Dáil Éireann díospóireacht -
Wednesday, 10 Dec 1980

Vol. 325 No. 5

Local Loans Fund (Amendment) Bill, 1980: Second and Subsequent Stages (Resumed).

Question again proposed: "That the Bill be now read a Second Time."

Mr. McMahon

Before the break I had been making a plea on behalf of loan applicants in my constituency. I do not know whether the Minister realises the seriousness of the situation, but it might be no harm for me to put before him some of the figures that have been presented to us in recent days as members of the local authority. For the entire month of November the expenditure on house purchase loans in respect of both new and previously-occupied houses amounted to £127,600. This represents payment to 13 people. The corresponding figures for November 1979 were £375,550 and 52 applicants. In other words, in respect of one month alone in one local authority area there is a reduction of 39 loans compared with the corresponding month in the previous year. Is this supposed to be the progress in the housing programme that we have been hearing about since Fianna Fáil returned to office?

I do not know whether anything that has been said here today will be strong enough to impress on the Minister how bad the situation is. The housing department in Dublin County Council have approved loans to the value of £4 million and representing 386 housing applicants. These are mainly new house purchasers though a small number, perhaps 20 at the most, would represent house improvement loans. In any case, the money cannot be paid except in a few cases which we will be able to meet from the £74,000 we received last Monday from the Local Loans Fund.

An Leas-Cheann Comhairle

The Deputy is becoming involved in great detail and such detail is not relevant to the small Bill before us. It is totally in order to refer to the lack of finance for housing but the detail is not relevant. It would be relevant to an Estimate or to some other debate.

Mr. McMahon

It is very relevant to the 380 people who are awaiting loans in County Dublin and my purpose in raising the matter is to extract from the Minister the information whether there is any hope of these people being paid their loans in the near future. If there is no such hope, my attitude in respect of my representations to Dublin County Council will have to change and, instead of asking the council to speed up loan approvals. I shall have to ask them to desist from approving loans. That is the situation we are in. By approving loans we are putting the applicants in a very difficult position. On the basis of the approval, they obtained loans from their banks which must be repaid at interest rates ranging from 15 to 18 per cent. But they will not know when they will be able to pay off the bank loans because of the non-availability of the local authority loans.

The situation is difficult enough for house purchasers without having to bear this extra burden. Very often people are satisfied to pay the interest on bridging loans in order to be able to get their houses but not many are in a position of being able to service such loans indefinitely and that is the position they are being put in. The situation up to last July was that delays in the payment of the local authority loans ranged from one to three months or, in some instances, six months; but now people may have to depend on bridging finance for a year or two. The £74,000 that we received a couple of days ago from the Local Loans Fund represents just less than six-and-a-half full loans though the council have approved of loans to the extent of £4 million. The 380 people who have been approved for loans know that there is no chance of the money being paid before Christmas. Indeed, they will be lucky if it is paid before the following Christmas. I am dealing with the situation in only one local authority area.

An Leas-Cheann Comhairle

The Chair has told the Deputy that such detail is out of order on this Bill.

Mr. McMahon

I consider myself obliged to plead for those 380 people whose situation is so desperate.

An Leas-Cheann Comhairle

The Chair recognises that, but all of this detail is not relevant to the Bill.

Mr. McMahon

I am endeavouring to extract from the Minister information as to the real situation. He may not be a free agent in this. He may have been sent here to pull the wool over our eyes, as has happened to the applicants concerned. I hope that the Minister will be honest with us in relation to the real situation and that he will tell us what the position is likely to be during the next six to 12 months. These people are entitled to know that. Last week we were talking about consumer protection and this is one area where the Government can give the consumer some protection by telling him the facts. It is extremely important that these people should know how long they will be on bridging loans. I had a case recently where a person sold his house and bought another one, but because he could not get approval from the local authority — they had stopped approving loans, and rightly so——

An Leas-Cheann Comhairle

The Deputy should leave it there. He has made his case.

Mr. McMahon

I am sure the Minister is anxious to hear about this case.

An Leas-Cheann Comhairle

I refuse to allow Deputies to raise individual cases.

Mr. McMahon

That person is out of his house because he signed a contract when selling his house and was unable to get into the new house.

Mr. Donnellan

The Minister would like to hear these cases.

An Leas-Cheann Comhairle

The Chair is in control of this House not the Minister, and the Chair will allow what is relevant to the debate.

Mr. McMahon

I did not give that as an individual case but as an example of the kind of case I am getting, and, I am sure the Minister is getting too. We would be failing in our responsibility to these people if we did not air this type of case here.

I do not know if the policy with regard to releasing money from the Local Loans Fund has changed, but in the past the local authority of which I am a member received a substantial sum — this year it was £2.1 million — every six months. In that way they knew where they were going. What is happening today? We got a monthly payment but from what we got last Monday — £74,000 — I hope it was a weekly payment. Are we getting to the stage where local authorities will be paid day by day? That is how it appears to me. A local authority with approval for £4 million are getting £74,000 — an insult. That is the only way I can describe it. It means we can give relief to six or seven people on a list of 386.

I ask the Minister to look at how these payments are being made and to tell local authorities what they are getting. Even if he does not have the money to pay them now, he could tell them how much they will be getting every month or every six months. It is very worrying for county managers and principal officers of housing departments to approve loans while not knowing when they can be honoured. These people do not get any pleasure seeing housing applicants getting into difficulties, knowing they have loan approval and cannot get into their homes.

I want to refer to the payment from the Local Loans Fund to local authorities for the resettlement of the itinerant population. The local authorities should be told the amount of money being made available for this purpose. I have no complaints about payments to Dublin County Council. I do not know of any hold-up in that area but I know that there are other local authorities who do not know where they stand and this is affecting the settlement of itinerants. We in the Dublin area have gone some considerable distance to find out what the problem is. As of two weeks ago, we know there are 310 itinerant famiilies in the greater Dublin area and we have planned for their resettlement. I am sure the Minister will give the money when requested, because he has not yet refused us.

He should ask the Minister for the Environment to encourage local authorities to apply for money for the scheme to settle itinerants. He should then make the money available, or say it will be available when it is needed. Some local authorities are holding back because they cannot afford to go ahead with the schemes in case the finance is not available. This is affecting very important work which many local authorities have embarked on and it will certainly affect the resettlement of itinerants in the Dublin area.

This is a problem that should be tackled on a national basis. We have come a fair way up the road and many local authorities are interested in settling the travelling people. What is holding them back is the fact that one local authority knows it will be financed by the Local Loans Fund, while their neighbours do not know if the money will be available and they are not prepared to go ahead with the scheme. In other words, if we in the Dublin area go ahead with the resettlement of the itinerant population and our neighbours Meath, Wicklow, Kildare, do not go ahead with their plans, there will be an influx of itinerants from those areas into the Dublin area.

I appeal to the Minister to tell the local authorities that money will be available for the resettlement of local itinerants. When this happens we will make greater progress than at present.

Mr. Donnellan

I welcome this Bill. This figure looks better than it is. We are making many millions of pounds extra available but the problem is that local authorities find it very hard to get their hands on this money. The Government control the flow of money from the Local Loans Funds to local authorities. We must accept that even if ten times as much money was made available the local authorities could not touch it because it is controlled by the Government. I could make a similar speech to that of Deputy McMahon because the problems that exist in Dublin also exist in Galway — there is a lack of finance for housing, sewerage, and so on.

If Galway applies for money from the Local Loans Fund, will the situation be the same as it has been so far, that is, that it is being considered by one Department or another? This consideration takes a long time; the Department bide their time and hold up this necessary work. I will have to give a number of cases to point out the problems I am talking about.

An Leas-Cheann Comhairle

I hope the Deputy is not starting to cite individual cases because I have already ruled all of those out of order.

Mr. Donnellan

Indeed, I am not. Deputy McMahon spoke about some 350 people involved in loan applications to Dublin County Council.

May I say, a Leas-Cheann Comhairle, that last week, when speaking as Opposition spokesman on public works and buildings, when I attempted to reply to the speech made by the Minister of State at the Department of Finance, Deputy McEllistrim, you tried to stop me at every point? When other speakers followed me later you allowed them to ramble on and talk on lines on which you had already prevented me.

An Leas-Cheann Comhairle

Please, the Deputy should not launch an attack on the Chair.

Mr. Donnellan

I am not launching an attack. What is sauce for the goose is sauce for the gander.

An Leas-Cheann Comhairle

The Chair is endeavouring to keep the debate relevant to the Bill before the House and nothing else.

Mr. Donnellan

May I say I fully sympathise with the difficult task of the Chair. But there should not be different criteria for different Deputies. That is the point I am making.

An Leas-Cheann Comhairle

There are not. As far as the Chair is concerned, I do my best to keep every Deputy relevant to the matter before the House. Sometimes the Chair finds that almost impossible. Nobody understands that better than Deputy Donnellan.

Mr. Donnellan

Indeed, I know how difficult is your task.

An Leas-Cheann Comhairle

Would the Deputy now go ahead with his statement?

Mr. Donnellan

Indeed, if the Chair had allowed me, without interruption, I would probably be finished by now anyway. There would be no argument, not that we are having any argument; we are just having a friendly chat about it. However, I maintain that what applies to one Deputy should apply to another.

An Leas-Cheann Comhairle

The Chair feels the same.

Mr. Donnellan

In Athenry there are 30 local authority houses being allocated this week. Athenry is a small, rural town. There are 150 applicants for those houses. We have a programme for local authority housing in Galway but we cannot get it off the ground. I think I am entitled to speak about this because I see that local authority housing is included in the Minister's introductory remarks.

An Leas-Cheann Comhairle

I have been endeavouring to stop every Deputy from dealing with specific or individual cases, and those are individual cases.

Mr. Donnellan

At the same time, because I have practical experience at local level, I may be permitted to sidetrack somewhat and it would be only natural that I would do so.

An Leas-Cheann Comhairle

The Deputy will do that anyway.

Mr. Donnellan

Therefore we are in the unusual situation of having 150 applicants for 30 houses. We have a building programme in Galway which would solve the local authority housing crisis if only we were allowed borrow to the degree we wish from the Local Loans Fund. We are not allowed to do so. This programme has been held up by one Department or another on one technicality or another. That is why I have wanted to contribute to this debate. The Local Loans Fund is there for a purpose. Indeed, twice as much could be made available and it would not make one whit of difference because this fund is totally controlled by the Government. It is the Government who control the flow of money. Why not make the money available which would solve the problem at least in relation to local authority housing? Something of the order of £1.8 million was allocated to Galway County Council for SDA loans. At this stage they have run short of money. I welcome the fact that the ceiling of this fund has been increased and as a result of that, I hope the SDA loan applications in County Galway already sanctioned will be met and that their loans will be paid forthwith. Am I right in that assumption?

Because the average cost to those who want to build their own homes has increased to such an extent in the past few years were it not for the increased loan they could forget about it altogether. Practically all applications coming into Galway County Council now are in the region of £12,000, and £1.8 million does not go very far in that direction, as the Minister will well appreciate. At the rate at which the Government are at present feeding out this money to us we have sufficient applications on hand in Galway County Council for the next two to two and a half years, that is, assuming the £12,000 ceiling obtains. Naturally people feel that ceiling should be raised. If it should be increased further that would mean that whatever allocation we might be given in the future will not go as far as heretofore.

I welcome the fact that this fund has been increased from £1,500 million to £2,500 million. In this respect I assume that application to the relevant authority by Galway County Council in regard to SDA loans, and possibly local authority housing also, will be favourably received so that we can get our plans into operation and solve our problems. Let us hope that the necessary money will be forthcoming from the appropriate Department.

Over the 16 years I have been a Member of this House I have talked at length about rural water supplies, which I see mentioned in the Minister's remarks also. I want to bring to the attention of the House and the Minister that, as bad as the problem may be in relation to local authority housing and SDA loans in County Galway the problem in relation to sanitary services is possibly worse. Rarely, if ever, in regard to sewerage schemes do we get a response from the Department. It is not that we have been negligent in our duty in preparing schemes, having them investigated and so on. Here again I want to refer to the total sum of £2,500 million. If only the necessary moneys would be released we could go someway towards solving our problems in regard to sewerage schemes. This problem obtains in many small towns and villages in County Galway. The same applies to water schemes. I talked about this problem recently. We have a particular problem in relation to Galway city, Galway city west and its environs. Parliamentary questions, expressions of opinion by me and indeed the local authority are getting us nowhere in that direction. I understand very well what is happening. The Department of the Environment are holding it up and we cannot get the money. The same applies to a water scheme in the Gort area. There is a bit of a local problem, but that suits the Department because if the scheme were ready the money would not be available.

In this document money is provided for vocational schools. We in Galway are no different from people anywhere else. Recently we had a problem and the vocational education committee had to make a decision and pick two of our four schools which needed attention urgently. They are in Ballinasloe, Tuam, Portumna and Gort.

An Leas-Cheann Comhairle

The Deputy is going into individual cases again. I prevented other Deputies from doing that as far as it was possible.

Mr. Donnellan

I appreciate the very difficult task the Chair has. Far be it from me to try to prevent him from doing it. It is my object to help the Chair in any way I can.

An Leas-Cheann Comhairle

I could do without that sort of help. We must get away from individual cases.

Mr. Donnellan

The allocation for vocational education in County Galway is not what is required. I mentioned the four venues in which the need to provide additional educational facilities has been established. To establish it is one thing, and to get the money is another. With this additional money in the Local Loans Fund, I presume that, on application to the proper authority, the two schools rejected by the VEC in County Galway can look forward with a certain amount of confidence to the money being forthcoming. Perhaps by way of promise their problem may be solved, but when they make the application the case will be somewhat different.

The Minister referred to harbour works and fire stations. I presume that is an indication that money is available for the development of harbours and the provision of fire stations. At the moment we have a particular problem in Galway in relation to a harbour and the protection of that harbour from fire. A recommendation was sent to the Department that a sum of approximately £140,000 should be made available for the provision of fire protection facilities in the event of an accident at Galway docks. The response we got from the Department was not the type of response for which I would look.

An Leas-Cheann Comhairle

I hope we have reached the end of the Galway cases.

Mr. Donnellan

Almost.

An Leas-Cheann Comhairle

The Chair will not allow any more individual cases to be raised. The Chair is far too lenient in these matters.

Mr. Donnellan

I accept that the Chair is lenient, but he is being no more lenient with me than he is with any other Deputy.

An Leas-Cheann Comhairle

I tried my best all day to keep Deputies on the Bill before the House and I found it almost impossible.

Mr. Donnellan

The Chair has an almost impossible task.

An Leas-Cheann Comhairle

Deputy Donnellan has mentioned more than his share of individual cases.

Mr. Donnellan

I appreciate that the Chair has an almost impossible task.

An Leas-Cheann Comhairle

That does not help the Chair.

Mr. Donnellan

As I have said, it is my intention to be of assistance to the Chair.

An Leas-Cheann Comhairle

The Chair could do without it. Deputy Donnellan on the Bill before the House.

Mr. Donnellan

I do not want to deal with any more parochial problems. I hope the Minister will take note of what Deputies have said. I hope he will ensure that the problems I mentioned in regard to local authority housing, SDA loans, water and sewerage schemes, VEC schools and Galway harbour will be looked after. Will the money be made available immediately it is applied for and, if not, how do the Government intend to release it?

Minister of State at the Department of Finance (Mr. McEllistrim)

I should like to thank Deputies for their contributions. Deputies used this debate as if it were an adjournment debate or did they think it was a debate on the Estimate for the Department of the Environment? Definitely they went outside the scope of the Bill.

Mr. Donnellan

Stupid as we are, we did not think it was a debate on an Estimate.

Mr. McEllistrim

Many of the matters raised could be raised more appropriately as Dáil questions or on the Estimate for the Department of the Environment, the Department of Education or the Department of Social Welfare.

Mr. Donnellan

It is hard to get satisfactory answers to Dáil questions.

Mr. McEllistrim

The Leas-Cheann Comhairle emphasised that this is a very limited Bill. It is merely an enabling measure to raise the statutory limit on issues from the fund which provides the mechanism for channelling funds to local authorities. It has no implication for the amount of funds to be allocated for the various schemes financed from the fund. Those are matters for Government decision.

As Deputies will be aware, the Bill provides for an increase of £1 billion. This, as Deputy Tully pointed out, would be sufficient for five years at the present rate of issue. However, since it is likely that the rate of issues will continue to increase, it will almost certainly be necessary to raise the limit again in less than five years. This does not present any difficulty and Deputies need have no fear that the limit applicable to the fund, has, or will have, implications for programmes financed from the fund.

As to the statement that I misled the House in the reference in my Second Reading speech to the increased provision for housing, I should like to strongly refute that allegation. I said, as Deputies will recall, that the increase in issues from the fund in recent years reflects an increased provision for local authority housing, including the house purchase loans. Issues from the Local Loans Fund for housing in fact increased by 22 per cent in 1979 over 1978, when the limit was last raised, and by a further 30 per cent in 1980. The amount for house purchase loans actually increased by 123 per cent in 1979 and 50 per cent in 1980.

Mr. Donnellan

In what way was the Minister misrepresented?

Mr. McEllistrim

Despite the limited nature of the Bill I should like, in view of the interest shown by Deputies, to refer to some general aspects of housing. As regards house completions I should like to point out that Deputy Fitzpatrick was selective in his statistics. The fact is that the National Coalition could not afford to continue to build 8,800 local authority houses as they did in 1975. Under their stewardship completions dropped to 6,300 in 1977. Since then the programme has been maintained at a steady level of 6,000 to 6,200 per year. About 6,000 houses will be built this year. Those who level the criticism at us that we are not continuing to build that number of houses annually should bear that statement in mind.

Mr. Donnellan

Irrespective of the number the Government are building, there is terrible dissatisfaction with the Government's housing policy.

Mr. McEllistrim

It is not any worse than the dissatisfaction that was felt when the National Coalition were in power.

An Leas-Cheann Comhairle

The Minister of State did not interrupt the Deputy during his contribution and Deputy Donnellan should allow him to conclude without interruption.

Mr. Donnellan

We cannot have the Minister of State making false statements.

Mr. McEllistrim

Private housing completions dropped from 19,500 in 1974 to 16,700 in 1976 during the National Coalition's term of office. Last year there was a record 20,300 completions. Private and local authority housing completions in 1980 are likely to reach an even higher level.

Mr. Donnellan

They must be all in County Kerry.

Mr. McEllistrim

The number of new house loans approved so far in 1980 does not support the Deputy's view that housing starts and completions will collapse next year. Regarding housing capital, the allocation for housing in 1980 at £202.53 million represents an increase of 20 per cent on the expenditure of £169.04 million in 1979. In addition, in real terms the allocation shows an increase of 31 per cent on 1977. In contrast, capital expenditure decreased by 57 per cent in real terms between 1975 and 1977.

Deputy Tully referred to SDA loans and I should like to point out to him that when he was Minister the SDA loans and the income limits remained unchanged between September 1973 and June 1977 despite the fact that house prices and earnings more than doubled during that period.

Mr. Donnellan

Criticism of a previous administration is no substitute for lack of performance by the Minister's Government.

Mr. McEllistrim

I should like to draw attention to the fact that when we got into power we introduced the £1,000 new house grant and increased the SDA loan and income limits to qualify for them.

Mr. Donnellan

Even if the loan is increased by twice the amount it is not much good if the money is not available for borrowers.

Mr. McEllistrim

Expenditure on SDA loans will reach about £65 million this year compared with £17 million in 1977.

Mr. Donnellan

That is inflation.

An Leas-Cheann Comhairle

The Deputy has made his speech and he should stay quiet for a few moments so that the Minister can conclude his contribution.

Mr. McEllistrim

I should like to tell the House that 4,800 loans were advanced in 1977 and that this year more than 7,000 loans will be paid. Deputies may wish to note that the trends in house prices since 1973 indicate that there is a close correspondence between the increases in house prices and the average earnings of adult male workers, taking into account the general improvement in standards of privately built houses. In addition, Deputies are aware that the introduction of the £1,000 new house grant and the building society subsidy this year were of considerable help to house purchasers.

As far as the building industry generally is concerned, the recent decision to provide additional capital for the 1980 Public Capital Programme is an indication of the Government's commitment in this regard. Of the £97 million provided, £66 million will be related to expenditure affecting the building industry. The Government are committed to the objective of the maintenance of the December 1979 level of employment up to the end of 1981. In contrast the building industry was allowed to collapse between 1974 and 1976. Public capital expenditure affecting the industry declined by 4.5 per cent in 1974.

Mr. Donnellan

The Minister is being given a free run by the Chair.

Mr. McEllistrim

That expenditure in 1975 declined by a further 7 per cent and a further 6 per cent in 1976. Direct employment also dropped by 9,000 between April 1974 and April 1976.

Mr. Begley

And there are 120,000 people unemployed at present.

An Leas-Cheann Comhairle

Deputy Donnellan should not continue to interrupt. As far as the Chair is concerned the Minister is replying to all the points made during the debate. Most of them were irrelevant and the Minister is as irrelevant as any of the Members who raised the points, but he is entitled to reply to any matters raised.

Mr. McEllistrim

Many of the matters raised were not relevant to the Bill and should have been referred to the Departments of the Environment. Social Welfare and Education. Such matters may be raised when the House considers the Estimates for those Departments or by way of parliamentary question.

Question put and agreed to.

Agreed to take remaining stages today.

Bill put through Committee, reported without amendment, and passed.

An Leas-Cheann Comhairle

This Bill is certified a Money Bill in accordance with Article 22 of the Constitution.