Thursday, 26 September 2019

Questions (203)

Michael McGrath


203. Deputy Michael McGrath asked the Minister for Housing, Planning and Local Government if a Brexit impact assessment has been undertaken to assess the impact that a no-deal Brexit will have on the construction of residential property and the credit environment for both buyers and developers in a no-deal Brexit; and if he will make a statement on the matter. [39262/19]

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Written answers (Question to Housing)

Since my Department started its Brexit planning, the question of the impact on the housing sector has been under consideration and has also been the subject of discussions at the Joint Oireachtas Committee on Housing, Planning and Local Government.

The Government has indicated clearly, on foot of analysis undertaken, that the UK's exit from the European Union will have a detrimental impact on our economy and public finances, whatever form it takes. This may result in a lowering in the demand for housing. However, it is also possible that Brexit may impact net migration to Ireland in the short-term, particularly if a slow-down in the UK economy diverts a proportion of UK based-enterprises and employees as well as EU migrants who might otherwise have migrated to the UK, to Ireland.

Short-term phenomena, both immediately prior to and after a UK withdrawal from the EU, must be distinguished from the likely long-term picture. The National Planning Framework is based on long-term, mid-range demographic and econometric projections over the period to 2040. If a significant trend becomes apparent that is likely to continue in the long-run, national strategy would need to be reviewed accordingly. In the meantime, the Rebuilding Ireland housing delivery target of 25,000 homes per annum by 2020 will be met, with the National Planning Framework, published in 2018, identifying a need for this number to increase to 30-35,000 homes in the years to 2027. Any post-Brexit impact will be closely monitored and factored in accordingly.

In December 2018, the Government published its Contingency Action Plan which outlined the many risks of a no deal scenario, and the work underway at national and EU level to mitigate these risks as much as possible. My Department contributed to the process and identified the areas within its remit. On 9 July the Government published the Brexit Contingency Action Plan Update which reflects the extensive work that has taken place at EU level and on a whole-of-Government basis. The Action Plan emphasises the need for stepped up preparedness measures, by exposed businesses in particular. In that regard, approximately one third of the Irish construction industry's inputs are imported, a significant proportion of which comes from the UK.

The preparedness measures for the construction sector span across a number of Government Department and Offices. These include the Department of Education and Skills (construction workers/professional qualifications), the Department of Business, Enterprise and Innovation & NSAI (the trade of goods and services) and the Revenue Commissioners (customs, duties and levies) and each is engaging on the issues in their areas.

One of the key areas under my Department's remit is the implementation of the Construction Products Regulation (EU) No 305/2011 (CPR), which sets the rules for placing certain construction products on the EU market and the requirement for a CE Marking. On the date of withdrawal, the UK becomes a third country. This has implications for the certification of certain construction products, for manufacturers, importers, distributors and authorised representatives when placing products on the Irish/EU Market and builders, building professionals and others when specifying and using certain construction products.

Since January 2018, my Department has been engaging with the construction sector in relation to the impact of Brexit for the CPR and the actions that should be taken before the UK leaves the EU. In collaboration with the Revenue Commissioners, the Department of Business, Enterprise and Innovation and NSAI, my Department set up a working group with key stakeholders (including the Construction Industry Federation, IBEC/Building Materials Federation, Hardware Association of Ireland, Irish Concrete Federation, the Royal Institute of the Architects of Ireland, Engineers Ireland and others) to further raise awareness of the business continuity requirements and provide clarity where necessary. The Department is also engaged in presenting at industry events, providing information on its website and disseminating updates to registered users of the Building Control Management System (over 100,000 users).

Issues in relation to the credit environment are a matter for my colleague the Minister for Finance.