Housing (Miscellaneous Provisions) Bill, 1979: Committee Stage (Resumed).

Question again proposed: "That section 13 stand part of the Bill."

Before the Minister starts might I say I had a difference of opinion with him before we adjourned. It was a misinterpretation on both sides. The Minister referred to the date of purchase which I assumed was the date on which somebody became the owner of the house. He has assured me in the intervening period that he was referring to the date on which vesting of the house was made in favour of the tenant. In that case my argument does not stand up. I was under the impression he was talking about what is normally accepted, the date on which it was purchased. Would the Minister let me have one other comment? In the case of the people who under the 1973 scheme and since have been purchasing their houses outright does the 25 years apply? If it does I have never heard of it.

I was responsible for the arrangement under which houses are purchased and the change in money values is taken into account in order that people who are now purchasing houses are purchasing them at the price of the erection of the house updated to present-day values. In other words, they are paying full price for the house. Surely the Minister is not suggesting that only they and nobody else, Land Commission farms or anything else, are to be restricted in this way? I am under the impression that the Minister is misinterpreting the thing. If that is so I would like him to say so; or, perhaps, as he said, he would prefer to wait until later on this evening, whenever the next Stage is being taken. I do not want to be told afterwards that we cannot now deal with it because it has already been passed by the House.

Mr. Barrett

Section 26 of the Landlord and Tenant (Ground Rents) (No. 2) Act, 1978, confers a statutory right on lessees of local authority houses to acquire the fee simple in their dwellings. In the case of a tenant purchaser, subsection (2) provides that the fee simple will be subject to the retention of certain conditions specified in the lease other than the annual ground rent for a period of 25 years from the date of acquisition of the fee simple. As well as giving a note to the Deputy, I will make a more specific statement on the matter on Report Stage.

Mr. F. O'Brien

If there must be approval to sell within 25 years and if there must be a certain type of person involved, will the Minister undertake to make a regulation to change that?

Mr. Barrett

No. It is the law under the Landlord and Tenant Act. It does not arise under this Bill.

We oppose the section. Because of a backlog in the local authorities a person buying a house will have the option to do repairs and he will get some compensation from the local authority. This may happen in a few local authorities but I should not like to see it legalised because it will give many of these bodies a way out of undertaking their responsibilities. When they sell a house it should be in good repair. If they cannot repair it I suggest they employ a local contractor. If a tenant agrees to carry out repairs, eventually he will have to get a contractor to do the job and the local authority will not meet the cost. It will be the start of the run-down of good housing stock and I object to that. Once local authorities know they can do this, overnight all of them will be so busy with other matters that they will not be able to carry out any repairs. There will be general decay in local authority housing.

By providing for local authorities to engage small contractors, we would be ensuring that the work would be done properly and we would be providing employment for these people in local areas. That would be a more sensible approach than the ad hoc type of situation being legislated for and which can only lead to confusion with nobody undertaking the work at the end of the day. Perhaps I shall table an amendment in this regard for Report Stage.

Mr. T.J. Fitzpatrick

(Cavan-Monaghan): The more one thinks about this situation, the more amusing it becomes. The device of entering into an agreement with a tenant to carry out structural repairs is recommended because of the delays that have been experienced in the past in having this work done by the housing authorities. We would be better engaged in pressuring the housing authorities to do the work rather than to provide for the remedy that is contained in this section whereby if the tenant fails to do the work it is handed back to the people who are not doing it now. The subsection reads:

If the tenant fails to complete the specified works to the satisfaction of the authority within the specified time, or such further time, if any, as may be allowed by the authority, the authority may carry out the work or such part thereof as has not been carried out and shall deduct from the sum otherwise payable by them to the tenant pursuant to paragraph (b) of this subsection the reasonable costs of any such works carried out by them ..

That is amusing. If the agreement is entered into and the work is not carried out by the tenant he will be given an extension of the time limit and, presumably, if he applies for yet another extension he will get that, too, but if at the end of all that time he has not carried out the work, the local authority are to be asked to do it. We would be far better engaged in providing in this statute that the local authority should put the house in repair within a time stipulated at the time of the sale and that if they fail in that regard, they would pay a penalty of £x per week for each week of delay in putting the house into repair. In that way we would be pressuring the local authority to do the work rather than acting as we are acting here by adopting an attitude of despair and saying that the situation cannot be dealt with in that way. What we are saying here in this legislation is that the local authorities are not competent to do the work. The reason for the uproar and frustration among people regarding these repairs is the failure of the local authorities to carry out the work. In the same way there is despair and frustration on the part of people who have been promised isolated cottages because the local authorities are not building such cottages.

Mr. Tully

It might shorten the proceedings if I say that there was no necessity whatever for this provision. This is because the onus is on the local authority to carry out the repairs and it does not matter whether those repairs are carried out by a contractor or by the tenant so long as the local authority are satisfied that the work is completed satisfactorily. The responsibility rests ultimately with the local authority. Perhaps if there had not been any reference to this arrangement in the Bill we would not be spending a couple of hours talking about something that is in operation already.

Mr. Barrett

Up to now there was a statutory obligation on the local authority to put houses in order before purchase. Under the optional arrangement situation it will be possible for the repairs to be carried out after purchase and the local authority can ensure that the work is done properly whether by the tenant, by the authority or by a contractor. The local authority can move in if necessary to finish a job that has not been completed. The problem of delays in bringing houses up to the necessary standard is not general. It relates mainly to Dublin and Cork.

I have heard criticism here at Question Time regarding the Dublin situation. I do not know whether the difficulties in this area stem from a failure on the part of the corporation to find the type of small contractor to which Deputy O'Brien referred, but perhaps if a tenant opted for this other arrangement he could, with the agreement of the local authority, find a contractor to do the work. The important point is that there is provision for this optional arrangement and this should result in this type of work being speeded up.

Regarding the point raised by Deputy Tully about the statutory obligation on local authorities to carry out work before the house is purchased, the point has been made that in one instance the work was done without the involvement of the Department of the Environment auditor.

Mr. Taylor

The Minister said that it is not the function of the House to make regulations. It is the function of the House to make law, and to voice their disagreement with a regulation if they wish. The Minister, but not the House, makes regulations. The House should have the right to say in which way regulations should be changed. For that reason, while it is a bit late in the day, the Minister would be well advised to have another look at this aspect. We should not build something into the law which we might regret for years to come.

Mr. Barrett

With regard to the legality or otherwise, that is the advice available to me from the Attorney General's office. Surely, I am not expected to disregard that advice.

Mr. Tully

The Attorney General has been wrong before.

Mr. F. O'Brien

This House makes the laws but we have now been told that it would be illegal to seek an opportunity to amend a regulation made by the Minister. All we are asking is for an opportunity to amend a regulation if we see fit. If we cannot do that we must question what we are here for.

I am wary about accepting the Attorney General's advice in view of the fact that this House should have the power to allow the Minister make regulations and the House should have the power to amend them, discuss them and vote on them if we so desire. To be told that that is illegal is outrageous. We cannot accept that at all. We would ask the Minister to accept this reasonable amendment.

Mr. Barrett

I oppose it.

Mr. T.J. Fitzpatrick

(Cavan-Monaghan): It is not good enough for the Attorney General to say it is illegal without giving some reason.

Amendment put.

The Committee divided: Tá, 37; Níl, 67.

Tá.

Barry, Peter
Barry, Richard.
Begley, Michael.
Belton, Luke.
Bermingham, Joseph.
Boland, John.
Bruton, John.
Burke, Joan.
Byrne, Hugh.
Cluskey, Frank.
Conlan, John F.
Corish, Brendan.
Cosgrave, Liam.
Creed, Donal.
Crotty, Kieran.
D'Arcy, Michael J.
Deasy, Martin A.
Desmond, Barry.
Donnellan, John F.
FitzGerald, Garret.
Fitzpatrick, Tom. (Cavan-Monaghan).
Gilhawley, Eugene.
Harte, Patrick D.
Hegarty, Paddy.
Horgan, John.
Keating, Michael.
Kenny, Enda.
Lipper, Mick.
McMahon, Larry.
Mannion, John M.
Murphy, Michael P.
O'Brien, Fergus.
O'Brien, William.
O'Toole, Paddy.
Taylor, Frank.
Timmins, Godfrey.
Tully, James.

Níl.

Ahern, Bertie.
Ahern, Kit.
Allen, Lorcan.
Andrews, David.
Andrews, Niall.
Aylward, Liam.
Calleary, Seán.
Cogan, Barry.
Colley, George.
Collins, Gerard.
Conaghan, Hugh.
Connolly, Gerard.
Cowen, Bernard.
Daly, Brendan.
de Valera, Vivion.
Doherty, Seán.
Fahey, Jackie.
Farrell, Joe.
Faulkner, Pádraig.
Fitzgerald, Gene.
Fitzpatrick, Tom. (Dublin South-Central).
Fitzsimons, James N.
Fox, Christopher J.
Gallagher, Dennis.
Herbert, Michael.
Hussey, Thomas.
Keegan, Seán.
Kenneally, William.
Killeen, Tim.
Killilea, Mark.
Lawlor, Liam.
Lemass, Eileen.
Lenihan, Brian.
Leonard, Jimmy.
Barrett, Sylvester.
Brady, Vincent.
Briscoe, Ben.
Browne, Seán.
Burke, Raphael P.
Callanan, John.
Leonard, Tom.
Leyden, Terry.
Loughnane, William.
Lynch,Jack.
McCreevy, Charlie.
McEillistrim, Thomas.
MacSharry, Ray.
Molloy, Robert.
Moore, Seán.
Morley, P.J.
Murphy, Ciarán P.
Nolan, Tom.
Noonan, Michael.
O'Connor, Timothy C.
O'Donoghue, Martin.
O'Hanlon, Rory.
O'Leary, John.
O'Malley, Desmond.
Power, Paddy.
Reynolds, Albert.
Smith, Michael.
Tunney, Jim.
Walsh, Joe.
Walsh, Seán.
Wilson, John P.
Woods, Michael J.
Wyse, Pearse.

Tellers: Tá, Deputies W. O'Brien and B. Desmond; Níl, Deputies Woods and Briscoe.

Amendment declared lost.

Mr. Barrett

I move amendment No. 18:

We should forget the essential repairs grants scheme because it does not do anything. The idea behind this amendment is good. There is only one thing wrong with it. On Second Stage I mentioned that some of this might be my fault and suggested that the Minister should have a look at site costs in the inner city. By preventing people who bought sites for a few hundred pounds from selling them for £1 million, the Minister would be giving better grants, without any cost to the public purse, than he would by including this section. I am not objecting to what he is doing. While using this as a temporary expedient, the Minister must face the fact that somebody must deal with this question, otherwise we will have to pay a million a foot in that area before very long.

It would not be the Minister himself.

Mr. Barrett

——the regulations would have to be again before the House for 21 days. It is not merely a once-off operation.

Amendment agreed to.

Question proposed: "That section 14, as amended, stand part of the Bill."

Mr. F. O'Brien

Section 14 (5) states:

(5) Regulations under this Act may provide for compliance by houses with conditions as to site, aspect, planning and number per hectare and with such plans as may be approved of by the Minister.

Again by regulation we are putting in things that might have far-reaching effects. This could be lawfully written into a Planning Bill rather than a Housing (Miscellaneous Provisions) Bill. It would be more pertinent to planning. With regard to regulating the density and the number of houses that should be on a hectare or an acre, the Minister should be careful. He should leave these matters to the planning authority because they are the people best suited and able to know what is good for their authority. If the Minister makes regulations on this it may tie the hands of certain authorities. We in Dublin city would not be as concerned about density as would county authorities because we are caught up for land and land usage. In inner city housing now we are building 20 and 22 houses to the acre. That would have been heresy a few years ago, but it is now deemed good planning. With what we are paying per acre in the inner city it is important that we use land wisely and well. I am worried that the Minister may put in regulations that could upset this type of planning. While is it good to have ten or eight houses to the acre, land is now becoming a scarce commodity, particularly in Dublin. We will soon be down to Wicklow in building for Dublin city, and that is wrong. We must have prudent use of land. The people best fitted to make decisions on this are the planning officers in the local authority because they are aware of what the needs are.

I would be afraid that this would be a general regulation which could have this far-reaching effect. People would see eight houses per acre as an acceptable density which makes better living for everybody. When we have the problem of a scarce and very expensive commodity, that is land, then we must design and plan our houses prudently and fit in as many as we reasonably can. If our hands are tied with regulations, as would appear in this Bill, we could be running into some trouble. I ask the Minister for his comments on this. It has always been a problem in the city and also in the county, and we are building now basically in the county.

Mr. Barrett

Not necessarily. Most of the matters which have been mentioned are ready.

Question put and agreed to.

SECTION 15.

Question proposed: "That section 15 stand part of the Bill."

Mr. T.J. Fitzpatrick

(Cavan-Monaghan): As I understand it, this section is to validate certain rates remission given in respect of new houses as well as reconstructed houses and other houses. If the Minister would tell us briefly what is in it we might be able to agree to it.

Mr. Barrett

Liability for the payment of rates in respect of domestic premises was transferred in full to the Exchequer as from 1 January 1978. This section is necessary both to validate rates relief enjoyed by certain householders prior to that date, which is not provided for by section 33 of the Principal Act, and to ensure that the basis on which the Exchequer liability for the payment of rates is determined is the same as that which applied when householders were individually responsible for payment.

The Local Government (Financial Provisions) Act, 1979, section 3, required rating authorities, as and from 1978, to make an allowance against the rates payable on domestic properties, the domestic portion of mixed property, secondary schools, community halls and farm buildings not already exempted from rates. Section 4 of that Act authorises an allowance of one quarter of the rates payable on such properties in respect of 1977. Section 9 of that Act required the Minister to make a grant to a rating authority equal to the aggregate of the allowance made by them under the Act.

Subsection (1) validates the rates relief given in respect of new houses for which grants were not paid where a certificate of reasonable value or a certificate of exemption was granted in relation to the house, and a certificate was granted by the Minister stating that the house had been satisfactorily completed. In effect, the section would confer the nine-year rates remission available under section 33 (1) of the Principal Act on houses in respect of which grants were not paid if, but for the income limits imposed between the period from January 1976 to July 1977 in relation to State grants for new houses, such a grant would have been paid.

The benefit of rates relief under section 33 (1) of the Principal Act was confined, in the main to new houses in respect of which a grant was paid under sections 15, 16, 17, 18, or 20 of that Act. In the case of grant applications received on or after 1 January 1976 where a certificate of reasonable value had not been granted prior to that date, eligibility for new house grants was confined to persons who were eligible on an income or valuation basis for supplementary grants from local authorities.

These arrangements were, of course, superseded by the introduction on 6 July 1977 of the £1,000 grant scheme for first-time owner occupiers of new houses. It was not intended, however, that persons who were ineligible for new house grants only because of the restrictions should also lose the benefit of rates remission. This subsection, therefore, validates the granting of rates remission to such persons even though grants were not paid in respect of their houses.

Mr. T.J. Fitzpatrick

(Cavan-Monaghan): That is prior to July 1977.

Mr. Barrett

Yes. This subsection also ensures that the Exchequer liability for the payment of rates on such houses consequent on the transfer of that liability as from 1977, partially, and 1978 in full, does not exceed the amount which would have been payable to a rating authority if the householders involved were liable for payment of rates.

If it is covered up to January 1978 I think it would solve the problem.

Mr. Boland

Yes.

Question put and agreed to.

SECTION 16.

An Leas-Cheann Comhairle

Amendment No. 19 is in the name of Deputy Fitzpatrick and Deputy O'Brien. Amendment No. 20 is related and they may be discussed together.

Mr. T.J. Fitzpatrick

(Cavan-Monaghan): I move amendment No. 19:

In page 12, line 50, to deleted "may" and substitute "shall".

Section 60 (8) of the Housing Act, 1966, provides:

For the purpose of determining the order of priority to be followed in the making of lettings to persons in accordance with the relevant schemes under this section the housing authority shall obtain and have regard to a report from their chief medical officer.

This deal with the allocation of houses. We know this is a very sensitive operation and that local authorities and local representatives want all the assistance and protection they can get in discharging their obligations in this regard because otherwise they will be accused of being unfair or of discriminating in the discharge of their duties. I have always thought that a great safeguard for a local authority was to have a report from the medical officer and the 1966 Act so provided. The allocation of houses was done on that basis.

The Minister proposes in section 16 to make optional the obtaining of a report from the medical officer. A points system that operates in all local authority areas is invariably based on a number of matters including the health of the applicant and his family and the condition of the house in which they are living. When the health of an applicant or of some member of his family is to be taken into account, in my opinion the only person qualified to report confidentially on that—and this is very important—is the county medical officer. He does not have to specify that a child of the applicant is suffering from a certain disease; he simply certifies that in his opinion and on medical grounds the applicant is entitled to a house. If we take this function away from a medical officer and hand it to a lay person, whether he is an executive of a housing authority or a health inspector, I think we will be going too far. I understand there has been a demand for it from executives of some housing authorities. One of the reasons given is that some counties do not now have a county medical officer of health—I think the title now is director of medical care.

Mr. Barrett

Let us be more specific. He is just as competent to accept a medical certificate as the medical man. The person may be suffering from a nervous disorder. The lay person is just as competent, and may be more competent, because he may have visited the area and seen the living conditions and the person. If it revolves around the acceptance of a simple medical certificate with a few words written on it, it can mean the same to a lay person, who would not under any circumstances carry out a medical examination, as to a doctor who has not carried out a medical examination.

We are not talking about medical people becoming allocating officers in local authorities. Some officials of housing departments may feel they are being replaced by a CMO or a medical officer, but that could be got over by redesigning the scheme of letting priorities, and not by saying lay people can do the job of medical people.

The Minister should look at this between now and the Report Stage. It should not be contentious. At local level in the largest local authority Deputy O'Brien and I have more experience than the Minister. We are former chairman and vice-chairman of the housing committee and I can say modestly we know what we are talking about in this area.

Medical factors are very important in large urban areas in relation to transfers of local authority tenants. I shudder to think of a manager using section 16 to the extent that he would refuse to obtain medical reports because his reading of it would be that he does not have to get them because the Act states that he "may" obtain them. That would mean a lot more work for local representatives who have too much to do and are voluntary. It is not possible for every local representative to be at Riverside House at 9.30 on Wednesday mornings because they must work also. It is putting too much of a load on a voluntary local democracy to put the onus on local representatives. It has been suggested that we could use a section 4 to get a medical certificate but there are only 12 occasions in a year when a council can use a section 4. It must be remembered that council meetings in Dublin conclude at 10 p.m. and that county councils finish late in the evening. That is sledgehammer work for representatives. I cannot understand why the Minister is resisting the acceptable amendment. At least the Minister should look at all the implications of it before Report Stage. I am disturbed by the Minister's comments in reply to this.

Mr. T.J. Fitzpatrick

(Cavan-Monaghan): For the second time during the Committee Stage debate we are changing procedure because things cannot be done by local authorities. We changed the method of putting houses which are sold into a state of structural repair because it takes local authorities years to do that work and now we are approaching the sensitive operation of letting houses. It appears to be the intention to take the consideration of sensitive medical matters, which may involve a discussion between a medical person and an applicant on the state of the applicant's health out of the hands of doctors and put them into the hands of a lay person who is unqualified and does not understand medical conditions. It appears that that is being done because there are delays at local authority level. That poses the question: are the public getting the sort of service they should be getting from officers and officials? In my local authority area a doctor visits the house concerned but I accept that in Dublin that would be impossible. However, it is strange that in the cities of Dublin and Cork where there are thousands of houses to be let the county and city managers want to retain the system laid down in the 1966 Act which we are now being invited to change. The number of houses being let in counties like Clare and Cavan are very few and it is not a trojan job for a medical officer to inspect the houses involved. It must be possible to inspect all applicants within a short period. There are also very few rural cottages to be let.

I would prefer if it were made a reserve function.

Amendment, by leave, withdrawn.

Amendment No. 20 not moved.

Section agreed to.

SECTION 17.

Question proposed: "That section 17 stand part of the Bill."

Mr. T.J. Fitzpatrick

(Cavan-Monaghan): This section gives the Minister authority to direct local authorities to sell or not to sell a specified class of house. I take it that the direction not to sell is meant to protect special classes of houses such as houses for invalids or old people.

Subsection (2) says:

Section 90 of the Principal Act shall apply, and be deemed always to have applied, to a building consisting of a house and a shop, together with any outoffice, yard, garden or other land appurtenant thereto or usually enjoyed therewith.

It seems that this section was put in to deal with special cases. Is its purpose to validate some sales in the past? How many houses are involved and where are they situated?

Mr. Barrett

This subsection is intended to remove doubts as to a housing authority's powers under section 90 to sell a house which includes a shop. Section 90 of the Principal Act enables a housing authority to sell or lease any dwelling provided by the authority under the Act, of which they are the owner. Doubts were raised by Dublin Corporation as to whether that section would apply to a house which included a shop. The Minister was advised in 1977 that a house which included a shop would come within the terms of section 90 and the corporation were informed accordingly. It was also indicated that in order to remove any ambiguity in the matter, provision would have to be made in the next opportune legislative proposals to meet the point. This subsection provides accordingly. In the case of any dwelling provided or to be provided by the housing authority, the authority is empowered under section 56 of the Principal Act to provide roads, shops, playgrounds, places of recreation, parks, allotments, open spaces, sites for places of worship, factories, schools, offices and other buildings or land and such other services as will in the opinion of the authority serve a beneficial purpose in connection with the requirements of the persons for whom the dwellings are provided.

Mr. T.J. Fitzpatrick

(Cavan-Monaghan): The type of house referred to would be provided mainly in Dublin or in large urban areas. The object of providing a house plus a shop is to provide an amenity in the housing estate for the residents. There seems to be some doubt as to whether authority was given under section 90 to sell these houses. Is there a provision for ensuring that these buildings will continue to be operated as a shop or to provide the service which they were built to provide. If a house cum shop were sold and the new owner decided to discontinue the shop and use it as a private house, the area might be deprived of this convenience or amenity.

Mr. Barrett

The existing lease would provide for it to be used as a shop and to continue to be used as a shop.

Mr. Quinn

I am not sure why the Minister is introducing this section giving himself the power to direct a housing authority to sell or not to sell any class of local authority housing. I would refer the House back to what the Minister said on this section on Second Stage at column 1112, Volume 315, of the Official Report of 27 June 1979:

At present, a housing authority have discretion under section 90 of the 1966 Act as to the sale of any of their houses. I want to ensure, however, that special, purpose-built houses which would normally be unsuitable for family use—one example would be elderly person's houses—are not lost from the rented local authority housing stock. On the other hand, I should like to make sure that most local authority tenants will be afforded an opportunity of purchasing their houses. Towards this end, section 17 of the Bill enables the Minister to direct an authority to offer for sale, or not to sell, as the case may be, houses of specified classes.

That is what the Minister indicated as being the reason for it. I commented at that time that it seemed to be an extraordinary lack of trust in the local authority to decide whether they should retain that stock themselves or whether it would be in the best interests of housing in that area to sell it to the tenants or the occupants. The decision to sell or not to sell ten or 15 local authority specially-built houses for disabled or elderly people would be much better made on the ground by the local housing authority than by the Minister and his officials in a central Government Department. I do not see why the Government need this power, and the Minister has not justified it. Are there any instances in the files of the Department which indicate that a local authority have behaved irresponsibly in this area?

Fianna Fáil policy is to sell without a clawback, without any kind of adjustment, as much local authority housing as possible. Most councillors, and indeed the Labour Party as well, agree that when people have a degree of ownership in their property it is better maintained, is of a higher standard, that the housing stock, as such, benefits, as do the occupants from living in a better maintained property. Indeed every specialist housing conference I have ever attended has clearly validated that viewpoint, of giving the occupants some degree of ownership over and above their weekly tenancy. That would be the alternative at issue.

The critical point is contained in subsection (1) (b) under which the Minister will now have power to direct a local authority not to sell housing on the grounds that they may be selling off specialised housing which should not be lost to the local authority area. Unless the Minister can refer to specific examples that have come to the notice of his Department, I feel this is an unnecessary power. It is further centralisation, further bureaucracy, increasing the process of alienation—under which an inspector will drive down for the day to, say, Deputy Fitzpatrick's constituency of Cavan-Monaghan, inspect a small housing scheme in a town there and, on that basis, return to Dublin, draw up a report which will land on the Minister's desk advising him to direct the local authority not to sell the houses to the people involved. This could apply equally to any other part of the country.

It is my view that the officials and local representatives on the ground are in a much better position to decide whether or not those houses should be sold. I do not see why this extra power should be given. It erodes further the powers of local government and the authority of local representatives and their officials. I should like the Minister to justify, in much more specific terms than he has done already during the course of the Second Stage debate why he wants this power.

Mr. Barrett

Mr. Quinn

I would have an objection in principle. I do not see the point of having a dog, then spending a lot of time barking oneself, and paying officials in the Custom House to do so, when they could be better employed administering other parts of the governmental system for which the Minister is responsible and which are not being as speedily tended. It would be the view of the Labour Party in relation to our general attitude to local government, that in a matter like this, it is absolutely gratuitous to take upon oneself the power to direct a local authority to sell or not to sell a house. If one wanted to be in the position of expressing one's interest, there is a system of housing circulars which could be used or, alternatively, it could be re-phrased that the Minister may advise a housing authority to do this, so that the validity of a circular could be seen in the context of one's overall concern, because the capital provision for such housing comes from central Exchequer funds.

It constitutes a further erosion of the power and responsibility of our local government representatives. It is little wonder that, in many instances, they have been reduced to being a spectacle of fun in Hall's Pictorial Weekly and others. In every instance a man must be sent to Dublin to ascertain whether or not this or that can be done. In my view the Minister has not justified it. It is basically a question of trust. Either one has public representatives elected at local level who know what they are at, who give a service to the community, who are better advised and informed, more capable of judging and, in the final analysis, accountable in a way that no official from the Custom House is for any decision they take. In a sense that is being taken away from them. Now a directive will be issued from Dublin: sell or do not sell, bringing us back to more and more centralisation. I cannot help thinking that there is steamed into the plaster of the Custom House—and it was not burnt out in 1921 when the IRA did burn it down—a colonialist attitude imbued with the spirit of: do not trust the natives with anything for fear they would make a mess of it. This is just another example of it.

Mr. Barrett

If there is any evidence of a colonial attitude in the Custom House—and I have been around there now for two years—I fail to see where it exists in the area for which I am responsible.

With regard to directing—as the Deputy puts it—a local authority not to sell a certain type of house, the type about which we are speaking are those built specifically for elderly people. It is not the first time something like this will have happened with regard to local authorities and this type of house.

During his term of office my predecessor insisted on sending a circular to all local authorities advising them not to dispose of this category of house. I do not know if it was his intention to have this embodied in the Housing Bill but I wanted to draw the Deputy's attention to that fact. I fail to see what objections there can be to copper-fastening the situation to ensure the retention of these houses by local authorities for elderly people.

I have no evidence of any of these houses being disposed of but inquiries were made from time to time. Perhaps that was why my predecessor saw fit to issue a circular. We are not interfering with local authorities by doing this. If it is written into an Act we are enabling them to retain these houses rather than subjecting them to pressures to sell to a tenant or anything like that.

Mr. Quinn

The circular to which the Minister referred dealt with the sale of local authority houses and had the clawback recommendation. That clawback was accepted by every local authority with the exception of Dublin. I vigorously opposed that view and felt that the clawback was morally right. However, the majority of the councillors—wrongly, in my view, but they were democratically entitled to make the decision—made a decision in that area. Because one local authority went against a decision of the Custom House this section is being introduced. It will make it possible for a Minister to direct whether the sale of local authority houses will take place. This is unnecessary. I would prefer to trust local public representatives and their housing officials. This section gives extra power to the Custom House which does not seem to be able to cope with the job it has on hands.

Question put and declared carried.

SECTION 18

Mr. T.J. Fitzpatrick

(Cavan-Monaghan): I move amendment No. 21:

In page 13, subsection (1), between lines 30 and 31, to insert the following new paragraph:

"(b) The Minister shall make a decision on an application for a certificate under paragraph (a) of this subsection and notify his decision to the applicant within 21 days of the receipt by him of the application and if he refuses the application, he shall specify in the notice of refusal, particulars of his reasons for such refusal and should the Minister fail to make a decision on the application within the said period of 21 days, the application shall be deemed to have been granted.".

Section 18 deals with certificates of reasonable value. The object of a CRV is to ensure that house purchasers get reasonable value for their money. We are 100 per cent in favour of a policy which will provide more houses for more house purchasers and which will provide those houses at a reasonable price. We do not want to create a situation that may in one way or another make it more difficult for people to get houses. By increasing prices and creating a scarcity of houses on the market instead of providing houses at a reasonable price, the CRV could have the effect, if not properly operated, of driving numbers of building contractors out of the housing market. If it does that the result of the operation will be the direct opposite to that intended by the Minister and the drafters of this Bill. The system of certificates of reasonable value must work in a reasonable way and must be seen to work reasonably.

My information about CRVs is that in some cases there have been inordinate delays in obtaining decisions from the Minister on these certificates. It will be no answer for the Minister to suggest that the average delay is so and so. Averages prove nothing in the end and they certainly prove nothing where one is dealing with a large number of individual applications, because the number which sail through as a matter of form will pull down the average time and make the waiting period look reasonable. I am told, and I accept, that there have been cases where there were months of delays and there may have been a large number of houses involved.

The next thing I am told which causes frustration and makes it impossible for building contractors to operate the system in a reasonable manner and to get on with their work is that when a CRV is refused no reason is given by the Minister. When the applicant asks the official why it was refused he is not given any reason. That seems to place the applicant in an intolerable position. It would appear that if the Minister refuses an application for a CRV he or his own officials must have considered, broken down the price and come to the decision that something was wrongly priced, or that some item was too highly priced; but that information is not given to the applicant.

I am also told there are apparent inconsistencies and inequities in decisions where different builders have applied for CRVs in respect of similar houses in similar locations and the Minister refused to discuss them or give reasons for them. Reasons are much more necessary and important now than they ever were before.

I understand that under pressure the Minister is bringing in an amendment to give the right of appeal to the Circuit Court by a person who has been refused a CRV. I will deal with that later. How in the name of goodness is a judge of the Circuit Court or any other appeal tribunal to deal with an appeal from the Minister if he does not know the Minister's case? In his amendment the Minister has set out that an officer of his Department may appear before the Circuit Court and be heard there, but I imagine that a judge of any other appeal tribunal going to adjudicate on the refusal by the Minister of a CRV will have before him the applicant's case. Surely he will want to know the Minister's case and why he refused. Up to now CRVs covered only about 33 per cent of the houses that have been handled by building societies. As from now the proposal is that they should cover 100 per cent of these applications. However, if they do not work, that will create chaos rather than bring down the price of houses.

Section 18 (1) (a) enables the Minister to grant a CRV on an application from an applicant. The amendment in my name and the name of Deputy F. O'Brien proposes to add a paragraph (b) which reads as follows:

The effect of that will be two-fold. It will speed up the process of application for a CRV and will ensure that the Minister or his Department will deal with it within 21 days. Secondly, it will provide that if the Minister refuses the application for the CRV he shall specify to the applicant his reason for so doing. The effect of that will be that if the application is refused the applicant will get reasons for that refusal and he will know where he stands. He can then consult his quantity surveyor or other expert and decide whether the Minister is right or whether he himself is right. He can decide whether the Minister's proposal is fair. In the light of the information which he then has, he perhaps would go back to the Minister and say "I still do not agree but I am prepared to come down to so and so if you are prepared to increase the estimate to so and so". If all else fails then they will have the homework done for an appeal which can be brought and which, I hope to suggest to the Minister later, shall be processed quickly.

I have no doubt at all that if the present unsatisfactory system of dealing with applications for CRVs is continued it will not be in the interest of house buyers or house builders because there will be fewer houses on the market and the prices will perhaps go up in the long run instead of coming down. There does not seem to be any good reason for the attitude of the Minister in refusing to discuss his reason for refusing a CRV. I think that what I have said is fairly clear and I would welcome the Minister's views on it when he thinks fit to intervene in this discussion. I do not want to talk just for the sake of talking. I have put the case as clearly as I can and I will deal with the Minister's objections if he does not tell me that he is prepared to accept the amendment.

Mr. Barrett

I appreciate that this amendment is designed to help builders who are applying for CRVs by ensuring that they get decisions inside three weeks or, if they are refused CRVs, particulars of reasons as stated. While I sympathise with both those aims I am not convinced that the acceptance of the amendment would in the long run be desirable as far as the builder is concerned.

I will deal first with the question of imposing a statutory time limit and I will give the reasons why I am opposed to the idea. Firstly, timewise a satisfactory standard of service has been provided to date and this is due partly to the absence of rigid time limits and the consequent flexibility which the present system allows. Last year almost 2,400 decisions were issued and the average time taken for a decision was only 15 days. In May of this year the average time taken was only 12 days. The number of cases taking more than a month is very small —about one in 20 according to a recent check—and would normally involve some abnormal aspect which might necessitate a site inspection.

Secondly, even if one were to accept the idea of a time limit, it would have to run from the date of receipt of all necessary information, not from the date of application since applications are frequently incomplete. The level of information may vary from one case to another depending on the amount of detail needed to justify the price, unusual aspects and so on. At present many of the requests for further information and clarification are made on the telephone or during interviews when it is easier to explain what is involved and quicker than making a formal written request, as the amendment would require. For example, during the recent postal difficulties the informal approach was of great benefit to the builders.

Mr. T.J. Fitzpatrick

(Cavan-Monaghan): I hope that is not going to be an annual occurrence.

Mr. Barrett

Thirdly, a time limit like 21 days might in exceptional circumstances be impossible to meet, with resultant granting of CRVs by default, which I am sure the proposers of the amendment would not welcome. I am talking about a short-term situation which might arise following a decision to extend the CRV system with a resulting increase in the volume of applications. We have to be realistic and recognise that it is extremely difficult to recruit the professional staff needed, particularly quantity surveyors. In any event the Minister is answerable to the Dáil for any undue delays.

To sum up in regard to the question of having a statutory time limit, I would suggest that the imposition of such in this section would not improve on the present standard of service.

The second part of this amendment would require the Minister to give details of reasons for refusing CRVs. At present the only reason given is the obvious one that the price exceeds the amount appearing to the Minister to represent reasonable value. I am aware that many builders feel they should be given particulars of the reasons but it is not as easy as it may seem at first sight. I might mention that my predecessor, Deputy Tully, resisted similar requests. Strictly speaking, the concept of the house and site as one unit being reasonable value for a certain price does not permit one to give a specific reason, such as that the land was too dear or overheads too high. In the final analysis the cost of the various elements is irrelevant as long as the total price is reasonable. It often happens that a builder has paid over the odds for a site but, because of economy of building and management operations, succeeds in getting a CRV. Indeed, the information given by builders is often so inadequate or the price breakdown so different from the Department's approach to the calculation of reasonable value that it is not possible to pin-point accurately which elements are making the price higher than that which appears reasonable. A builder's actual costs plus overheads and profit need not necessarily represent reasonable value. Other factors such as efficiency and good buying practices are also relevant.

A further point is that to go into detail about reasons for rejection would be tantamount to publication of the Department's criteria for the assessment of reasonable value so that builders would know the Department's figure for reasonable value before applying. This would, in effect, put the Department in the position of fixing prices and this would not be a desirable situation, especially since the majority of prices applied for are lower than would be approved by reference to these criteria and the net effect might well be to push up prices.

To impose a statutory requirement about particulars of reasons would mean that the Department would in every case have to look for much more detailed information from the builder than he has to submit at present or even than he may have at his disposal, though such information may not be necessary at the moment to enable a CRV to be granted, as is the case in the vast majority of applications. The provision of such information would add to builders' expenses, impose additional disciplines in their operations and delay the whole process. It would not improve the position for the vast majority of builders.

Finally, I would suggest that the need for such a concession, if one could call it that, is now less acute in view of the additional safeguard being proposed in amendment No. 23, namely, the granting of the right of appeal to the Circuit Court against the refusal of a CRV. Also of relevance is the fact that the detailed basis of the calculation of reasonable value is at present being reviewed with the involvement of a prominent quantity surveyor nominated on a confidential basis by the Irish House Builders' Association.

Having said why I am not in favour of making the giving of reasons a statutory requirement. I will consider in the context of forthcoming discussions with representatives of the house builders the possibility of indicating to applicants in a broad and less formal way which particular element appears to be making prices unreasonable. I would stress again that in the vast majority of cases being examined at present it is not possible to say why the price is not reasonable because of the lack of information from the applicant. These discussions will be relevant only in cases where sufficient information is available.

Mr. F. O'Brien

We are asking that the decision on these applications be taken within 21 days. The Minister has informed us that the time taken is generally less than 21 days but still he will not accept the amendment. Builders to whom I have spoken have all stated that they have experienced much longer delays. In my opinion the Minister will not accept the 21 -day situation because the number of CRV applications would flood the Department. He has admitted that it is difficult to get trained and competent staff. He knows that he would not be able to fulfill the terms of the amendment. The Minister says that the average time taken is 15 days and the 21 days provided for in the amendment must be adequate. We are saying that this should be the maximum statutory time and house builders, together with the CIF, would accept that. We are in favour of CRVs but we want the system to function in an orderly way which does not cause hardship to those within the building industry. The Minister talked about the right of appeal to the Circuit Court and we will discuss that further later.

I am giving the reasons why the decision should be taken within 21 days and it is relevant to the amendment. I am sorry you do not understand that.

An Leas-Cheann Comhairle

The Chair, hopefully, understands it very well. The Chair is anxious that all the matters being raised now will be dealt with on the section. Let us try to dispose of the amendment first.

Mr. F. O'Brien

The reason I am asking that the decision be taken within 21 days, is because, despite what the Minister says, long delays are causing undue hardship on many builders. As Deputy Fitzpatrick said, averages are all right; but many people have had to wait six weeks and eight weeks for decisions. We put the 21 days into the amendment to ensure that the Department are forced to make decisions in a fairly quick way. When this Bill becomes law, because of the upsurge in applications for CRVs, they will not be dealt with in 21 or in 28 days.

There is no reason why the Minister could not accept our amendment. He did not give us a clear reason other than saying that our amendment would mean that decisions taken on CRVs would take longer. The builder is in the dark if he is not given the reasons why the CRV has been refused. I do not believe the Minister's Department have any criteria. I believe they only have a rule of thumb in relation to this matter. The Minister is not wise to turn down our amendment. People who invest large sums of money in housing are doing a public service by providing houses. They do not appear to be getting fair play and justice. That is all they are looking for.

We agree with the principle of CRV but we consider the administration of the system is wrong. Although the Minister did not say so, he appeared to consider that there was some merit in what we were saying. The CIF issued an advertisement in the newspapers last week indicating that there was lack of communication. One would have imagined the Minister would have consulted them before bringing in the legislation. If he did that it might not have been necessary for us to put down this kind of amendment. We proposed a period of 21 days but they might have advised him on a better course to adopt. I shall deal with this and other matters on the section later.

Mr. Quinn

The amendment relates specifically to the administration of the system of CRVs. We should be clear about this. One weak but understandable line of defence for the Government would be to attack Deputies on this side by saying we were against the system of CRVs. I said on Second Stage, and I wish to repeat it now, that the Labour Party are not against the principle of the certificate of reasonable value. It is a form of price regulation as distinct from price control and, consequently, it is a form of consumer protection. The principle of the CRV is not at issue and I understand that it is not an issue with the CIF either. What is at issue is the administration of the system. Because of subsection (2) and because of the implications of section 20, the lending agencies will be directly concerned with the administration of CRVs and the whole question of the administration of the system is central to this discussion. For that reason the amendment is very important.

The amendment proposes to replace what the Minister considers to be the reasonable legislative framework for the administration of CRVs. The section states:

... the Minister, on the application in writing of a person who appears to the Minister to be providing for sale a new house, may, subject to compliance by the person with the provisions of this section, grant to the person in respect of the sale of the house a certificate (which shall be known as a certificate of reasonable value and is in this section referred to as "a certificate") stating that the house appears to the Minister at the time of the granting of the certificate and on the basis of the information available to the Minister at that time to represent reasonable value for the amount specified in the certificate, and specifying such other matters, if any, as the Minister considers appropriate.

The Minister may simply indicate that it appears to him to be of reasonable value. It does not indicate the form, the time or the framework within which such communication should take place. The amendment attempts to put some kind of framework for the communication of that comment by the Minister.

On Second Stage the Minister referred to section 18. At column 1114 of the Official Report of 27 June he stated:

Broadly, section 18 has two main purposes: first, to empower the Minister to require that certain loans by lending agencies for the purchase of new houses cannot be made unless a CRV is obtained; and second, to impose clear obligations on builders in relation to the construction and sale of houses for which they have obtained a CRV and to enable the Minister to take effective action against those who fail to fulfil these obligations.

I do not think that anybody would disagree with that, but we are disagreeing with the manner in which the CRVs are currently administered. The effect of this legislation will make the application of the CRV system more critical and central to the provision of housing.

We can only fully understand how important the administration of the CRV system is if we recognise that since this Government came into office and since they adopted a particular housing strategy designed basically to reduce local authority housing to the level that the then Leader of the Opposition referred to in December 1976, they have concentrated their efforts on the provision of housing in the private sector. Consequently, they have pegged money for local authority housing and they are depending on the private sector to provide the balance of the housing. I hope the Chair is not concerned about the relevance of this on the section——

An Leas-Cheann Comhairle

We must first dispose of the amendment.

Mr. Quinn

We know the amendment will not be accepted and once it is rejected we will be on to the section.

An Leas-Cheann Comhairle

A number of other amendments must be disposed of first. There will be plenty of opportunity to deal with these points on the section.

Mr. Quinn

I will try to facilitate the Chair by coming quickly to the point of the amendment. The experience of the last two years, as evidenced by the report of the Central Bank and by others, is that the private sector housebuilder because of difficulties in the administration of the CRV has tended to build more expensive houses, has tended to move up-market to such an extent that the sector of middle-income housing is not being adequately provided for by the private sector. This is specifically because the administration of the CRV system was so apparently difficult for the builder to work with. Moving to a more expensive kind of house enabled the builder to get a CRV or to convince the Department that the house concerned qualified for such a certificate.

That shift in housing policy, which has been regretted by Government spokesmen, which has been referred to in the last report of the Central Bank and which I have put on the record of this House in a housing debate, has brought about a shift in the allocation of housing resources for middle-income people largely because of the administration of the CRV system. This amendment proposes to change the framework within which that system must be administered so that two things will occur. The builder can calculate the time in which he will get a reply from the Department and he will know that there will be certain categories under which the reasons for refusal will be indicated. I cannot see why the Minister will not accept the amendment.

The costing of a house is done on the basis of taking into account the various elements of the structure so that the categories as set out in a bill of quantities are already there. There is no question of having to invent those categories. The categories of costing as sub elements and as major elements are understood by the industry, so that a builder looking at a price under any such system of building elements will understand it readily and be able to relate it to estimators or to quantity surveyors that he might engage. Therefore, the system for categorisation of the breakdown of the cost of an application for a CRV exists and is not in dispute. Perhaps the eminent quantity surveyor to whom the Minister referred operates on some such similar system. There should not be a problem there. I suggest that some system of approch of elementary costing such as the one I have described is being used already by the Department in relation to CRVs.

The other factor relates to time. If, as the Minister assures the House continually, the average time involved is only 15 days, one might ask what would be the problem in respect of 21 days and, and if 21 days is too tight a time perhaps on Report Stage we could talk in terms of 28 days. What is being sought here is the principle of a builder knowing that he will definitely have a reply within a fixed period of time. That fixed period of time where it applies in relation to planning applications is a very important factor because people know exactly where they stand and can do their sums in relation to bridging finance, of closing dates of sale and so on. Time is money and there is nothing more horrendous than going to a lending agency or to a bank and presenting them with a situation in which there is no control over the time involved. That is the sort of situation that is being maintained by the Minister in this instance.

On previous occasions I have castigated the Government on their management of the housing market. In relation to this amendment specifically I would say that, if the Minister failed to satisfy the House and refuses to accept the spirit of this amendment, there will be chaos in the house building industry. I use my words carefully because nobody can estimate what the form or shape of that chaos is likely to be. However, we know that if an open market situation is distorted, as the private house building market is distorted, with these kind of controls, the effects of that distortion can be severe. In previous experience in an open mixed economy such as ours those people who are weak economically and who are vulnerable and who, in the context in which we are talking would be perhaps desperately in need of housing without adequate resources to rented accommodation, are the ones who will suffer most. They will suffer in a variety of ways because of the maladministration of the Department in relation to the CRV system.

The Minister's long and prepared response to the amendment in the names of Deputies Fitzpatrick and O'Brien has not dealt with the central issue. On the question of reasons for refusal, the Minister states that if the Government were to indicate the reasons for refusal on a category basis and by implication to suggest certain upper limits or maximum amounts for certain categories, whether in respect of external walls, internal partitions or whatever, these maximum figures would automatically and immediately become the minimum figures and that consequently the price of houses would increase because builders, through their own contacts and associations, would discover very quickly that the maximum price being allowed for substructure under the CRV system was so many £ per square metre and that, therefore, a CRV application in respect of that figure would be successful. That is a very naîve argument. I assume that that is the argument for justifying the refusal to give itemised reasons for refusal, but that argument is not sufficiently strong and will not necessarily stand up. The whole question of price regulation is one that has been monitored and considered in a major way by the NPC. There is sufficient experience in this country as well as in other countries to enable us to devise a scheme that would make it possible for the Department to give reasons for refusal without inflating the market price of houses.

On the question of time the Minister has not responded to the right of a person to be notified of refusal within a certain period. He has simply reassured the House that the average delay is 15 days. As Deputy Fitzpatrick has said, averages do not mean much to those people who must wait a long time for notification. The Minister has justified the delay in those areas by saying that the applications were drafted inadequately, that they did not contain adequate information and that, consequently, it was impossible for the Department to evaluate them. However, the Minister is responsible for planning as well as for housing in this context and he knows that, in respect of an adequately drafted application for planning permission which operates within a fixed legal time frame, the application can be, as is the case often, referred back to the applicant on the basis that it did not contain sufficient information. The simple application form that one receives from a local authority states clearly what items of information are required. There is no reason for a similar approach not being adopted in this instance and that such information as cost per square metre, elementary cost and so on would be sought. That sort of information could readily be supplied. The problem of the possible inflating of the market could be overcome by giving specific cost reasons for refusing an application.

The time question is such that many builders who operate on bridging finance lent by the short-term money agencies need desperately to know what the time factor is in relation to their operations. Fianna Fáil are supposed to be the capitalist party in this House. They are supposed to understand how the system works. Many Deputies in Fianna Fáil are involved directly in house-building organisations of one kind or another. I cannot understand that they seem totally unaware of the constraints and difficulties under which private "spec" builders are operating. It is not my brief to defend private "spec" builders. They can do that very well themselves. It is my job as an Opposition Deputy to assess the administration of a Government policy for which the majority of the Oireachtas have voted.

The refusal by the Minister to entertain the Fine Gael amendment seems to display a total lack of understanding of the real problems which confront a section of the house building industry upon which the industry greatly depends. The two requirements of this amendment, the reason for the refusal and the time framework, are eminently reasonable and would lead to a much clearer scheme within which the Government's strategy of relying upon the private sector of the housing industry could operate. I cannot help thinking that the Minister's refusal to entertain these amendments shows that his reasoning is clouded by administrative difficulties for which he is responsible and which have nothing to do with the principles of the amendment.

If it is a matter of staff shortage, and therefore the implications of a 21-day time limit could be quite serious, the Minister should say so. He has indicated that he has difficulties in getting trained personnel. I know he has only one quantity surveyor servicing the CRV applications. If that is the problem we can deal with it as a fact. We can say that people are not necessarily in the right grade, or getting the right money. It might be done by way of consultancy, or making extra money available, or transferring the matter from the Department of the Environment to the National Prices Commission with a joint industrial and departmental committee overseeing it. The fees which we will be dealing with in a later amendment could be used to fund it.

One is drawn to the conclusion by inference, because the Minister has this difficulty, that the Department are still hung up in a 19th century belief that all technical grades must be locked into the status of the highest engineer and that, if you change the status of any technical person, everybody from the janitor upwards will automatically seek an improvement to maintain the differential. That system of engineers rising to the top of the pile and holding down grades with special skills in the Department should not be used, as it has been used all too frequently in the past, to deprive local authorities and the Department of essential skilled personnel.

I have made a detailed and rational case in favour of a framework which would give the builder the time within which he could plan his operation for CRVs, organise his bridging finance and his working capital, and also a system whereby if a house was becoming too expensive in certain areas he could decide to change the standard of finish or reduce the floor area. No serious arguments have been put forward by the Government as to why this amendment should not be accepted.

Mr. Barrett

I have already given my reason in some detail as to why I cannot accept these two amendments. They are valid reasons, and they are valid now as they were before these further contributions were made. Deputy O'Brien alleged that the Department had no criteria for the assessment of reasonable value. I want to say quite clearly that, as the Minister responsible, I would not stand over such a situation, nor indeed would my predecessor, Deputy Tully, or his predecessor, the Minister for Defence, Deputy Molloy.

There are very definitive criteria and they are applied uniformly without fear or favour right across the board. I mentioned that in my original contribution and I said also that the Coalition Government consistently refused to give reasons. At least I am now making two important changes. I am providing the right of appeal against a refusal, and I intend to disclose the full basis of CRV calculations on a confidential basis to a person nominated by the CIF. When this Bill becomes law, I will be prepared to discuss with the CIF how we can improve the administrative side of getting out the CRVs.

As I said, in May the average time was 14 days. Only one in 20 went over 28 days, which is a very small percentage. I gave reasons why some went over 28 days: inadequate information and having to seek further information. If we were to write out to all the applicants this would add to the delays. During the postal strike we were able to contact the applicants by telephone. This cut down the delays which would have been involved. No major delay is involved. The average in May was 14 days. Last year it was 21 days. That is an improvement. One in 20 go over 28 days. The average is a fairly true guide there.

Deputy Quinn warned me that if I do not accept these two amendments the building industry will be in chaos in a short time. I should like Deputy Quinn to explain why it has not been in a state of chaos since 1973 when the same two factors existed with regard to time. The amount of time taken to process applications has improved drastically. Disclosures were not made over that period, but the industry did not fall into a state of chaos. I have made two improvements. I am providing the right of appeal in a later amendment and I am disclosing on a confidential basis to a person nominated by the CIF the manner in which the calculations are made. I cannot accept these two amendments.

Mr. T.J. Fitzpatrick

(Cavan-Monaghan): To use a cliché, the Minister's attitude on this amendment represents bureaucracy gone mad, bureaucracy having taken control of everything and thinking they are infallible. The Minister asked Deputy Quinn why chaos did not prevail since 1973. At the height of the certificates of reasonable value, not more than 50 per cent of houses were affected by them. For the past few months only about 30 per cent of the houses built were affected by CRVs. The manner in which the CRV system has been operated has driven builders out of the more modest type of house building and into more expensive house building not effected by CRVs. That is the reason why chaos did not rule supreme up to the present. As far as one can judge, the Minister now wants to take practically 100 per cent of the houses being built into the CRV net. I am not objecting to that if it has the effect of reducing the price of houses and does not result in fewer houses being built. I am aware that it is the Minister's policy to cut back on the number of houses being built in the private sector.

It is essential, from the point of view of house purchasers and builders, that the system proposed by the Minister works smoothly and is acceptable to all concerned. If it does not work we will have chaos with the interests of house purchasers and builders not being served. How can such a system work smoothly if a person is obliged to apply for a certificate of reasonable value but does not have a right to expect a decision on that application until such time as the machinery available to the Minister is ready to process that application. If there are complaints with only 30 per cent of new houses being subject to certificates of reasonable value how many more delays will there be when three times as many houses will be subject to CRVs? How can the Minister expect that system to work smoothly when an applicant must wait until the Minister thinks fit to grant his application. It must be remembered that the Minister has the necessary staff or machinery to move speedily in this regard.

How can that system work smoothly if, when an application is refused, that applicant is not given any reason for that refusal but is simply told that the house does not represent reasonable value? The only reason the Minister can give for not giving any reasons is that to do so he would have to have more information from applicants. In my view that means that applicants are not being properly processed and that the Minister is simply coming to a decision without adequate information. The Minister told us that he is providing an appeal procedure but we all know that an appeal to the Circuit Court may not be held for some years by which time the whole ball game may have changed. That is a laugh; it is meaningless. Our amendment is reasonable. There is a precedent for imposing a time limit in the Act which deals with planning and development. Under that Act a decision must be given within two months. It provides that the Minister may seek further information and that the time only runs from the submission of a proper application. When an application under that Act is refused reasons are given. That Act also provides that if a decision is not given within the stipulated time the application shall be deemed to be granted. That has worked reasonably well to date.

The Minister is adopting a new procedure to control housing prices. We are in favour of that because prices have gone stark mad but the Minister will not benefit the purchaser by introducing a system that is doomed to failure before it is introduced. He is aggravating that problem. He will not encourage builders to stay in that business if he is going to make it impossible for them to carry on. The Minister has given a typical Ministerial reply: "leave it to me and everything will be all right." There is no doubt that within 12 months of the passing of this Bill there will be chaos in the building industry and only the very wealthy will be able to build houses without loans.

Mr. F. O'Brien

There is a precedent for this in the Acts dealing with planning and development in that a decision must be reached within two months. Prior to that when an appeal was referred back to the Department it could have rested there for six months or a year. It is obvious that the reason for not accepting this amendment is that the Department will not accept any constraints that might be imposed on them. It is time for the Department to get their house in order and start making decisions and considering people who have invested large sums of money in houses and are awaiting certificates of reasonable value. It seems that the only reason that this amendment will not be accepted is because the Department will not accept any arbitrary constraints put on them to make a decision. That is a sad reflection on the Department.

The Minister tried to justify it by giving averages, but he was not at all convincing and he will not convince the building industry. The Minister will not accept a reasonable amendment. This amendment would impose a certain discipline on the Department in relation to decision-making so that their laissez faire attitude towards decision making would be changed. It does not matter to the officials of the Department; they do not have overdrafts on which they have to pay substantial interest. This amendment would ensure that decisions are made quickly in the best interests of house purchasers and house builders. I would urge the Minister to reconsider his opposition to this amendment, because if it is accepted CRV's will work in an orderly and fair fashion.

Mr. Barrett

In relation to what Deputy O'Brien said about my Department not wanting limitations, I would remind the Deputy that the National Coalition Government introduced the 1976 Planning Act which set up An Bord Pleanála which acts independently of my Department and they did not impose any kind of limit on that board. My Department have nothing against time limits where they are necessary and valid.

Mr. F. O'Brien

Time limits are necessary.

Mr. Quinn

Lest we get our lines crossed, as far as I am concerned the person exclusively responsible for this legislation is the Minister. What Departments wish to do or not to do is their affair.

An Leas-Cheann Comhairle

The Chair would like to take up that point. To refer to officials or members of staffs or anybody else is not in order. The Minister is fully responsible for the legislation before the House.

Mr. Quinn

The Minister is probably familiar with a memorandum from a building organisation, Lyons Industrial Estates, which was circulated on 9 July last to the Minister for the Environment, Deputy T.J. Fitzpatrick the Fine Gael spokesman and to me. In relation to the administration of the CRV's and in direct reference to the amendment put forward by Fine Gael I would like to put on the record what this organisation had to say in relation to the whole matter.

Having read the Official Report of the Dáil debate on the Second Stage of the proposed Bill we would respectfully suggest that at Committee Stage the following matters be considered and provided for by way of amendment:

(a) The Minister should be obliged in notifying a builder of a refusal of a CRV to state the reasons for his refusal.

(b) A builder who has been refused a CRV by the Minister should have a right of appeal against the Minister's decision and a proper forum should be established to which the builder could appeal.

(c) We suggest that the National Prices Commission is the most suitable organisation to deal with appeals. The Minister's suggestion of a right of appeal to a court seems to be impractical.

(d) Time limits should be imposed on all aspects of decision making relating to CRV including the Minister's decision and any subsequent appeals.

We hope that these suggestions made in a constructive manner meet with the approval of the legislators.

Presumably the Minister got a copy of that memorandum, as did Fine Gael. The matter of CRVs has been going on for a long time. They are an instrument of a policy which is not questioned. I would have thought that the Fine Gael amendment which takes up the points made in the submission I have just read out, and my argument would have been sufficient to persuade the Minister to consider how he might deal with this on Report Stage. I am not looking for a great dramatic political victory, I am simply forced on to the conclusion that whatever the Minister may say in relation to the administration of the CRVs the facts are, from the representations we are getting as legislators, that all is not well. The building industry is not in the business of making gratuitous representations and it is not in the business of getting worked up about these things or in the business of contacting the Labour Party to intervene on its behalf with Fianna Fáil to make the system of CRV administration work that much better. I regret that for whatever reasons the Minister is unable to accept the amendments.

The Minister indicated that he has moved somewhat on the suggestion that the eminent quantity surveyor would make a report available to the CIF outlining the structure of costings and the items of costings that are taken into account when a CRV is made. These renewed discussions and meetings with the CIF in some shape or form are an indication of the capacity for the Minister to sit down and talk on this question of CRVs. There is a solution to this problem, but it is a matter of negotiating. This should not be frozen because of entrenched positions taken up by either sides. I readily accept that on the builders' side a lot of people who do not want the CRV at all have taken up entrenched positions and refuse to deal in any shape or form with CRVs. I accept the criticism the Minister has made in relation to builders who did all sorts of tricks to circumvent the principle of the CRV. If we do not get the administration of this system right the housing market will be distorted. We already saw the first evidence of that distortion by the removal from the modest house building sector of builders who were building modestly priced houses in the private sector. As Labour Party spokesman for housing and environmental matters generally, I know that a consequence of that has been that people cannot buy modestly priced houses in the private sector and they are driven on to the local authority housing lists, which are getting longer by the day. The Dublin Corporation list is approximately 9,000 as against 6,000 a year ago. The overall consequence of that is that people are finding it more difficult to obtain housing, and that is my concern.

Amendment put.

The Committee divided: Tá, 33; Níl, 61.

Tá

Barry, Peter.
Barry, Richard.
Begley, Michael.
Belton, Luke.
Bermingham, Joseph.
Boland, John.
Bruton, John.
Burke, Joan.
Gilhawley, Eugene.
Harte, Patrick D.
Hegarty, Paddy.
Keating, Michael.
Kenny, Enda.
Lipper, Mick.
McMahon, Larry.
Mannion, John M.
Mitchell, Jim.
Byrne, Hugh.
Cluskey, Frank.
Conlan, John F.
Crotty, Kieran.
D'Arcy, Michael J.
Deasy, Martin A.
Desmond, Barry.
Fitzpatrick, Tom, (Cavan-Monaghan).
O'Brien, Fergus.
O'Brien, William.
O'Toole, Paddy.
Quinn, Ruairi
Ryan, John J.
Taylor, Frank.
Timmins, Godfrey.
Tully, James.

Níl

Ahern, Bertie.
Ahern, Kit.
Allen, Lorcan.
Andrews, David.
Andrews, Niall.
Aylward, Liam.
Barrett, Sylvester.
Brady, Vincent
Briscoe, Ben.
Browne, Seán.
Callanan, John.
Calleary, Seán.
Cogan, Barry.
Colley, George.
Collins, Gerard.
Conaghan, Hugh.
Connolly, Gerard.
Daly, Brendan.
Doherty, Seán.
Fahey, Jackie.
Farrell, Joe.
Faulkner, Pádraig.
Fitzpatrick, Tom, (Dublin South-Central).
Fitzsimons, James N.
Fox, Christopher J.
Gallagher, Dennis.
Herbert, Michael.
Hussey, Thomas.
Keegan, Seán.
Kenneally, William.
Killeen, Tim.
Killilea, Mark.
Lawlor, Liam.
Lemass, Eileen.
Lenihan, Brian.
Leonard, Jimmy.
Leonard, Tom.
Leyden, Terry.
Loughnane, William.
Lynch, Jack.
McCreevy, Charlie.
McEllistrim, Thomas.
MacSharry, Ray.
Moore, Seán.
Morley, P.J.
Murphy, Ciarán P.
Nolan, Tom.
Noonan, Michael.
O'Connor, Timothy C.
O'Donoghue, Martin.
O'Hanlon, Rory.
O'Leary, John.
Power, Paddy.
Reynolds, Albert.
Smith, Michael.
Tunney, Jim.
Walsh, Joe.
Walsh, Seán.
Wilson, John P.
Woods, Michael J.
Wyse, Pearse.

Tellers: Tá, Deputies W. O'Brien and B. Desmond; Nil, Deputies Woods and Briscoe.

Question declared lost.

Amendment declared negatived.

Mr. Barrett

I move amendment No. 22:

It was introduced by the last Government in 1976.

Mr. Quinn

I appreciate that, but to introduce it by way of an amendment could be misinterpreted.

Amendment agreed to.

Mr. Barrett

I move amendment No. 23:

In page 13, lines 37 to 54, to delete subsection (2) and to substitute the following subsection:

"(2) (a) Regulations for the purposes of this subsection may specify the loans to which this subsection applies, and the specification may relate to all loans or to loans that do not exceed a specified amount or to loans that are not less than a specified amount or to loans that do not exceed a specified amount and are not less than another specified amount.

(b) If and whenever regulations for the purposes of this subsection specifying the loans to which this subsection applies are in force, a loan so specified shall not be made by an assurance company, a bank, a building society, or other industrial or commercial organisation or a housing authority (hereinafter referred to as ‘the lender') in respect of a new house unless the person who made the application for the loan furnishes to the lender either a certificate in respect of the sale of the house, or a certificate of exemption in respect of the house, and the provisions of any regulations for the purposes of this subsection are complied with.

The main purpose of this technical amendment is to enable such regulations as may be made by the Minister to be applied to all new house loans advanced by the agencies concerned or to new house loans of an amount within whatever range the Minister considers appropriate at the time. The amendment is designed also to ensure that the expression "the lender" applies to a housing authority. The amendment also clarifies the point that the controls will operate only when regulations under subsection (2) are in force. During the course of my speech opening Second Stage I said that I would like to make it clear that I do not envisage that whatever form of house price control is implemented following the enactment of the Bill will remain unaltered indefinitely. A flexible approach must be adopted and controls adjusted in consultation with the interested bodies to take account of changing circumstances. It is conceivable that the controls could be dismantled from time to time.

Mr. T.J. Fitzpatrick

(Cavan-Monaghan): In one way I welcome the amendment because it replaces section 18 (2) (a) which I cannot understand at all. I am not too clear what the amendment means but it is certainly an improvement on that drafting. I would like the Minister to explain exactly what is involved in 2 (a). It says:

Regulations for the purposes of this subsection may specify the loans to which this subsection applies,

I understand that,

and the specification may relate to all loans

I understand that,

or to loans that do not exceed a specified amount.

That is understood,

or to loans that are not less than a specified amount or to loans that do not exceed a specified amount and are not less than another specified amount.

I am accustomed to jargon all my life and I have digested a fair amount of it in my time, but I find it difficult to understand in plain language what that means. Perhaps the Minister could tell us.

Mr. Barrett

The Minister could decide that for loans, for instance up to £5,000, it would not be necessary to get a CRV.

Mr. T.J. Fitzpatrick

(Cavan-Monaghan): Yes, I understand that.

Mr. Barrett

Or the CRV would not apply to loans, just to take a figure, of over £20,000.

Mr. T.J. Fitzpatrick

(Cavan-Monaghan): Yes, but it is a peculiar way of saying it:

Mr. T.J. Fitzpatrick

(Cavan-Monaghan): I had intended to raise that point either on this section or later. Building societies and other lending agencies are very concerned about the time of the handing over of the CRV. If it is not to be handed over until the mortgage is taken up it means that the building societies will not know until the last moment what their commitments are and what ready cash they will require to meet a given number of loans. They will not know until the applicant's solicitor comes to their solicitor to close the sale whether they can make the loan. That situation is quite unreasonable. The applicant for the loan may have sold an existing house or may have made arrangements to get married and he will not know until the last moment whether he is to get the loan. On the other hand, if he has to produce the CRV at the time of application it may be a long time before the house is built and the whole situation may have changed by the time the loan has to be collected. That matter will have to be further scrutinised on the section and it is not as clear as the Minister seems to think. Grave difficulties may be created for building societies if they are not presented with the CRV until the mortgage transaction is to be closed.

There is one school of thought which holds that the CRVs should be provided at planning stage and that planning permission should be given subject to a CRV being obtained by the developer in respect of each house on the site. I know this would probably mean an amendment of the Planning Act, but there is much merit in this suggestion because it might control the price of land as well. This is a very complicated matter which is causing concern to building societies and other institutions.

Mr. Barrett

It would be difficult to justify the argument that the CRV is more appropriate to the planning application, which might be in respect of a house which would not be built for, say, two years.

Mr. T.J. Fitzpatrick

(Cavan-Monaghan): I took the same view as the Minister when I first heard this suggestion but the provision is that the amount of the CRV would not be fixed. It would be a condition that a CRV would be obtained in respect of each house when it was built.

Mr. Barrett

That does not seem to me to be practical.

Mr. T.J. Fitzpatrick

(Cavan-Monaghan): On further consideration it would seem practical.

Mr. Barrett

With regard to the point about the production of the CRV to the lending agency, there is nothing to stop any lending agency approving a loan subject to the production of the CRV at a later stage. They approve loans all the time subject to proper title. There is ample time between approval and release of the loan to produce any documentation which would be required. Many borrowers have to obtain bridging finance while awaiting release of their loans. It would not present any difficulty to approve a loan subject to production of a CRV.

Mr. F. O'Brien

There is now a sellers market and people applying for a loan can be told that their application will not be processed because they have not a CRV. Deputy Fitzpatrick's point about getting the CRV as early as possible should be examined. It is a matter of concern to building societies and reinforces our point about the 21-day period. People may get loan approval subject to a CRV and the builder's application may be turned down.

Progress reported; Committee to sit again.

The Dáil adjourned at 8.30 p.m. until 10.30 a.m. on Thursday, 12 July 1979.

Dáil Éireann díospóireacht - Wednesday, 11 Jul 1979

Housing (Miscellaneous Provisions) Bill, 1979: Committee Stage (Resumed).

Tá.

Níl.

Dáil Éireann díospóireacht -
Wednesday, 11 Jul 1979