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Seanad Éireann debate -
Wednesday, 2 Dec 2015

Vol. 244 No. 2

Planning and Development (Amendment) Bill 2015: Second Stage

Question proposed: "That the Bill be now read a Second Time."

I am pleased to have an opportunity to introduce the Second Stage debate on the Planning and Development (Amendment) Bill 2015 in the Seanad. The primary background to the Bill is the package of measures recently approved by the Government to deal with problems being observed in the housing market. I note that the Residential Tenancies (Amendment) (No. 2) Bill 2012 which is another component of this package has just been passed by the other House and will now go for signature. The housing package which is entitled, Stabilising Rents, Boosting Supply, followed on from extensive engagement between the Minister for Finance and me, as well as our colleagues in various Departments. It encompasses a comprehensive range of measures to improve the operation of the private rental sector, tackle increasing homelessness and support increased housing supply. The rent stability measures in the package which are primarily intended to give greater protection to tenants in the private rented sector are being progressed separately in the Bill I have just mentioned, the Residential Tenancies (Amendment) (No. 2) Bill 2012. All of this follows on from the unprecedented €4 billion package for the provision of social housing in the period to 2020 which I announced earlier this year.

While the provision of new social housing and the enhancement of the operation of the private rental sector are essential to help to counteract homelessness and provide tenants with greater certainty with regard to security of tenure and the level of rent that is applied, boosting housing supply is also critical if we are to address our overall housing problems. The current shortage of housing supply is unquestionably one of the most pressing and challenging priorities currently faced by the Government. It is particularly acute in Dublin where demand for housing well outstrips supply. There are increasing issues in Galway, Cork and other areas. This shortage of supply has consequential knock-on effects for house prices and rents and has a negative impact on thousands of households throughout the country.

The housing package announced last month contains some important measures to help to address the housing supply shortage problem. It introduces a targeted development contribution rebate scheme to support and make more economically viable the delivery of affordable starter homes in Dublin and Cork. These homes will be required to be completed and sold in 2016 and 2017. The housing package also provides for the Ireland Strategic Infrastructure Fund to offer financial support for the provision of housing-related enabling infrastructure in large-scale priority development areas. These measures are in addition to previous actions, including the 26% reduction in development contributions in the Dublin area. The legislative changes enacted in the Urban Regeneration and Housing Act 2015 will allow these development contribution reductions to be applied to certain unactivated planning permissions. The same Act provides for reductions in the Part V obligations that are imposed on developers in providing social and affordable housing. It is estimated that this will reduce housing costs by up to €10,000 per housing unit. The suite of actions already being implemented under the Government’s Construction 2020 strategy aim to restore the wider construction sector and increase activity in that sector generally.

Two further elements of the housing package announced last month which are designed to increase housing supply require legislative underpinning and are incorporated in the Bill I am presenting today. The first of these measures will ensure planning authorities do not seek requirements above the national standards set out in ministerial planning guidelines issued under section 28 of the Planning and Development Act 2000, as amended, for example, in relation to apartment standards. The second measure will streamline the arrangements for the making of modifications to strategic development zone planning schemes which are commonly known as SDZs.

I would like to set out the main provisions of the Bill before us for consideration today.

The Bill contains seven sections which propose to amend sections 28 and 34 of the Planning and Development Act 2000, as amended, as well as Part IX of the Act, as follows. Section 1 provides for the necessary definitions. Sections 2 and 3 provide for amendments in connection with ministerial planning guidelines issued to planning authorities.

Section 2 amends section 28 of the Planning and Development Act relating to the issuing of ministerial planning guidelines to planning authorities. Section 28 currently provides that planning authorities shall have regard to ministerial guidelines in the performance of their planning functions, such as in the determination of planning applications and the adoption of development plans. The amendment elaborates on this by introducing a new power whereby the Minister may, within the section 28 guidelines, expressly state specific national planning policy requirements to be applied by planning authorities or An Bord Pleanála, as appropriate, in the exercise of their functions. Therefore, the content of guidelines will distinguish between advisory or general commentary on the one hand and specific requirements that must be mandatorily applied by planning authorities.

This amendment is a critical underpinning to revisions that will shortly issue to replace the current 2007 apartment standard guidelines which will contain specific new requirements for minimum apartment sizes, the number of lifts per number of apartments, car parking provision, floor to ceiling heights, the provision of dual aspect apartments and so on with a view to ensuring their consistent application. Such new revised guidelines would represent a change in national planning policy which should accordingly, on foot of this amendment, be implemented by planning authorities in the determination of planning applications and the adoption of development plans. The amendment will also enable future revisions to any other current guidelines such as development management guidelines and sustainable residential development or to new planning guidelines that may be developed to be expressed and applied in a clearer manner and will improve consistency and certainty in the planning process generally by distinguishing in policy terms between matters to be determined locally and by national policy.

Section 3 further underpins this approach by addressing a number of supplementary amendments required to section 34 of the Act of 2000 relating to the granting of planning permissions by planning authorities. The first amendment in this section will require planning authorities to expressly consider any specific national planning policy requirements arising from section 28 guidelines issued by the Minister in the determination of planning applications.

The second amendment provides, for the avoidance of doubt, that where such guidelines and the standards or provisions of a local development plan differ, the national planning policy as reflected in ministerial guidelines shall prevail and take precedence. This amendment will, for example, preclude the adoption by local authorities of their own local standards, thereby preventing a multiplicity of approaches throughout the country, and will require local authorities to comply with the national guidelines issued by the Minister of the time.

The third amendment in section 3 is aimed at streamlining the assessment of applications seeking modifications to existing planning permissions in respect of multi-unit housing developments, primarily apartment block and duplex type developments, on foot of the issuing of new or revised apartment standard guidelines by the Minister of the time. The amendment will restrict the assessment of any such planning applications to the modifications proposed for the purpose of complying with any new guidelines and so that the whole previously granted permission and the question of the suitability of the development for housing as already determined is not reopened. In the case of internal changes only, for instance, in relation to an apartment block, arising from new or revised apartment standard guidelines and where there is no materially significant change to the external structure of the development, the amendment precludes the right of third party appeal.

Sections 4 to 6, inclusive, amend the existing provisions of the Planning and Development Act of 2000 relating to strategic development zone, SDZ, planning schemes. Section 4 amends section 169 of the Act of 2000 relating to the procedures to be followed in the adoption and approval of SDZ planning schemes. SDZs are set by Government order and designate areas which are considered to be of economic or social importance to the State. Following designation, planning schemes setting out objectives for specified development in designated areas are drawn up by prescribed development agencies, which may include a local authority, in respect of the designated areas concerned and are subject to public consultation procedures before being submitted to the elected members of the relevant planning authority for adoption.

The experience has been that all SDZ planning schemes which have been approved by planning authorities to date have been appealed to An Bord Pleanála for final determination. Under the current section 169 provisions, An Bord Pleanála can only make modifications to an SDZ scheme where they are considered to be minor in nature and are, therefore, unlikely to have significant effects on the environment or on a European site designated under the habitats or birds directives. Where An Bord Pleanála considers that the scheme requires modification of a more material nature, it is effectively required to uphold the appeal and refuse the modification, requiring the re-commencement of the overall SDZ planning scheme process under section 169 if the relevant planning authority or development agency wishes to pursue the scheme with the proposed modifications.

Section 4 amends the current section 169 provisions to provide that An Bord Pleanála can, as before, approve an SDZ planning scheme with modifications of a minor nature. However, under the new section 4 provisions, An Bord Pleanála will now also be allowed to approve the SDZ planning scheme with a modification or modifications which would constitute a material change to the scheme provided that such modification or modifications would not constitute a change in the overall objectives of the scheme concerned. These new arrangements would mean that where modifications of a material nature are considered necessary by An Bord Pleanála on appeal, the relevant planning authority or development agency responsible for bringing forward the scheme would not have to recommence the whole SDZ planning scheme process.

The proposed new procedures insert considerable checks to ensure that where proposed modification or modifications of a material nature to an SDZ planning scheme may have significant effects on the environment, An Bord Pleanála shall require the planning authority to undertake a strategic environmental assessment as per the EU SEA directive, an appropriate assessment as per the EU habitats directive, or both such assessments in relation to the proposed modifications; undertake a full public consultation on the proposed changes, including the forwarding of the proposed changes to prescribed bodies, publishing notice of the proposed changes in local newspapers and putting them on public display for a minimum of four weeks; and following the public consultation, prepare a detailed report for submission to An Bord Pleanála for its consideration. Where An Bord Pleanála makes a determination to make a modification constituting a material change to an SDZ planning scheme, it shall approve the scheme with the modification and notify the relevant planning authority or development agency accordingly.

While these revised procedures for the modification of planning schemes will take some time, having regard to the built-in public display and public consultation timeframes, they will still save considerable time in the making of a modification or modifications deemed necessary compared to having to recommence the overall SDZ process again. This process can take up to two years under the current provisions based on previous SDZ planning schemes and can lead to significant delays in the progression of SDZs with consequential delays in the provision of housing and other commercial development.

Section 5 inserts a new section 170A into the Planning and Development Act to provide for a new more flexible process for the amendment of an already approved SDZ planning scheme. As indicated, this is not possible under the current SDZ provisions where any amendment to a scheme requires the commencement of the overall SDZ planning scheme process once again. The new provisions in section 5 will allow a planning authority, on its own behalf where it is promoting an SDZ scheme or on behalf of a development agency promoting an SDZ planning scheme, to make an application to An Bord Pleanála for an amendment to a previously approved SDZ scheme which may be in the course of being developed. Such a request may be in respect of modifications which are minor in nature or, though material in nature, meet certain specified criteria and do not affect the overall objectives of the scheme. The new provisions would in effect allow for amendments to an already approved SDZ scheme, as determined by An Bord Pleanála, following procedures along the lines of those contained in section 4, as stated - involving the undertaking of a strategic environmental assessment, an appropriate assessment or both, as required along with mandatory public consultation, but which would take a considerably shorter time than the current procedures requiring the commencement of the overall SDZ process again.

Section 6 is consequential on sections 4 and 5 and proposes the replacement of the existing section 171 of the 2000 Act relating to the revocation and amendment of SDZ planning schemes with a new section 171. The new procedures relating to the modification of SDZ planning schemes are provided for in sections 4 and 5 as outlined. Consequently, section 6, inserting a replacement section 171 in the 2000 Act now only provides for the procedures relating to the revocation of SDZ planning schemes.

Section 7 contains standard provisions relating to the Short Title, construction and collective citation.

Members will agree that this Bill contains a number of fundamental and important revisions to the Planning and Development Act 2000, emanating from the Government’s housing package, Stabilising Rents, Boosting Supply, which are necessary to support increased housing supply which I presume everyone in the House would support.

As I have outlined, the amendments to sections 28 and 34 of the planning Act strengthen the status of aspects of ministerial guidelines to planning authorities to ensure their consistent application, particularly in relation to the proposed issue of revised apartment standard guidelines, throughout the country and will require local authorities to comply with the national guidelines. This new provision will particularly apply in the first instance to revised apartment standard guidelines which I propose to issue shortly. Even allowing for some reductions in the minimum floor areas as are applied by some local authorities, the revised guidelines will still ensure minimum floor sizes which will be among the most generous in Europe.

In addition, the amendments to the Part 9 provisions in relation to SDZ planning schemes will streamline the process for making modifications to such planning schemes which are not yet approved and are going through the approval process, as well as to planning schemes which have already been approved, thereby bringing greater flexibility in relation to the modification of SDZ schemes than is possible at present.

SDZ planning schemes are, by their nature, large projects where the proposed development works can take a number of years to complete. They also contain a significant number of residential units and the timely delivery of SDZs in the Dublin area is critical to underpinning future housing supply.

These SDZ streamlining proposals will also complete action 24 of the Construction 2020 strategy aimed at revitalising the construction sector and bringing on stream housing units at a faster rate than at present. Accordingly, I commend the Bill to the House.

I welcome the Minister who, as the man says, is under pressure.

Pressure is for tyres.

The Minister is doing what he can. Fair play to him.

Pressure is for tyres.

I will be nice to the Minister because he is a former Member.

The Senator is always nice to me.

We welcome the Bill which, effectively, will streamline the planning process from a ministerial perspective. It follows on from recommendations of the Mahon tribunal, notwithstanding current challenges in housing. While we are supporting it, one of the concerns is that if some guidelines of planning institutions go beyond the national standards in terms of quality and what they bring to it, we would not seek to undermine those or give a blanket no to any improvements.

I am specifically speaking about the situation in Dún Laoghaire-Rathdown County Council which has plans and regulations for passive housing, in particular. Nationally, we should be opposed to that on the basis that it is too cumbersome and will take too long and is too expensive and so on to allow that go on. I would not have that perspective on it and ask that while ensuring the Minister has adequate powers to get the right policy across each local authority in the country, that in certain instances where that is surpassed by the initiative of those councils themselves, we should welcome and facilitate it to the extent possible.

On the surface, passive housing can be looked at as being more expensive. If we were undertaking a large development where a lot of stuff is prefabricated, it could actually be less expensive. We should be careful on that issue and not have it written in stone that if local authority A or local authority B is going an extra mile on certain aspects, we do not say an automatic "No" and that, at a minimum, we would look at it on a case by case basis.

Obviously there is an SDZ aspect to it. It is essential that there is a centralised involvement, while not wishing to take from local planners, councillors or the executives of the councils in terms of their input to major projects throughout the country. If nothing else it is important when the correct project is being planned that while everyone has the opportunity to comment on it and there is a planning process in place for it, we have it streamlined so that it is not an application on the never never. It is important that the Government of the day has the powers to intervene quickly to facilitate the process, albeit that it may not work out in favour of the development overall. While the Minister mentioned that this was very much with a housing crisis in mind and the fact that we have a national crisis, he has been looking at having different measures from modular housing to rent controls implemented that will make life easier for the 700,000 people in the rental sector.

I wish to make a few suggestions. Local authorities throughout the country seem to have a basic self-determined rule of not buying or renting houses in former council schemes. Certainly in Sligo that is part of the policy. I think that is wrong and a bad policy. The Minister's officials could do worse than to check with each of the local authorities. It is an unwritten rule but certainly, in practice, it does not happen in Sligo. The reason is that the local authority wants to get to a situation which was perhaps the vision of Part V that we have full integration between people who are mortgaging their houses to people who are in social and affordable housing and so on. That is very honourable if one is dealing with a blank canvas. Sadly, nationally, that is not the case so we have to take cognisance of the social balance in a number of places. I use Sligo as an example. Throughout the Part V era, any developments had to have that or they had to swap their land or pay money in lieu. In Sligo we had the third highest social mix in the country, after Cork and Limerick. With a national average of about 14% to 16%, Sligo was 33%, Cork was marginally more than that and I think Limerick was 36% or thereabouts, give or take a percentage, or maybe I am forgetting the figures. While we all want more social housing we have to be cognisant of what the landscape looks like and how we can best meet the challenges.

Looking at the former scheme, this will be a short-term measure. How many former local authority homes lying empty throughout the country are for sale? I can assure the House one can buy four for the price of a house on the open market. There is probably a stock of housing around the country that at a minimum can provide a short-term measure. Presumably, these units would have be refurbished but I am sure that solution would be at least as quick as modular housing and in parallel with modular housing. Obviously, that is being done and it is welcome.

Developers cannot get money. Leaving aside all the boom, bust and the developers we all grew to vilify and hate who led us down the track, it is evident we are missing developers who are prepared to take risks, get capital and build houses. It is not happening because they cannot get money. Most builders who were involved for a number of years were either so big that they are dealing with NAMA or have refinanced themselves abroad and are going again. However, the average developer who built 30 houses per year is either a bankruptcy tourist or is negotiating with the banks here and has a bad credit rating and they just will not give him or her any money. That is a real problem and I am not sure how we can deal with it. I know there is the Strategic Investment Bank, but its money is at a rate of 16%. If its interest rates are at that level, one would need to come in with a squeaky clean track record. If one is up on the credit bureau I do not think it would lend one 50 cent. This is an issue we need to look at.

In planning nationally we have to take cognisance of the fact that people live outside cities and towns throughout the country. I know the Minister is from a rural county. County Leitrim has a major problem. We are using the excuse nationally to say there are loads of houses for sale. If a person wants to build a house in Sligo he or she will ask for a site but and state there are 150 houses for sale.

There was a rule some years ago where the child of a farmer, while not guaranteed planning, would be facilitated subject to the design and the correct septic tank system being installed. The Minister of State would do the nation a service if she would look at this possibility. There are specific grounds for it in County Leitrim where there is a particular issue with soil. Not all people in Ireland live in cities and we must provide for this.

A radical proposal on the housing issue was suggested to me recently. It might produce giggles from some Members, but my belief is that if one is to dream, one should dream big. One might then come up with a workable solution. There will be an underspend in each of the Departments, apart from the Departments of Health and Social Protection, and hundreds of millions will come back in. That money could be used to purchase compulsorily the housing stock that underlies the security on loans sold by IBRC to Mars Capital and Pepper. As they would have paid a knock-down rate for them, they could be made the subject of a compulsory purchase order, CPO, at an appropriate level and this would provide cheap housing stock for us throughout the country. It might open up problems on the other side in that some of the housing could be in areas overpopulated with social housing or on land swapped under Part V obligations, but if there are underspends in each Department next year, we will not be able to increase spending accordingly because of the new rules coming in. I can see that the Minister of State is thinking of her Christmas break and feels all this is too radical for her to embrace, but the likes of Mars Capital and Pepper do not care about the property, the loan or the client. They just care about profit. They bought books of loans for a certain sum and they are happy to sell them to regain their money plus a margin. If somebody looked into this, it could provide us quickly with a supply of stock.

We welcome the Bill and look forward to Committee Stage.

I welcome much of what Senator Marc MacSharry said but one sentence struck me. He said "if one is to dream, one should dream big". We have to be careful that the Government does not end up in a nightmare. The Minister said housing was his main priority and that we must ensure the utmost was done to ensure the homelessness problem was addressed.

The Bill represents a change in national policy guidelines. There is a huge shortage in housing and it must be addressed, but I have some reservations about the means by which we are doing it. Nevertheless, drastic measures are needed to make houses available. Development is not taking place anywhere at the required rate. Why is this? As Professor Ronan Lyons from Trinity College College said, the cost of development is not enticing any developer to build houses. Developers with high finance are purchasing office space but not residential. Excluding the cost of the land, it would take a monthly rent of €1,400 to justify the construction of a two-bedroom apartment. Between 2011 and 2015 the monthly rent for a two-bedroom home in the centre of Dublin increased by 50%. At the other end of the spectrum the cost of a five-bedroom family home in County Donegal or County Leitrim was almost unchanged while rents in Clare, Tipperary and other rural counties have seen single digit increases. In a couple of years we should look at whether one size fits all in this respect. Local councillors hate to see top-down regulations but the departmental guidelines are a one-size-fits-all approach. In three years, it is hoped, the houses will be available and the figures will show that we can give more power back to the local authorities because that is where the power should be.

Cities drive our economic growth; therefore, we have to ensure houses are made available there, and this Bill is one way of doing it. The tight restrictions Dublin City Council imposed, which exceeded departmental guidelines on building apartments, regulated things like car parking spaces, orientation, balcony depth, ceiling height and the numbers of lifts per floors, which all add to the cost. These guidelines were very good as they were to entice family living back into the city following the doughnut-shaped planning we had seen which caused everybody to move out to the suburbs. I complimented Dublin City Council on what it did but the ordinary person cannot afford a house now because it is too expensive to buy and something has to be done to redress this.

There has been a focus on developers over the question of why so few houses are being built, but the banks and international developers are also a factor. The Central Bank has also capped house prices relative to our incomes to secure the country's financial stability, but nothing is being done to cap construction costs relative to our incomes in order that we can secure affordability. The Bill will address some of those problems by changing regulations, including requiring a planning authority to undertake a strategic environmental assessment and making local authority development plans subject to national guidelines.

I am cautious about the restrictions on local authority powers, but at this stage I believe these conditions are necessary. I am pleased to see the streamlining of the strategic development modifications in section 4. South Dublin won a European award for its strategic development zone, but changes to the guidelines are better than going back to the drawing board. Development must begin and there can be no two-year delay while we put in place a new SDZ. This applies to Cherrywood where more than 3,000 houses are to come on stream.

Housing regulations were developed to guarantee that housing in the State supported a good quality of life. It is important to emphasise that the building standards are not being lowered. We are just making houses affordable. The CSO requirements were for a 50% ratio of one-family living whereas Dublin City Council had a smaller ratio. The two have to be streamlined. The principle at the heart of these changes is that it is unacceptable to demand an increase in the living standards of our most secure citizens at the expense of those who are most vulnerable and who cannot afford to buy. When Dublin city introduced changes in lifts and brought in dual aspects, there was almost a lift for every two or three apartments. If there were six apartments there had to be an outside balcony as in the council estates of old. Naturally, planners and designers would not go with that requirement.

I have some reservations but the main one is the subjugation of local development plans to national policy. I am a supporter of the devolution of powers to local authorities and my fear of usurping local powers comes from the recognition of the value of local needs. Senator Marc MacSharry spoke about Leitrim versus Dublin and I agree that if developers could buy and do up derelict local council houses such as in Roscommon where I saw some last week and lease them back to the local authority, it would be a good initiative. Different localities have different needs and local councils know best what is needed in their counties.

There are many good reasons for doing what is being done in the Bill but reason enough would be the fact, as Dublin City Council has admitted, that the additional cost for a one-bedroom unit is €22,000, €15,000 for a two-bedroom unit and €23,000 for a three-bedroom unit. While the census shows the percentage of one-person households exceeds 50%, the council has indicated the percentage of one-bedroom units is at 20%. In other words, there is a mismatch between what is needed according to the census and what the council is providing. As a former councillor, I recall that when one saw "have regard to" in legislation, one tended to put that provision to one side and not give it a blind bit of notice. Guidelines, on the other hand, require compliance. We must give consideration to the question of whether one size fits all for all local authorities. That is why a review of these provisions after three years is necessary.

I welcome the Minister of State, Deputy Ann Phelan. This Bill is one of several measures being introduced with a view to stabilising rents and boosting supply in the housing sector. Increasing rents have led directly to an increase in the numbers, including the numbers of families, experiencing homelessness. In this context, I welcome the passage through the Dáil of the Residential Tenancies (Amendment) (No. 2) Bill 2012 and hope to see it signed into law shortly. The Bill before us contains measures to improve the supply of housing, particularly in the rented sector. We all agree that supply holds the key to solving many of the difficulties we face in the area of housing and homelessness. There are two aspects to the legislation. The first concerns the implementation of guidelines relating to the Planning and Development Act 2000 and the second is to do with strategic development zones, SDZs. The SDZ provisions are progressive and will have a distinct impact in terms of facilitating a more efficient planning process. In addition, they will fast-track the provision of modular housing, which is very welcome. There are many anxious families waiting to move into these units.

I have some concerns about the provisions in the Bill relating to national standards. As a member of Dublin City Council's strategic policy committee for seven years and as chairman of Threshold, the issue of improving apartment standards was something for which I campaigned for years. In 2006, 78% of all units built in the Dublin region were apartments. The occupants of those units were not the type of people at which the glossy brochures were aimed, namely, double-income couples with no children who would spend most of their weekends on city breaks. In fact, the purchasers of the apartments were often single parents with children. It became obvious that significant parts of the inner city of Dublin were rapidly deteriorating into slums which bore some resemblance to those to be seen in the 1930s and 1940s.

There is no doubt that the standards which were introduced, both the national standards and the specific standards introduced by Dublin City Council, were introduced for very good reasons. The Bill strengthens the national standards and provides that individual local authorities will not have the right to deviate from those standards. Like Senator Cáit Keane, I have concerns that this might infringe on the rights of local authorities to determine policy for their own area. Moreover, I am not convinced that the harmonisation of standards across the country is a good idea even though it might look like such in the first instance. In Dublin, for example, where we have people living in high-demand and high-density areas and where, in some cases, apartment dwelling is the only option, as opposed to semi-detached homes or self-built dwellings, higher standards are necessary. For increasing numbers of people, rented housing and apartment living are a lifelong reality. In the coming years, we will see more and more people living in rented accommodation for the rest of their lives. Already, one in five families is living in rent accommodation.

The Bill proposes to reduce the minimum size of a one-bedroom unit in a context where more than 60% of households will be either one or two-person households. In other words, we are looking at a significant number of people living in one-bedroom units. I accept that the original Dublin City Council proposals had too few single-person units and also too few family units. However, there needs to be a recognition of the significant percentage of people for whom a one-bedroom apartment will be their permanent accommodation. A reduction in the minimum size from 55 sq. m to 45 sq. m should be compared with a national average of 50 sq. m in the United Kingdom and a German average of 60 sq. m. Another issue to consider is that there is a question mark over the costings. I have spoken to a number of people in the construction sector and they point out that an apartment which is 20% smaller will not be 20% cheaper to build. In fact, the estimation is that the reduction in build cost will be some 5%. There is a question mark over who will win in that particular scenario but it has been suggested it will be the developers. How can we ensure any savings that are made by easing the standards in respect of apartment size will be passed on to the consumer?

The Society of Chartered Surveyors Ireland recently conducted a survey among its members to ascertain the relative significance of different aspects of building costs. The survey found that the most significant factor was bank finance, with 35% of respondents identifying it as the number one constraint. Insufficient profitability was highlighted by 27%, while 17% identified the availability of mortgage finance as the main issue. Land costs are clearly also a significant constraint. We are in a situation where the equity gap for developers is in the region of 40%, which means that many are forced to access very expensive mortgage finance.

I accept that we are in desperate times and arguably need desperate measures. However, we must ensure any changes we make are kept under review, particularly in very dense urban areas where there is a high proportion of apartment developments. While I do not particularly favour the change being made here, I support it in the same way I support anything that can move matters forward. I fully appreciate the Minister's bona fides in bringing the proposals to the House. I reiterate that we must ensure any savings made are passed on to consumers. Price is determined by supply and demand, but we need measures to ensure there are benefits for people.

I suggest we consider legislation with policy interventions to manage the price of development land. We cannot afford a repeat of what happened between 1998 and 2006, when the cost of land rose to over 60% of the overall cost of a development. We must ensure affordable credit, particularly for developers who are prepared to engage in providing lower priced housing developments.

I thank all of the Senators who spoke for their contributions on this Planning and Development (Amendment) Bill. There were many interesting and varied contributions made and while I might not agree with all of them, I fully accept they were made in a genuine and constructive spirit. As the Minister, Deputy Alan Kelly, outlined in his opening statement, and as has been acknowledged by many Senators in their contributions, we are faced with pressing and complex problems in regard to the operation of the housing market which require swift, decisive and innovative action if they are to be addressed. The housing package, Stabilising Rents, Boosting Supply, which was recently announced by the Government, contains a comprehensive range of measures to improve the operation of the private rental sector, tackle increasing homelessness and support increased housing supply. This follows on from previous actions implemented by the Government to address our housing-related problems.

While the provision of an unprecedented amount of new social housing units and enhancements to the operation of the private rental sector are essential to counteract homelessness and give tenants greater certainty in regard to security of tenure and the level of rents applied, boosting housing supply is also an essential ingredient to the overall mix of actions required to address the housing problems faced. There is no single panacea or silver bullet to address the housing problems, but I can assure Members of the House that this issue is, and has been, a top priority of the Government.

The amendments to the Planning and Development Act proposed in the Bill emanate from the recently announced housing package, which will be legislatively underpinned on the enactment of this Bill. The main measures in the Bill relate to ensuring planning authorities do not seek requirements above national standards set out in ministerial planning guidelines issued under section 28 of the Planning and Development Act 2000, as amended, and streamlining the arrangements for the making of modifications to strategic development zone, SDZ, planning schemes.

As outlined earlier, the Minister is empowered under section 28 of the planning Act to issue guidelines to planning authorities to which they are required to have regard in the performance of their planning functions - for instance, in the determination of planning applications and the adoption of local development plans. However, not all planning authorities apply such national guidelines in their entirety, giving rise to some inconsistent application of such ministerial guidelines.

The apartment standard guidelines comprise a case in point. For example, Dublin and Cork city councils currently apply higher apartment standards than the current 2007 guidelines, the net effect of which is an increase in apartment costs in both cities, which is affecting the delivery of necessary housing at this stage. While Dublin City Council is considering this issue in its new development plan, there is a wider issue of consistent approaches to national policy issues as reflected in national guidelines that the Minister needs to address.

Revised apartment standard guidelines will be issued shortly to replace the 2007 guidelines which will contain specific new requirements in regard to minimum apartment sizes, the number of lifts per number of apartments, car parking provision, floor to ceiling heights, the provision of dual-aspect apartments and storage provision with a view to ensuring their consistent application. It is estimated that the proposed revisions to the guidelines which are still being finalised and which all planning authorities will be obliged to apply on enactment of the Bill will deliver an average estimated cost reduction of €20,000 per apartment in Dublin city, in addition to the other cost reductions which will already apply on foot of other previous Government actions. These include the development contribution rebate scheme for affordable starter homes announced in the recent housing package, previous reductions in development contributions, in addition to the reductions in the Part V obligations on developers in regard to the provision of social and affordable housing as provided for in the Urban Regeneration and Housing Act passed last July.

I have noted the reservations expressed by some Senators about reductions in apartment sizes in the revised guidelines. However, I emphasise that these revisions which are being finalised will not become a race to the bottom for apartment standards. Even allowing for some reductions in the minimum floor areas currently applied by Dublin and Cork city councils, we will still have minimum floor area sizes that will be among the most generous in Europe.

The primary aim of the revised guidelines will be to promote sustainable urban housing by ensuring that the design and layout of new apartments will provide satisfactory accommodation for a variety of household types and sizes, including families with children, in the medium to long term. A further aim of the guidelines will be to make apartments more economically viable for developers to develop and more affordable from the perspective of potential owner occupiers and renters alike.

The reality is that minimal apartment development has taken place in both Dublin and Cork since their respective city councils’ own local standards were introduced. This is not in anyone’s interest. Apartments should be developed taking account of real-world requirements and not aspirational standards, however well intended, that effectively put access to homes in some locations out of reach of ordinary citizens.

The Bill is also not about eroding or reducing the powers of elected local authority members in regard to the adoption of local standards. It is aimed at facilitating the development of well designed and reasonably sized apartments that are not presently being provided in certain local authority areas. It is also aimed at ensuring the adoption of a consistent approach by all local authorities and that we do not have a multiplicity of approaches being applied throughout the country, which would be unsustainable.

The clear view of the Government is that we need to ensure development proposals, including in respect of apartments, are more economically viable and are provided at more affordable prices than at present, thereby facilitating increased housing supply, particularly in Dublin, where demand is most acute. This will not only help counter house and apartment price increases but also have the ancillary benefit of helping to address rent increases in the private rental market.

The streamlining of the procedures for the modification of proposed and previously approved SDZ planning schemes, as outlined in sections 4 to 6 of the Bill, are necessary in order to help bring on stream housing supply in such schemes much more speedily than at present, when any modification to such schemes can take up to two years to be approved, thereby bringing development to a halt.

The measures proposed in the Bill are designed to ensure any perceived barrier to housing supply from a planning perspective is addressed and that the planning system is fit for purpose in this regard, increasing housing construction activity. Accordingly, I commend the Bill to the House. I look forward to further engagement with Members as the Bill progresses through the House.

Question put and agreed to.

When is it proposed to take Committee Stage?

Committee Stage ordered for Tuesday, 8 December 2015.
Sitting suspended at 5.40 p.m. and resumed at 6 p.m.