to particular areas, either geographical or sectoral, and leave the first-time buyer out of that. The other, more obvious, thing to do is to give greater tax relief to home owners. I think that is in line with Government thinking.

Why will there be a problem? The Minister will recall that there was a big gig in Galway in 1979 when the Pope arrived. The consequence was the highest rate of birth in the history of the State the following year. That is 22 years ago and many of those born in 1980 are now coming into the housing market. Added to that are the numbers of immigrants and returned emigrants. Both of those groups are putting a substantial demand on the housing market.

Unless something has radically changed in the past month the targets set out in the national development plan will not be achieved this year or next year. That is a problem. I am not saying this to have a go at the Government. This is a market with forces acting on it and one that the Government cannot, and should not, control. It should seek to regulate it to a certain extent but there should be as little intervention as possible. We should try to help young people and first-time buyers, and that can be done by directing investors into particular types of property or areas. Special, intensified and increased reliefs should be given to first-time buyers.

Social housing is causing all kinds of difficulties for builders. When granting planning permission in a particular area, why does the planning authority not insist that a certain percentage of houses in the development must sell for less than a certain amount? That would help going forward.

I do not have time to discuss planning in depth but the hamlet and small village developments that many local authorities are examining will also be important going forward and they should move in that direction. If the targets in the national development plan are not met, we will experience the same problems as a year ago. I compliment the Minister of State on his efforts. The pendulum needs to be stopped in the middle in the next budget and I ask him to take my proposals on board.

Minister of State at the Department of the Environment and Local Government (Mr. Molloy)

I am pleased to have the opportunity to address the Seanad in support of the motion, to set out again the main elements of the Government's approach to housing and to update Senators on the positive effect that this approach is having. Housing remains at the top of the Government's agenda. A wide range of measures have been taken over the last five years to reduce house price inflation; to increase housing output to match demand; to remove infrastructural and planning constraints on residential development; to afford greater access to the housing market to first-time buyers; and to improve affordability for first-time buyers and lower income households.

The Government's publication of Action on House Prices in April 1998 was the first of three major policy initiatives on housing. Its primary focus was to increase housing supply through a range of infrastructural and tax measures and to prevent investors pricing first-time buyers out of the market. These measures were supplemented in 1999 by further measures taken in Action on the Housing Market and in June 2000 the Government published Action on Housing, which spelt out additional actions necessary to continue the momentum that was being achieved on foot of the earlier measures that we introduced.

I will outline some of the key measures taken by the Government because some Opposition Senators are not aware of what is happening on the ground. A range of tax measures, including adjustments to the stamp duty system, were introduced to bring forward the supply of development land, remove speculators from the market and improve affordability for first-time purchasers. We introduced targeted measures to increase the supply of serviced residential land on top of significantly increased investment generally in water, sewerage and roads services. More than €63 million in Exchequer funding is being spent on the serviced land initiative, which will provide water and sewerage services for some 165,000 housing units. A total of €248 million in Exchequer funding has also been provided to part fund the construction of 42 non-national roads that will provide services for more than 42,000 housing units. Six project offices have been established to drive key infrastructure projects necessary to support housing development.

We designated the first three sites, comprising some 14,000 housing units, in June 2001 as strategic development zones for residential development to assist in the early development of these sites. We published planning guidelines on residential density in September 1999, which are helping to secure efficient use of serviced development land, facilitate provision of more affordable housing and promote sustainable development. Strategic planning guidelines were drawn up on a regional basis for the Dublin and mid-east regions and this is being replicated in other key regions throughout the country.

We introduced a range of measures to expand the capacity of the planning system, including the appointment of additional planning staff to local authorities and An Bord Pleanála, the recruitment of planners from abroad, additional planning courses in third level institutions and revisions to regulations to increase the size of exempted domestic extensions.

It is clear that Government measures in the housing market have been effective. I published details of the second national inventory of zoned serviced land at the end of 2001, which showed that the position in regard to the stock of serviced building land is encouraging. There is currently approximately six years supply of serviced land nationally, in Dublin and in the greater Dublin area. This will improve further on foot of increased investment in economic infrastructure such as roads, water, sewerage and public transport over the period of the national development plan. The availability of serviced land, which was identified as a key issue when we took office, has been fully and comprehensively addressed.

More than 13 houses per 1,000 population were built in 2001, the highest rate in the EU in proportion to population and approximately four times the UK rate. House completions in 2000 reached almost 50,000 units nationally. Notwithstanding the Opposition's attempt last year to talk up problems in the house building sector, this record level was surpassed in 2001. The prophets of doom in the Fine Gael Party and the Labour Party told us the numbers would decrease. Last year was the fifth consecutive year of record housing output under the Government. Since the Government came into office, housing output has increased by more than 33% from a little under 39,000 units in 1997. Some 216,000 new houses have been built in the five years that the Government has been in office, equating to approximately 18% of our total housing stock.

Since house price inflation peaked in 1998, primarily as a result of the failed policies of the previous Government, there has been a downward trend in house price increases. My Department's September quarter data for 2001 showed a continued moderation in new house prices with the annual rate of increase at 5.6% nationally and 6.7% in Dublin, with second-hand house price increases of 3.4% and 4.8% respectively. This data is supported by other sources. According to the Irish Permanent, November 2001 figures show that for the eleventh consecutive month the year on year growth in national house prices has slowed, falling from 10.1 % in October to 7.5% in November. This is the lowest year on year increase since the index started.

One of my principal objectives in office has been to create space for first-time purchasers. I am glad they are accounting for a larger share of the market, with applications for new house grants increasing by 7.3% in 2001, following an increase of 4.8% in 2000. Indicative figures also show that first-time purchasers accounted for 34% of the market in 2000. This figure increased to 43% in 2001. Our policies have achieved increased output, reduced house price increases and afforded a greater share of the market to first-time buyers. The facts speak for themselves.

The Government can also claim credit for bringing about real and positive changes in the provision of social and affordable housing. We have, for the first time, provided a long-term framework for the funding of social and affordable housing through the inclusion of €7.62 billion in the national development plan, which was earmarked for these purposes. This was supplemented by the Government commitment of a further €1.27 billion for social and affordable housing in Action on Housing.

Action on Housing also included a number of measures to address social and affordable housing need, including an increase of 6,000 units in the number of local authority housing starts under the national development plan, increases in the income limits for the shared ownership and affordable housing schemes and a new site sub sidy for houses provided by local authorities under these schemes. This overall investment will ensure that the housing needs of approximately 100,000 households will be met with Government assistance over the period of the plan. The total provision for social housing in 2001 was more than €1.4 billion, an increase of more than a third on 2000 and almost treble that provided in 1997 when the Opposition was last in Government. The provision this year is €1.7 billion.

The impact of the Government's social housing strategy under the national development plan is being reflected in the provision of local authority housing. I introduced a multi-annual local authority housing programme for the first time, commencing in 2000 and running through to the end of 2003. Under the programme we aim to provide a total of 25,000 local authority housing starts. The multi-annual approach was introduced to provide for greater forward planning and efficiencies of scale in delivering the increased local authority housing targets. Local authorities completed some 5,000 units in 2001 and commencements of new house starts are estimated at more than 7,000 units, the highest level of starts for more than 15 years.

In addition to the main local authority housing programme, major regeneration programmes have also commenced in Dublin and Cork, most notably the redevelopment of Ballymun in Dublin, which is the biggest regeneration project in the State involving the demolition of all the towers and the construction of 2,800 houses. More than 500 houses are currently under construction and some have been completed and are occupied. Since 1998, I have provided more than €86 million for this project. There are also other major regeneration schemes underway or due to commence shortly in Dublin and Cork. A large redevelopment programme is currently underway, at an estimated cost of some €130 million, in Dublin's inner city, where there are currently more than 200 new houses under construction on six schemes. Work is also due to start shortly on the first phase of the €50 million redevelopment of the Glen area in Cork city.

My Department is also jointly funding with Dublin City Council a once off upgrading of high density older housing complexes, mainly flats, at various locations around the city at an estimated cost of €110 million. These measures are additional to the main construction programme and they all represent new and additional social housing activity. More than €165 million is being provided in 2002 for the Ballymun project and the various redevelopment programmes.

On coming into office, the Government quickly identified the important contribution the voluntary and co-operative housing sector has to make in tackling the growing demand for social housing. The voluntary housing organisations were in deep depression when there was a change of Government. They were dismayed by the lack of support they received from the previous Govern ment, as a consequence of which their house building activity had shrunk.

The commitment of the Government to the expansion of the sector is reflected in the national development plan which includes ambitious targets for output by the sector for each year of the plan and provides the necessary funding to achieve these targets. This commitment is also reflected in my improvement of the terms of the voluntary housing funding schemes on four occasions since 1997, the most recent in July of last year. The improved terms for these schemes clearly have a positive effect on activity. Output by the sector in 2000 showed a substantial increase in the number of units of accommodation provided, with 950 units completed, the highest output by the sector since 1995.

Indications are that output by the sector in 2001 will be in line with the national development plan target of 1,250 units. There has been a marked increase to 7,600 in the number of units of accommodation under construction and at various stages in the pipeline. Last year, I approved €254 million in assistance towards voluntary house building programmes compared with €151 million for the previous year. These indicators augur well for continued growth in the sector.

Housing output from the local authority housing programme, together with output from the complementary social housing programmes of voluntary, affordable and shared ownership housing and with vacancies occurring in the existing local authority housing stock will have enabled the housing needs of about 11,000 households to be met in 2001.

A key concern for me as Minister has been to meet the special needs of specific categories of households such as the elderly and the disabled. This concern is reflected in the substantially increased funding I have made available for the task force on special housing aid for the elderly, the disabled person's grant scheme, the essential repairs grant scheme and the scheme of improvement works in lieu of local authority housing. The total number of grants paid under the disabled grants scheme and the essential repairs grant scheme in 2000 was just more than 5,000 with a value of €32 million. In 2001, more than 6,300 grants were paid under both schemes. The improvements I have made to the terms and conditions of both schemes since taking office have led to a significant increase in activity given that fewer than 3,000 grants were paid in 1996 at a value of about €13 million. The number of houses improved under the task force, and the figure for the improvement works in lieu scheme in 2000 was just under 4,000. Activity under these schemes in the first half of last year points to an even higher level of activity in 2001.

I launched the Government's integrated strategy on homelessness in May 2000. The strategy recognises for the first time that homelessness is not just about a lack of accommodation, but that the health, care, welfare, education and training needs of homeless persons need to be addressed in a co-ordinated manner if the problem of homelessness is to be tackled effectively.

A key element of the Government's strategy is that homeless action plans are to be drawn up at local level jointly by the local authority, health board and voluntary bodies to chart clearly what services exist for homeless persons and to outline what services need to be provided for them in the next three years. The plans for the main urban areas are completed and work is well under way on the plans for other areas and should be completed shortly.

I have made substantial additional funding available to ensure that the recommendations in the homeless strategy are implemented. Capital funding for the direct provision by local authorities of accommodation for homeless persons is being doubled from €25 million to €50 million over the next five years. Current funding has been increased by €7.6 million per annum to increase bed-night contribution rates to voluntary bodies and to fund other support services such as settlement and outreach services. Additional funding of €7.6 million is also available from the Department of Health and Children to fund the provision of in-house care in hostels providing accommodation for homeless people.

As part of the overall homeless strategy, the Government gave a commitment to prepare a preventative strategy to tackle key groups at risk of homelessness. Having received Cabinet approval for its publication on 30 January, I will be in a position to launch this strategy very shortly. The main theme throughout the strategy will be the need to ensure that no one is released from any type of State care, whether custodial or health related, without appropriate measures being in place to ensure they have a suitable place to live with the necessary supports, if needed.

The Government has also brought about in the Planning and Development Act, 2000, one of the most fundamental changes to planning law introduced by any Government. Part V of the Act radically alters the role of local authorities in the planning and provision of housing. It requires them to undertake a much more strategic role in identifying and addressing housing needs through the preparation of housing strategies. These must address the housing needs in the area covered by their development plan, including the need for social and affordable housing. The Act also requires local authorities to zone sufficient land to meet these needs. The first set of strategies has been prepared by local authorities and almost all authorities have varied their development plans to incorporate their strategies.

Housing output is not simply about increasing the numbers. It has been a fundamental objective of the Government to promote more balanced regional development by promoting the development prospects of areas outside Dublin while at the same time managing and dealing with Dublin's current problems in terms of meeting its housing needs and transport requirements on an integrated basis. This fundamental objective is being fleshed out through the national spatial strategy which is being finalised.

Ireland's critical spatial weakness is that we do not have a wide enough range of the type of locations needed to attract significant levels of international investment or sustain substantial indigenous investment. We need to add to the locations which already have this capability and tackle disadvantage in parts of the country not enjoying the level and growth of development and economic benefits in some areas, especially Dublin.

Doing this successfully will depend on selecting and developing emerging stronger centres or combinations of centres to drive growth in their wider areas at an appropriate scale for each area and strengthening the roles of other towns, villages and rural areas linked to the emerging, stronger centres.

My Department received more than 240 submissions in response to the public consultation paper on the strategy, Indications for the Way Ahead. These emanated from local and regional authorities, representative community groups and interested organisations and individuals throughout the country, not least from a number of Members of the House. All these submissions have been carefully considered with a view to ensuring that the views expressed in them are factored into the development of the national spatial strategy before it is finalised for approval by the Government.

The objective of the strategy will be to identify and provide guidance on the key policies and actions that need to be developed to bring jobs closer to people through developing the potential of different places. The key to this will depend on being focused while seeking to set the agenda for what all areas can do in terms of widening opportunity and access to employment, housing and services. The Government is determined to leave a legacy which will enable all parts of Ireland to develop over the next 20 years and beyond in a way that is economically competitive, environmentally sustainable and socially inclusive.

The Government also recognises the importance of and need for a diverse and well managed private rented sector. In July 1999, I established the Commission on the Private Rented Residential Sector to examine the issues of security of tenure, supply and development constraints and the balance of rights and responsibilities between landlords and tenants. This was the first comprehensive review of the sector undertaken by a Government appointed body. The commission reported to me in July 2000 and the Government accepted my proposals for reform of the sector arising from the recommendations contained in the commission's report. These proposals were announced in January 2001.

A number of relevant measures have been implemented in the Finance Act, 2001, including a reduction in the stamp duty rate for new residential investment properties, tax relief on rental income in respect of refurbishment capital expenditure, the reintroduction of interest relief on borrowings in the case of certain properties meeting specified conditions and roll-over relief on capital gains tax in respect of qualifying reinvestment in the sector.

Implementation of reforms relating to improved security of tenure, graduated notice to quit periods, tenancy termination, landlord and tenant obligations and rent aspects require new legislation, including amendments to the existing landlord and tenant legislative code. The Government approved the general scheme of the Housing (Private Rented Sector) Bill which I brought before it earlier this week. It is the most radical legislative proposal dealing with landlord-tenant relations ever introduced in the history of the State.

In the meantime and pending the enactment of the necessary legislation, I established the private residential tenancies board on an ad hoc basis in October 2001 to deal with disputes and perform other research and information functions. It is developing the necessary procedures to allow it commence dispute resolution. It has advertised for mediators and appointments will be made soon.

As well as measures to improve the operation and regulation of the private rented sector, I proposed to Government measures to boost the supply of private rented accommodation. Over 900 units of student accommodation, providing over 3,500 bedspaces, have been provided on foot of measures introduced in the Finance Act, 1999. A further 3,800 units are at various stages of planning which will provide an additional 14,000 bedspaces, greatly easing the student accommodation problem.

I also proposed a new rent a room scheme, introduced in the Finance Act, 2001, which provides for an exemption from income tax where gross rental income does not exceed €7,600 per annum for accommodation provided in a person's principal private residence. The scheme will increase the availability of accommodation, will assist affordability for house purchasers and will also make better utilisation of the housing stock. In addition, the ceilings for income tax relief in respect of rents paid by tenants in the private rented sector have doubled over the budgets of 2000 and 2001.

Developments in the private housing market, as I outlined earlier, have now allowed us to step in and introduce further measures in budget 2002 to deal further with the rental sector. We withdrew interest deductibility against rental income for housing in 1998 as part of a set of measures designed to reduce speculative demand for housing, reduce pressure on house prices and create space in the housing market for first time purchasers. As a result of these measures conditions in the housing market have altered fundamentally.

I make no apologies for using these financial instruments available to us in order to achieve certain Government policy objectives. The situation was running riot. Speculators were ripping off private tenants because of the shortage of housing at the time. That shortage still exists. It is a huge challenge to provide enough homes to meet the needs of all of our people. We are quite a distance from this. You can call it a crisis, a challenge, a scarcity. The problem exists no matter what you call it. The Government faced straight into it and took a wide range of measures to deal with it, as I had the opportunity to outline tonight. It all depends on the capacity of our house building industry, which we have stretched to the utmost in reaching the astonishingly high output achieved in recent years.

The reintroduction of interest deductibility, as well as the changes to the stamp duty system whereby the rates applying for investors have now been aligned with those applying in the case of existing owner occupiers, will encourage an increase in the supply of rental accommodation. Accommodation provided with the aid of interest deductibility will, of course, be subject to compliance with proper regulatory controls and to registering tenancies with the Private Residential Tenancies Board. Any landlord who does not register his property will not qualify for any of these tax concessions. These budget measures complement the other reforms introduced on foot of the recommendations of the Commission on the Private Rented Residential Sector and are laying the groundwork to achieve my objective of a diverse, properly functioning and well managed private rented sector.

I want to outline briefly a number of the significant initiatives I have introduced over my term in office. A local authority multi-annual approach has been introduced to achieve a total of 25,000 starts for the period 2000-2003 and allow for greater forward planning and efficiencies of scale in delivering the increased local authority housing targets. Senator Costello is a member of Dublin Corporation. I know the number of housing starts that I gave to Dublin Corporation. It has not started to build the number of houses which I authorised from the funding which I made available. It is buying houses with the money, rather than bothering to acquire brown field sites, designing houses, building them and adding to the overall housing stock.

I have committed record levels of resources to funding and supporting the voluntary housing programme. I have increased the funding limits for assistance under the voluntary housing schemes on four occasions and by more than 100% since 1997. It is hard to hear Fine Gael challenging me about the terms of the motion when I know the dismay that existed throughout the voluntary housing sector when I took over. It had been totally neglected by the rainbow Government. The number of activities in the pipeline was at its lowest level for years.

I resuscitated the voluntary housing sector and threw it a huge challenge. I told it to get up off its knees and I would help it. It was building 3,000 units per year under the previous Government and I wanted it to reach 4,000 units per year. I am funding that and supporting those organisations. I am helping them with estate management funding and special training courses for workers in this sector. I have increased the funding to these organisations fourfold with non-repayable loans. They are the brightest sparks in the country, the dedicated people who are active and committed in the voluntary housing organisations. They are coming together where they see a need in their locality and availing of the Government support and funding. They are providing fantastic new homes, through that partnership, for people who need them. Families with low incomes, elderly people and disabled people are benefiting from this. The output is up from 300 to 1,250. There are 7,600 units either under construction or in the planning stages. I want to increase the completions to 4,000 units per year. I know that will be achieved.

It will not matter if I go out of office after the next election. I have started a momentum. It is like a big, heavy ship in the ocean. Once you get it going it will keep going on, even if you turn off the engines. What has been done will continue to bring results and benefit many people for years after the Government leaves office.

I introduced a new initiative to enable voluntary bodies undertaking housing projects under my Department's voluntary housing capital assistance scheme to provide accommodation for elderly emigrants who wish to return and who are unable to provide it from their own resources. Many Senators do not know this. They have not read their brief and acquainted themselves with the facts. These emigrants did not qualify under the previous regime in which a person had to be living here, put their name on the housing list and wait for three or four years for an offer. Now a voluntary housing group can come together and allocate a large percentage of their homes to people returning from England. I compliment Doctor Gerry Crowley in Mayo, who acts as an agent for my Department in co-ordinating applicants to his organisation. This is in its infancy and I am proud of it although we have not yet brought home one emigrant. It will benefit people for many years.

I provided funding to Rural Resettlement Ireland, a voluntary national agency, which deals with assisting Irish urban families to move to areas of their choice in rural Ireland. Funding has been made available for major research projects in housing including, for example, the three Bacon reports on the housing market, the establishment of the housing unit, which is invaluable now, particularly to voluntary organisations and local authorities and the undertaking of the national house condition survey.

The Housing (Miscellaneous Provisions) (No. 2) Bill, 2001, currently before the Dáil will increase the Housing Finance Agency's borrowing limit to €6 billion and allow it lend directly to voluntary housing organisations. It will no longer need to apply to the local authority, which no longer needs to seek the approval of the Department of the Environment and Local Government. Now it can go straight to the Housing Finance Agency.

Substantial increases in funding were made available for the housing management initiative to enable local authorities to fund the employment of a number of staff to work with tenants and residents groups as well as addressing the training needs of their own staff in this area. A provision of €63 million was made for the serviced land initiative which will provide water and sewerage services for some 165,000 housing units. This is a completely new initiative by the Government.

I introduced increases in the income limits for the shared ownership and affordable housing scheme, which is a new scheme that I introduced a few years ago. My local authority, in Galway, is making excellent use of this. Other local authorities are not using it at all. It is quite astonishing. The local authorities are the housing authorities. We lay down the policy, provide the funding and the schemes. We have laid out all that is required, down to site subsidies to help them buy the land and they are still slow to avail of some schemes. Members of both Houses on the Opposition side, who are also members of local authorities, are criticising when they should be getting more action on the ground in their own areas.

I introduced increases in the income limits for all of those schemes and extended the essential repairs grant to urban areas. There are still Deputies and councillors who have not made themselves aware, by reading the local authority circulars, that this extension has taken place. The terms and conditions of the scheme have been improved, as has the disabled person's grant scheme, on several occasions since 1997. I am very proud of the disabled person's grant scheme, which I introduced in 1971 and have greatly improved over the past four and a half years. Tens of thousands of disabled people have benefited from it. I am happy to say that €32 million was spent on that scheme last year.

Substantial increases in funding for the various grant schemes have been provided. The provision for the special housing aid for the elderly schemes has increased from €5.1 million in 1996 and this year I will provide almost €12 million for that excellent scheme. The health boards and the task force have been put to the pin of their collars to keep up with the funding being made available by the Government. Their problem in many cases is in spending the money provided. Some Western Health Board areas came back for more money before the end of the year but others could not keep up with the level of funding. I want to see backlogs being cleared.

Funding for the disabled person's grant and the essential repairs grant has been increased to €32 million. Funding for Traveller accommodation has increased from €12 million in 1997 to €23.7 million last year and will be increased further this year. The enactment of the Housing (Traveller Accommodation) Act, 1998 has led to the subsequent adoption by all local authorities of the five year accommodation programme to meet the existing and projected accommodation needs of Travellers in their areas. I launched a comprehensive Government strategy on adult homelessness in May 2000 and will shortly publish the preventive strategy to ensure that people leaving State care do not become homeless.

The Government's record on housing speaks for itself. We have responded to the numerous and diverse challenges with a credible and wide ranging set of measures. We have adjusted and fine tuned existing policies to reflect developments and introduced new policies where we deemed they were necessary. We have provided unparalleled levels of funding. Our vigilance in the housing area is paying off. Output is up, prices have been stabilised and social housing is being delivered at record levels. The motion clearly sets out the range of actions taken by the Government in relation to housing and these actions need to continue with the support of the Seanad.

With the continued support of my colleagues in Government we can deal with the current housing challenge. The country is in an economic boom. We have had a huge increase in the number of people needing homes and applying to public authorities for them. We have responded to the need for housing and the house building industry has been challenged to keep up with the funding and planning of the Government. I am happy with the work we have done and proud of the contribution we have made. Much more remains to be done.

Mr. Burke

I welcome the Minister of State to the House. He has done laudable work in his Department in the past five years. He has brought great changes in the provision of houses, particularly in the provision of social housing. However, shortcomings remain in the provision of housing.

It is rich of the Minister of State to refer continually to the two years Fine Gael spent in Government. Fianna Fáil has been in Government for the past 14 years, with the exception of the two years Fine Gael was in office. The Minister of State's party was in Government on two occasions in that period. To hear the Minister of State speak one would think all the country's housing problems arise from the fact that Fine Gael was in office for two of the past 14 years.

This Government is lucky to have been in office for the best five years in the history of the State, when money was not a problem. Nevertheless, there have been shortcomings. Why is homelessness on the increase? Why are housing waiting lists getting longer? The housing list in Cork has doubled. A number of years ago there were 2,000 people on the housing list in Cork and there are 4,000 today.

Miss Quill

That is because of all the jobs being created under this Government. People have come home to take up jobs.

Mr. Burke

In the Minister of State's own city the number has risen from 700 to over 1,000.

Why are builders worried and why is there a lack of confidence in the building industry? This is partly due to the Bacon reports and to decisions taken by the Minister for the Environment and Local Government. Every local authority has adopted a housing strategy, including a requirement for all housing projects to include 20% social housing. The Government has also introduced new planning regulations. At one time planning permission remained valid for five years but now, in order to retain planning permission, a builder must have completed 50% of the work within two years. A building contractor who applies for planning permission for a parcel of land is faced with the requirements to provide 20% social housing and to complete 50% of the work within two years. Such a contractor will think twice before investing in the building of houses.

Where is the accountability in relation to the provision of the 20% social housing? A local authority manager enters into a contract with a builder for the provision of an amount of social housing and a price is agreed. Is there a tendering system to decide the price of the houses? The financial arrangement is between the builder and the local authority manager. There appears to be no accountability here. The Minister of State must address this question.

There is a lack of essential services. I come from a county where there is a total lack of services. In Castlebar we are still waiting for the Government to provide a sewerage system. Six months ago our local authority manager refused planning permission for 200 houses. A builder from the Minister of State's own city has applied for planning permission but it looks as if he will not get a favourable decision. Other contractors are also seeking planning permission. These projects are dependent on the provision of a sewerage system which is on the waiting list. Numerous towns in the county lack services.

I congratulate the Minister of State on his achievements. He has introduced change and put many fine things in place but we are still lacking essential facilities.

I congratulate the Minister of State on the extra funding provided for the essential repairs grant but I ask him to look at the long list of people in County Mayo who have applied for this grant. County Mayo's funding allocation is not sufficient. The terms of the scheme should be changed. Grants are provided only to extend the life of a house to meet the needs of its elderly occupants. A number of rural houses could be brought up to a proper standard if the terms of reference were slightly changed to allow people to spend money on repairing their parents' houses. It is ridiculous if some of these people apply for planning permission and their children are willing to provide much of the funding, but they cannot avail of the funding the Minister of State has put in place. I ask him to consider that aspect.

Mr. Ó Fearghail

I welcome the Minister of State to the House and I am pleased to have an opportunity to contribute to the debate on this motion. He made one of the most comprehensive presentations I have heard during my term in this House, setting out a litany of real and positive achievements made by the Government in the housing area since coming into office. It has always been my philosophy that the availability of proper housing affects more than anything else the quality of life of individuals and families. It impacts directly on the health, education and employment prospects of citizens. No area of Government activity is more fundamentally important.

It is necessary to emphasise, as the Minister of State did, that the Government has prioritised housing. This is evidenced by the achievements set out in his address and by the fact that during its term of office the Government established a Cabinet-led sub-committee, chaired by the Taoiseach, which is a cross-departmental team on housing. In 1999, it established the housing supply unit. These initiatives, together with the €63 million serviced land initiative, the implementation of the residential density guidelines and the construction of record numbers of local authority houses, have achieved an overall output of record proportions. The facts set out by the Minister of State cannot be denied and are incontrovertible. By the end of 2002 it can be expected that more than 21,000 local authority units will have been completed. It is also clear that the implementation of the Bacon recommendations has contributed enormously to the massive reduction in house price inflation, down from 40% in 1998 to approximately 5.5% for new houses and 3.5% for second-hand properties at the end of last year.

The Government's multi-annual programme to 2003, to which the Minister of State alluded, sets the objective for local authorities of 25,000 new starts. We must accept that is a tall order and it will be a challenge for local authority members throughout the country to ensure their local authorities actually deliver. In order for them to deliver, there must be a radical new approach to the task at local authority level. I suggest mirroring what has happened at national level by establishing SPCs on housing as the engine that might drive that construction programme. We need a local engine to make these things happen and to achieve the sort of levels the Minister and the Government have set out.

In County Kildare we are used to building major roads and every time there is a major road programme we are able to recruit substantial numbers of technicians, engineers and so on. However, that has not been a feature of the housing programme. Recently, in County Kildare, the number of staff employed in the housing department was the same as in the early 1990s when we were building 20 or 30 houses. That is a local management issue and the Government can help by bringing additional pressure to bear on county managers. While the better local government initiative will be tackled in the medium to long term, perhaps the recruitment and promotional aspects within the housing department need to be prioritised. We need to professionalise the housing service within local authorities.

I am convinced time will show that the most significant legislation introduced by the Government was the Planning Act 2000, particularly Part 5. I recall attending a housing conference in Britain more than ten years ago, coming back and making a proposal to my Fianna Fáil colleagues on Kildare County Council that we should emulate what was being done in Edinburgh where 10% of units being built were being taken for social or affordable purposes. I recall being laughed out of court in the early 1990s. We have now reached the 20% point. I was interested in what Senator Burke said and I wonder if he is suggesting, given his reluctance in regard to the 20%, that Fine Gael in Government will renege on that initiative. I believe it is one of the most positive things that has happened.

As the Minister of State said, housing strategies have been adopted in practically every part of the country by local authorities. It must also be said that adopting the housing strategy is very easy – to a certain extent, it is an academic exercise. Making it happen is the big challenge. Local authorities will have to challenge developers and builders to make this a reality. If it is to become a reality, the construction industry must buy into the fundamental concept of social integration. The benefits for society of achieving that particular objective in the medium to long term are enormous but we need the construction industry to buy into it. Once the construction industry buys in and signs up to the basic philosophy, delivering the 20% is just a design challenge. It is possible to deliver estates with a properly designed 20% element if there is goodwill on all sides.

The Minister of State said much about voluntary housing. I know he has done enormous work in that area and I salute him on his achievements. The fact that there are 7,600 units currently under construction or at the planning stage is indicative of how far we have come in the past four or five years. We have seen the growth in the number of indigenous voluntary housing associations, many of which are run on a professional basis, and all are committed to building communities, not just houses. A number of British housing associations have been coming into the country and getting in on the act. I have been involved in a number of local community-based voluntary housing associations in County Kildare – I am sure the Minister of State is aware of what has been going on there.

We need to monitor carefully the development of the voluntary housing sector. It is fair to say that the main priority for people on the local authority housing list is to get a house. As soon as people are housed they have other priorities. The two principal priorities of tenants of voluntary housing associations are that they want equity and parity with local authority tenants. They want a maximum rent system and the opportunity to buy their houses. That is currently being resisted by some of the large voluntary housing associations. I understand the Government is rightly emphasising at this stage the output issue. However, we need to move beyond that and to give parity of esteem to people housed by voluntary housing associations because at the end of the day the right of people to purchase or to have parity with local authority tenants is more important than allowing voluntary housing associations build their property portfolio.

I compliment the Minister of State on his outstanding work on behalf of the people over the last five years when there have been enormous changes in society and family make-up. There will be a continuing demand in the housing area. Meeting that demand will be one of the major challenges for the Government over the next five years. However, it has proved that it is more than up to the task.

Mr. Farrell

I congratulate the Minister of State on the work he has done and the amount of money he has put into the housing area since coming into office. Travelling throughout the country one can see the number of houses being built in towns, villages and so on. Housing is a big business and it is good that so much money has been invested in that area. I particularly welcome the fact that the Government has provided local authorities with the money to buy land. If they work out the figures, pre-built houses can be obtained cheaper than buying land and building on it, and those houses are given out almost immediately. That is a great advantage and I do not think enough local authorities are availing of it.

Much was said about homelessness. It can be broken down into two categories. I reckon that about 25% of homeless people suffer from psychiatric problems. Houses should be bought and converted into high-support hostels for those people, as was done by the North Western Health Board, because they are not capable of looking after themselves and they are not taking the medication that they have been prescribed.

The other 75% are, by and large, involved in alcohol and drug abuse. I appeal to voluntary organisations and everybody else who talks about homelessness to bear in mind that unless we deal with alcohol and drug abuse, we will always have homelessness. Many of the homeless had good homes but their parents could not put up with them and their drug-taking habits and drinking so they had to leave and become homeless. If they were not involved in drug and alcohol abuse, they would be at home where they should be.

In other cases, people are homeless because they cannot stand the fact that their parents are taking drink and drugs. Drink and drugs are the two biggest problems in this country today. Some 75% of our social problems would be solved if we could come to grips with those issues. Throwing money at the problem will not solve it. I congratulate the Minister for financing a system whereby people with the aforementioned problems can be treated. It is a medical problem, a difficult problem. I know people who have tried to give up cigarettes and were not able, which shows the strength of addiction. It is a terrible problem but it must be addressed to solve the problem of homelessness.

Objectors are causing a hold-up in terms of housing. We are becoming a very selfish society. When a scheme of houses is planned, there is an objection. People who have houses do not want others to have a house. It costs a fortune to go to An Bord Pleanála, and sometimes the person has to reapply for permission. This is a terrible problem. We face this problem with regard to social housing because people are now saying "They are not good enough to live beside us, they will devalue our houses." We are all human beings. We are all just passing through this world and on the path of life nobody will ask one what kind of house one lived in. What matters is the kind of life one lived. One will not have lived a proper life if one's attitude is to be selfish and object to other people getting houses.

I am annoyed with An Taisce, which is objecting to fathers and mothers giving sites to their sons and daughters to build houses on their own land. They want to bring back the extended family system, which was prevalent in this country for years. Fathers and mothers would like nothing better than to have their sons or daughters nearby. People are forced to pay up to £40,000 and £50,000 for sites miles away from their parents. We have to confront An Taisce and objectors who are giving more priority to birds and bees than human beings. We hear so much about flora and fauna, but I say continually that people are fauna. We are part of the fauna. The problem is worse now than it was in the time of the landlords 100 or 200 years ago, when they put their tenants into holes and hollows so that the gentry from England would not see where they were living. We are now doing the same thing by saying that in areas which are scenic the views cannot be spoiled. The skyline is more important than human life. This must be confronted.

In my county, everyone admires Classiebawn Castle, the home of the late Lord Louis Mountbatten, and rightly so. Who would get planning permission today to build a castle on top of the hill, right by the shoreline? The hypocrisy annoys me. If William Butler Yeats or some other famous person lived in a house 100 years ago, it has to be rebuilt because it is argued that it is part of our culture and heritage. Yet, if the son or daughter of someone living on land for generations wants to build a house on that land, he or she is denied the right to do so. We have to face up to this problem, which is being blown out of proportion by objectors.

I congratulate the Minister on bringing in more planners because we had a shortage, which was causing a hold-up. Unfortunately, many of our planners, although they are very good people, are not looking at the basic problem. Again, they are more interested in hedgerows, or whins as we call them in my part of the country – they are called furze in other parts of the country. People are not allowed to open a gap in the hedgerows to build a house on the inside. The objections are absolutely ridiculous. We have to come to grips with this and face the fact that the Government is doing its best. Objectors are getting money and objecting is now a way of life for many people. A crowd is gathered to object. Then engineers and experts are paid who know much more than the Government and all the officials it and the councils employ. It is a money-making racket that must be confronted. Unless we confront it, we will not get real value from the money we are spending. Too much of it is being spent on administration etc.

I congratulate the Minister on what he is doing for the disabled because they had been neglected for a long time. He is doing a good job and I wish him every success. I hope that, based on what I said, some objectors will think in a more humane manner and realise that, only for the grace of God, they could be in the same position as the people to whom they are objecting.

Mr. Cassidy

I will be very brief. I congratulate the Minister on the great work that has been done since 1997. On many occasions during the Order of Business, I remember that many Senators were sceptical about the projected figures of the Government in respect of its commitment to have buildings in place. To have 250,000 units, houses and apartments built in the past two years is outstanding. Any fair-minded Member of this House could only congratulate the Minister of State, Deputy Molloy, a Deputy of long standing and a respectable Minister of great repute in many Governments down through the years. I know he was very ably assisted by the Government, particularly the Minister, Deputy Dempsey and the Minister of State, Deputy Dan Wallace. It is one of the great success stories of the era that was known in Ireland as the Celtic tiger. Something meaningful has been done for the people of Ireland by building all the units, and I hope this continues.

Senator Farrell has said that a son or a daughter cannot live in the parish in which he or she was born, which is not in the spirit of the Constitution in many respects. This is because the thinking in the schools that are training our plan ners – young, energetic, good planners – is that one cannot build here or there.

I hope many of the planners will take the example of Cavan County Council, particularly the Cavan county manager, Brian Johnson. He has rejuvenated the declining population in County Cavan, which was 75% in decline at one stage. If any local authority member wants to see how planning should be dealt with, particularly in rural Ireland, he or she should go to County Cavan to see how the county manger, Mr. Johnson, is doing so.

Miss Quill

This has been a very worthwhile and useful exercise. I particularly want to thank the Minister for coming into the House and enabling all of us to have a fuller understanding of what has been put in place in terms of housing provision in the past five years. It was not just that money was made available but several worthwhile initiatives have been introduced by the Minister during his term of office. Those initiatives will continue to bear fruit long after the Government will hand over to the next Administration. There is no need for me to say who I hope will be the Minister with responsibility for housing in the next Government. It would be in the best interest of the upcoming generation of Irish people that Deputy Molloy be given another term to build on the very constructive contribution he has made to housing, which was chaotic—

Mr. Burke

The Minister's admiration society.

Mr. Connor

I hope he holds his seat.

Miss Quill

Housing was chaotic five years ago. The Opposition had ample opportunity to make its contribution to this debate. I thank Senator Burke for taking the debate seriously. He used the opportunity presented to raise issues with the Minister. Charity prevents me from mentioning the input from other Members from that side of the House.

Mr. Connor

That is a disgraceful comment.

Mrs. Ridge

I am deeply offended.

Miss Quill

Senator Ridge has every reason to be so.

Mrs. Ridge

It is very nasty to say that. There is no need for charity.

Miss Quill

The truth must stand and I stand over it.

Mrs. Ridge

It depends on the way it is looked at.

Miss Quill

Senator Ridge is wasting time, both hers and mine. Homelessness is one of the things that hurts us most. Year after year we have heard the problem stated without a real solution being implemented. I take great heart from the prevention strategy the Minister is now proposing to introduce. Nobody is born homeless. They are homeless when they are released from prisons without proper provision for their aftercare. They are homeless when they are let out of big mental hospitals without proper care in the community. They are homeless when there are problems in the homes into which they were born. Very often the problem for young people is not of their own making. There are reasons people are homeless and unless we analyse those reasons, tackle them and implement a package of prevention, we will continue to have homeless people on our streets. We must stop it at source and I compliment the Minister. Nobody should be released from any institution in future unless a proper package of integrated care is introduced by the relevant social services to enable people to get back to live in some kind of home again. They must not be left on the streets.

I am absolutely intrigued by what Senator Burke, who I believe is a very honourable politician, said about the 20% of social housing. Is the Fine Gael Party against the principle of social integration?

Mr. Connor

No, we proposed it.

Miss Quill

If that is so, why was an objection raised tonight about the application of the 20%.

Mrs. Ridge

It did not happen.

Miss Quill

Senator Ridge was not here when that point was raised.

An Cathaoirleach

Senator Quill should not refer to the absence of any Member from the Chamber.

Miss Quill

Having said that, I think we had an extremely useful debate. It is an issue that should be returned to repeatedly. It is not easy to address the problem of providing housing for the explosion of population that fortunately has happened in my lifetime. I grew up in Kerry when houses were deserted, people went to Liverpool and London and households died out. Now people are coming back to build houses. The system has been strained to capacity because of the success of the economy. If success is our problem, God grant us no greater problems, but God keep in office people like the Minister, Deputy Molloy, who has the intelligence, initiative and courage to tackle those problems.

Mrs. Ridge

He is a saint.

Amendment put.

Tá

Burke, Paddy.Caffrey, Ernie.Connor, John.Coogan, Fintan.Cosgrave, Liam T.Cregan, Denis (Dino).Doyle, Joe.Henry, Mary.Jackman, Mary.

McDonagh, Jarlath.Manning, Maurice.Norris, David.O'Dowd, Fergus.O'Toole, Joe.Ridge, Thérèse.Ross, Shane.Taylor-Quinn, Madeleine.

Níl

Bohan, Eddie.Bonner, Enda.Callanan, Peter.Cassidy, Donie.Chambers, Frank.Cox, Margaret.Cregan, JohnDardis, John.Farrell, Willie.Fitzgerald, Liam.Gibbons, Jim.Glennon, Jim.

Kett, Tony.Kiely, Rory.Leonard, Ann.Lydon, Don.Mooney, Paschal.Moylan, Pat.Nolan, M. J.O'Brien, Francis.Ó Fearghail, Seán.Ó Murchú, Labhrás.Ormonde, Ann.Quill, Máirín.Walsh, Jim.

Tellers: Tá, Senators Burke and Coogan; Níl, Senators Farrell and Gibbons.

Amendment declared lost.

Motion put and declared carried.

An Cathaoirleach

When is it proposed to sit again?

Mr. Cassidy

It is proposed to sit again at 10.30 a.m. tomorrow.