Dáil Éireann Debate, Thursday - 13 July 2017
14. Deputy Eoin Ó Broin asked the Minister for Housing, Planning, Community and Local Government the status of the ongoing discussions within his Department and the approved housing bodies, ABH, sector on the forthcoming housing (regulation of approved housing bodies) Bill 2015. [33144/17]
View answerI am looking for an update on the ongoing discussions between Department officials and the approved housing bodies in terms of the forthcoming regulations for the future of the approved housing body sector.
The Rebuilding Ireland Action Plan for Housing and Homelessness recognises the key contribution that approved housing bodies, AHBs, make to the delivery of social housing. It is estimated that AHBs have the capacity to contribute around a third of the new social housing units that are currently targeted over the period to 2021.
The housing delivery capacity of AHBs will need to expand greatly and they will require significantly increased external investment. AHBs that have statutorily regulated standards of governance and management capacity will be better able to access private or loan finance.
The proposed housing (regulation of approved housing bodies) Bill and the underlying policy, which was formulated in consultation with the sector, intends to establish a regulator to oversee the effective governance, financial management and performance of voluntary and co-operative housing bodies. The Bill aims to safeguard public and private investment in the social housing provision sector, to rationalise and enable increased supply from the voluntary and co-operative housing sector and to ensure that the assets built through investments in the sector are managed sustainably. The statutory regulatory framework will provide further assurances to investors, tenants, the Government and to the sector itself that social housing providers operate in a well-regulated and stable environment.
My Department is working with the Office of the Parliamentary Counsel to finalise the text of the Bill for publication as soon as possible. I had hoped that the Bill would be published during this current Dáil session. However, the complex nature of some of the issues related to transitioning from voluntary to statutory regulation has required additional time. Notwithstanding this, I expect the Bill to be published in time for early consideration in the autumn Oireachtas session. Until such time as the legislation is enacted and the statutory system of regulation is put in place, the interim regulatory arrangements in operation since 2014 will remain in place.
This is legislation which most in this House will welcome, and we will certainly collaborate with the Minister to ensure the regulation is fit for purpose. There are three concerns I want to flag at this stage. One is the fact there is very significant variance in the size and capacity of the approved housing bodies in the sector.
While greater regulation is going to be needed for the tier 3 approved housing bodies, particularly because they will be carrying the extra burden of unit delivery, it is important that we do not squeeze out the small, local tier 1, and bottom end of tier 2, bodies which have units, are not looking to expand and need to be encouraged and supported to continue to do what they are doing.
The second issue arises in the context of the EUROSTAT and Central Statistics Office, CSO, review of the status of the approved housing bodies. One of the issues that caused real difficulty and eventually forced approved housing bodies on balance sheet across the water was a view of too much Government control of the sector. While the review taking place of our approved housing body sector is on the basis of the current regulations I would urge the Minister to be cautious about following the heavy-handed regulatory approach in Britain that has caused such difficulty for the designation.
Finally, there is a need to ensure the increased level of financial risk that those tier 3 approved housing bodies are being expected to take on, a result of the increased stock, and low in finance, is adequately provided for in the regulations.
I spoke at the recent annual general meeting in the Ashling Hotel about making sure that as we move forward with this new regulation we do so in a way that is mindful of the different sizes and capacities of the housing bodies. I absolutely want to see how we can get some of the large tier 3 housing bodies, with 300 units or more, to increase their ambitions and scale. I am not sure whether that would require amalgamations. We might have to bring in a housing body from abroad that has more experience of working on a bigger scale such as those in the United Kingdom to help.
I completely take the Deputy's point about the good work being done by the tier 1 and 2 housing bodies that are dealing with few units but with people who have very particular needs. We want to make sure they can continue to deliver their supports. I also take the Deputy's point about making sure the regulation is not going too hard as the UK regulatory system did. We are considering other models.
Following meetings with the Housing Finance Agency, the Housing Agency and others I know there is a need to leverage more finance into this sector. We can only do that with appropriate regulations but we can only do that in a way that will not undermine these housing bodies in the long term.
I fully support all of those sentiments. In respect of the level of risk that they will increasingly carry, there is a need to ensure there is a good solid, off-balance sheet vehicle through which credit union or private finance can deliver increased approved housing body units. That would be one mechanism to protect them against some of that risk. Given the difficulties that the approved housing body sector has had through the redesignation process in Britain, if such a redesignation were to take place here that would have a very significant impact not just on the sector but on the targets for the delivery of units within the Government's current plan. Any new borrowing by the approved housing body sector would be on-balance sheet and have an impact on the expenditure ceilings and cause real difficulty for us. I am not against regulation. Good quality, strong regulation is needed and I support the Minister in that but I ask him to be mindful of the line that Britain crossed and that it is really important we do not cross it here.
I am aware of that risk and it is important that the Deputy recognises and raises it again because we will have to keep it in mind as we approach this in September. I hope we can move quickly with this legislation because it is very important.
Getting off-balance sheet financing or finding other financing vehicles, for example, private money, pension funds, or credit union funding are options that are being explored. A couple of suggestions have already been put to the European Investment Bank, EIB, as well. We can find the financing solutions. The responsibility we will have in bringing the legislation through will be to put those safeguards in the regulations to make sure we do so in the right way.
