There is one item on the agenda, a Revised Estimate for the Department of the Environment and Local Government - Vote 25. The Clerk to the Committee has circulated a suggested timetable similar to the practice adopted in previous years. A briefing note on the Estimates has also been circulated. I propose to allow the Minister of State and the Fine Gael and the Labour spokespersons to make an opening statement that shall not exceed 15 minutes. Is that agreed? Agreed. The timetable, as agreed, will give each member the opportunity of raising matters with the Minister of State relative to the Estimates. I welcome Ministers of State, Deputies Molloy and Dan Wallace and their officials to the meeting. I understand the Minister, Deputy Dempsey, is unable to attend the meeting. I particularly welcome Mr. Niall Callan, Secretary General designate, to the meeting and wish him well in his new post. I call the Minister of State, Deputy Molloy.
Estimates for Public Services, 2001.
Vote 25 - Environment and Local Government (Revised).
I am pleased to have this opportunity to discuss my Department's Estimate with the Select Committee and I look forward to a constructive discussion and exchanging information with the members.
As the Chairman said, the Minister, Deputy Dempsey, sends his apologises for his unforeseen and unavoidable absence.
A short briefing note has been circulated to the members giving details of the overall Estimate and the individual subhead expenditures. The Minister of State, Deputy Dan Wallace, and I will be happy to assist the committee in any way we can during the question and answer session later. If more specific information that is not readily available is sought by members, we will be glad to forward it subsequently.
Overall my Department's Estimate is up about 30% on the outturn for the previous year. This reflects the Government's commitment to accelerating the infrastructural programmes which are the cornerstone of the national development plan. The three main programmes on which the greater part of my Department's capital provision is expended are roads, water services and housing. Together these account for some 95% of the overall capital spend of more than £1.75 billion. Members might note that in addition to the foregoing more than £200 million in capital spending will be made available for non-national roads through the local government fund. All these programmes are vital for continued economic and social progress. Our road networks are our primary transport arteries. Water and waste water schemes build capacity into the economy as well as protecting the environment and social housing caters for the needs of those in our society who cannot acquire housing from their own resources.
I propose to speak briefly to the committee about each programme in turn starting with housing. We are living through unprecedented times in terms of housing here. Never before in the history of the State have we experienced such a period of sustained high housing demand. While annual housing output has been almost doubled - annual housing since 1994 and achieved record housing outputs in each of the last six years - we still have some distance to go in matching housing supply with demand. Moreover, the economic, demographic and social factors that have underpinned this exceptional demand for housing are set to stay in place for some years to come.
We also face a significant challenge in meeting the high levels of social and affordable housing need. The establishment of long-term investment frameworks, together with increased resources of programmes which we can now afford to sustain, allow us to face this challenge with some measure of confidence.
A range of positive measures have been taken to maximise housing supply, in particular the supply and more effective use of housing land. These measures with particular reference to social and affordable housing are supported by the provisions of the Planning and Development Act, 2000. Part V of the Act provides for the preparation of housing strategies by local authorities which must address the housing needs of all sectors of the community, including the need for social and affordable housing and for the integration of housing strategies with the local development plan. Efforts to increase the supply of housing are underpinned by the investment programme provided under the National Development Plan, 2000-2006, in relation to essential economic infrastructure such as roads, water, sewerage and public transport. This will facilitate the provision of more than 500,000 houses required to meet demand over the years to 2009. Considerable priority has been given in recent years to tackling increased social housing needs. We are allocating £7 billion for social and affordable housing over the plan period to ensure that the social housing needs of some 100,000 households are met between 2000 and 2006. This is a real response to social housing needs.
Our approach is essentially two pronged - first, to increase the traditional local authority house building programme and, second, to expand voluntary housing activity and output under other complementary schemes, such as shared ownership and the affordable housing scheme. Since 1997, the resources allocated to housing have trebled to just over £1.1 billion in 2001. Funding for local authority and social housing programmes increased from £179 million in 1997 to almost £703 million this year.
Considerable priority is being afforded to tackling the increased level of social housing need. The increased investment provided for under the national development plan and the multi-annual local authority housing programme, which I introduced for the period 2000 to 2003, will assist local authorities in planning more efficiently and effectively the level of provision and the implementation of their programmes. Under this initiative a comprehensive funding package was agreed to deliver 22,000 local authority houses over the four year period 2000 to 2003. As members are aware, this was further boosted in the Government's action on housing in June when an additional 1,000 starts per annum were announced. Therefore, in total, the multi-annual programme will deliver 25,000 local authority housing starts over the period 2000 to 2003.
Record levels of capital funding have been secured for the local authority housing programme in 2001 of £448 million, an increase of 44% on the original provision for 2000. While the level of local authority house completions in 2000 was disappointing, it was the first year of the programme and I am greatly encouraged by the fact that, at the end of 2000, more than 5,000 local authority houses were under construction, which is the highest level for 15 years. This increased level of activity is borne out by the provisional completion figures for the first quarter of this year which indicate that local authorities completed or acquired almost 800 houses in the first three months of 2001, an increase of 150% on the corresponding figure for the first quarter of 2000. Based on this level of activity I expect authorities to complete or acquire more than 5,000 houses this year and to start in excess of 7,000 houses. This is the highest level of activity for many years and evidence that the multi-annual programme approach is beginning to bear fruit.
I reiterate the Government's commitment to the development of the voluntary housing sector. The objective is to develop and expand the sector and to increase housing output by the sector to 4,000 units of accommodation per annum over the lifespan of the national development plan. This commitment is reflected in the fact that since the Government came into office in 1997, limits for assistance under the voluntary housing schemes have increased on three occasions and are currently under review.
I am pleased that the improved terms for the voluntary housing schemes are having a positive effect on activity in the sector. Returns for 2000 show a substantial increase in the number of units of accommodation completed by the sector, with 951 units completed compared to 579 units completed in 1999. I am also pleased that there has been a marked increase in the number of units of accommodation under construction and at planning stage at the end of 2000 compared to the position at the start of the year. In addition, in the course of the past year, in excess of £119 million has been approved towards voluntary housing building programmes, which is more than double the amount of funding approved in the previous year. These are all positive indicators in the context of the targets set for the sector by the national development plan and augur well for continued growth in activity in the sector.
Major investment in infrastructure, including national roads, has been identified by the Government as a leading priority of the national development plan over the 2000-06 period. The extent of this commitment is reflected in the overall allocation of £17.6 billion over the seven years of the plan for public infrastructure such as roads, public transport, water services, environmental protection, energy, housing and health capital. This year builds on last year's significant increase in funding for roads. The 2001 Estimate of £983 million represents a 28% increase over the 2000 expenditure of £706 million.
Over the course of the national development plan, £4.4 billion - measured in 1999 prices - will be directed towards national road infrastructure improvements. The Revised Estimates for 2001 include a total provision of more than £660 million for national roads. This is over £143 million more than the provision last year. Over £620 million has been allocated to the National Roads Authority for the construction and improvement of this network. These funds will enable the authority to finance projects such as the M1 Dunleer-Dundalk and the M50 southern cross routes, which are opening this year, as well continuing work on major infrastructural projects like the M1 Cloghran/Lissenhall, N11 Glen of the Downs and the Kildare and Drogheda by-passes.
To complement improvement works to the network, £40 million has also been provided to the authority to carry out maintenance works. This is a further record level of provision and it will protect the value of the increased investment in constructing and improving the network. Almost £53 million is being directed towards the forward planning and design of major roads. This is a critical component in ensuring that the ramped up investment levels to be provided over the period of the plan will be capable of being used on schedule and that progress on improving the network can continue as envisaged in the national plan.
Better roads are safer roads and road safety is foremost among my ministerial concerns. The National Roads Authority predicts that by the end of 2006, there will be an annual reduction of over 50 fatalities and 100 serious injuries in road traffic accidents due to the planned construction of 875 km of motorways and dual carriageways on major inter-urban and other routes. The accident rate on these roads is one-third of that on two-lane roads. The authority's ongoing remedial measures programme, which is targeted at high risk accident locations, is proving very successful in reducing accidents and fatalities. Preliminary findings on the effectiveness of the programme since its introduction in 1994 indicate that over 100 lives have been saved to date.
Increased numbers of vehicles and greater road usage place demands on us to ensure that there is a good quality non-national road network for all road users. These roads are especially important to the fabric of our rural economy and should be seen as complementary to investment in the national network. They are - quite properly - seen by the public as a test of our ability to manage and deliver a quality customer service. The total non-national road grant allocations in 2001 will amount to over £323 million, an increase of £54.3 million, or 20%, on the 2000 payment figure. This allocation is an increase of 87% on the original 1997 allocation of almost £173 million.
The grants provision of over £323 million for 2001 includes over £162 million for the restoration programme or £15 million more than was provided last year under this heading. Investment in this programme has been and remains the principal focus of expenditure on the non-national network. Much has been achieved in recent years and the results are clear. Since the launch of the programme in mid-1995, more than 26,667 road schemes have been completed with over 43,006 km of road improved or maintained. This is equivalent to 50% of the entire road network of regional and county roads. The increased level of funding available this year will enable county councils to complete a further 5,339 restoration, maintenance and improvement schemes with the result that close to 60% of the network will be restored by the end of the year.
Regarding the environment, two major assessments, the EPA Millennium Report on the State of the Environment and the report arising from the OECD Environmental Performance Review of Ireland, 2000, concluded that Ireland's environmental quality remains relatively benign in comparison to most other European countries. Equally, it is important to acknowledge that, as economic growth and rising consumption continue, we are confronted by a series of challenges that must be met if we are to protect and enhance the environment. These are to tackle and reverse trends towards increasing eutrophication of inland waters, to fully implement modern waste management policies and practices in accordance with the waste hierarchy and to protect the urban environment and control greenhouse gas emissions in line with our Kyoto Protocol commitment.
Damage to the environment and depletion of natural resources can only be avoided by resolute measures to step up environmental protection and make developments more eco-efficient. Responses are demanded from everyone. For the Government's part, a range of policies and measures are being developed and implemented to meet these challenges. For example, record levels of investment in water services, development of catchment strategies and the 1998 phosphorus regulations will help secure and maintain good water quality. The national development plan provides for the creation of a modern waste management infrastructure in Ireland and work is now at an advanced stage on a new policy statement in relation to waste minimisation and recycling. Substantial investment in public transport under the plan, together with the elimination of leaded petrol and extended bans on smoky coal, will work to protect urban air quality. A national climate change strategy is now in place setting out the framework for action by Ireland in relation to climate change. The committee may be assured that we will continue to work vigorously at national, EU and global levels for high standards of environmental protection and more environmentally sustainable patterns of development.
The main objectives of this investment programme are to provide an adequate supply of water of suitable quality for commercial, domestic, industrial and other users and to provide systems for the safe and adequate disposal of sewage and other water borne wastes. It represents the largest single expenditure measure within the Vote that bears directly upon protection of the environment. Last year the Minister announced the first phase of a rolling three year investment programme for the period 2000 to 2002 containing 529 schemes at various stages of planning and construction. This programme, underpinned by an investment of £2.1 billion, will be rolled forward each year up to 2006. I expect that the 2001-03 programme will be announced shortly. The three year rolling programme has been introduced to reduce the uncertainties caused by the previous single year approach. It gives those charged with delivery of the programme the opportunity for longer term resource planning and it has been well received in this regard.
The provision of £331 million this year will enable us to maintain the momentum built up through the increased level of investment which was put in place for the water services section since 1997. Much of our expenditure this year will be incurred on a limited number of major schemes required under the EU Urban Wastewater Treatment Directive. Included among these is the Dublin Bay project which is the largest waste water treatment plant currently under construction in Europe. Waste water schemes being completed this year and next will provide for an increase in treatment capacity for a population equivalent of 234,000 in 2001 and 317,000 in 2002 compared to an average increase of 66,000 during the period of the last national development plan.
One of the major upcoming developments in the area of water supply is the increased emphasis on water conservation. The unprecedented economic growth of recent years has placed huge demands on water services infrastructure. The new water conservation programme announced in the last few weeks aims to dramatically reduce current levels of unaccounted for water, that is, water that is produced at source but lost from the system, mainly due to leakage, thereby improving the level of supply to customers, lowering operating costs and maximising the value of investment in capital works.
Following a further round of approvals earlier this year, projected investment in the serviced land initiative now amounts to £133 million, of which the Exchequer contribution is £51 million. The initiative continues to deliver sites for housing as part of the Government's policy to ease pressure on the housing market. On the basis of the most recent returns from local authorities, the initiative will now provide over 170,000 sites. At the end of March this year over 70,000 sites were either completed or at construction.
The rural water programme is an integral part of the overall investment in national water supply infrastructure and is primarily aimed at improving the quality and reliability of group water supply systems, many of which are subject to organic pollution and without adequate treatment and disinfection equipment. Following years of under-investment, annual capital spending has increased over five fold since 1997. Last year the Minister announced a radical revamp of the capital grants and subsidies for group water schemes, including a new 100% capital grant for essential water disinfection and treatment equipment. My Department is implementing the rural water programme in a spirit of partnership with the National Federation of Group Water Schemes, the local authorities and the rural organisations. All the partners are represented on the National Rural Water Monitoring Committee which was set up to advise the Minister on rural water supply policy issues and to monitor the implementation of the annual capital investment programme. All the principal recommendations of the committee have been implemented to date.
The limited time available to me does not allow me to touch upon the many other functions and services for which my Department is responsible. However, I and the Minister of State, Deputy Dan Wallace, will be more than happy to assist the committee with matters which Members wish to raise. If the information in question is not to hand, we will be glad to communicate with Members subsequently. I am confident the 2001 Estimate will enable the services for which my Department and local authorities are responsible to be maintained and enhanced. It will also allow us to take further practical measures to ensure that our natural environment is preserved for the benefit of this and future generations.
I thank the Minister of State for his presentation. As I received these Estimates this morning I have not had a chance to prepare a comprehensive response.
I accept there has been a huge increase in recent years in the amount of money available for capital programmes. No one would dispute the need for capital investment in all our services and infrastructure, whether it is roads, water, the environment or waste management, which have been under-funded for years. However, it begs the question why every local authority member is dissatisfied with the level of funding being given to local authorities. At least part of the explanation is that while the capital programmes have been increased dramatically, the so-called discretionary funding of local authorities from the local government fund is not increasing at the same pace. This is obvious from the services provided by local authorities. There are various explanations for this, including the fact that capital programmes soak up local authority resources in terms of personnel with the result there is not enough time to deal with local authority housekeeping. I will speak later about the ability to spend the available capital funds.
I have spoken to a number of colleagues about this issue and it is clear that we do not have the skills required to put in place the type of project management teams available to private firms undertaking the huge capital programmes envisaged for local authorities. The Minister of State spoke at length about the housing programme. There are also road building and waste management programmes which also involve the same few personnel in a local authority. There is a limited number of planners, architects and engineers and they are all running from Billy to Jack. That is the reason the capital programme is falling behind and certain projects are not coming on stream. Despite extensive use of the private sector and consultants, the resources are not available in the local authorities to give briefing sessions and to examine reports of the consultants which have been employed. This is slowing up the entire process. Project management of the funding of the capital programme for local authorities is critical to implementing it. This has a knock-on effect on the work local authorities are expected to do.
There will always be too little local government funding, but it is causing problems for local authorities now partly because of the increased level of economic activity. More people are driving, for example, and there has been an increase in every type of economic activity which is putting a strain on all our resources and services. People are more demanding of local authorities and they are working harder themselves. They expect public services to be of the same standard they are providing in the workplace each day. Civil servants and others are working harder and for longer hours. They expect the services they pay for to be delivered, and they expect State and local authority services to be of a similar standard.
The other reason for funding ongoing local authority maintenance and reinvestment work is that the years of neglect have not yet been redressed. It began with the abolition of rates in the 1970s and was exacerbated in the MacSharry years when local authorities took a huge hit. For years there was a lack of maintenance which has now reached the stage where reinvestment is required for footpaths, old pipes and other projects that were not undertaken during the years of recession. Coupled with the other factors to which I have referred, local authorities are now under huge pressure.
One of the reasons local authorities are being held in increasing contempt by the public is their inability to respond to the demands of the public. The public regard it as inefficiency when they see that, while the country is awash with money, local authorities are not responding in the same way as the private sector.
I wish to refer briefly to a couple of individual matters. I have spoken to the Minister of State, Deputy Molloy, about the housing programme. He maintains that output is not a worry to him but the reality is that the projected social housing of 100,000 households - which is modest in the context of demand - is but a dream if we continue as we are doing. No doubt if I am back here in 2006 and the Minister is also here, we will see that those units have not been delivered if we continue in this way. Local authorities are unable to deliver such housing. The local authority of which I am a member built nine houses last year; its allocation is to build 900 for the next three years but that is not realistic. It will not happen because local authorities do not have the management resources to deliver on that kind of programme.
During the budget debate, the Minister referred to his intention to use the voluntary sector to increase the output of social housing. This is something I feel has been under-exploited in the past, despite its great potential. Voluntary bodies are seen by the public as being able to deliver and maintain social housing in a way that local authorities have not been able to do in the past. However, if there is an expectation that they will deliver many houses, there will have to be a change. The Department will have to be more proactive in directing local authorities to facilitate such voluntary sector social housing. There is a view in local authorities that voluntary housing bodies are in competition with them and so they are not seen as partners in delivering such housing. As a result, if there is not downright opposition to them, there is certainly a reluctance to share with the voluntary sector any land bank that may be available. Therefore, if the voluntary sector is to take up the shortfall and deliver a number of housing units, there will have to be a directive to local authorities to co-operate with them.
The Minister says he is encouraged by the end-2000 figures which show that 5,000 local authority houses were under construction. That, however, is a wish list the Department got from local authorities. I do not believe the figures are correct and I am sure the Minister knows they are disputed. Local authorities might have had the best of intentions to have that number of houses under construction but I do not think the number is correct. That will be borne out when the figures are finally published.
As regards non-national roads which are paid for by the local government fund, there is a concentration on capital programmes. God forbid that I would be seen to be against capital investment in such roads. Of course, they are absolutely essential but it always seems to be done at the expense of maintaining existing roads which have taken a hammering through years of under-investment. The Minister mentioned an increase of 87% in such investment since 1997 but the figure is irrelevant because it is a different world now. The level of damage currently being sustained by roads is far higher than previous years because of increased traffic volumes. In addition, labour costs in the construction sector have risen by 42% this year alone, and they are growing. Such costs have escalated greatly; therefore, the level of maintenance work being achieved is much less than it was in 1997.
I wish to comment on environmental resources and particularly those going to the Environmental Protection Agency which is responsible for so many aspects of waste management. My colleague, Deputy Clune, will speak about this later. The EPA licenses all waste management facilities and is, therefore, critical of the delivery of waste management programmes and the achievement of local authority recycling targets and required standards. The EPA seems to be completely under-resourced. My local authority made an application for a waste management facility. I accept that it was a fairly large and complex application but what is demanded in terms of the standard of the application is enormous. It took three vans to transport the application paperwork to the EPA's offices in Wexford and it took the best part of four years to obtain planning permission for that waste management facility. How on earth will we roll out all the services that are required throughout the country in any sort of reasonable time-frame if it takes four years to obtain planning permission for one waste management facility? As the EPA is where everything starts, it should be examined by the Department. Everything that local authorities do depends on the EPA delivering planning permission on time.
Although it would not be appropriate to go into detail at this forum, the other aspect of waste management which needs to be delivered upon is money for landfill, waste segregation and collection facilities. Important as these are, they are useless if we do not have a recycling industry. The public see recycling as segregating and having a collection but if it all goes to landfill it is not just a pointless exercise but a very expensive one also. There is no recycling infrastructure in place and in many cases certain products are shipped abroad for recycling. Quite apart from the expense of shipping such materials abroad, it is environmentally expensive to do so and there may be no environmental gain here. From the conversations I have had with him, the Minister seems to be reluctant to incentivise the private sector to become involved in the recycling industry. In such circumstances, local authorities will have to segregate and recycle collected material, as someone has to do it. The Minister has to look at this in the short-term, until there is an opportunity for the private sector to get involved. No leadership is being shown at local level. I will ask questions on this issue later.
I ask the Ministers of State to convey my best wishes to the Minister, who cannot be here today. I appreciate that his absence imposes certain limitations and constraints on the Ministers of State in areas for which they do not have direct responsibility. I congratulate Mr. Callan on his appointment and wish him well for his term of office. The committee's discussion of the Estimates for the Department of the Environment and Local Government gives us an opportunity to review the performance of the Minister and the Ministers of State in the wide range of issues they cover, as reflected in the document before us.
Listening to the Minister of State going through the increased allocations and percentages of finance made available, it strikes me as a case of "money, money everywhere and not a drop to drink". The Government has had no shortage of money available to it for its various Estimates. Since Deputy Quinn put the finances of this country back in the black, we have not had a financial shortage or the kind of difficulties of scarce resources faced by previous Administrations. Given the amount of money available, the Government has no excuse for the scale of the housing crisis, the poor state of road construction and maintenance, traffic congestion, substandard roads, our charges before a European court regarding water and sewerage schemes, our poor performance in relation to our Kyoto Protocol commitments which would make the President of the United States blush had he to justify it and the poor quality of local government services which were resoundingly rebuked by the Ombudsman in his annual report, to which I will return later.
Specifically, I want to focus on housing as it is the area in which the Government is leaving its most appalling legacy. Home ownership has been put beyond the reach of young middle-class couples. For the first time in the history of the State, two teachers in their late twenties trying to set up home cannot afford to buy a house from their own resources. Submissions to the housing strategy by various local authorities will be interesting as they will give us official figures regarding the extent to which young middle-class professional couples have been priced out of home ownership. We have not yet fully come to terms with the appalling consequences of this problem for families, relationships, traffic, transport, child care and other areas.
The most immediate consequences of the Government's failure can be seen in housing. There has been a huge increase in the number of applicants for local authority housing. Most recent figures showed that about 40,000 people were seeking local authority housing in early 1999, a figure which rose to 50,000 when applications for shared ownership and other schemes were taken into account. The Minister acknowledges that the figure has increased by about 15% each year since, which means there are between 45,000 and 50,000 people on local authority waiting lists and about 60,000 seeking all forms of housing. Despite this background, the number of local authority houses built in the State was the lowest in eight years. According to the Department's housing statistics bulletin there were 2,204 local authority house completions in 2000, a decrease of 25% on the 1999 figure of 2,909. The last time local authority housing output was lower than last year was in 1993, when building was based on a programme produced by a coalition of Fianna Fáil and the Progressive Democrats.
The Minister takes comfort in telling us that figures are up by 150% in the first quarter of the year compared to the corresponding period in 2000. I have statistics for all quarters since 1995 and the lowest amount of new local authority houses to be built was in the first quarter of 2000. This is another example of the Government's selective use of statistics to put a sheen on a poor and lamentable performance. The summary of the housing programme provides financial information, but I am curious to know the reason parts of it dealing with housing were not given in tabular form, as is the case with other programmes. I presume the figures given for 2000 refer to the out-turn for that year, which would mean the estimated number was not achieved as my Book of Estimates states housing would be given £497 million, but the out-turn was just £469 million. Can the Minister explain the reason, during the worst housing crisis, his Department spends £30 million less on housing than was estimated and approved? How, in the area of greatest social need, does one end up spending less than was estimated and produce considerably less housing than the previous year?
Housing is not the only area in which there has been a lamentable performance, despite all the money being lashed around. We need to look at the delivery of local services. The Ombudsman's comments on local government services must be the most damning ever given by the Ombudsman or any equivalent body regarding a public service. He said it is becoming apparent that many local authority planning sections are understaffed, which is probably an understatement. He went on to state that even the most basic elements of the services provided by planning sections were deteriorating. He stated that the public told him that they were unable to make contact with staff to discuss their complaints, it was increasingly difficult to arrange meetings with planning officials and letters were not acknowledged or replied to. He stated that he was also concerned about the very considerable delays on the part of local authorities in furnishing reports to his office on planning complaints. His overall impression was one of a system which was in a state of collapse.
At a later stage in his report, he criticised the local authority housing loans arrangements, and I want to come back to that issue when we are dealing specifically with the housing programme at a later point in our discussion this afternoon. He further stated, regarding local authorities generally, that public bodies which seek to operate in a climate of secrecy, which provide partial information to citizens or which disseminate information on a selective basis undermine the basic principles of openness and transparency. He was savage in his criticism of local authorities for the secretive approach, for their lack of co-operation with the public and their remoteness from the public. He made specific criticisms about two local authorities and went on to state that he had been dealing with the individual cases for a considerable period and that it had been suggested to him that the problem may not be confined to these two local authorities. He stated that in view of this he had taken up the matter with the Department of the Environment and Local Government.
I can readily concur with what the Ombudsman was describing. It is clear to me that up and down the country, notwithstanding all the money to which the Minister referred here, the delivery of environmental services by local authorities is not happening to a satisfactory degree. At present we are witnessing probably the worst ever level of local service to the public that I can recall. This is at a time when there is money available in the Department in terms of these Estimates.
The basic question I would put to the Minister is, with the amount of money available to him, can he explain the crisis in housing, the poor state of local service and the justified harsh criticism of the local government system by the Ombudsman? Will he, as Minister, take responsibility for a general problem which is not confined to individual local authorities? What will be done to address these criticisms and ensure that the public, who after all are paying the taxes which are reflected in these increased Estimates, gets the service for which additional money is being provided?
The Minister says that these Estimates have increased by 30% in total. That is fine up to a point and it gives the impression that there is a great deal of extra money for many extra services. The bulk of the Estimate is for capital expenditure, however, and we are told that there has been huge inflation - up to 25% - in construction. In his reply, I want the Minister to tell us how much of that 30% is absorbed by construction inflation and how much of it is estimated to be reflected in net additional service provision as distinct from the inflationary factors contributing to it.
We will now take subheads A1 to A7, the administrative budget. Are there any questions on those subheads?
I suppose the general question I wanted to ask may as well be asked under this heading as under any other. Further to what Deputy Gilmore said about the general deterioration in the services being provided by local authorities and the increasing disaffection by the public with local authorities, what the Ombudsman had to say about local authorities is everybody's experience - letters go unanswered, telephone calls are not returned and services are appalling. This is all true but it would be easy to say that local authorities are somehow inefficient.
On a point of information, we are dealing with the administrative budget of the Department, not that of local government. That is the procedure which has been laid down.
In that case, I have nothing to ask about it. I am sure it is all run efficiently.
I have one question under administration. What was the total amount spent last year on the press and public relations activity of the Department and what is the total estimate for this year?
It would be difficult to extract that figure here. Is the Deputy referring to general advertising and publicity? Subhead A3, incidental expenses, would cover general advertising and publicity, environmental promotion, entertainment and statutory notices. To what kind of publicity is the Deputy referring?
I am looking for a total. It is difficult to phrase the question. For instance, does the photograph of the Minister putting the brick into the toilet cistern come under the press and PR activity of the Minister's office or does it come under one of these promotional activities? I want to get a figure for the total amount spent by the Department on all press and public relations activities.
We can supply that to the Deputy separately. Under entertainment, for instance——
I am not interested in that unless the Minister is telling me something specifically. How far does the Department go in massaging the fourth estate? Perhaps I should ask about the entertainment budget.
The Deputy's question is not clear to me. Does it relate to the involvement of the Minister or the Department? There are many sections in the Department. Is he talking about road safety publicity where the Department runs campaigns through the National Safety Council, or about Enfo, fire safety, water safety and all the other Department's activities? Obviously, there is a great deal of money spent on advertising. There are many statutory notices which must be published.
The Deputy mentioned a photograph of the Minister putting a brick into a cistern. Certainly the cistern would not work with a brick in it and I am not too sure why a Minister would stand beside a cistern.
He must have had to take it out again. In subhead A3, for example, there is reference to expenses such as advertising, environmental promotion etc. I would be interested to know how much of that was spent on advertising.
I can give the Deputy the figure for that.
The other subhead I am interested in is subhead A7, which is consultancy.
Last year, the figure for advertising was £162,000 and the estimate for this year is £150,000. The figure for environment promotion last year was £48,000 and it is £58,000 this year. Last year's figure for entertainment was £73,000, while this year there is a proposed figure of £65,000.
The consultancies employed by the Department were largely non-IT consultancies. They included: a review of the driver testing service; the preparation of standard contract terms for PP contract forms; financial assessment of PP projects for the Department's PPP unit; consideration of local authority services and local government finance; a review on the outlook for the construction industry; support for the development of human resources, policy initiatives and changes in the management unit; an ERSI repair and maintenance survey on the construction industry side; and the design of customer service leaflets, particularly those which provide information on housing schemes which have to be updated when a scheme changes, comment cards, action plans and a statement of strategy.
These are all routine matters. I do not believe there is evidence of excessive expenditure in this area. From a personal point of view, I am extremely prudent and I do not believe I am costing the Department a great deal of money from the point of view of providing entertainment or anything of that nature. I do not spend any money on this.
Perhaps the Minister of State might splash out and take us out on the town some night.
And come before the committee next year to be questioned about it?
I appreciate the Minister of State's difficulty in outlining the exact position. I was seeking to discover if there is a figure for the total spend on press and publicity. I am not concerned about matters of entertainment, I am merely seeking to find out the total amount the Department spends on promoting the good news it is so anxious to promote.
We mainly do that by issuing statements, there is no heavy PR effort put behind promoting anything we are doing. However, perhaps we should reconsider the matter. We will make an effort to see if we can obtain the information requested and provide sources for the expenditure.
That is fine.
We will now move on to subheads B1 to B4 which deal with housing.
I have two questions, the first of which is probably unanswerable. Last year, local authorities did not succeed in drawing down all the moneys that had been allocated. This year, the allocation has risen by 44%. Is there any expectation, and what is the basis for it, that this money will be drawn down?
What expectations?
That local authorities will draw down more money than they did last year, when they failed to draw down their allocation. What has changed since last year that makes the Minister of State believe that local authorities will draw down more moneys?
What happened last year was exceptional. There was a single reason that there was an underestimate in the allocation for housing last year. We provided £97 million for the redevelopment of Ballymun and, due mainly to a legal challenge, progress was slower than expected and only £37 million of this money was expended. On the other hand, we spent an additional £18.5 million on the main local authority housing programme which was more than we initially provided.
Is the Minister of State saying that, with the exception of those relating to the Ballymun project, all moneys due to local authorities were drawn down?
A sum of £18 million more than the total allocated was drawn down.
Even allowing for housing costs? It is certainly not my experience that local authorities are delivering, particularly in light of the housing allocations they are receiving.
One of the difficulties is that tender prices are increasing. Obviously, authorities will experience a lower rate of output for the amount of money expended than would have been the case two years ago. This is a major concern, not just in terms of the housing programme but also in relation to the national development plan. It was the subject of active debate in the House as late as yesterday and it is a matter of concern to the Government. Overall inflation is at a low level and interest rates are low. However, a different picture emerges when one considers building costs as reflected in the tender figures that are being submitted. The construction industry has been operating at full capacity for some time and there is a need to introduce greater competition into the tendering process, particularly as it relates to housing, roads and major capital projects. Efforts are being made to ensure that the major capital programmes or plans contained in the national development plan will attract competitive interest from abroad to ensure that the timescales for the completion of projects can be achieved within reasonable cost levels.
The absence of a high level of competition in the building industry is reflected in the higher estimates attaching to tenders. However, there are hopes of a slight improvement because more contractors are tendering for local authority housing programmes than did so in the past. On the other hand, we are following a rigid policy of trying to achieve a social mix and to avoid the mistakes of the past when major social problems arose because of the building of enormous housing estates in one go. There would be tremendous cost efficiencies if we were to grant one contract for the building of 1,000 houses. However, we would pay for this with the emergence of social problems later.
The average contract for local authority housing programmes involves the building of 14 or 15 houses and, in many cases, less than that. The Department is tracking 1,000 schemes at present - there were 750, but it has increased. These vary in size from five house schemes to 20 house schemes, with the average being 12 house schemes. Many years ago the O'Malley Park scheme in Limerick involved the building of 2,000 houses, while 1,000 houses were built in my area over a period of two years in the 1970s. However, we are not doing that now and for good reason.
It appears there are two housing markets in this country, one in Dublin and one outside it. The inflation rate which applies in the construction industry outside Dublin does not compare with that which applies within the county's boundaries. It remains relatively easy to employ contractors to carry out work outside Dublin. As a result, the houses being built, even those in the private sector, are being built outside Dublin. This will have long-term consequences. Is there any way the Department could encourage builders from outside Dublin to tender for projects in the city? It would be better to have construction workers travelling to and from Dublin for a year than oblige the ultimate buyers of the houses they construct to commute for the remainder of their working lives. If we attracted builders from outside the city, it would increase output at a lower cost than that which obtains at present. Given that the land to be used is owned by the local authorities, would there not be a possibility of erecting temporary living accommodation for workers while construction was taking place?
My final question relates to the maintenance budget for the Traveller accommodation programme. I welcome the small increase provided this year but it is not adequate, particularly in light of the importance of maintaining these sites and thereby gaining acceptance for new sites. Even if no new sites were built, it would still be a small increase in the maintenance budget given increases in costs and so on. If new sites are built, it is critical they are maintained to the highest standard from the beginning. If they are not maintained, others will not be built. One cannot spend enough money on these sites in terms of getting the programme rolled out. Will the Minister of State examine that, if not to allocate more money now at least to respond positively to local authority requests for maintenance money?
On the issue of the cost of housing and scarcity within the building industry, there is a shortage of skilled construction workers and they are at a premium. I know the Deputy is familiar with the common practices within the trade where skilled workers move between contractors throughout Dublin and pick and choose. Costs are escalating and are reflected in overall house building costs at the end of the day.
The question of providing additional accommodation would not be a major problem. We will examine any proposals we receive. I understand that the Minister is examining means whereby temporary accommodation can be provided without having to undergo the various planning procedures and some temporary arrangement can be made, if possible. In recognition of the difficulty the Deputy referred to, it will be examined, but the basic difficulty is a shortage of skilled workers.
Despite many contractors and workers from the North coming down here and many construction workers from abroad having work permits, we are still short of skilled workers and we need many more. In times gone by our people went abroad to England, the Continent, America and Australia and became the backbone of the construction industries in those places. They came home, the boom did not last and they had to go away again which means they are probably reluctant to return without a guarantee that the boom will last long enough this time. It is a matter of concern to the construction industry and the Government to ensure we have enough workers. If it were only a matter of providing temporary accommodation for workers on different sites, we would be only too glad to try to deal with that immediately.
I have three issues I wish to raise with the Minister under this heading. The first arises from the Ombudsman's annual report which refers to local authority housing loans. The Ombudsman drew attention to complaints he received from families who had taken out high interest local authority mortgages with no mortgage protection. He described how, in July 1986, mortgage protection was introduced for the first time for purchasers with local authority housing loans but was not extended to those who had taken out their loans before July 1986. Many of these people were not notified that a mortgage protection scheme existed.
Situations arose where, for example, a partner in a family passed away and the widow or widower was left with considerable repayments to be made on the loan without mortgage protection. The Ombudsman described a number of those cases in his report. Since its publication, the RTE radio programme, "Five Seven Live", has described and interviewed a number of other people who have been in similar circumstances.
The Ombudsman stated in his report that he was concerned the cases may reflect a more widespread problem affecting many other families caused by a specific combination of factors. He stated he had written to the Department of the Environment and Local Government outlining his views and asking it to consider some form of relief scheme to provide assistance for such cases.
What consideration has been given to that recommendation? Will the Department introduce a relief scheme to provide mortgage protection insurance for people whose loans date prior to 1 July 1986? Will the Minister of State introduce a scheme of relief for families who have been caught in this trap, especially families where a member has passed away and where a widow or widower has been left with the burden of the repayment of the mortgage which, I remind the Minister, in today's terms carries high levels of interest?
The second issue relates to the provision of houses, the underperformance in local authority house completions and the objective to provide 500,000 houses in the next decade. The National Economic and Social Forum has recommended that a national housing authority be established, and that is a view the Labour Party has advocated for some time. Is it not now painfully obvious that, to meet the required number of houses which will have to be produced through the local authority system to deliver the housing output required, to supply the houses to meet demand and to provide direction for that so that we get houses built for families to live in rather than second or third homes for people to occupy for two or three weeks of the year, the Department must consider the establishment of a national housing authority to lead the drive to provide homes for families?
My final question is prompted by what the Minister of State calls the Government's two-pronged approach to housing. One category of people who have been on the receiving end of this approach are tenants in the private rented sector. They have been getting the two fingers from the Government which has told them they must wait until 2002 or later before legislation is introduced to provide them with the necessary protection they need.
I saw nothing in the Estimates or the briefing material we received for the promised private rented tenancies board. My understanding was that this was to be established on a non-statutory basis this autumn. Perhaps I missed it when I read the briefing material we were given, but I would like to know what Estimate has been provided for the establishment of that board and when the Minister of State will establish it.
The Deputy raised an issue also raised by the Ombudsman. I accept a certain number of people have a problem with the interest rates they pay on loans taken out in different times. There is a Government commitment included in the programme for Government, An Action Programme for the Millennium, to try to target support to homeowners with high fixed interest rate local authority loans. We recognised this issue when we worked on the programme for Government and the commitment reflects the Government's concern for the plight of local authority borrowers on high fixed interest rates, some of whom pay almost twice the current variable rate.
While that is so, I emphasise that there is a concession available to borrowers to redeem their loans without penalty and to refinance the loans in the private sector. Many local authority borrowers have availed of this concession, but others have not and there is a certain cost involved. Perhaps it is not an option for some of them.
I am considering the possibility of some reduction of the high interest rates in light of the fact that some of these remaining borrowers have no option but to accept the fixed rate because local authority variable rates were not introduced until 1 December 1987. While a survey of fixed interest rate loans was carried out last year with the purpose of fulfilling the commitment made by the Government - both parties in Government agreed to do something about this - that survey showed that some local authorities did not include tenant purchase loans in the information they submitted. The Department must be able to accurately cost concessions for these local authority borrowers on high fixed interest rates and it would not ultimately be a matter for us when we have the information from the local authorities to present the case to the Department of Finance. I agree with the Deputy that this is an area in which some action must be taken.
We are examining mortgage protection in consultation with the local authorities and I am hopeful that something can be done for people who do not have mortgage protection. Obviously many of these issues are between my Department and the Department of Finance but there is a Government commitment to doing something about it. I expect that we will be able to make a decision on this in the not too distant future.
I want to pursue this. I am glad to hear that interest rates are being addressed and I welcome the Minister of State's statement on mortgage protection. Will he be more precise about when he will be in a position to make an announcement as to what the Government intends to do on those issues?
We are waiting for information to come in. As I said, we are seeking information from the local authorities so that we can make a full assessment of the costs, and that information is expected to be available to us in a few weeks. Following receipt of that we will proceed to the Department of Finance.
I will be pursuing this with the Minister of State when that information is available.
Without being too long-winded, I said the local authority house building programme last year was disappointing. We had given the local authorities a multiannual programme over four years. They know how many houses they can build and they have never been given that kind of direction before. We gave them vastly increased funds to facilitate a huge increase in the number of starts and we encouraged the local authorities not to look on these as targets for each of the next four years but to frontload the programme. In other words, if the local authority was told it could build 1,000 houses over the next four years, it was asked, encouraged and cajoled to accelerate its planning so that 1,000 houses could be built in two or three years rather than waiting four years. As I see it, the same people on the housing lists will go into these houses, so why keep them waiting four years when we have the wherewithal to provide the houses?
Local authorities were asked to take on a huge increase in the level of activity in their house construction programmes, something that had not been undertaken in over ten years. Local authority housing construction programmes were below 2,000 houses a year, so to crank that up they have had to organise themselves. That involved ensuring they had adequate land, that the land was serviced and then they had to go through the various planning stages. There were design and tendering issues and the matters had to be approved by councils and receive departmental approval.
I am very hopeful. Last year was the first year of the multiannual programme and the increased figures we have now, which Deputy Gilmore is being pessimistic about and doubting——
Look at the record.
The Deputy is doubting.
I am not doubting, look at the record.
Deputy Mitchell believed that the figures would not be achieved but I have every expectation that the figures will be increased because of the huge activity on the ground.
The flow of information to the Department from local authorities regarding what stage their house construction schemes were at did not give us a true reflection of what was happening on the ground for one reason or other - I am not pointing the finger at anybody. New procedures have been put in place and the Department is tracking every one of the housing schemes in the pipeline with local authorities. With this new tracking, the level of information and contact with managers, housing officers and the Department means I can feel confident in stating that the figures I gave in my introductory remarks will be achieved in relation to starts and completions, or reasonably close to the figures we are talking about.
It has taken that time to get the local authorities' programmes up and running. The landbanks were gone and we had to guide them to go out and acquire land, so we had to make special arrangements to fund them to acquire land for house building. We put in special funds to bring in water, sewerage and roads, even where land was not accessible. The result of that good work is now beginning to show and it will be reflected in the level of starts, which I hope will raise the number of completions.
My constant theme has been that money is not the problem, it is getting everyone organised. Now that everyone is organised money may come back into the picture again. It is a problem if the level of activity we see out there comes to fruition.
There definitely was an underperformance but regarding the NESF and the National Housing Authority, Deputies are saying in effect that the existing housing authorities should be abolished. Those are the local authorities, the people on the ground, and they are charged with implementing the Government's local authority house building programme. I do not know how one can impose a national housing authority on top of the local authorities if those powers are taken away from them.
The Minister of State did it for the roads and industrial development.
If it is a question of just using the national housing authority for housing research, there would be no problem with that, though we already have a housing forum with all the social partners represented. Centralising housing functions in that kind of national authority being suggested would undermine the measures already under way to strengthen the capacity of local authorities. The recent change, the creation of the director of services, is an excellent change because it includes a director of housing. A potentially serious drawback would be if we were to go down the road being suggested by the Deputy it could lead to a dilution of local authorities' responsibility and accountability in relation to providing houses to meet the needs in their areas. I certainly do not want to do that and if it were introduced now it is my and the Department's opinion that it would lead to major upheaval in the system and would not contribute towards an increase in output.
What we have is up and running and should be allowed to concentrate actively and vigorously on achieving the objectives we have set, on assuring the expenditure of the funding provided and to maintain their costs within reasonable levels. It was considered by the housing forum briefly, and considerable reservations were expressed by the voluntary and co-operative sector. They also saw some dangers in the establishment of a national housing authority. Comparisons have been drawn with the role of the National Roads Authority, as the Deputy has said, in implementing national road programmes, however the provision of housing is fundamentally different from the provision of national roads, it is essentially a local service which must be geared to local needs and circumstances. As Deputies can see, the NRA was not given responsibility for county roads - it has responsibility for national roads only, which makes sense, when roads from A to B go through four or five different local authorities. That is not the case with housing. We have placed the housing authorities and staff under new directors of services and it is up to us to fund the activities they are capable of producing. It has taken them some time to get their act together. The Deputy knows of the poor situation in his local authority area.
The situation is poor, for which there are a number of reasons.
In the House I explained the situation regarding the private rented sector, the new legislation and why it will be some time before it is brought on stream. We are proceeding with the establishment, on an interim or ad hoc basis, of the rental board which can be availed of on a voluntary basis if both sides agree to operate it. There is a commitment in this regard. The Department of Justice, Equality and Law Reform, which is generally responsible for landlord and tenant legislation, is working with my Department on drafting the legislation.
Why is there no provision in the Estimates for the private rental tenancies board?
It will be included in next year's Estimates.
The Minister of State was supposed to set up the board this year.
We can meet whatever set-up costs arise——
Out of petty cash? The Minister of State is not very serious about this issue if he is going to meet the costs out of petty cash.
It will not involve much expenditure. We have no problem funding it.
If that is the case, it is not going to be much of a board. There are 150,000 tenancies, many of whom are experiencing problems with rents.
I will give an assurance that whatever costs are required to fund the board——
If the Minister of State was serious about this issue he would have included a provision in the Estimates.
We are serious about this issue.
There is nothing in the Estimates regarding the board.
I call Deputy Clune.
Just a second, Chairman. I do not wish our sincerity with regard to this issue to be in question. This issue has been lying around for decades. Up to now no Government has taken on the issue, but I took it on. It should have been taken on by the Department of Justice, Equality and Law Reform.
We did not have a housing crisis until the Minister of State took charge of housing.
We set up the commission which has produced an excellent report. We have every intention of implementing this measure and we have always said so. To suggest that it cannot do anything because there is nothing in this Estimates is——
It shows that the Minister of State is not serious about this issue.
It does not show that.
It does. The Minister of State is not introducing the legislation until he is out of office. He said he would set up the private rented tenancies board on a non-statutory basis this year, yet he has provided no money for it in the Estimates. That speaks volumes. The Minister of State is not serious about this issue.
That is the Deputy's interpretation. We are fully committed to this measure. We will provide whatever funds are necessary this year. Work on the legislation is proceeding apace and it might even appear before the general election, which could go to the last day of June next year.
I wish to refer to the shared ownership and affordable housing scheme subhead. Many people in urban areas still do not qualify for this scheme. I have come across a number of such cases recently. I came across one couple in which the man was earning £27,000, yet they did not qualify for the shared ownership scheme. This couple are paying rent of between £550 or £600 and the figure is escalating. Is the Minister of State examining this issue given the cost of houses, particularly in urban areas? I am speaking about Cork, but it is also true of Dublin. Many people who cannot afford a house do not qualify under the scheme. If they do qualify, the level of funding which is available, which is about £90,000 or £95,000, is not enough to buy a house.
The affordable housing scheme is an excellent programme as it bridges the gap between being a local authority tenant and buying one's own house. There is much scope to enable people to buy their own homes. Will the Minister of State address this issue?
I wish to raise the issue of the tendering process and multiannual budgets. The Minister of State outlined that most of the schemes being developed by the Department or by local authorities through the multiannual funding programmes involve 15 or 20 houses. Is there a possibility of considering a situation in which companies would tender for the building of, for example, 200 local authority houses which are not in the same estate? Have any foreign companies tendered for local authority housing starts? We will not attract foreign companies if the tenders involve small schemes of 14 or 15 houses. Is it possible to combine a number of schemes in one tendering process, even though they may be in different areas? We will not get value for money if the schemes involve small numbers of houses. Such schemes could be combined in the one tender document. Is this happening? Are foreign companies tendering for local authority housing starts?
I take on board the point made by Deputy Clune. However, the scheme is geared at a certain income level and it is not the only option for housing people. The scheme is aimed at those on lower incomes as the mortgage repayments are subsidised.
One of the reasons I was keen to introduce the multiannual programme was that it would give local authorities the opportunity to enter into contracts which would last, perhaps, from year to year, so they would build 50 houses per year for the next three years or whatever. Some contractors only have the capacity to build 20 or 25 houses per year. The programme would allow such contractors to be taken on for three years under one contract. I am not aware that this has happened to any great extent, but the option exists.
We are not telling local authorities that the schemes should involve only 14 or 15 houses. That is what has emerged from the local authorities. We have encouraged them to go for larger schemes. One can design schemes providing a social mix in which the local authority is involved, either through the affordable housing scheme, the capital assistance scheme or the local authority scheme. One can have a good mix within the public funding.
One Turkish contractor expressed an interest in a local authority house building scheme in one area. The largest scheme I can recollect involves about 90 houses. The Department is not telling authorities not to opt for such schemes, but we are looking at the social mix and the location to ensure that we do not create social problems down the road.
Local authorities do not seem to have the will or to make an effort to consider using the multiannual budget to allow a contractor to tender for 90 houses over the next three years in which 30 houses would be built per year. They seem to be locked into the thinking that a separate tender contract must apply to houses in one area, even though more houses are being built a quarter of a mile up the road under another contract. Why can we not have a system whereby houses in different locations are built under a single tender? One would assume that would be cheaper, more efficient and less bureaucratic.
The multiannual approach gives local authorities the option of going down that road and availing of those options. I have been encouraging them to do so. The change will come.
I appreciate that the shared ownership scheme is geared at those on a certain income. However, houses are not available for the amount of funding allowable under the scheme, particularly in Cork and Dublin. Most people will get a mortgage allowance to the value of £90,000 or £95,000, yet one cannot buy a house for that amount of money. People, particularly in Cork, are being forced to move to towns outside the city. This involves much commuting and is expensive. There is a problem with the shared ownership scheme due to the price of houses in urban areas.
Deputy Clune makes a valid point. It is not valid for the Minister of State to say that the scheme is only geared at some people. The Deputy's point is that it is geared at some areas. There are some areas, particularly in Dublin, where there is no such thing as an affordable house. People in these areas do not qualify for shared ownership or affordable housing. This inevitably leads to a flood of people who have to live outside Dublin and who will have to commute all the time. This is part of a problem which has been well signalled.
I agree there is more potential in the shared ownership scheme but these matters must be kept under review. One is dealing with the capacity of the applicant to repay. One is repaying a mortgage - granted it may be a reduced mortgage - and one is also paying a rent level even with the subsidy. I will check out the point made.
We are encouraging local authorities to enter into discussions with local builders in regard to turn key operations. Many local authorities are availing of the opportunity which relieves them of much of the administrative work involved in getting a scheme going from scratch. They can now go to a builder who may have land and put a proposal to the local authority to build 100 or 150 houses. They can negotiate the price and the required standard and the builder will hand them over following inspection on completion. That is helping to achieve the increase in the housing output to which I referred in reply to Deputy Gilmore.
Before proceeding to subheads C.1 to C.4 - roads programme - as we are running late, perhaps members would keep one eye on the clock and the other eye on the documents.
As I am conscious of the time, I will restrict myself to one question, that is, the old chestnut of the non-national roads. I must confess that I do not understand the subheading which indicates that £323 million will go to non-national roads. I do not know what subheading they come under. Everything here seems to be going to the NRA, with the exception of this little sleight of hand whereby local authorities think they are getting £31 million, but they are actually getting £31 million they would otherwise get for discretionary spending. As far as I can gather the serviced land initiative is being funded by local government.
Regardless of how the national roads network is funded, it is completely inadequately funded. It is an ongoing source of annoyance and complaint throughout the country. I accept the value of the restoration programme which is showing results. However, it is very slow and very little is done each year. Roads that were done in the first year the programme began now need to be redone and still the county roads are in an appalling condition. The problem in urban areas is that so few of the roads are county roads, so to speak. These are estate roads which carry far more traffic than most county roads throughout the country, which are simply crumbling and subsiding. In some cases footpaths have not seen a lick of cement since rates were abolished in 1977. There is a huge need to put money into these roads to bring them back up to standard because they have deteriorated over the past 30 years to the stage where complete reinvestment is needed. There is no point talking about repairs. These roads need to be completely restructured and footpaths need to be replaced. The reality is that just £4 million extra in Exchequer funding has been provided. I am sure that money is taken up by inflationary costs, therefore, the net effect is that there is no benefit to the local authority. I ask the Minister of State to look at that section of the Estimate, certainly for next year if it is too late for this year.
Together with Deputies Mitchell and Clune, I have spoken on a number of occasions about this issue. The biggest problem with road maintenance and improvement is that urban roads in housing estates, many of which were built by speculative builders in the past, were poorly built and are cracking up and disintegrating. These roads have been dug up several times by various statutory bodies, are in a mess and will not survive. When one looks at the total budget of £730 million for the entire roads programme, the amount of money being provided is pathetic and must be increased.
I ask the Minister of State to establish a special fund for the improvement of roads in housing estates. Motorists who contribute to the local government fund through their road tax will increasingly demand an improvement in these roads. We will be looking shortly at the total reconstruction of roads if serious funding is not made available to upgrade and maintain roads in urban housing estates.
We could spend a lot of time debating the various Estimates for national and county roads and so on but local authorities have not got the money to maintain housing estate roads. At this stage some of them require resurfacing, footpath repairs or virtual reconstruction. A special fund should be set up in the Department, operated through the local authority, to have serious improvements and upgrading done on these roads.
Can I have clarification in regard to verge cutting on national secondary roads and county roads? There seems to be some confusion in local authorities regarding who is responsible for the cutting of hedges. Some local authorities claim it is the responsibility of farmers, while others claim they do it voluntarily. Who is responsible for the verges and hedges on the outside of the ditch running along by the road, and the stuff falling onto the road? I know I am probably stretching the Estimates but I would like clarification on that issue.
The landowner is responsible for hedges growing out from his property. From a practical point of view, as happens in the case of most local authorities, they cut hedges themselves. I know from experience in my area that the council decided it would leave this work to the landowners. However, after two years, one could not travel some of the roads so they reverted to doing the work themselves. The only practical solution to ensure the public have clear access on some of these roads is that hedge cutting is undertaken by the local authorities as part of the service on the national secondary roads. It would apply in both cases. Many owners of the lands may be in Australia for 20 years so it would not make sense to abandon the issue.
On Deputy Mitchell's question in regard to the £323 million, that is made up of two separate sources. One is the local government fund and the other is Exchequer funding.
Deputy Gilmore raised the question of improvements and repairs to housing estate roads and suggested there should be a special heading for this work. There is a special heading for it. There is a special block grant for footpath and carriageway restoration. This provision has been in place for three years. This year £8.95 million of the discretionary block grant for urban authorities will be used for restoration work on carriageways and footpaths. This will ensure improved driving and walking conditions in urban areas. Last year the amount was £6.25 million and the previous year it was £4.2 million. The funding has been doubled over a three year period.
That is the problem. Is that £8 million?
It was £4 million in 1999. There was nothing before that.
I understand that. I accept that the amount has been increased but if one divides £8 million between all the urban authorities one is left with a couple of hundred thousand pounds for each.
That is not the full picture.
With the cost of road works these days nothing could be done for that amount. It is tiny compared with what is required. Serious money needs to be put into this.
This is additional to the block grant and discretionary grant made to local authorities. The grant does exactly what Deputy Gilmore asked for a few minutes ago and it has been increased substantially since it was introduced. I agree that further increases are warranted if funding is available next year. I am told £100 million is being spent from local authorities' own resources, as well as the amount we are giving.
Maybe I live in a very built up and congested constituency but every time I ask a roads engineer about road repairs I am told there is no money to do them. I understand that. The scale of this is quite big now. The money was not available in the past and there is now an inherited problem.
It is a problem. It highlights the need to ensure that when housing schemes are being constructed there is a careful watch on the quality of roads being laid by builders. In many cases housing schemes are taken over subsequently by local authorities and roads break up, not after 60 years but after six, if they have not been laid properly. There is a need to be vigilant. Some mistakes have been there for 60 years and little improvement has been made to the surfaces.
Concrete was poured on grass in some cases.
There is a need and it was recognised by the introduction of a special amount for this.
We will now discuss subheads D1 to D4 - environment.
A sum of £44 million has been allocated this year to the rural water programme. There have been several recent reports about the quality of water in group water schemes. I understand the Department has done as assessment of the water quality in many of these schemes and has found it to be quite poor with a high faecal contamination and high levels of nitrates and aluminium. Approximately 12% of the population depend on these schemes for drinking water.
Will this funding bring about an improvement in the rural water programme? As well as investment, there is a need for supervision and training of staff dealing with these schemes. There should be greater emphasis on this aspect.
The most recent EPA report on drinking water quality covered the year 1999 and it confirmed the fundamentally good quality of drinking water in public supplies to the vast majority of the population. It also highlighted continuing difficulties with the quality of privately owned group water schemes. These supply 50,000 rural households or 5% of households nationally.
It is a matter of serious concern that any supply of drinking water is deficient in quality. The Government acknowledges that the situation is not acceptable and is determined to confront and remedy water quality problems in the group water scheme sector. A comprehensive and co-ordinated programme of activities has been put in place under the rural water programme for this purpose.
The Government is providing record investment of £420 million under the national development plan for rural water. The bulk of this funding is being targeted at remedying deficiencies in group water schemes. We put in place a radical revamp of the grant and subsidy schemes which support the group water sector. Under this package water disinfection and filtration equipment qualifies for 100% capital grants. With this support, group water schemes will be in a position to provide state of the art technology to bring their water up to EU standards. In addition, 85% capital grants are being provided for the upgrading of distribution systems, provision of source protection measures and extension of group water networks to households currently dependent on private individual supplies.
Another key facet of the rural water programme is the intensive monitoring of private sources under the group water schemes which commenced in July 2000 to determine causes of pollution and assist in the development of appropriate source protection measures. The successful implementation of the rural water programme is dependent on a vibrant partnership approach between the group sector and local authorities working together to achieve a common objective. In this regard, a national rural water monitoring committee, representative of local authorities, the National Federation of Group Water Schemes and rural organisations has been established to advise on policy and oversee the implementation by local authorities of the rural water programme.
There is no quick fix solution to the problems of the group water scheme sector but I am satisfied that all reasonable measures are being taken to rectify the deficiencies as soon as possible.
I thank the Minister of State for his reply. He mentioned the £420 million which is available under the national development plan. There is considerable scope for the training of operatives and the supervision of that training, apart from investment in infrastructure. Inadequate training of operatives who are working with equipment and on disinfection procedures may be a large part of the reason for deficiencies in water quality.
I am advised that there is a national training scheme in operation for local people who are involved in group water schemes.
We now come to subhead E - local government finance.
My question is not unrelated to the theme of this afternoon. The local government fund explains more than anything the description in the Ombudsman's report of the service being given by local authorities as being in a state of collapse. With the Exchequer contribution and the yield from the motor tax this fund represents the bread and butter of what local authorities can provide. Members of local authorities can see that while considerable money is available for capital funding these bread and butter matters are the cause of collapse of local authority services, the inability of local authorities to respond, their lack of resources and their inefficient spending of money. All these factors make the public less happy with their local authorities and increase their disaffection with the whole political system.
The Exchequer contribution is up by £4 million, a less than 1% increase when the Government is supposed to be awash with money. It does not even come close to covering the 2% not budgeted for but paid out under the PPF during the year. That is a completely inadequate figure. To give local authorities, with all the demands being made on them, a less than 1% increase in Exchequer contribution to the local government fund is an insult. It is no wonder they are struggling and totally fail to meet their residents' needs.
Whenever we look to the Minister for money we are told the local authorities can provide for this or that out of the discretionary fund. One has to be totally out of touch to give such an answer. There are no discretionary funds in local authorities. How can there be with a less than 1% increase? That does not even come close to inflation never mind the increased demands being made on the local authorities. There is nothing left when a local authority pays its staff and meets its commitments under the PPF. Some of the slack, at least, is being taken up with money from motor taxation but that will dry up. The current increases will not continue in future years. The buoyancy will not be there. There is a limit on how much motor tax can be increased. I am pleading with the Minister to increase the figure of 1%. Surely we can do better than that for the local authorities which are at the coalface of delivering the services.
Prior to the change of Government there was a different method of funding local authorities. The local government fund, which this Government introduced, gave a much more generous financial allocation to local authorities. The difference over recent years is astonishing. The initial general purpose allocations to local authorities have increased from £267 million in 1997 to £436 million in 2001. That is an increase of 63.5%.
Are we looking at the same paper?
What the Deputy is looking at is the outcome for the year 2000. The way in which the local government fund was established is that a base figure was inserted with add-ons in line with the cost of living and any new services. The figure in last year's Estimates was £285 million.
Does that mean that last year's initial Estimate will be supplemented to pay for the 2%?
There was a £30 million Supplementary Estimate last year. The figure for this year is based on the original local government fund proposals and will amount to £285 million. If there was to be an increase on the figure of £319 million it would have to be done by way of Supplementary Estimate, as was done last year.
Why can it not be done at the beginning of the year? Why can local authorities not plan their services like everybody else?
I wonder how they would be planning their services today if we had adhered to the method of funding of the previous Government.
It was a two and a half year Government.
There has been a very substantial increase and a huge amount of financial independence has been given to local authorities under this Government which was not previously available to them. I am a former member of a local authority and am well aware of the years when services collapsed. They are not collapsing now, they are being extensively funded. There are no limits applied except on the housing side where there is a spending capacity limit. One must look at the foundation of the local government fund, the amount provided last year and the increase to £319 million.
The Minister can juggle his statistics all he likes, but the reality is that it is a 1% increase. Is the Ombudsman making up the story that services have collapsed?
I understand that the managers do not accept many of the arguments brought forward by the Ombudsman and that discussions have taken place between them regarding issues he raised in his report. It will be interesting to see the final outcome.
There are 34 managers. The public are aware of the failure of the services. We cannot stick our heads in the sand and pretend the whole system is not falling down around our heads. Yes, there is new building and investment in capital programmes but there is nothing happening in the area of ordinary everyday services. We are building problems for the future in terms of capital investment.
I agree with Deputy Mitchell. I concur with the Ombudsman's criticisms and assessment of the state of the services provided by local authorities to the public. Local authority staff are working under incredible pressure. Some of the pressures on staff of local authorities are phenomenal. It has to be acknowledged there is increased public demand on them. Local authorities' responsibilities have increased. The public is experiencing enormous frustration. I can understand why there may be a degree of defensiveness on the part of county managers in respect of criticism of the service which they provide. The Ombudsman is right. I am listening to complaints about a whole range of services every day. The public are dissatisfied and frustrated at even making contact with their local authority much less resolving problems with them. It is one of the things which is contributing to the erosion of respect for public services generally and for politics and democracy in general.
I remind the Deputies of the Minister's decision in May of last year to launch a range of service indicators to improve the quality of service delivery. There were 21 indicators under eight different headings, housing, planning, roads, environmental services, motor taxation, revenue collection and corporate health. These indicators are common to each local authority. This was to enable the authorities to determine and share best practice. Local authorities are required to report on their performance against the given indicators in their annual reports commencing with last year's report. This will allow the public and other interested parties to make their own judgments on the local authorities' performance. It must be accepted that that is very much a first step in the process of trying to measure service performance. Local authorities have been asked to expand their service measurement in their customer action plans.
All of us are conscious of the level of demands being put on local authorities and the services they are expected to deliver. We have been adding many new functions and systems on to them and have been reorganising the local government system with the intended objective of getting a system which is closer to people, more responsive to their needs and is funded to enable them to meet the level of services demanded of them. A myriad of changes have been imposed on local authority staff and members. Everyone is living in a new environment. Great credit is due to the members and, in particular, to the staff for the manner in which they have taken up their new roles. We have only recently appointed directors of services right across the system. That has been a traumatic experience for the staff although it has been willingly taken on board. We are aware of the local development activities. The Deputy's comments are recognised in the fact that the Minister established the service indicators procedure to measure the level of service and give the public a better opportunity to find out what is going on and available, so as to make its own judgment. I hope it is not as bad as the Deputy implies.
It is bad.
Members of the House and I as Minister are in daily contact with local authority offices.
We are not all Ministers.
We are all demanding. The public are demanding of us in expecting instant replies, information and action. We will never be perfect but we want to ensure that good service is provided and is viewed as being satisfactory. There is no point in making impossible demands, as often happens.
We will deal with subheads F1 to F14 - other services.
There is an outstanding problem of people who took out HFA loans from local authorities and today pay more interest than other borrowers. The local authorities cannot convert the loans to realistic interest rates. Many do not have long to run but it is a gross injustice.
This is dealt with under local authority loans and we will take action on it. We need information on the extent of these loans first and then we will act.
When will the rest of the Planning Act come into operation?
Draft regulations will be before the committee before the end of June and they will be in operation in the autumn.
I thank the Minister of State, the officials and the members for contributing today.