My Department assesses, approves and records local authority social housing delivery costs for each project submitted for funding approval. As part of this process submitted costs are reviewed, taking cognisance of the particular circumstances of each project and the context of the overall housing need. On occasion, tender approval has been withheld by my Department or only a reduced budget approved, where costs were at a level which could not be justified.
As SHIP-funded construction projects by local authorities must, like all publicly-funded construction programmes, comply with the Public Spending Code and Capital Works Management Framework, my Department periodically issues Unit Cost Ceilings (UCCs) for each local authority area, for use as a key benchmark for the development and costing of scheme designs at capital appraisal stage.
To monitor tender cost trends and to inform the UCC levels, my Department analyses the tender data for the construction cost element of new build schemes approved under the SHIP and CAS four stage pre-construction process as well as the purchase costs for turnkey and Part V projects at final approval stage for each unit type, where sufficient information is available to allow such costs to be extrapolated and where the information available is appropriate for comparison purposes.
My Department have recently undertaken a high level analysis of tender price construction costs for social housing over the period 2017 to 2020. This analysis provides the average unit cost for construction.
Following a recent report from Dublin City Council (DCC) Housing Department on average costs my Department have engaged with it in relation to the points it has made on tender prices in respect of a selection of recent tender competitions run by them. An exercise is on-going with DCC to ensure that costs it used for analysis and reporting align with the approved funding budgets provided by my Department.
My Department intends to engage with the SCSI to further review issues raised in the recently published SCSI report on apartment delivery costs.