I invite the Minister to address the House on this very important subject.
Housing: Statements
I thank the House for this important opportunity to update Members on housing and related matters. In view of the time available, I will not address every single issue in housing but I look forward to coming back to any questions Members have.
The top-line figures for house building are going in the right direction. Planning permissions for 20,776 homes were granted to the end December 2017, up 27% year on year. Commencement notices for over 18,500 new homes were submitted, an annual increase of 41% in the year to the end of February 2018. BER figures show that 2,367 housing units were built during the first three months of the year, an increase of 45% on the same time last year, not including self-builds. ESB connections in 2017 totalled just under 20,000, an annual increase of more than 30% in the year to the end of February 2018. Since early 2014, this has increased by 128%. Finally, registrations have increased to 9,521 units, which is 46% up on the 12 months to February 2017.
The growing numbers show that house building and supply are moving in the right direction, rapidly and dramatically on a year-on-year basis. Growing employment in the construction industry is further evidence of increased confidence and buoyancy in the housing sector. Employment levels of skilled tradesmen in the construction sector was estimated at 83,000 in the first quarter of 2017, which is up by 14% on the same period in 2016. The volume of production in the residential construction sector has been growing at an annual average rate of 22% since its low point in the fourth quarter of 2012. In the fourth quarter of 2017, volume increased by 16.3%. The Central Bank, in its quarterly bulletin for the first quarter of 2018, forecasts that both housing and non-residential building should continue to recover strongly. For 2018 and 2019, according to the Central Bank, residential construction investment is expected to increase strongly, with approximately 23,000 and 27,000 new homes being built, respectively.
The building of local authority homes is increasing rapidly and the target for the 2018 build is 4,696 homes, which is more than 50% higher than the 2017 target. This will increase again in 2019 to 6,385 units, a further 30%, and continue to grow to a target of 8,907 in 2021. The social housing build programme is ramping up, as is evident in the fourth quarter of 2017 construction status report. At end-2017, 2,512 homes were completed, 3,650 were under construction and 1,912 further homes were about to go on site, with the remainder progressing through the various stages of planning, design and procurement. Whether it is social housing homes, forecasts from the Central Bank or notices submitted to my Department and local authorities, the statistics show a dramatic increase in the number of homes being built across the country.
We also provide ongoing social housing supports in the rental sector and almost 26,000 households had their housing needs met last year, with 100 households having their housing needs met every working day in 2017. A further 18,000 households are targeted for support under these schemes in 2018. The figure for last year is made up of rental accommodation scheme, RAS, numbers, housing assistance payments, HAPs, builds, acquisitions, leasing, voids, regeneration and all the different delivery streams we have for house building and social housing in the State.
On the whole, there is no doubt that all the evidence points to real progress in terms of housing delivery. Most important, last week we saw a significant reduction in people sleeping rough of 40%. Last November there were 184 individuals sleeping rough and now there are 110.
This reduction in people sleeping rough, in many ways our most vulnerable people who are homeless, is welcome. It follows the dedicated and compassionate work of the Dublin Region Homeless Executive, working with our partner organisations to increase the services available in the Dublin region. There is still more to do because we still have many people sleeping rough on our streets. Many of those accessing homeless services have complex needs and require other supports, notably health supports, to assist them to exit our homeless services. Housing First is best international practice for getting people out of homelessness. That is why earlier this year I appointed a national director for Housing First and increased its funding allocation. I thank Mr. Bob Jordan for the excellent work he has done so far this year. He is delivering results, and pilot programmes are now being progressed in other parts of the country, including Cork, Limerick and Galway. My Department is also leading the homelessness inter-agency group which involves a range of Departments and the NGO sector. This process is showing a number of inter-agency issues which need to be addressed to tackle homelessness more effectively. I will bring forward policy proposals upon receipt of the first report of the inter-agency group which I expect later this month from the group’s independent chair, Mr John Murphy.
The continued presentation of families to emergency accommodation is a source of serious ongoing concern for me. I am pleased that we have been able to exit so many families from hubs and hotels. The reasons behind the homeless figures are complicated but are linked to the collapse of our house building sector and the severe supply shortage associated with that collapse. The staff in my Department and across the system, in local authorities and NGOs, are putting in a huge amount of work to help people and families in homelessness. Last year, more than 4,700 adults exited homelessness. Of the more than 100 families who presented in Dublin in February, only 20 were accommodated in hotels. During 2017, more than 2,000 families left hotels for sustainable tenancies and the majority of those families into homes. I saw this incredible work first-hand during the severe weather events in January and February of this year. During that time, the people dealing with homelessness were in work helping to provide emergency shelter. I pay particular thanks to our partners in the NGO sector who, with the Dublin Region Homeless Executive and the Department, do so much to help prevent people from entering homelessness, provide supports for those who are in difficulties and help us to exit people into sustainable long-term accommodation. The emergency response was extraordinary and I have no doubt that lives were saved on our streets as a result.
While homelessness is often the worst manifestation of the housing challenge, the underlying issues of housing are supply, access and affordability. That supply shortage cuts across the entire housing system into social housing, starter homes, affordable rental options and larger family homes for trading up, not to mention smaller apartments for singles and couples that are desperately needed throughout the country. In terms of understanding where the Irish housing system is currently and the progress being made to get it where it needs to be, it has to be put in some context where we have come from. What we are seeing today are the symptoms of one the last legacies of the economic collapse. As we know, that collapse was closely linked to a property bubble and related credit issues within our banking sector. As a result, those sectors were severely impacted. The result was that residential construction collapsed by 90%, only a handful of social and affordable homes were being built, virtually no starter home estates were being built, there were unfinished housing developments that had to be knocked down and employment in construction fell by two thirds. The residential construction sector in Ireland was deeply impacted and it was clear that it would take a major concerted effort over time to rebuild it. Importantly, Rebuilding Ireland, built upon the work carried out by the special Oireachtas committee on housing and which was the subject of very broad stakeholder consultation, is in place and is showing the results, some of which I have alluded to.
The building of new social housing by local authorities and approved housing bodies is ramping up dramatically, as I have said. These numbers do not include new builds under Part V, voids, acquisitions or long-term leases, so the actual stock of new social housing coming on stream is larger again. Roughly 7,000 new homes in all in 2017 were delivered into the social housing stock for local authorities to take people off the housing lists into both local authority homes and housing body homes. With the additional funding I secured last year, we have increased the overall level of ambition under Rebuilding Ireland in the period to 2021, rebalancing delivery more towards construction projects. Overall, the Government has committed €6 billion to support the accelerated delivery of 50,000 additional social housing homes by the end of 2021, through building 33,500 new homes, acquiring 6,500 new homes and leasing 10,000 new homes under the various programmes. In addition, the housing assistance payment and rental accommodation scheme will continue to play an important part in meeting social housing needs.
In terms of housing supply more generally, the Government has undertaken a co-ordinated set of targeted actions aimed at encouraging arid incentivising house building at scale again. For example, we have the approved investment of €200 million in key enabling infrastructure to open up strategic public and private sites for early development; updated, streamlined and de-risked the planning and regulatory regime to progress major house and apartment developments; approved arrangements for development finance to be made available to house builders; and put in place a help to buy scheme to help first-time buyers with their deposit. After a lot of hard work there are really encouraging signs that home building is recovering. All supply indicators are showing encouraging trends, as I stated at the outset.
Ireland is a great success story today, having bounced back incredibly well from the downturn. With growth of 5.6% forecast and unemployment set to reach 5.8%, the demand for housing will also grow. Therefore, while the increased activity and supply is very encouraging, it is important that we continue to drive the implementation of Rebuilding Ireland and increase housing supply. It is also crucial that the new housing is increasingly affordable and accessible to those who need it. When I took over as Minister for Housing, Planning and Local Government I initiated a review of the Rebuilding Ireland action plan. At the time, I made a firm commitment that housing access and affordability would be a central focus of my work. As supply is increasing, the Government is committed to ensuring that people throughout Ireland can access affordable housing based on their ability to pay. For households, particularly those renting in our cities and urban areas and trying to save to buy their first home, this can be a real challenge. Increasingly in our modern society, people want a choice of affordable homes to rent and buy, depending on their stage of life and circumstances. Our housing system needs to provide attractive options for both. The new affordable housing measures I signalled in January are specifically targeted at delivering more affordable homes. The emphasis is on delivering affordable homes from our State landbank in urban areas where affordability issues are greatest. Initial indications from local authorities in the main target counties highlight the potential for almost 4,000 affordable homes from their land. The target is for the delivery of at least 10,000 new affordable homes in the medium to long term.
I will be commencing the necessary legislation for the affordable purchase scheme next week, and I expect to see more local authority sites coming forward thereafter. To deliver these affordable homes, local authorities will need to maximise the potential yields from their landbank. To assist them in this, I have secured additional funding of €25 million for infrastructure on their sites to facilitate affordable housing provision. The call for proposals for this funding will issue to local authorities shortly. Additionally, as part of the budget for 2018, I announced that an additional €50 million in Exchequer funding will be available for a second local infrastructure housing activation fund, LIHAF, call. This will be subject to matching funding by local authorities, bringing the total available to €66.5 million. The criteria for the second call are being finalised and I expect to announce phase 2 of LIHAF soon. Already 30 major public infrastructure projects have received final approval under the first phase of LIHAF. These projects will activate the delivery of almost 20,000 new homes across public and private sites by 2021. More than 28%, or some 5,600 of these 20,000 new homes, will be social or affordable homes. In addition, a further 5,600 of the homes will have a LIHAF related cost reduction and another 8,800 will be sold at market rates, greatly increasing supply and with many in locations offering very good affordability.
In January 2018, I also launched the new local authority home loan. Eligible first-time buyers can now access affordable mortgages from local authorities with fixed interest rate options of 2% to 2.25% for terms of up to 30 years. Recent activity figures show the interest in the mortgage is very high, with more than 90,000 visits to the Rebuilding Ireland home loan website and 1,350 application forms having been downloaded.
A thriving rental sector is crucial in a modern and growing country such as ours. As reported recently, I am progressing legislative changes to give effect to a number of new actions. The changes will provide the regulatory framework to enhance and strengthen the powers and functions of the Residential Tenancies Board. We also need to ensure that the rental sector, especially in our cities and major urban areas, is accessible and affordable. To ensure this we need to invest in a different type of rental offering, a so-called cost rental sector, which operates between the social and private market sectors. Other modern European cities like Vienna, where I used to live, have delivered cost-rental homes into the market at scale over many years, making a sustainable long-term impact on housing affordability. We know from the national planning framework that Ireland will need to provide more than 500,000 new homes to accommodate our growing population and workforce between now and 2040. We need to ensure there are enough rental options at affordable rents to make our cities attractive as places to live as well as work as we implement these plans. I am determined to deliver a major cost rental project in Dublin in the short term and then roll it out more broadly. We are learning from pilot projects which are helping to shape the model for future larger-scale versions. We are working with the European Investment Bank and other key stakeholders with a view to announcing the first major cost rental project in Dublin city shortly, with a programme of cost rental projects across Dublin and other cities to follow.
Ireland is recovering positively from the crippling economic downturn, the economy is growing and we are reaching for full employment. It is crucial that, as we grow, we match the demand for housing with supply that is accessible and affordable. By any supply measures and given our starting point, real progress is being made under Rebuilding Ireland. Of course we continue to face very challenging circumstances when it comes to increasing numbers in homeless emergency accommodation. Some additional measures will be announced shortly on that. While there are different ways to measure housing output, all indicators of home building activity are trending positively. Housing is a top priority for me and the Government, and we are determined to repair and reform one of the sectors of our economy and society worst impacted by the downturn. All efforts are now being concentrated towards increasing output, particularly in terms of affordable homes to rent and to buy.
I thank the Minister for coming into the House. I know he is a very busy man. It is good to be busy, and I am busy, but it is not good to be busy if nothing is getting done. I am not saying the Minister is doing nothing. Far from it. I know how hard he is working, but I have concerns.
Housing is the key issue facing this Government. It is not about personalities. It is about real political priorities on which the Government has failed. Homelessness has reached unprecedented levels, surging rents are at historic heights, home building numbers are tens of thousands behind where they should be and some 85,000 people are on the social housing waiting list. All the while, ordinary workers cannot afford a place to own.
Fianna Fáil is using the confidence and supply agreement to press for a policy shift to establish an affordable housing scheme, increase social housing spending and strengthen the rental sector. The Government has to start delivering on housing. After four separate plans and over a dozen launches, we need to see bricks and mortar in the ground.
We have the four pillars in Rebuilding Ireland. However, the flagging Rebuilding Ireland plan is behind target already. Supply and affordability is the key issue that must be addressed to get to grips with the crisis in the private, social and rental sector.
I welcome the news this morning about the new national regeneration and development agency, NRDA, being given the powers to buy State and semi-State lands for development for housing but I urge that there would not be a repeat of over the odds payment for those sites. Nobody needs to get rich from that. We just need housing.
When the Minister outlined his expectations last week for the delivery of social housing to local authorities, with targets of almost 5,000 units including 249 in Cork city, 115 in Carlow, 165 in Waterford and 153 in Limerick - those are the few I want to mention - there was no timescale or sense of what might happen if those targets were not met or an indication of when they would be met. I need clarification on that because it reminded me of "Groundhog Day". Last year, when the Minister was in Carlow, he turned the sod on the sites he announced the other day. He had already gone to those sites. What we have is the 115 houses in Carlow, which I welcome-----
Hear, hear.
-----but that was last year. We actually turned the sods at that time. Work has started on some of the houses - I will give credit where credit is due - but they were last year's targets. I need the Minister to know that.
Let us not highlight what many of us believe are targets which fall very far short of our current waiting lists. It is great to have a plan and a goal but as we all know, having a goal is just not enough. There must be real incentives. What incentives or carrot or stick approach is the Minister using to ensure delivery of those units? I see great plans in my area but nobody is all packed, with keys dangling from their wrists. There is no delivery of houses.
We have a massive problem in Carlow because contrary to popular opinion, we are close enough to Dublin for people to commute. People are buying houses in our county and renting out the remainder. There is hardly a house left that we can buy through the local authority or that people are buying, and waiting lists are growing almost daily. What firm handle is the Minister applying to these planned targets because that is what we need now?
I know the Minister is aware that this is a serious issue but we have serious issues to deal with and before we engage in the usual back and forth debate on who is at fault, we need to draw a breath. We cannot sit here and argue among ourselves, blaming the current political players for the actions of past political players. We are not playing a history game. We should rise above that and look at the massive issues at hand.
We will remind the Senator of that.
Play that back on the Order of Business tomorrow.
Hang on. I am getting there. Almost 10,000 people are homeless, more than 3,000 of them are children. We are a rich country so if money is not a problem, what is the problem? Homeless numbers are high. Home building numbers are tens of thousands behind what they should be. Ordinary workers cannot afford a home and those who have secured a mortgage are struggling. We are struggling here, Minister.
I and my party are calling on the Minister and his party to make changes, make a policy shift to establish an affordable housing scheme, increase social housing spending and strengthen the rental sector. This Government has to start delivering on housing. After four separate plans and over a dozen launches, it needs to put bricks and mortar in the ground. People need that. They do not need announcements and fancy photo opportunities. They need houses, and we need to see them getting the keys for their houses.
Supply and affordability is the key issue that must be addressed in order to get to grips with the crisis in the private, social and rental sector. In 2017, and this frightens me, only 60 apprentices registered for bricklaying and stone laying and 34 for plastering. That is far short of what is required to meet even the Government's target of a limit of 25,000 housing units. We are falling down in terms of the supply of bricklayers and stone layers. How can we build if we do not have builders? We need urgent action on that. We need incentives to lure our builders back from Canada, Australia and America. We need to examine why those who have worked abroad and raised money for a deposit for their own homes are not qualifying for a mortgage because our banks will not take rent payments as proof of ability to pay. That is a major issue, and it is one of the biggest issues the Minister will have to deal with in the future. We have so much to examine but we need to work together on this issue.
Fianna Fáil has been working with the Minister's Government in a confidence and supply agreement on this issue and we will continue to put forward costed, credible ideas to work out all the layers of this complicated crisis. The vacant housing Bill has the potential to bring 4,000 new units into the system by streamlining planning for above-shop unit spaces. We have already put forward a new Bill to give the Residential Tenancies Board, RTB, investigatory powers to reinforce rent pressure zones, RPZs. This week, we have approved a new Bill to extend rent pressure zones to purpose built student accommodation. I would argue that we need to look at the pockets of rent surges throughout the country and at rolling out rent pressure zones outside the commuter belts.
On 17 April the Minister announced a tenancy Bill in the Cabinet which states that any landlord in rent pressure zones will commit an offence if they increase the rent above 4%. I am very disappointed today. I have raised that issue with the Minister on several occasions. Our neighbouring counties, Wicklow and Kildare, are in rent pressure zones but Laois, Kilkenny, Wexford and Carlow are not in rent pressure zones. In terms of what has happened, the Department has put together a plan and neighbouring counties are in rent pressure zones but Carlow, my constituency, Kilkenny, Laois and Wexford are not in those rent pressure zones. That is unacceptable and I have highlighted that for the Minister on several occasions.
Fianna Fáil supports measures which have legislation to empower the RTB to undertake its own investigations, with the Social Democrats, to strengthen RPZs. We are also putting forward a new Bill to limit rent increases in student accommodation to 4%, which is the case in all rent pressure zones. However, those steps will not address the rent crisis. What is needed is a comprehensive cost rental model in cities across Ireland. That should use State lands to provide cheap, affordable units to rent for average income earners.
This tinkering around the edges will not resolve the crisis. I have said it twice but I cannot emphasise enough the importance of building houses. We need to examine why we are always playing catch-up on this crisis. We are late to every battle on it, and something has to change. Reactive policy has meant the State is always behind. We cannot continue as people die on our streets and stress breaks up families, especially those in arrears with their mortgages.
The Minister might ask what my party would do differently if we were in his shoes. I will tell him. We would increase the capital budget. It is still 24% below 2008 levels. A new housing agency would be established that would run efficiently and make clear decisions. We would use NAMA and bank share proceeds to invest in social housing. We would look at the possibility of loans from credit unions. The issue of credit unions and so on must be addressed because there is an issue with mortgages. The Minister has brought in a new mortgage for first-time buyers. I do not have time to go through that with him but the people who need to qualify for that are not qualifying. There are so many restrictions attached to this new mortgage that most people are not qualifying for it.
The Senator is over time now.
I will make a final point about my area. I have addressed this but I am so disappointed. I refer to the number of people in Carlow who are not qualifying to go on the housing list because of the cap of €27,500 per year when the cap in neighbouring counties is €30,000 and €32,000 per year. That is not acceptable. People are becoming homeless because the Minister is not addressing that issue.
I have been working with the Minister-----
Senator, you are way over time. There will be more debates on this issue.
-----and I know he is trying. I have a lot more to say-----
I know you do. Thank you.
-----but I will come back to the Minister. I thank him for taking the time to listen to me.
I welcome the Minister to the House. I want to stay positive. I have always said I support Rebuilding Ireland. We know that came about initially as a Government programme with the then Minister, Deputy Simon Coveney. We know that the new Minister, Deputy Eoghan Murphy, had another look at it. It was right to look at it again to see if it needed to be tweaked, not changed. I want to pay tribute to and acknowledge the Minister's staff in the Custom House, who have been very supportive. Senator Murnane O'Connor and myself are on the Joint Committee on Housing, Planning and Local Government and we have a good deal of interface with them.
I acknowledge their support.
Hear, hear.
They have always helped us when we asked for it. From time to time, though, there are frustrations about the slowness of the process. Undoubtedly, even the Minister is frustrated in that regard and is eager to move the situation on. I acknowledge his commitment to this.
The Minister is present, so I will repeat something that I said last week because I want him to hear it from me directly. I am disappointed by the targets that have been set for the 31 local authorities with the agreement of their chief executives and the Minister. Those targets are not ambitious. I took the time to read the Department's website and some of the Minister's speeches provided thereon. It is an excellent website. The Minister referred to stretching people and being ambitious. The figures before us are the minimum ones. For example, 115 units are to be built in Carlow in 2018. Lest there be ambiguity, these are the figures of the direct social housing build. There are other forms, of course. As I have stated time and again in the Chamber and at the committee, I do not have a hang-up about who builds houses, be it local authorities, approved housing bodies, AHBs, co-operatives, private bodies, public ones or public private partnerships. I do not have a problem with any of those. We want to build new homes that are affordable to rent and purchase. The Minister agrees fully with that.
Consider the figures, though. Cavan's figure is 41, Clare's is 29, Cork city's is 249 and Cork county's is 235. Kilkenny's is 98, Longford's is 44, Mayo's is 69 and Offaly's is 19. These are the agreed targets for social housing. Undoubtedly, the Minister will say that there are other aspects. Wicklow's figure is 156. All of the areas' figures are listed and have been published in the media and via the Minister's press release.
The social housing construction projects status report for the fourth quarter of 2017 is interesting. Today, The Irish Times published a timely article and released figures, which I have checked with the Department. There were 780 social houses built in 2017. I am open to correction.
It is not correct. We are correcting it with The Irish Times.
Minister, please.
I appreciate the Minister's response.
It was so that the Senator did not perpetuate a wrong number that, unfortunately, had been reported in a newspaper.
I will not propagate it if it is not fully correct information, but perhaps this points to the problem, namely, trying to get a handle on the correct figures for the output in terms of social build. I am not referring to AHB builds but local authority builds. I take on board the Minister's assertion that this figure is not correct, but he might confirm whether it is correct to say that 1,757 voids were brought back into use. That would be a good and impressive figure. As reported in The Irish Times, 543 of that number were in Dublin city, 168 were in Donegal and 121 were in Fingal. That is an achievement and a positive news story and I would be interested in hearing the Minister's thoughts on it. Rather than citing the article any further, the Minister might circulate in the next few days the correct figure for the direct social housing build in 2017.
I acknowledge the positives that are happening. Cork is in the national media today. We read that plans for 600 new homes are to be submitted to Cork City Council next month, making it the authority's landmark project to tackle the housing shortage on Leeside. The 22 acre site will be the single largest housing development in the city. We must concentrate on positive news, and this is positive news. In conjunction with the city council, Cork County Council has drafted major plans for new council designs. This is also positive. It is important that we use every model to develop housing.
All of the Members present are close to our 959 or so local councillors throughout the country. The Minister used to be a council member, so he also has this experience. He also has significant levels of contact with his group across the 31 councils. Councillors are frustrated with the slowness of the process. Some of the chief executives and housing authorities are frustrated. Everyone wants progress and to be positive, so what is the problem? Can we increase the level of direct builds?
I read something else today. All of this information is coming from the media, so I would like the Minister to correct me if I am wrong. The Taoiseach commented on the possibility of the Government acquiring more private land. That is not necessary. I have taken the time to have an assessment done of some of our local authorities' landbanks. The Minister knows the details from his own research. There are substantial landbanks on most of the authorities' books. As such, we must ask why the Government is not pushing for a greater level of social housing building on council lands. It is what the public wants and expects. I do not wish to frustrate the private sector in this regard, but it is important that we embark on an ambitious plan. I am familiar with a number of social housing schemes in the Dublin and Kildare areas that were built in the 1950s and 1960s. Some comprised 300 houses. I am not suggesting that we want schemes with 300 houses now, but their planners were ambitious. The Minister is ambitious as well, but I am not convinced that we have set the targets for local authorities high enough. I would be interested in the Minister's response. What sanctions can he bring to bear on a local authority that does not perform on what are very low targets?
I do not wish to dwell on this matter any further because I am conscious that the Minister is busy and I have other opportunities through the Joint Committee on Housing, Planning and Local Government to engage with him. I thank him for that ongoing engagement.
How can we work better with elected members of local authorities and council management? The Minister cannot micromanage the local authorities, but he can incentivise them. He also has the power to sanction them, even though he might not want to use it. If councils do not perform or possess the necessary expertise, I would like to believe that the Minister would send them that expertise by seconding to them able staff from his Department or the private sector.
Let us raise the bar higher and have greater ambition for the delivery of social housing on underutilised State lands, including ports like Galway and Dún Laoghaire. I thank the Minister for his time.
Next is Senator McFadden, who has eight minutes.
As I always say, eight minutes is a ceiling, not a target. The Minister will be relieved to hear that. I thank him for attending again. The Fianna Fáil Senator who last contributed said that we were "not playing a history game."
I will remember that quote and remind her of it in the years to come. She is probably not playing the history game because we all remember that Fianna Fáil caused the recession, put too many eggs in one basket and did not build a sufficient number of houses during the Celtic tiger-----
We are seven years on. The Government cannot-----
-----when the country was awash-----
We are seven years on and the Government still has not taken responsibility.
If the Senator would only listen-----
We are seven years on.
-----she would hear-----
I am listening.
-----that we are taking responsibility. However, she is talking about not playing the history game. Back during the Celtic tiger when the country was awash with money, Fianna Fáil was in the Galway tent drinking champagne when it should have been building houses.
Back to the blame game.
(Interruptions).
I was not going to contribute on this debate because, to be honest, I did not know what to say. I constantly go around in circles on this topic trying to figure out solutions. I hate to hear other parties and the media claiming that Fine Gael does not have a social conscience and that other parties have the monopoly on concern and care for people who are struggling with the housing crisis. We all know that is not the case. The Government, the larger part of which is Fine Gael, is working tirelessly to improve the situation. That includes the Minister and his predecessor, the Tánaiste and Minister for Foreign Affairs and Trade, Deputy Coveney.
I wish to ask a series of questions instead of pontificating about what the Minister should and should not do. I hope he can answer them. If not, perhaps he will send me a letter or email about them later.
Why can we not just instruct councils to build where they have land?
If they come back and say that they do not have the staff and that is why they cannot build, why can we as a Government not allow them to recruit? If money is not an issue, why can local authorities not recruit staff who can build on the local authorities' own land? If it is more cost-effective for the local authorities to buy in expertise and contractors, why can we not do that?
Councillors around the country whom I speak to want their local authorities to build houses in their localities. Local authority staff want to build houses but they say they are held back by red tape. Why can we not deal with that?
Some local authorities state that they do not have the resources to build and yet there are local authorities next door to them that have resources. Why can three or four local authorities not come together, pool their resources and build together? It may be more cost-effective.
What is happening to houses that are derelict that have derelict site orders placed on them by councillors? Why are they not subject to CPOs? Why is there not funding invested in those? Some buildings in my area have been the subject of a CPO and they are still sitting there nearly ten years later. Why are they not being dealt with? Are the local authorities being held accountable for those lands?
Recently local authority staff told me that they are inundated with people presenting themselves as homeless at the local authority offices, so much so that they are not at their desks working to house people but are down meeting them coming into the reception area. When they ask the clerk of works for the local authority to go out and inspect houses for people to move into, he cannot do so because he is the only one in the Athlone municipal area. Why can local authorities not employ staff? There is no moratorium on recruiting staff at present.
The previous Minister had an idea, the repair and lease scheme, that I was keen on and that I had made a submission to him on. Why was there such poor uptake of that scheme and what can we do to improve it? These are all questions that have been put to me over the past number of months. I do not know the answers to them and that is why I want the Minister to answer them for me.
Earlier in the year, an article I read stated that Permanent TSB was selling the 14,000 non-performing mortgage loans. Why could the Government not buy these mortgages and keep those people in their homes? What was to stop us doing that if we have the money?
Everybody knows the use of hotels is not suitable for families and it has to stop. Why can that money not be redirected and used to house families? These are all questions that people ask me every day, and I do not know the answers. I feel frustrated that I cannot answer them. They seem sensible, down to earth and simplistic. They are probably too simplistic for the Minister but I would love if he could answer those questions.
I would love if the Government could say to the banks that not one more person is to be made homeless because of a bank that we are stakeholders in and that we as a country bailed out. No bank should ever be allowed to make a person homeless from here on in. It is just not good enough in this day and age.
I ask the Minister to give me answers to those questions. I appreciate all his work. I am aware of the hours he puts into this. I am aware of the concern that the Minister has, like the rest of his Fine Gael colleagues, for those who have housing difficulties. I really appreciate the work the Minister is doing and I thank him.
Here we are again making statements on housing. It is impressive to hear the Minister talk about the numbers of houses being built, etc., but if I talk to people in my constituency in Waterford or meet people here in Dublin, the word on the street is that we still have a housing crisis. The articles I read in the newspapers are still about those who are suffering because of affordability. Their salary is not sufficient to enable them to afford to buy a house. Their salary is not sufficient to enable them to afford renting. There are students who cannot afford the rent. When one looks at the situation on the ground and when one hears what the Minister is saying, it just does not seem to match up.
I refer to a Goodbody report that I saw on Monday last which found that Ireland's level of housing output is among the lowest in Europe with only 2,367 housing units built during the first three months of 2018. It is clear that we are not meeting the level of demand. The numbers are based on building energy regulation applications rather than the number of ESB connections that the Department uses but the building energy regulation, BER, applications are a better indication of whether the houses are actually appearing on the market. I cannot understand the disparity between the numbers in the Goodbody report and the numbers listed by the Department under Rebuilding Ireland.
Apart from the issue of completions, we have problems that come from the developer-led approach to housing and construction. These include, as I stated, the lack of affordability. They also include problems with regard to quality and the real menace, that plagues me and leads to misery with regard to housing, of land speculation. Investors bought almost one fifth of all homes on sale in Ireland in 2017 which inflated prices and rents. This problem will likely only worsen in the face of Brexit as already we see people start to move out of the London property market. These may decide to invest their moneys here in Ireland, as the nearest English-speaking country. In fact, this would worsen the problem here considerably.
From the evidence I see and the reports I read, we are still in this housing crisis. In this crisis we still see private developers hoarding land in derelict and vacant sites. I commend the Government on finally getting around to the implementation of the vacant site levy next year and the increase, to 7%, in the rate in year 2, as argued so heavily in the Derelict and Vacant Sites Bill I introduced to this House last year. The local authority in Waterford states that even if that 7% levy is applied, it will be difficult to bring it in. It is difficult for the local authorities to ensure that 7% will be paid up. We have thus crossed the line of constricting private property rights regarding housing and construction, and without facing the wrath of the courts. I welcome the move and I hope that it will yield new development over the coming years. I hope a system will be put in place whereby the local authorities will be able to draw down the 7%.
Ten thousand people were on the streets of Dublin last month marching with the housing and homeless coalition protest and many of my Green Party colleagues from around the country were there to add their voice. My colleagues were calling for a socially-minded housing policy that helps the homeless and restricts speculators. The Minister mentioned in his presentation the Government's support for the cost rental model. This is something the Green Party will be focusing heavily on at a constituency level, identifying public spaces suitable for development in high-pressure areas. I am glad to hear that on this we can work with the Government to help identify and increase the supply of high-quality and affordable rental property.
In the fit of the information the Minister is providing with the message and the reality out on the streets, one might say there is a gap. There will be an acceleration of activity. Hopefully, under the Minister's stewardship over the coming months we will see a change from what is perceived as a housing crisis and be in a position to stop using phrases such as "housing crisis" and "homelessness crisis".
I welcome the Minister to the House. I will speak mainly about student housing if that is okay. I am conscious it is only one part of the subject but if the Minister cannot answer questions I have today, we could revisit them in future statements. To follow Senator O'Sullivan's point on investors buying a fifth of the available housing, I read somewhere that every time a bomb is dropped in Syria there is a flight of capital to London. I cannot imagine there are wealthy people who would come to Dublin for a party once a year and leave the house for the rest of the year but I wonder if there are broader parallels that the Department could examine between Dublin and London, particularly in the Brexit context.
When most of us consider student housing, we think of times when we were younger and living in accommodation not close to the standards we are used to today. The expectation in standards of student housing has been particularly low for some time before any accommodation crisis. It is a sector with rogue landlords who shirk their responsibility to provide adequate standards of living and attempt to manipulate an age cohort that might not be as comfortable or experienced in asserting their tenancy rights. I spent a short time in Galway but the accommodation I saw had issues like black mould, draughts, damp, a lack of insulation and a number of repair or maintenance issues that a landlord may refuse to deal with. Many of us may look back with fondness on our times as students but we should not lower our expectations for standards of accommodation based on age or some sort of nostalgic right of passage. We are in a rental crisis but it is no time for us to absolve ourselves of having adequate standards. I am sure the Minister agrees with that.
It is more important than ever to realise and actively promote tenancy rights as our younger renters are more vulnerable at this time. The most pressing matter I have seen with young renters is either a portion of or the entire deposit being unfairly retained by a landlord when a young person leaves accommodation in the summer after exams. The Department has been aware of this practice for some time and has formulated a deposit retention scheme; the Department announced its intention to roll out such a scheme in September 2017. That has yet to happen and I wonder if the Minister could progress this in time for September 2018, when student renters will move into new properties and pay deposits to new landlords.
There is no doubt that student renters are hit by the crisis. Our students are engaging in personal development and career advancement. They are faced with higher fees, rising rents, sometimes part-time and precarious work, as well as escalating costs of living. The student accommodation sector, like the entire rental sector, is rife with those who seek to take advantage of the lack of supply and proposed extortionate rates. Inevitably, the average rent per room is driven up in the vicinity of our third level institutions. This is done outside of rent pressure zones and, in many cases, in direct defiance of those zones. I wish the Department well in its endeavours to clamp down on that.
Purpose-built student accommodation is, however, outside rent pressure zones and is beyond the remit of the Residential Tenancies Board. This issue has come to prominence with the Dublin City University student union holding a protest outside Leinster House as just one part of its action in the "Shanowen shakedown" campaign. Rents are to be increased by 27% to €9,000 for the next academic year, working out at approximately €1,000 per month per room for student accommodation. It is completely unsustainable and it is cruel and greedy of the landlords involved. Over 50% of DCU students receive a maintenance grant and therefore their families simply cannot afford €250 per week on accommodation along with all the other costs of living in a city and dealing with education.
Deputy Eoin Ó Broin is currently drafting legislation that would bring purpose-built student accommodation into the rent pressure zone process in order to give students some certainty about their rent. Will the Minister give an indication of his plans to deal effectively with this as the current position is untenable? Every year in which the loophole is not close we leave the most vulnerable people locked out of the rental market.
I have been caught on the hop. The Minister is welcome to the House and I thank him for being here. It is an important debate. Like Senator McFadden I dispel the idea that the Fine Gael Party is not concerned with housing and does not build social housing or support the construction of such housing. I commend the Minister, Deputy Eoghan Murphy, and the Minister of State, Deputy Damien English. In Cork city the Minister has opened a number of housing developments and we have just signed a contract in Deanrock estate with the Department to construct more than 60 social houses. Go over Tramore road to Sheridan Park and one will find people living in new houses provided under Rebuilding Ireland. If we were to listen to some people in this housing debate we would swear nothing at all is happening and the Minister is uncaring, as he was unfairly portrayed by Deputy Darragh O'Brien. Of course he cares. I know Deputy Murphy to be a person of sincerity and intellect who is committed to this in his Department, as is the Minister of State, Deputy English. I always speak on housing as I believe in both the Minister and the Minister of State.
I am impatient to see change and to have it more quickly like everybody else. The alleviation of the housing crisis is a Government priority. Rebuilding Ireland is ahead of its targets but we all accept there is a road to travel. We must be honest in recognising there is no quick single fix for this. The targeted Government initiatives are working, although perhaps we need to tweak some of them. Perhaps we must be creative and think outside the box as well. I know Senator Murnane O'Connor spoke of historical but it is important to recognise that the construction sector was decimated and there are now fewer people employed in the housing and construction sector. We can compare the number of builders of houses in Cork now with 15 or 16 years ago and it is a fraction. I appreciate that under the Minister of State, Deputy Halligan, there is a new apprenticeship recruitment process but we can consider the age profile in the construction sector. Many builders have now retired or gone abroad so we must think about how we can incentivise people to come back to the sector.
Fundamental in the debate is that demand is outpacing supply. Notwithstanding the Minister's speech and his actions, we must take additional measures to stimulate supply. One of the problems is the price of development land and the way in which the price of land affects developers. At one stage in my political life I was of the view that developers were the bogey men but they are not. We need to have developers as part of the process, even if it is not developer-led.
I have tremendous faith in someone like Mr. Michael O'Flynn in Cork. I think he is a visionary and has an idea of where the construction sector should go. Equally, I know from looking at people like Mr. John Cleary in Cork, who has taken risks to build, construct and change the public landscape of Cork, that we need people like him. They are people of courage. In saying that, I refer the whole issue of how we have zoned land. Some of us were members of local authorities. Where we put land in the past and zoned it made no sense whatsoever. The Minister in his speech spoke about the vacant site levy and incremental increases in it. We all need land to build. However, are we at the point now, and I am speaking with no vested interest whatsoever in this, where we are putting a huge impediment on developers or on State agencies building because of the price of land?
I welcome the affordable housing initiative that the Minister has taken. We need to see people getting on the property ladder and able to have the dream of owning their own property fulfilled. It has come to my attention in my clinics that a number of people have been refused under the affordable housing scheme by Cork City Council. I am mystified as to why they have been refused. I am trying to get that rectified. I welcome any help we can get for these people. We need to have people buying and owning their own property. The Minister's speech is one that we need to see published further. The fundamental and key issue we must all face is that the amount of land available to build on must be increased. The economic viability for developers to build and sell needs to be examined, as does the ability of local authorities to deliver social housing units.
The price of affordable housing to the purchaser must be at the forefront of what we do. The 2017 daft.ie report referred to a change of policy to increase supply and quantity. I am confident that in a number of years the Minister will deliver. I hope he will continue to be bold, to be creative, to engage and to think outside the box. Some of the old ways have not worked. I hope the Minister will move beyond some of the thinking from those who have been in the Custom House for a long time. I commend the Minister on his work. I salute him because he is trying, as is the Minister of State, Deputy English. I believe we will see an increase in output in the coming year.
I welcome the Minister. As everybody has described, this is a serious issue that has to be addressed. Unfortunately, much of the commentary and debate, in particular in political circles and in these Houses, has been below the belt. I join with Senator Buttimer in condemning the comments of Deputy Darragh O'Brien. I refer to his personal attack on the Minister. I will pick up on the word "elite". It is not to do with where one is from. Elite is to do with a mindset. It was the mindset of the Galway tent, as Senator McFadden said. It is a mindset that says jobs for the boys. That has put our country the way it is today. Let us think about language. When we talk about housing, are we advancing the debate or are we just finger-pointing for headlines?
Other groups that get trotted out and abused as if they are pariahs in society are landlords and builders. Truth be told, they are key to delivering solutions and they are part of giving those solutions. That is no way to deal with anybody when we are looking for their bona fides and their co-operation. There needs to be more maturity in the debate around housing. I have limited time but I have a couple of points. Some will echo previous comments. I have no doubt that the Minister is serious about ramping up our social housing programme. This year alone the capital budget to local authorities for building social housing has gone from €307 million to €638 million. That is a massive sum of money.
Why are the houses not being built? I know the Minister met the chief executive of each of the local authorities and they have been told about this money. When it is broken down, are they acquiring expertise and in-house knowledge? We know they were depleted because social housing building had stopped and the local authorities lost staff etc. Are they acquiring this expertise? Are they acquiring land?
If any politician on a local authority wants to make a constructive input into the housing crisis, he or she would want to start by asking the chief executive of his or her local authority what that chief executive is doing with this money. How is the local authority delivering on targets? The Minister is not going to build the houses himself, notwithstanding all the commentary, nor is the Government. The local authorities are housing authorities and it is their statutory obligation and responsibility to be building social houses. If we can get to grips with the social housing deficit, we will go some way towards addressing issues of shortage of supply in private rental accommodation for people who are not social housing candidates. It all has a knock-on effect. The arm of the State that the Minister has the most input into is the local authorities. They are abysmal to tell the truth, notwithstanding targets and what they are about. Why are they not seizing this opportunity and knuckling down to do what is required?
It is apt that this programme is called Rebuilding Ireland. It is so called because the bottom fell out of Ireland, its economy and housebuilding under Fianna Fáil.
The Government has been seven years in power.
That is why it is called Rebuilding Ireland. It is because something has collapsed. It is like after a war.
That has to be-----
The Senator's party had its go. She does not want to hear it.
There has to be-----
(Interruptions).
She does not want to hear it.
Senator, please.
I ask the Senator not to interrupt.
I ask Senator Murnane O'Connor to please-----
That has to be clarified. What about the local authorities? There needs to be accountability.
Senator Mulherin, without interruption, please.
What about the 3,000 ghost estates in 2011 when Fianna Fáil left Government?
Fine Gael has been seven years in Government. It promised the sun, moon and stars. I know mistakes were made.
Where are her colleagues?
Please, Senator Murnane O'Connor. Respect the Chair, please.
Fine Gael has to take responsibility seven years on.
Through the Chair, please.
I am looking over to Senator Murnane O'Connor's side and she looks very lonesome.
Senator Mulherin.
(Interruptions).
There is not another Fianna Fáil Member over there.
Senator Mulherin is inviting interruptions now.
I have no problem addressing the Minister and he knows I-----
Sorry, Senators.
-----can ask any question.
Senator Murnane O'Connor, please. Respect the Chair.
I am sorry, but if claims are made, they have to stand by them.
I will, if the Senator will let me speak. I will stand by them.
Please, Senator Mulherin. You are inviting interruption.
Senator Murnane O'Connor would be better placed to go to her Fianna Fáil-controlled councils and ask why the local authorities are not building social housing, with hundreds of millions of euro available. That would be a more constructive use of her time.
The Minister for Housing, Planning and Local Government is here. He is accountable. If the Senator cannot see that, there is a problem. The Minister is sitting here. He is accountable for housing.
Senator Murnane O'Connor, please.
It is the truth.
Please, respect the Chair.
I really wonder about-----
Please, the Senator had her opportunity to make her contribution. I ask Senator Mulherin to finish her contribution.
I refer to housing loans and affordable housing loans. There is an issue in Mayo where local authority tenants are paying rent. They are good rent payers. They may be in receipt of a social welfare payment. They could get a loan only the local authority will rule them out because they are in receipt of a social welfare payment. They could be investing and buying a house. They are blocked from doing so, however, because of the nature of the income they are receiving, notwithstanding that on that same income they are managing to pay rent which is the equivalent of what they would be paying on a loan.
What is the National Asset Management Agency doing? NAMA controls land banks and has brought many builders to their knees. It announced great programmes for building housing, getting involved in an area which, to my mind, it decided to do late in the day. It should have decided to do so when it was established. What is it doing?
I raise the cost of construction in the private sector. We have a situation where, taking Mayo as an example, it is much cheaper to buy a house than to build a house. The local authority is finding the same situation. What steps is the Minister taking to reduce the cost of construction?
I welcome the Minister, Deputy Eoghan Murphy. I regard this debate as extremely important. I want to address a few areas in the time I have. I will look at it under the three main headings of social, affordable and private housing. It is about Rebuilding Ireland. The biggest issue across all areas in Ireland is supply. All have different issues. On social housing, I can speak for Limerick city. Quite a number of social houses have been built. It is not enough but construction is under way across a range of areas. The Minister was down there only recently. He opened 83 units on Lord Edward Street and he saw the units on Hyde Road where there are new apartments. They are good. Houses are already being built in Churchfield, in Southill and across the city.
I have a comment coming from local authorities. If one is building social housing, it must be sustainable. What is required here goes back to the land banks that local authorities may have. I would sometimes question the due diligence that is done on the sites local authorities submit to the Department for building to make certain that what has been put forward is sustainable. In some cases, one is going into areas that are very old and may not work. It is a feature of some of the sites that have been put forward and approved by the Department. On the face of it, they look like good sites because, in some cases, they will be turnkey developments. If due diligence is done in depth by local authorities before it goes to the Department, which is a bottleneck, it would speed up the building of social housing.
Affordable housing is a huge issue which needs to be addressed. I know that work is being done on it and that the Minister is speaking about it. I expect the Minister will say further policies will be announced regarding it. The biggest concern for parents and younger people is being able to afford their homes. It is private housing but we had an affordable housing scheme that was in place a number of years ago. That scheme was defunct because affordable houses cost more than it costs to buy the house on the open market because of the form of the structure being used. That is a key element. We have a culture where people like to own their own homes and I feel strongly about it.
On private housing, the Minister mentioned many planning permissions being issued and, in Limerick, there is much construction underway in the private sector. There are issues with some of the smaller builders' access to credit. They find it difficult to get access. We need to look at that area again. Speaking of the number of people employed in this sector, it is a problem that we lost a decade of people with skills, including tradesmen. Many emigrated and many are older now. No one was training in that area in the last decade from 2008. We are now playing catch-up. We need to look at ways to fast-track this to have tradesmen in place. I welcome that there is another round of local infrastructure housing activation fund, LIHAF, funding. I welcome that the Minister is looking to do an integrated model. The key issue here is supply.
On social housing, the Minister should make certain the sites that councils are putting forward are suitable. For any of us dealing with the issue daily, local authorities are key because they are in control of the building of houses, whether through approved housing bodies or otherwise. They put the applications up to the Department and they determine where social housing is going in. It is probably necessary to bring the local authorities in to say where their land banks are and where there will not be difficulties in building. In many cases there are major difficulties with location across a myriad of areas. In some cases, where one is looking for a balance, if there is an overconcentration of social houses in an area, that is not fair to existing tenants. That is why we went for 10% social and 10% affordable in estates. The key is that the due diligence being done by local authorities before they submit to the Department needs to be looked at in great depth. We need to have fast-tracking to train apprentices, which we are doing. I look forward to the future. The affordable element is key.
I refer to the issue raised made by my colleague, Senator Mulherin, which is increasingly happening under the tenant purchase scheme. One of the criteria is that there must be someone in employment in the house. We are finding that older couples who have retired are now at the stage where they would like to own their own homes. They go in and could afford to pay the mortgage but they are not working. We try to get around that by getting a member of the family to come to live in the house and become a tenant. It is very cumbersome and the issue is coming up increasingly lately. Perhaps we should see if something can be done where there are retired couples and whether they can afford to purchase the house if they have been lifelong tenants. Senator Mulherin referred to it being something that is coming up increasingly. It is now a regular feature. It was not perhaps a year ago. The tenant purchase scheme has come back in a slightly revised form. It is perhaps something that the Minister will take under advisement.
I welcome the Minister to the House for this vital consideration of housing. I want to focus on housing for people with disabilities. A motion was unanimously passed in this House in July 2016 that focused on housing for people with disabilities. The House agreed to the motion which stated:
- confirm that the Government's action plan for housing includes specific commitments on the delivery of housing in sufficient numbers and type to also meet the housing needs of persons with disabilities;
- ensure the provision of an annual update from local authorities of the number of social housing units allocated to people with disabilities on the housing waiting list;
- ensure that any housing project supported by public funding, including Part V housing, provide a percentage of pre-planned and reserved housing units to meet local needs for persons with disabilities;
- ensure that the social housing 2020 strategy is routinely disability proofed;
- provide funding in 2017 to increase housing supply and to make necessary and timely adaptations to current housing stock;
and
- requests that the Joint Committee on Housing, Planning and Local Government draft a work programme which will routinely consider and review Government progress towards delivering adequate and sustainable housing for persons with disabilities.
Almost two years later, that has not been honoured. That was a decision of this House in July 2016. We now have the United Nations Convention on the Rights of Persons with Disabilities which has been ratified by not only the Government but by the Dáil. It has been ratified and agreed by Ireland. We have given our international word, our bond, that we would implement that. I will mention one article that relates to people with disabilities and housing, namely, Article 19.
Article 19 of the convention, entitled "Living independently and being included in the community", relates to people with disabilities and housing. Section (a) states that we must ensure that "Persons with disabilities have the opportunity to choose their place of residence and where and with whom they live on an equal basis with others and are not obliged to live in a particular living arrangement". We know there is a programme to ensure that people with intellectual disabilities can be moved out of congregated settings. We also know that 1,200 people under 65 have been routinely moved into nursing homes where, as I have often said, the doors only turn one way. There was a housing crisis for people with disabilities before there was a more widespread housing crisis but that is not seeping into the ongoing thinking and work in this area. The Minister, his officials and others who are dealing with a very nasty situation on housing in Ireland do not wake up in the morning and consider the legacy housing problem that existed before this crisis and which will get worse. I must be clear that I do not have easy solutions but the problem will not be solved by putting on carpet slippers and tiptoeing around it or by pretending it is not there. We are trying to keep people living in the community. They need to live somewhere.
I wish to mention Rebuilding Ireland 2016, which was published on 19 July, a week after the motion to which I referred. It did not reference the figures on social housing waiting lists which the Department already had. According to a survey conducted in 2013, there were approximately 3,900 persons with disabilities on the social housing waiting list at that time. That figure was not included in that strategy and has since increased to approximately 4,560. There is a blindspot in that regard or people consider that they do not need to include those figures as they have enough to be getting on with, which is unacceptable.
As regards the housing adaptation grant, the maximum grant available is €30,000 but that decreases for households with incomes exceeding €30,000 per annum. Households with annual incomes of €35,000, €40,000 or more may end up getting buttons and having to fund so much of the work themselves that it is not feasible to carry it out. The houses of many families in this country with babies or children with significant physical and other needs, or family members who have become disabled, are unsuitable for the person with a disability. This is to a large extent the first generation of families to try to rear such children in their own homes. The parents may be trying to hold down a job and earn the average wage, which is in excess of €30,000 per annum. However the maximum grant available under the scheme is €30,000 and that can only be claimed by households whose annual income is under 30,000. What is the cost of such works? If we seriously wish to help people who have a child with a disability and other children to rear or who care for a family member who becomes disabled midway through life, they must have real help with the cost of bricks and mortar. It is a once-off payment. There is no recurring expense. Surely, we can find a way to upscale that scheme. Although the State contributes funding to the scheme, local authorities must find matching funds for it. We should be able to do something serious and substantial in the short term in this area which would help to alleviate the burden of a particular group of people. We must help these families who are trying to get up early in the morning - I do not mean to poke fun at anyone by saying that - get children out to school, get things moving, get to work themselves and so on but who must cope with the extra and incidental costs of having a child or other person in the house with a disability and all the things we never think about until we find ourselves facing them. The State must act to change this very harsh and Victorian style of means testing. It does not work, it does not help people and it will hinder Ireland meeting its obligations in respect of people with disabilities.
I ask that the Minister come to the House relatively soon to comprehensively outline where we are in terms of ensuring housing for people with disabilities. Let us be honest. If we have problems - and we do - let us put them out there and then see how we will solve them.
I welcome the Minister, Deputy Murphy, to the House. He visited Limerick not too long ago and we had a very positive day involving the opening of the new housing development on Lord Edward Street. He met many people who worked there in the past and some new residents. Limerick was very lucky to have been in receipt of funding for social housing when other local authorities were not able to build. However, we would like to receive more funding if possible. I understand that the Minister must share the budget between local authorities based on applications.
I am concerned that some of the many applications submitted by local authorities propose construction on very small green spaces. These very small sites may be the only green space in the area. Although it is lovely to think that extra houses would be provided there, such development would remove a green area of which existing residents have the use. I know of an application to build a house on a plot of approximately 10 ft. by 12 ft. in between three houses and a tree. I have said to the local authority that I am unsure whether it should target such sites. There are plenty of vacant land banks which are very suitable for development. I fully support the building of social housing as quickly as possible.
I have represented Hyde Road for 17 years. There are quite a few privately owned derelict houses on the road but the local authority has stated it has little power to do anything with them. Houses with rubbish dumped in them may be next door to lovely houses but nothing can be done because they are privately owned. We must find a way to get around that and be able to access such derelict houses. If such houses have been derelict for a long period there should be a way to bring them back into the ownership of the local authority and renovate them for families to move into because families previously lived in these areas. Such issues must be addressed. The local authority stated its hands are tied because the houses are privately owned. However, it should be possible to empower the local authority to step in if the house has been derelict for a long period. Perhaps it has such power but is unaware of it or unwilling to use it. I acknowledge that a change of legislation may be required in that regard.
Although I welcome the Rebuilding Ireland programme and the new housing loan scheme, the rates involved should be reconsidered. I know a young single mother who went back to college and then got a job at a starting salary of approximately €25,000. She would only qualify for a loan of €101,000. One would not get a house in Limerick nor many other places for €101,000. Perhaps the rates could be reconsidered in that context. That young girl is determined to get a local authority house and have the option of buying it in the future or to try to buy under the affordable housing scheme. The Minister indicated that the affordable housing scheme will be reopening very shortly and that he will soon make an announcement in that regard. I welcome that because it was successful but not enough houses were available under the scheme. I understand that there were restrictions to do with funding but those schemes worked very effectively in certain areas and that should be considered.
I will leave the Minister with one last point. I use Limerick just as an example, but on our main streets the majority of businesses do not have anybody living overhead. Could incentives be brought in? I am aware a trial was done to incentivise businesses to renovate the premises above their shops to turn the spaces into rental units and these could be rented or even lived in by the owners. People, however, found the schemes too restrictive. By the time the premises was renovated and let, it was just not worthwhile. I believe it is a common complaint in all large urban areas that there are very few people living within the city centre. In European cities, one will find people living over business premises. They have their business downstairs and upstairs is rented. We need to look seriously at this area to see how we can encourage businesses to develop living above the shop.
Overall, I compliment the Minister and the Department on the number of people who have been taken out of rough sleeping and hostel-type accommodation. I have seen first-hand, and in my own experience, the number of people who were recently in receipt of local authority housing and have been accommodated. This is very welcome. I also pay tribute to the staff who work in the accommodation and in the emergency centres. During winter, near to where I live, I was aware of a hostel for families at one end and emergency accommodation at the other. While there are issues sometimes, people were able to go in and get a bed for the night. It was very welcome that people were not rough sleeping.
A group in Limerick will be building modular and wooden-framed houses under a regeneration scheme. I invite the Minister to come down and look at what they are proposing. The idea came from the United States of America. The group has come back here and will team up with the regeneration agency in Limerick with regard to the fast supply of houses. It would be well worth the Minister's while to visit the next time he is in Limerick.
The Minister, Deputy Murphy, has 13 minutes if he wishes to avail of it.
I think I definitely have to as I have nine or ten pages of notes here. I would like to respond to everyone if I may in the time available. I thank all the Senators for their contributions. We will be back here talking about housing because it will continue to be an issue until we have actually managed to stabilise the housing sector, bring along the supply we have provided for with regard to taxpayers' money and deal with the different supports we have put in place to help ramp up the private supply.
Senator Murnane O'Connor raised the issue of builders and the people who might do the work. As I said in my opening statement, the number of people working in construction has increased. The number of construction projects has increased so more builders are required. We are also seeing new technologies being availed of, especially in residential developments. This is in modular, pre-cast and pre-fabricated homes that happen off site.
Apprenticeships are the biggest issue.
As we ramp up supply, it does not necessarily mean that we will need the same number of individuals as we have done in the past. We can take advantage of new technologies. Of course we still need people and a scheme in my area has been quite successful in training people and in taking them from long-term unemployment, and even some people who had been homeless, into working jobs. They did this in a matter of weeks and trained them in the basic skills. I went to visit them for their graduation ceremony. It is a small enough throughput of maybe ten to 14 people in each class, but it does work and it produces results. Every additional body is definitely necessary. A new group is being put in place in the context of Project Ireland 2040 to monitor the needs around skills and everything else as investment ramps up massively across the economy, not just in house building. We will be keeping a very close eye on that and the Construction Industry Federation will sit on that new group.
With regard to some of the ideas that Senator Murnane O'Connor has put forward, she describes it as a policy shift coming from Fianna Fáil. It is not actually a policy shift rather it is measures that the Government is already taking with regard to affordability. I announced schemes earlier this year relating to new protections in the rental sector such as rent pressure zones, greater security of tenure, rent transparency and rent fairness. These are things we are in the process of doing. More money has been made available for social housing with an additional €100 million being put into the budget in the last quarter of last year to provide for regeneration and more house building in certain parts of the State where we could avail of it. We knew that this additional funding in that fourth quarter would get people into those homes by the end of the year. It also provided for some family hubs. On top of that, I secured an additional €500 million from the Minister for Finance for Rebuilding Ireland. The capital finance available for the five-year programme is now above €6 billion. A ring-fenced capital fund over a multi-annual programme has never happened before. It gives me great flexibility if I need, in a given year, to do more of certain things. I can do that and I can provide the funding. It is very useful in that regard.
Reference was made to credit unions financing social housing or house building. This is a Central Bank issue ultimately, but a huge amount of private finance is now interested in building social housing homes and private homes. The enhanced leasing scheme and the new mortgage to rent scheme have shown significant increase in interest from the private side to bring the money to provide solutions for home building, which is very welcome. There will be more announcements about that in the near future.
Turning to the Rebuilding Ireland home loan, nobody should be advocating imprudent lending in this regard. There are certain criteria to make sure that the loans given are affordable and that people can meet their repayment targets. I had a meeting on this yesterday with the relevant people. There are a couple of things we will do and I recognise that some tweaks might be made but whether they will be made in this first tranche of €200 million or in the second tranche is being looked at currently.
We spoke a little about history lessons. I believe that it is incorrect to hark back to 2008 when we talk about the numbers at the time because there were too many homes being built, and also because of the amount of money being spent on housing. They were not built on sustainable finances. As we talk about these issues, we need to be aware of the mistakes that were made in the past so we do not repeat them. We need to look to the future and where we all want to go as a State and as a society in building more homes that are private, social and affordable.
Senator Boyhan asked about the targets for local authorities in the context of social housing. The direct build target for this year for local authorities and housing bodies is 3,800. There are some outliers and some local authorities are not moving as quickly as others, but we have doubled the local authority build for this year. It is a very ambitious target and we have put in new resources to help them with it.
On the output that has been achieved, the numbers published by the Department are the accurate numbers. They are not claims; they are accurate. They have to be verified every year with the Committee of Public Accounts and the public spending codes. There are statisticians within the Department who check and double check. They might move the provisional figures and then give the final figures. It is part of a very robust process in the Department. I recognise, however, that it is sometimes difficult to communicate the numbers because with social housing we have six different delivery streams. It is not like it was back in the day when it was just the local authority that built social housing. Now there are housing bodies building social housing, there is the Part V stream and we also have acquisitions because in some parts of the State, acquisitions offer better value for money. Long-term leasing is a new type of delivery stream, involving 25 or 30 year leases. There is also the void conversion programme. These are empty social housing homes that are not in use and the programme brings them back on line. As a result of the different delivery streams, it is very easy for certain parties, if they want, to unpick the numbers to give the impression of very low build rates when it is not actually the case. Last year, 2,200 new homes were built across local authorities, housing bodies and the Part V delivery scheme. This is three times the number in 2016. This year, we will double that number again. We are coming from nothing because of mistakes that were made in the past. We are, however, ramping up very quickly.
I clarify for Senator Boyhan that I gave the 2017 figures in January. They are the accurate figures and they are broken down by build, voids, acquisitions and leasing. It is very clear. People can look at the table in the document on the 2017 results that was published in January this year. The Senator asked about increasing direct build. We are doing that and all the numbers are up for social housing on the private side. It is up 30%, 37% and 41%, and building energy rating numbers are up 45%. These are huge increases. We are seeing increases we have never seen before, even in the good years, in investment in the residential area. Much of that is foreign investment, which is not necessarily a bad thing. In the boom years, part of the reason that it was so destructive to our economy is that we were selling property to each other at inflated prices. If mature, residential investors want to come into the market to provide new solutions around apartment building or mature build-to-rent, and if these investors are looking for a steady rate of return - not supernormal profits but a 3% or 4% uptake year on year for pension fund investors, pension funds such as the teachers' unions in the United States of America that have very large resources - then there is no problem with that funding coming into the economy. It means there are more solutions being driven every year.
On affordability, a new agency is being developed currently. We are doing detailed work on it. It is about using public lands and semi-State land as leverage to drive affordable house building. If we need to compulsorily purchase certain land because it makes sense for site assembly in particular strategic areas, then we will do that.
A huge amount of working is happening at the moment so that when we come to announce what we are doing, everyone is quite clear on our objectives. There will be quite an important intervention in the land market.
How much time do I have left?
The Minister has six minutes.
I will go straight to Senator Murnane O'Connor's questions, which are the most important, according to her, and to the questions posed by Senator McFadden.
In terms of local authorities, the funding is there and the extra resources are in place. We have told the local authorities that if they want to hire more staff, they can bill them directly to the Department. We have also set up a new housing delivery unit headed up by the Minister of State, Deputy English, with new resources. We have made design and procurement expertise available to the local authorities. The target for this year is 3,800 units for local authority and housing body direct builds. That does not include the units provided by way of Part IV. We have published those numbers for local authorities to have accountability and transparency, so that we can see exactly what is meant to be delivered. Those are good, robust numbers in that we have consulted with each local authority. That target number of units can be delivered as long as our delivery unit continues to drive things at local authority level. Of course, the local authority councillors have a role to play in this as well. Every time I make a housing intervention that takes any kind of power away from the local authorities or local councillors, they complain so I have to try to find a balance between national interventions and powers, and what the local authorities can and should be doing themselves.
In the context of Senator McFadden's questions, we have spoken about the history of this problem. Reference was made to the 90% fall in levels of construction, the hundreds of thousands of people who plummeted into negative equity and the more than 3,000 ghost estates, many of which were still being bulldozed up to quite recently. It is not just a seven-year problem with which we are dealing. In the first few years of the recession, we had to deal with the problem of having houses in places where no one wanted to live. We had to stand down the affordability scheme because there was a 50% drop in house prices. We no longer needed an affordability scheme and many people were in massive negative equity. The first few years of Fine Gael-led government were actually about fixing the economy and trying to turn those things around. We actually turned them around more quickly than many believed we could, in terms of creating jobs and so forth. We have an increase in pressure on housing now because of a natural shortage of supply coupled with more people being back at work and more than 100,000 of our sons and daughters returning from abroad. They all need somewhere to live and that has placed extra pressure on the housing sector.
Local authorities can recruit staff and bill the Department directly, as I have already said. We have identified lands on which the local authorities can build. Local authorities can partner with construction companies in order to deliver more homes more quickly. They can do all of those things. We have to be careful about making broad statements that local authorities are not building or that there is no social housing being built. The truth is that they are building social housing but just need to do more and we know that. Rebuilding Ireland is working. Across almost every metric that we have, it is exceeding its targets. I made an announcement around that at the beginning of the year.
The repair and lease scheme has been reformed. There were some problems with the ten-year condition but that has now been reduced to five years. We have increased the amount of money that can be spent if a former bedsit is being put back into use. We have also allowed the costs to be spread over a number of units so that, for example, one unit might cost more than €30,000 to refurbish while another might cost less than €5,000, so it can be balanced out. We have made the scheme more attractive and there are hundreds of applications in the system at the moment for repair and leasing.
We are in discussions with the banks about their properties but I cannot say any more than that at the moment. Senator Grace O'Sullivan is right to point out that we are here again, talking about housing and that we will be doing so for some time to come. Rebuilding Ireland is a five-year programme. That does not mean that it is going to take us five years to solve all of our problems. It just means that we have put in place a five-year programme to try to do every piece of it, including building a mature rental sector and building more social housing units. There will be a 50,000 increase in the social housing stock over that programme but it is going to take some more time before the new homes commencing on site each month actually get built and tenanted. It will not take too long but more time is needed.
It will take the remainder of this year before people start to feel what is happening in our housing sector. That said, over the course of last year, 26,000 new social housing tenancies were created between the private rental market and our own builds. We will do something similar again this year, if not more. It is not that people have to wait too long. We have the supports in place through HAP and through our own build programme to help them in the meantime. The Senator is right to focus on affordability. We are still 20% off the house prices peak of the boom years when it comes to buying a house. However, when it comes to renting, we are well above the boom time peak because of the shortage of supply. Affordability is a key issue that we must address.
The Goodbody report is very interesting. It looks at the number of BER certificates issued but that does include self-builds. If one looks at Goodbody's figures for the first three months of this year, they show a 45% increase, excluding self-builds. The report says that we are one third off what is needed. Given what actually happened in our housing and construction sectors and in our economy, to be back at one third off is not so bad. Our own statistics, based on data from the Central Bank, on ESB connections, commencement notices and planning permissions all point to us being one third away from where we need to be in order to be in a steady state.
The ESB figure is no longer being used for completions because that figure is for newly-built homes or any homes that have been vacant for more than two years. It is interesting that if the figure is 18,000 to 20,000 based on ESB connections, people say that is not accurate because it includes vacancies but at the same time, they say we are not doing anything about vacancy rates. If the ESB connection figure is 18,000, then that could be 10,000 new builds and 8,000 units taken out of vacancy, which is fantastic because it signifies better management of our housing stock. It could also mean 18,000 new builds and no vacancies. We cannot be criticised on both. What it means for people moving into those houses is a new home that was not previously there, either because it was newly built or was vacant for more than two years and that must be welcomed.
I absolutely agree that the State needs to intervene to prevent land speculation. A vacant site levy of 3% is in place at the moment and that will more than double to 7% next year. That means that if landowners have not built on their land by the end of 2019, they will pay a 10% levy on their land but we will do more than that. Senator Buttimer raised this issue too and we are going to intervene directly in the land market by building on public and semi-State lands. We expect that to have a dramatic impact on the price of land in this country.
Reference was made to 10,000 people marching on the streets recently in a homelessness protest. I get accused of inflating my figures sometimes but the figure we have for that protest is around 4,000. That said, nobody should have to march. I welcome people expressing their democratic right to protest and getting angry and frustrated about the issue. The Government is also getting angry and frustrated, which is why we are doing so much about it. We need to be careful about the numbers of people that were actually at that protest. We also need to understand some peoples' motivations because there are some people who do not want to hear the good news. They do not want to acknowledge that social housing is increasing so they point to other metrics and say that the levels are falling or that Rebuilding Ireland is failing because there is an increase in homelessness.
There is an increase in homelessness but a big part of that is the fact that not enough homes are being built. However, as we build more homes, we will be able to help those people. Crucially, 4,700 people left homelessness last year, while more than 2,000 families left hotels and the majority of them went into homes. Now we have a record decrease in the number of people sleeping rough. Among the most vulnerable homeless, there has been a 40% decrease - about 110 in Dublin - but of course we need to do more. That is why we have Housing First under Bob Jordan, the new national director. A full 50 Housing First tenancies were secured in the first quarter of this year. That kind of rate of increase has never been done before. He has the mandate and the money and is working with local authorities to roll out the Housing First model across the country. That is going to work. It has worked well in other countries and it will work for us too.
I assure Senator Grace O'Sullivan that I have spoken to the Green Party leader about the cost rental model and I know her party's position on it. Indeed, her party tabled a motion in the Dáil on it recently which I would have supported, had it not mentioned specific sites. We have to be careful about identifying sites but cost rental has to be a part of our rental market as we look to the future.
Senator Warfield spoke about student accommodation. I think I have already addressed the issue around foreign investment and why I believe it is welcome. It is not Irish people selling property to each other at ever-inflating prices and sometimes foreign capital is not looking for super normal profit. In fact, a lot of the investors that I have met just want a steady return on their pensions. The current low interest rate market internationally means that people cannot get a return on their money. Significant pension funds, some of which are worth billions of euro, need safe havens and property can be a safe haven. Those pension funds will not have a problem with things like rent pressure zones or the capping of rent inflation because they see that as what is called a "steady Eddie". They know that they can invest for 20, 25 or 30 years in the rental market here and if the standards are good by international comparison, they will get a return on their money and we will get more housing into the market. Furthermore, we will not be exposed to some risks that may have existed in the past when the majority of investors were people in this country selling property to themselves.
I apologise for interrupting, but the time is up.
I am sorry I am not going to get to the points made by the others speakers. In terms of student accommodation, rent pressure zones and the difficulties being faced, we are looking at that at the moment. I will be introducing a Bill relating to the rental sector and am working with the Minister of State at the Department of Education and Skills, Deputy Mitchell O'Connor, on it. That work is ongoing and if it is possible or necessary to amend that legislation, we will do so. It is tough enough being a student in terms of trying to find the money, particularly when costs are going up and we do not want rent to be another significant pressure for them. We obviously want more rental accommodation to be available and there will be an additional 9,000 very modern student bed places in the system by 2019. It is great accommodation and represents a whole new way of living for students that has not been seen here before but as we bring that on stream, it must be affordable for them.
I am very sorry that I did not get to the points made by Senators Buttimer, Mulherin, Kieran O'Donnell, Dolan or Byrne. Senator Dolan talked about disability which is very important. All of the schemes that I have visited have included some homes with disabled access, including the scheme in Lord Edward Street in Limerick which I visited last Monday. I received a copy of A Stitch in Time, a book by the people who used to work in Limerick's clothing factory which has now been re-purposed. The new accommodation units include lower worktops in the kitchens with space for wheelchairs underneath and wider doorways. I know that we need to do more but every social housing scheme that I have visited has had homes for people with disabilities.
Could the Minister give us an update on where things are at in that regard?
Absolutely, I would love to do that at a future engagement.
Perhaps we should start to silo some of these things in order that we can go in depth into the issues of affordability, disability and student accommodation and not go in depth too much into the history. My apologies for running over time.
That is fine.
The recent history has been very positive.
We are moving forward. We attend all the Minister's meetings weekly and I have to say he works hard.
Thank you, Senator. I appreciate that. I thank the Members for their time and forbearance.
The Minister is very welcome back to this House anytime that he has good news for us.
I propose we suspend the House until 4.40 p.m.
Sitting suspended at 4.21 p.m. and resumed at 4.40 p.m.