Dáil Éireann díospóireacht -
Tuesday, 3 Dec 1991

Vol. 413 No. 9

Written Answers. - Tenant Purchase Scheme.

Jim Mitchell

Ceist:

213 Mr. J. Mitchell asked the Minister for the Environment if, in relation to the 1990 report of the Comptroller and Auditor General, he will outline whether his Department have been in a position to supply to the Comptroller and Auditor General the information he requested in relation to savings on management and maintenance costs arising from the tenant purchase sales scheme, as referred to in the third paragraph of page 45 of the report; and if he will outline the information supplied to the Comptroller and Auditor General.

Minister for the Environment (Dr. O'Hanlon)

In accordance with established practice, the request in this case was made to the accounting officer of the Environment Vote. The following is the information supplied to the Comptroller and Auditor General by the accounting officer on 23 October last.

Returns from local authorities indicate that the expenditure on maintenance and management of local authority dwellings was £66.2 million in 1987, £65.6 million in 1988, £63.7 million in 1989 and £66.5 million in 1990. While there is a small real reduction in the figures, a more substantial reduction did not arise because (i) most of the dwellings sold were those built in more recent years on which little maintenance arose, and (ii) most of the dwellings are being purchased by the annuity method which still involves management costs as the collection of annuities is in many cases on the same basis as rent collection.

However, as 60 per cent of the proceeds of the sales must be used for capital purposes, it has been possible to use £30 million of the receipts from the 1988 scheme up to end 1990 for the construction of new local authority dwellings in 1990, thus saving the Exchequer £30 million. Annuities will continue for many years and the annual saving from the 1988 scheme to the Exchequer is about £17 million.

As regards the Environment Vote, no savings would arise as there was and is no direct provision for the maintenance and management of local authority dwellings for which responsibility rests entirely with local authorities. The rate support grant in the Vote is a general discretionary grant to local authorities and its division over the eight local authority expenditure programme groups is a matter for each authority.

Tenant purchase of dwellings in estates built by local authorities is an important factor in improving social stability and responsibility in these areas from which, in the long term, substantial beneficial effects will accrue in terms of reduced public expenditure in other areas.

Returns from local authorities indicate that the sale of 27,200 dwellings was completed by 31 December 1990 under the 1988 tenant purchase scheme and the proceeds of the sales up to that date amounted to £53.85 million. Information on sales/receipts during 1991 will not be available until 1992.