Dáil Éireann Debate, Thursday - 9 November 2023
86. Deputy Cian O'Callaghan asked the Minister for Housing, Local Government and Heritage when he will introduce the "use it or lose it" clause to ensure sites with planning permission are developed without delay; and if he will make a statement on the matter. [49193/23]
View answerI want to ask about the use it or lose it measures the Minister has promised on a number of occasions. Where are they? When will they be introduced? Will he give an update on that?
I thank Deputy O'Callaghan for his question. Since the publication of Housing for All, the Government has focused on the activation of permissions, which we are seeing happen now. I will go through that in some more detail. The residential zoned land tax is a new tax, introduced in the Finance Act 2021, which seeks to increase housing supply by encouraging the activation of land which is suitably zoned and appropriately serviced. Draft maps were published by local authorities on 1 November 2022, supplemental maps were published on 1 May 2023 and final maps of land in scope will be published on 1 December 2023. Significant work has gone into that through our local authorities, with public engagement on that. Liability to the tax will commence on 1 February 2025, subject to enactment of the Finance Bill 2024.
Where development is not commenced on the identified land, the landowner will be subject to a tax of 3% of market value annually, which will be administered by the Revenue Commissioners. The tax will therefore incentivise landowners to either develop land or to sell it to someone who will develop it, with the benefit of planning permission, to ensure they are not subject to any annual tax liability on their land. The tax will operate in conjunction with amendments in 2021 to section 42 of the Planning and Development Act 2000 which mean that the five-year duration of a planning permission can only be extended once commencement of development has occurred and, importantly, substantial works have been undertaken, introducing a requirement to "use" a development in order to avoid planning permission lapsing.
On the activation front and delivery this year, up to the end of the third quarter, we have seen more commencement notices and more homes being built. We are projecting that we will exceed the target set in Housing for All this year of 29,000, which is good. We are seeing planning commencements increase substantially, particularly in the third quarter, in months where one would usually not see that happen, July and August. An element of that is the development levy waiver and the Uisce Éireann connection charge waiver. Those initiatives, coupled with the residential zoned land tax, are having the effect of more land coming into the market and more planning permissions being activated.
I will address issues regarding the residential zoned land tax in my second contribution. According to the Department of Finance, planning permissions for 100,000 homes around the country are unactivated. In the programme for Government, the Minister gave a clear commitment to introduce lose it or use it measures to penalise developers who sit on planning permission. More than three years later, we now read reports that developers have got yet another big win, as these measures have been scrapped. That is what is being reported. Caving into developers is another kick in the teeth for thousands of people looking for somewhere affordable to live. Why are strong measures and penalties relating to use it or lose it not being implemented? Will the Minister honour the commitment that he made to bringing forward strong use it or lose it measures in the planning and development Bill?
What is happening on the ground can be seen across the country, including in Deputy O'Callaghan's constituency in Dublin. We have not seen anything like the number of homes and apartments under development since 2007. Progress is being made. The residential zoned land tax is a big change in how we manage land and how we will deal with reducing speculation on land and people hoarding land. It is already having an effect in advance of it coming in. Lands have been sold back into the market by agencies and we need that. The State itself, through the land acquisition fund which we established, is buying land for local authorities and approved housing bodies to build up their own land banks so we can develop more. Those activation measures are working. I already explained in my initial response that no extension to planning permissions will be given unless substantial works have been undertaken and that we are introducing a requirement to use a development. The measures that we brought forward are taking hold and working this year. I believe the residential zoned land tax will further help and is already helping in activating land and reducing land hoarding, which none of us want.
Will the Minister explain why the residential zoned land tax is being delayed until 1 February 2025? We are in the middle of a housing disaster for people. These measures are needed as quickly as possible to eliminate any land hoarding and to reduce speculation. Why kick it down the road yet again, given the crisis that we are in at the moment? What can possibly explain more delays in the approach? That is not treating this like the emergency that it is. Will the Minister tell us why that has been done? The explanations I have heard from the Taoiseach and Tánaiste simply do not make sense. They describe problems with the land hoarding tax, or residential zoned land tax, which are actually what it is designed to do. It is designed to address whether land is going to be built on and if it has the proper zoning on it. That is what it is meant to do. Why delay it and kick it down the road in the middle of an emergency?
No one is delaying it. One has to get it right. This is a really-----
It is delayed.
This is really extensive work.
It is delayed a year.
Across every single local authority, all maps were published. We had to allow the public to make submissions if they wanted to request a dezoning of land too, where land was zoned residential, they had no intention of developing it and did not want to develop it. We had to engage with all relevant stakeholders to allow that public information campaign and for public consultation to happen. One has to have a fair approach to this. I can tell Deputy O'Callaghan that, with the residential zoned land tax coming in from the start of 2025, it is already having the effect of people selling land or seeking dezoning. The dezoning is important because local authorities or planning authorities are not counting that land in their overall view.
We have seen this happen and it will work.
