Private Members' Business. - Housing Policy: Motion.

I move:

That Dáil Éireann resolves that the Government immediately reverse its housing policies which have proved totally counter productive and that it urgently moves to restore confidence in a housing market where under-provision is causing widespread misery and notes the growing crisis in housing provision, the growing number of homeless people, the £100,000,000 plus annual bill for rent subsidies, the failure of the ‘affordable housing' programme, the inability of employed young couples to purchase their own home, the loss of confidence in the housing sector by buyers, builders and lenders, the total inability of local authorities to deliver housing in sufficient numbers, the collapse of provision in the rental market and the consequent dramatic increases in rents and the catastrophic reduction in private housing building.

I wish to share my time with Deputies Farrelly, Durkan, Neville and McCormack.

Prior to 11 September we had a vibrant economy full of confidence for the future. Output was growing very strongly, investment was high, the population was expanding and demand and spending was growing. In every sector people were working longer and harder and investing more and more each year in an effort to meet the ever growing demand for goods and services from a wealthier and growing population.

This was true in virtually every sector of the economy with one exception, the housing sector. Housing bucked the trend and has been bucking the trend for almost three years. In this sector the slow down in investment long preceded 11 September and the Government cannot blame bin Laden or any outside influences for the crisis we now face. Because of the time lag in house production we will continue to face this crisis for some time to come. This is a Government-induced crisis, the result of policy initiatives each and every one of which has had an outcome precisely the reverse of which was required. When taken together, all these perverse incentives have produced massive uncertainty in the market and have stripped all confidence from buyers, builders and lenders, all of whom are leaving the market in droves. It took some level of incompetence from the Government to produce this turn around in such a short few years.

Even when confidence was high in the economy generally Government housing policy was counter-productive and inappropriate. Now that the economic climate is entirely changed these policies are catastrophic and must be reversed. Instead of being counter-cyclical in order to stimulate demand and supply they are reinforcing the downward trend in housing activity and, consequently, the downward trend in the economy generally. The evidence of this is all around us every day and everywhere, in every city, town and village and it is very difficult to understand how the Government can be so insulated from reality and so isolated from events which are evident for everyone else to see. Even if it is so entrenched in its ivory tower that it does not see it for itself, surely it has economic advisers and consultants to quantify the disastrous impacts. Surely it has enough friends in the building industry to whisper in its ear the reality of what is happening on the ground.

This is a Government-induced crisis and only a complete reversal of policy can help mitigate its effects. It is only mitigation we can now hope for. Because of the time lag in house production, the time between applying for planning permission and making a decision to invest and bringing a house to market, any change in policy now will not produce results for another three to four years in terms of output, just as we are beginning to see the real impact of Government decisions taken as far back as 1998, even though the signs have been there for anyone who wished to see them. There is no point in the Minister telling us about the high output last year. This had nothing to do with the Government, it was as a result of investment decisions made up to four years prior to last year. The Minister told us how high output would be this year. It is now anticipated that it will not even reach 40,000, which was a huge drop.

Planning applications are down 9% this year to September. Registration of housing starts is down 21% and that is just until September. Heaven knows what the drop will be by the end of the year. Those who have land are not applying for permission to build, those who have permission are not building, those who are building have slowed down the rate of output, sites are being closed down, jobs are being shed and some builders have gone into liquidation in recent months. All of this is happening against a background where it is stated Government policy to meet housing demand by increasing output to 50,000 units a year and where it exhorted the industry to gear up and engage specialists and skills to sustain that output over the next ten years. Those builders who did so and bought land at highly inflated prices, including local authorities, must now be feeling very sore about a Government whose perverse incentives guaranteed this objective could not be achieved. When it became obvious this could not be achieved, they were too intransigent to accept the evidence and reversed the policies which caused such problems.

As far back as the first Bacon report, against a background of overnight queuing by young couples, escalating prices and gazumping the problem was identified as under supply. While this was evident to the dogs in the street and it was the clear message of the Bacon reports, the only Government response should have been to increase supply. Why then did the Government do everything possible to dampen supply and when it became evident that supply was falling why did it persist in these policies? God only knows what perverse thinking produced a rule that ensured planning permission lapsed if an entire estate was not completed to external wall stage within two years of granting permission? The impact of this was immediate and predictable. Banks immediately were unwilling to extend financing on the basis of a time constraint permission. Costs increased and smaller permissions were sought for partial site development.

Almost every builder now faces a situation whereby if he wants to finish a site he will be forced back into the vagaries of the planning system, clogging it up further, slowing down output of housing, increasing costs to buyers and leaving half finished estates for years on end. Almost every significant planning permission granted since August 1999 will fall foul of this requirement and its effect on slowing down supply will be with us for years. Even when the remainder of the economy recovers, as the Minister for Finance suggests it might by the end of next year, we will not be in a position to produce houses because the planning permissions will not exist. This is the best case scenario because in good times builders might go to the trouble, expense and uncertainty of renewing planning permissions in order to finish estates.

In the current climate why on earth would they bother? It is far easier for them to build in Lisbon or London or sit on the land indefinitely until the climate changes. It is absolutely crucial to amend section 96 to ensure the normal five year period of planning permission pertains to all existing permissions. The reason for that measure has now gone and there is no point maintaining it any further. I ask the Minister of State to listen to that request because everyone in the building industry is saying the same thing. It is stopping the building of houses.

Equally inexplicable was the decision to remove mortgage interest relief on rental properties. Interest payments on borrowings are a deductible business expense throughout the tax code. Apart from the fact that it seems strangely inequitable that one type of business should be treated more onerously than others, it defies belief that the one sector singled out for this treatment was the very one for which we most need an incentive. What on earth was the Government thinking, that it allowed this totally bizarre measure go ahead? The effect was immediate, devastating and totally predictable. All new supply of rental accommodation ceased. Rents sky-rocketed by at least an amount equivalent to the loss in interest relief. For the first time in history rents are now 25% to 30% more than a mortgage on a similar house, ensuring that no young couple could ever hope to save for a new home. Those who might have rented in the past, and even those who aspired to home ownership at some stage, are now forced to put themselves on waiting lists of local authorities who do not and will not have the potential to fill the void left by private investors.

Every public representative at every level and in every party must have heard the heartbreaking stories of human misery caused by the lack of rental accommodation. It has affected the entire market from top to bottom but its impact has been most devastating for those who are most vulnerable at the very bottom of the market. Many single older people who felt they had secure rental accommodation and a home for life are now almost starving themselves to pay increased rents. There is nothing more heartbreaking than the countless families every public representative hears about, many single-parent families, who in order to avail of the safety net of rental subsidies must take their children from school in order to relocate to areas in the city where lower rents apply. If that was not enough, they must also give up their jobs or any hope of jobs in order to qualify for the subsidy and put a roof over their heads. The rental subsidy scheme is costing the taxpayer a massive sum of well over £100 million a year. It is causing as many social problems as it is solving and utterly unnecessary to have so many people depending on it.

Any thinking Government would recognise that home ownership is not the only or even the most desirable form of accommodation. Every modern economy needs a vibrant and professionally managed rental sector to cater for a mobile labour force as well as providing for the accommodation needs of those who can never aspire to home ownership, or choose not to aspire to it. There is no sense whatsoever in ensuring the private sector will not meet the demand. The removal of interest relief has simply resulted in a switch in the flow of available investment funds into either commercial or industrial developments, both of which are now over-supplied, or into overseas investment. It is estimated that a massive £900 million has gone into property investments overseas since this measure was introduced in mid-1998. In short, this has been a disastrous measure, both socially and economically, and if the Government does nothing else in the few months left to it, it must restore interest deductibility for the provision of rental accommodation.

Stamp duty is another area of Government incompetence in which its regime has increased housing costs and added rigidity to the market, thereby discouraging both trading up and trading down, preventing optimal use of the housing stock and inhibiting labour mobility. Stamp duty is a transaction tax purely and simply aimed at raising revenue for the Government which it is not even doing efficiently any more because it is now so penal. The minimum now required is to widen the bands to reflect higher house prices and abolish the ridiculous 9% rate altogether. Stamp duties are not just high, they are extraordinarily complex. There have been no less than four changes in as many years and, even within the industry, most do not know the precise rate which applies in any given set of circumstances.

No market and no business can operate successfully and prosper in a climate of such uncertainty, where the taxes applicable are constantly changing. If the Government wants a regime which encourages housing supply and the optimal use of housing stock, it needs to give some serious thought to how it proposes to achieve this, before it jumps in with any more ludicrous schemes such as those it has given us to date. Taken together, these schemes have sapped all confidence from the industry and left a whole generation with no hope of a home of their own.

Many problems are being encountered as a result of Government measures. For instance, the new planning Act was designed to streamline and speed up planning. In reality, the process is now slower than ever, due to lack of resources and the greater responsibilities being thrown at local authorities and An Bórd Pleanála, which is now holding up the roads programme as well as the housing programme. This, again, is entirely due to Government mismanagement. The implementation of the 20% social and affordable housing schemes, which had appeared to offer so much, varies from one local authority to another. It takes endless negotiation and is hugely time consuming for local authorities, which are already taxed to the limit in trying to deliver on all aspects of the national development plan. Even when money was plentiful, they could only deliver a modest increase in social housing. What prospects are there for families, now that the money has evaporated and the future is so uncertain?

If the Government wishes to consider the housing sector in terms of helping those most in need, I suggest that first-time buyers are most deserving. Innovative ideas are needed to help those who, otherwise, have no hope of getting off the housing lists. A lower, or zero, VAT rate on new houses in the social and affordable category is one option which is quite feasible within European law and which already operates in Britain and most European countries. A once-off tax credit of £5,000 for first-time buyers is another possible approach. Those first-time buyers who do not qualify for any of the schemes are being deprived of all hope. The serviced land initiative, under which some 100,000 sites were envisaged by the end of this year, has delivered no more than half that expectation.

I wish to remind the Government, yet again, of the social consequences of its ill judged policies. The generation which apparently had it all, which was told by the Government to break open the champagne and grew up in times of unprecedented growth, now finds it cannot aspire to home ownership. Unlike their parents and grandparents, they are deprived of this most basic need. For those in a position to even consider purchasing, the only available options may involve moving up to 100 miles from their families, friends and support networks. They are crippled with high mortgages and long commuting hours and we will live with the consequences of this dispersed method of settlement for many generations. Meanwhile, these young couples have zero quality of life and their stress levels are mounting even higher as every job becomes uncertain. Nevertheless, they are the lucky ones. For those forced into an ever contracting rental market or onto ever lengthening council waiting lists, there is even less light at the end of the tunnel. This is what this generation has inherited from the so-called champagne years.

If the Government has no concern for the plight of those seeking accommodation, perhaps it would consider the economic costs of its policies. Every single one of its policy initiatives has inhibited labour mobility at a time when it was never more important. Under-supply of housing will continue to put upward pressure on wages, even in bad economic times. Housing output comprises 11% of our GNP and represented £1.5 billion in taxes to the Exchequer in the year 2000. Can we afford to forgo that? There were 70,000 directly employed in the industry last year. I suggest the Government cannot risk those jobs. However, all this is now being jeopardised as jobs are being shed in the industry and the lack of confidence generated in the housing sector is spreading throughout the economy. It is time for the Government to admit it was wrong and reverse the policies producing precisely the opposite results to what is now required.

I welcome the opportunity to contribute to this debate. I should declare an interest in relation to my business of selling houses over the last 20 years. In relation to recent comments by the Minister for Finance, I might paraphrase the words of a once popular song as follows:

Where have all the billions gone, short time passing,

Where have all the billions gone, because of the housing downturn.

To a large extent, the loss is due to the policies implemented by the Government. On present indications, when some 15,000 to 25,000 people in the construction industry get their Christmas holiday pay, they will be told there are no jobs for them after Christmas. Those on the Government side of the House should listen to somebody who is trying to provide jobs and take notice of the number of jobs being lost on a weekly and monthly basis, which will amount to a massive total by the end of the year. One of the main causes is the Government's mismanagement of the construction industry and the implementation of the three Bacon reports during the term of office of the present Minister for the Environment and Local Government. This has devastated the industry throughout the country, not just in Dublin. The decision to take the investor out of the market by not allowing interest relief on mortgages against the capital and the increased stamp duty from 6% to 9% dealt a hammer blow to Irish investors. It turned their sights towards purchasing property abroad – mainly in the United Kingdom, Spain and Portugal – which has sent colossal amounts of money out of the Irish economy.

This action by the Government was based on a report from an individual who knew as little about the building industry as he knows about the sugar industry, in which people are out of work today as a result of his proposals being taken on board by the Irish Sugar Company. For example, in Navan, rent for a three bedroom semi-detached house has gone from £450 per month to between £600 and £650 per month and the situation is much worse in Dublin. Students who came to Dublin this year could not get accommodation at less than £85 or £90 per week for one room. This year alone, it is estimated the Government will pay out £134 million in rent subsidies through the health boards, as compared to £76.5 million when it came into office. I asked if the difference had been put into the servicing of land, would the problem not be solved.

The second major decision, proposed by Mr. Bacon and implemented by the Government, was the introduction of the social and affordable housing policy. Builders had to provide 20% of the land for this purpose. In many cases where sites were expensive, it is not possible to build the houses and provide them for the amounts of money that the Department of the Environment and Local Government has informed the local authorities they can pay for them. What will happen? Building will not take place.

As a result of these two Government decisions, introduced by the Minister of State and the Minister for the Environment and Local Government, we could see housing completions drop from a high in 2000 of 46,000 to about 30,000 next year. That is a stark reality if we look at the number of sites that have closed to date and the number of houses that will not finish between April and June.

The Minister for Finance, with the Attorney General, demanded at a Cabinet meeting that stamp duty be 9%. I propose that in the budget stamp duty be reduced to 5% on properties under £150,000. I propose that the interest relief be abolished and that the first time buyers' grant be increased from £3,000 to £10,000.

On 15 July, the Meath county manager introduced an increase in development levies from £3,600 to £8,600 during a downturn in the building industry. These are for water supply, sewerage facilities, surface water and community facilities, the majority of which should come from the coffers of the State. The Government is taking over 40% of the cost of a first time buyer's house through different taxes but it has failed to provide sufficient funds to service the lands.

Along with other Meath county councillors, I asked what would happen to the social housing policy if there were a serious downturn in the economy. After a lengthy debate I was told that it would be binned. Is it the policy of the Department of the Environment and Local Government that if the social and affordable housing scheme does not work, it will be binned? If that is the case when will this be announced?

The price of sites is the real problem. When the Government reduced capital gains tax from 40% to 20% it had the opportunity to deal with this issue, without implementing the social housing policy, by telling land owners it wanted a percentage of their land at three times the agricultural rate. This would have provided all the sites required at £3,000 per site. I suggested it but the Government did not listen. Will someone today listen so that we might get the kind of major industry here that has kept the Celtic tiger running over recent years to rejuvenate the economy and bring significant income to the State?

Since the Government came into office in 1997 there has been unprecedented growth but the Minister has failed to provide sufficient funds to local authorities to service sites for development. As a result developers, who went to the local authority looking for planning permission, were asked to provide money to service the inner relief roads. The Minister for the Environment and Local Government opened three of them in Navan. Who paid for them? They were paid for by the ordinary person buying a house for the first time. The developer was asked to pay for it and passed this on to the house buyers. The Government collected 40% of the total income and never gave any of it back to service the areas where people wanted to live. The only reason people moved to these areas was that they could afford the houses there.

This Minister has left a legacy of disaster. Does he or his colleagues realise how ill advised they were in, first, employing Mr. Bacon – I hope they did not pay him – second, implementing his proposals and, third, allowing the economy go into a tailspin as a result of their policies which had no foundation or foresight? This has left a bleak future for 25,000 families as we approach Christmas.

We all want to see cheaper houses. This could have been dealt with without the legislation that was introduced, which put severe penalties on developers from the point of view of planning applications as mentioned by my colleague, Deputy Olivia Mitchell. I believe the Minister is honest enough to admit he has got it wrong and I hope that on budget day, the Minister for Finance, Deputy McCreevy, will bring forward proposals to rectify the problem and put some backbone into the economy which has been destroyed in the past two years.

One would tend to be sympathetic to the Minister in his unenviable position, presiding over the most awful housing crisis since the foundation of the State. Since he is a Minister in Cabinet, albeit he only sits on a three legged stool down at the end of the table, he must accept responsibility for what has happened since he and his Government came into office. When he came into office, there were 35,000 to 40,000 people on local authority waiting lists; there are now 80,000. When he came into office, rents were at an affordable level; they have trebled in the time he has been in office. He has now joined the unenviable list of Ministers who presides over a waiting list longer than any experienced previously. He has managed to do that at a time of unknown wealth and resources, which are unparalleled in the history of the State. How did he do it? What help did he have?

He cannot blame Jimmy Tully anyway.

I am sorry to say the public will have little sympathy. I know it may be unfair to say so and I know that the Minister is a decent man, but he has seriously neglected his job, as has his senior Minister. What has he been doing? Has he listened to the words of the people in this House who have repeatedly brought his attention to the plight of the people waiting to find a house they can afford?

In my constituency, there are about 2,700 families on the waiting list. In addition there are another 2,000 families who cannot afford a house. There is no place they can go to get a house they can afford. If they want to pay £500,000 for a house they will have no problem, but what about the majority of people who are working their way up and deserve some kind of recognition? What has happened? Absolutely nothing.

In our constituencies we almost have to counsel people who cannot get a house. We can talk it over with them, tell them how bad it is and empathise with them, but we can do nothing for them because the Government has neglected them. The Government has welshed on its responsibility and has no intention of doing anything further.

I am only a short time in this House by comparison to the Minister for State. However if I presided over what he has presided over for the last four years, I would be ashamed of myself. Consider what the public have to look forward to. They are not looking forward to a house; they are looking forward to a plan that the various local authorities will introduce. When the plan is concocted, they will be told that is the resolution of their problem. Maybe in two, three or four years they will get houses. People cannot live in a plan, at least not as far as I know. The Minister has failed to bring affordable houses within the reach of people and to provide rental accommodation. On the latter issue, in parts of the country, including my constituency, people pay £100 per week with up to ten people occupying a house. What is going on? Is the Department aware of it?

I suggest an honest and fair response to the situation. The Minister of State should ask his senior Minister what he has been doing. Why has he done nothing about this? He must accept some responsibility. He cannot walk away. We owe something to the people. The Minister and the Minister of State must get off their tails and do something about it. They have talked long enough. They have a multiplicity of plans but no action. The only thing they have accorded people on housing lists is the benefit and privilege, as in every other Department, of joining a waiting list.

The Government's housing policy has proved to be counterproductive. I draw attention to local authority housing which is causing widespread misery. People on local authority waiting lists are forced to endure serious stress and it creates difficult friction in families. Housing lists have exploded. In many cases the numbers waiting have doubled. The Government's policy forces people, who prior to this could purchase a house, to depend on local authorities for their needs. In County Limerick, 1,360 people are on the waiting list and they are deemed to be entitled to a house. As a public representative, it is frustrating to advise applicants of the situation. How can one respond to people in need of hous ing who have been on a waiting list for many years? It is unfair that such vulnerable people are being ignored.

In County Limerick, 400 families await houses. There are many pressures on families today and family breakdown levels are at their highest rate in the State's history. There is agreement across the board that the State should recognise the crisis in families and give assistance to ensure that the traditional family remains the bedrock of society. Comparing the Government's aspiration to its approach to vulnerable families makes one doubt its commitment to the family. A basic need for a family is a house. The Government has failed families who must live in overcrowded conditions, live with parents often in one room, in unacceptable conditions, rat infested rented dwellings or damp houses which are a health hazard, in mobile homes or caravans. This is a disgrace and I cannot emphasise strongly enough the misery, pressure and despair of such families.

Limerick County Council has 960 people on a waiting list for small houses, made up of single parents and senior citizens. In most, but not all cases, single parents are young vulnerable women who require every assistance to meet their situation and to assist them in rearing children. Last year there were 17,735 births outside of marriage. In 1999, there were 16,461 and in 1998 there were 15,492, an increase every year. The number of marriages per 100,000 has dropped from 704 in 1970 to 506 in 2000. The Government has a duty to introduce policies to cater for the needs of single parents. I raised this issue over ten years as I recognise, from those who call to me, that this is a vulnerable group with special needs. The Government must recognise the special housing needs and provide special funding for single parents and their children who are on the waiting list. The stress and pressure of single parents trying to survive on lone parent's allowance is exacerbated by their not having their own accommodation. Many live with their parents which causes stress for both families resulting in a breakdown in relationships. Many must live in substandard conditions. People on social welfare, even with health board support, cannot afford decent rental accommodation. They are the group most exploited by unscrupulous landlords. Not all are guilty, but too many landlords abuse the single parents' vulnerability by charging very high rents for substandard accommodation. The Government, in its housing policy, treats single parents unjustly and has failed them.

Limerick County Council has more than 450 senior citizens on the waiting list for small houses. Those who spent their lives working to build the State, in their retirement years deserve better than to be forced to wait for most of their declining years for decent accommodation. The Government professes to honour and recognise the contribution of our citizens. It gave medical cards to all people over 70 years regardless of wealth and housing conditions. At 70 years with a mansion worth £1 million, a person is entitled to a medical card while too many dependent on their pensions, who ought to be entitled to a medical card on the basis of income, will not have decent accommodation or a house in which to end their days.

It is quite clear the Government's housing policy has failed. It has resulted in a major fall-off in private house construction. As Deputy Farrelly stated, unless there are major alterations in the budget, many construction workers will go on Christmas holidays not to come back. Look at local authority housing waiting lists. In Galway City, there are more than 1,000 on the list and a similar number in the county. The waiting time is more than four and half years for both but worse in some situations. People arriving at the office counter are told that they have five years to wait and so do not fill in applications, at a booming time in the economy when the Government squandered the opportunity to solve the housing crisis.

I am concerned with the red tape in Galway city and county in regard to housing repairs for which local authority tenants sometimes wait for years. Workers do some of the work before going away for months or even years. The tenants must contact me or someone else to get the workers to return. The repair grants situation is a shambles, as I have brought to the Minister's attention before, but he has done nothing about it. There are local authority schemes such as the essential repairs scheme, the disabled person's grant, improvement in lavatories grants and health board schemes for the elderly. The delay in carrying out works under such schemes is a scandal. First, with regard to repairs for the elderly, the house is examined and if it is put on a priority one list, work might be done in a year or year and a half. If the job is listed on the priority two list, it is four or five years before the work is done. There is duplication of inspections and red tape between the health board and the council as applicants often apply to both in their anxiety to get a grant. As I said to the Minister before, let one authority deal with this.

The disabled person's grant is one for a bathroom or downstairs bedroom for use by a disabled person. I dealt with a woman caring for her husband, whose health was seriously deteriorating. She had applied for a grant for a downstairs bedroom and a shower. A year later he had to sleep on a couch downstairs while she slept on the floor. The poor man died before the grant was sanctioned. Is that the way for the Minister to treat people in his own city? He ought to give the necessary staff to the local authorities, which they say is the problem.

Many people are forced on the rent supplement scheme because of the housing situation, on which more than £100 million is spent nationally, £11.2 million in the Western Health Board area last year. Many people on rent supplements are good tenants but many cause hell for their neighbours. They keep dogs in the back garden. They sleep all day and make noise all night while children are trying to study. The health board can do nothing. If they were in local authority housing, they could be convicted for anti-social behaviour. Some of those people are getting 95% rent subsidy from the health board but the health boards can do nothing about them. I ask the Minister to bring in the same rules for those people as those that apply to local authority houses who have to abide by social behavioural norms. The Minister must get the staff into the local authorities to deal with the backlog of housing repairs and house applications.

I am pleased to have the opportunity to address the House on the important subject of housing and to set out once again the main elements of the Government's approach to housing and the positive effect that this approach is having.

One of most striking features of the Fine Gael motion is that there is no mention made of house prices. The simple fact is that Fine Gael does not have the audacity to mention house prices. For the last four years the Government has had to put up with criticism from the Opposition benches about what they termed the Government's failed policies to bring about a reduction in house prices.

The Government collapsed the market.

Now that we have the firm evidence that these policies are succeeding, Fine Gael has had to retreat and regroup and has mounted what can only be termed as an appallingly weak counter-attack. It's encouraging for Ministers and Deputies on the Government benches, as we face into an election next year—

Is the Minister of State standing next time?

—to know that this motion is the best that their front line can come up with.

The Government has taken a wide range of measures, each reinforcing and complementing the others, to reduce house price inflation, increase housing output to match demand, remove infrastructural and planning constraints on residential development, afford greater access to the housing market to first time buyers and improve affordability for first time buyers and lower income households.

The Government's publication, Action on House Prices, in April 1998, was the first of three major policy initiatives on housing. Its primary focus was to increase housing supply through a range of infrastructural and tax measures and to prevent investors pricing first time buyers out of the market. First time buyers – Fine Gael does not seem to care a damn about them.

I beg the Minister of State's pardon, there have to be houses for them to buy.

These measures were supplemented in 1999 by further measures taken in Action on the Housing Market and last June the Government published Action on Housing which spelt out additional actions necessary to continue the momentum that was being achieved on foot of the earlier measures that we introduced.

Let me remind Fine Gael about some of the key measures taken by the Government. A range of tax measures, including adjustments to the stamp duty system, were introduced to bring forward the supply of development land, remove speculators from the market and improve affordability for first time purchasers.

And reduced the number of houses built each year.

On top of significantly increased investment generally in water, sewerage and roads services, we introduced targeted measures to increase the supply of serviced residential land. Over £50 million of Exchequer funding is being spent on the serviced land initiative which will provide water and sewerage services for 165,000 housing units. An additional £195 million of Exchequer funding has also been provided to part-fund the construction of 42 non-national roads which will provide services for over 42,000 housing units. Six project offices have been established to drive key infrastructure projects necessary to support housing development. We designated the first three sites, comprising 14,000 housing units, in June of this year as strategic development zones for residential development to ensure the early development of these sites.

We published planning guidelines on residential density in September 1999 which are helping to secure efficient use of serviced development land, facilitate provision of more affordable housing and promote sustainable development. Strategic planning guidelines are being drawn up on a regional basis for the Dublin and mid-east regions and this is being replicated in other key regions throughout the country.

The Minister of State had better talk to his colleagues about that.

We introduced a range of measures to expand the capacity of the planning system, including the appointment of additional planning staff to local authorities and An Bord Pleanála, the recruitment of planners from abroad, additional planning courses in third level institutions and revisions to regulations to increase the size of exempted domestic exten sions. It is quite clear that Government measures on the housing market have been effective.

Not in Galway.

My Department published details last year of the first national inventory of zoned serviced land which shows that the position in relation to the stock of serviced building land is encouraging. There is currently about six years supply of serviced land nationally, in Dublin and in the greater Dublin area. This will improve further on foot of increased investment in economic infrastructure such as roads, water, sewerage and public transport over the period of the national development plan.

We built over 13 houses per 1,000 population last year, the highest rate in the EU in proportion to population and about four times the UK rate.

As a result of decisions made four years before that.

House completions last year reached almost 50,000 units nationally, the sixth consecutive year of record housing output. Since this Government came into office, housing output has increased by over 28% from just under 39,000 units in 1997 under the Rainbow Government. Output nationally for the first nine months of this year is up over 4%—

It is down.

The Minister is living in an ivory tower.

We are on target this year to achieve the second highest level of housing output on record. Since house price inflation peaked in 1998, primarily as a result of the failed policies of the last Rainbow Government, there has been a downward trend in house price increases. My Department's quarter data for June of this year showed a continued moderation in new house prices with the annual rate of increase at 12.2% nationally and 10.9% in Dublin and second hand house price increases of 12% and 12.4%, respectively. The 12% annual increase nationally for second hand houses was the lowest recorded since the first quarter of 1996, when the Rainbow Coalition was in Government. These data are supported by other sources. According to the Irish Permanent, September 2001 figures show that for the ninth consecutive month the year-on-year growth in national house prices has slowed, falling from 12.8% in August to 12.1% in September. This is the lowest year-on-year increase since the index started.

And 30,000 jobs are going to be lost. Will the Minister address the real issues?

One of the principal objectives of Government polices has been to create space for first time purchasers. First time purchasers are now accounting for a larger share of the market, with applications for new house grants up 6.3% in the first nine months of this year following an increase of 4.8% last year. Indicative figures also show that first time purchasers accounted for 38% of the market in the first half of 2000. This has risen to 44% for the first half of this year. So, Fine Gael would have us reverse our policies which have achieved increased output, reduced house price increases and a greater share of the market for first time buyers.

The Minister of State should tell us about the rent subsidies.

On this basis, I look forward to the housing elements of the Fine Gael manifesto which I hope they will subject to the same rigorous analysis that this motion was subjected to. This Government can also claim credit for bringing about real and positive changes in the provision of social and affordable housing. We have for the first time provided a long-term framework for the funding of social and affordable housing through the inclusion of £6 billion in the national development plan earmarked for these purposes. The £6 billion in the plan was supplemented by the commitment by Government of a further £1 billion for social and affordable housing in action on housing.

Action on Housing also included a number of measures to address social and affordable housing needs, including an increase of 6,000 units in the number of local authority housing starts under the NDP, increases in the income limits for the shared ownership and affordable housing schemes and a new site subsidy for houses provided by local authorities under these schemes. This overall investment will ensure that the housing needs of over 90,000 households will be met with Government assistance over the period of the plan.

The total provision for social housing in 2001 is over £1.1 billion, up more than a third on last year and almost treble the amount provided in 1997 by the Fine Gael led Rainbow Government. The impact the Government's social housing strategy set out in the national development plan is now being reflected in the provision of local authority housing.

What about the 2,000 waiting for housing in Galway?

Members must sit here now and listen. The Government introduced a multi-annual local authority housing programme for the first time starting last year and running through to the end of 2003. Under the multi-annual programme we are aiming to provide a total of 25,000 local authority housing starts.

And it is aiming the Minister will be.

The Minister is a very poor shot.

The multi-annual approach was introduced to allow for greater forward planning and efficiencies of scale in delivering the increased local authority housing targets. Effectively, we have given carte blanche to local authorities to start as many projects as they possibly can. They are now building houses at a rate we have not seen for many years and I expect that local authorities will complete at least 5,000 units this year and that commencements of new house starts will exceed 7,000 units. This will be highest level of starts for more than 15 years and is an indication of how local authorities have successfully accelerated their programmes to meet existing demand. The Government has effected a major sea change in the local authority housing programme, not only by ramping up output, but also by improving standards. The quality of local authority housing being provided is of a very high standard and compares favourably with private housing design standards.

Who wrote the script for the Minister of State?

The Minister of State is dreaming.

We are also now achieving a mix of tenure types in our social housing developments with local authority rented housing being provided along side voluntary and affordable housing. This will help to establish strong local communities and avoid social segregation.

Major regeneration programmes have also commenced in Dublin and Cork in addition to the main local authority housing programme, most notably the redevelopment of Ballymun in Dublin, the biggest regeneration project in the State. More than 500 new houses are under construction in Ballymun. A major milestone in the Ballymun redevelopment was achieved earlier this month when the first completed houses were handed over to the new tenants. Over the next few months it is expected that a further 200 houses will be completed and occupied by tenants moving from their existing high rise flats to low conventional housing.

They are replacements.

The rainbow coalition did not provide one red halfpenny for this work when it was in office.

Hear, hear.

There are also other major regeneration schemes under way or due to start shortly in Dublin and Cork. Work is under way in Dublin on a number of large flat complexes in the inner city involving a combination of demolition, refurbishment and new build. I am proud that I have been involved in getting rid of the poor quality accommodation that existed in inner city Dublin when I took office.

The Minister of State was involved in the Government which built those complexes under Mr. Blaney.

The total cost of this programme will be over £100 million, which is totally funded by my Department.

The flat complexes are the Minister of State's legacy.

More than 200 new houses are under construction in six projects in the inner city.

Work is also due to start early next year on the first phase of the £40 million redevelopment of the Glen area in Cork city. This phase will involve the construction of 48 new dwellings and the refurbishment of 66 existing dwellings. These measures are additional to the main construction programme and represent new and additional social housing activity.

My Department is also jointly funding with Dublin Corporation a once-off upgrading of high density older housing complexes, mainly flats, at various locations around the city at an estimated cost of £85 million. Work on this programme has been progressing well since 1997 with the result that new windows have been installed in more than 2,000 dwellings, central heating installed in 8,000 dwellings and roof replacement completed on 12 major flat complexes.

On coming into office the Government very quickly identified the important contribution which the voluntary and co-operative housing sector has to make in tackling the growing demand for social housing. The Government's commitment to developing and expanding the sector and giving it the necessary resources and support to enable it to become an important and significant force in the housing area is reflected in the national development plan, which includes ambitious targets for output by the sector for each year of the plan and provides the necessary funding to achieve these targets.

The commitment of the Government to the expansion of the sector is also reflected in the improvement to the terms of the voluntary housing funding schemes on four occasions since 1997, the most recent in July this year. When I took office the sector was collapsing and funding had not been increased for several years. The improved terms for these schemes are clearly having a very positive effect on activity.

Why are the waiting lists increasing?

Output by the sector in 2000 showed a substantial increase in the number of units of accommodation provided, with some 950 units completed, the highest output by the sector since 1995. The indications are that output by the sector this year will be in line with the NDP target of 1,250 units. There has been a marked increase in the number of units of accommodation under construction and at various stages in the pipeline at the end of the first half of this year as compared with the same time last year. I have approved £158 million in assistance towards voluntary house building programmes in the year to date compared to £119 million for 2000. These indicators augur well for continued growth in the sector.

Housing output from the local authority housing programme together with output from the complementary social housing programmes of voluntary, affordable and shared ownership housing with vacancies occurring in the existing local authority housing stock will enable the housing needs of approximately 11,000 households to be met this year.

That is minuscule.

On the issue of homelessness, I launched the Government's integrated strategy on homelessness in May 2000. The strategy recognises for the first time that homelessness is not just about a lack of accommodation, but that the health, care, welfare, education and training needs of homeless persons need to be addressed in a co-ordinated manner if the problem of homelessness is to be tackled effectively. The Government's strategy has been welcomed by both the statutory and voluntary sectors as providing, for the first time, an integrated response to homelessness at both national and local level.

A key element of the strategy is that homeless action plans are to be drawn up at local level jointly by the local authority, health board and voluntary bodies, to chart clearly what services exist for homeless persons and outline what services need to be provided for them over the next three years. The plans for the main urban areas are already completed and work is well under way on the plans for other areas and should be completed shortly.

The Government has made substantial additional funding available to ensure the recommendations in the homeless strategy are implemented. Capital funding for the direct provision by local authorities of accommodation for homeless persons is being doubled from £20 million to £40 million over the next five years and current funding has already been increased by £6 million per annum to increase bed night contribution rates to voluntary bodies and fund other support services such as settlement and outreach services. Some of these services were starved by the previous Fine Gael-led coalition. Additional funding of £6 million is also available from the Department of Health and Children to fund the provision of in-house care in hostels providing accommodation for homeless people.

There is already firm evidence that there have been considerable improvements in services for homeless persons. For example, current funding to many voluntary bodies which provide accommodation and related services for homeless persons has been significantly increased in line with recommendations in the homeless strategy. Settlement and outreach services have been developed in some areas to work with homeless persons and assist them into suitable long-term accommodation. Additional accommodation, particularly transitional and long-term accommodation, has already come on stream at various locations throughout the country and more will become available next year and in future years.

As part of the overall homeless strategy, the Government gave a commitment to prepare a preventative strategy to tackle key groups at risk of homelessness which I will be in a position to publish very shortly. The main theme throughout the strategy will be the need to ensure no one is released from any type of State care, whether custodial or health related, without appropriate measures being in place to ensure they have a suitable place to live with the necessary supports, if needed.

The Fine Gael motion completely fails to acknowledge one of the most fundamental changes to Irish planning law introduced by any Government contained in the Planning and Development Act, 2000.

The Minister of State has failed to acknowledge waiting lists.

Part V of the Act radically alters the role of local authorities in the planning and provision of housing.

To achieve 20% social and affordable housing one must build 100% of houses in a development.

I know Fine Gael does not like change, but we are making the changes. It requires local authorities to undertake a much more strategic role in identifying and addressing housing needs through the preparation of housing strategies. These strategies must address the housing needs in the area covered by their development plan, including the need for social and affordable housing.

Yet another plan.

The Act also requires local authorities to zone sufficient land to meet these needs. The first set of strategies have now been prepared by local authorities and by the end of this month virtually all local authorities will have varied their development plans to incorporate their strategies.

The Government recognises the importance of, and need for, a diverse and well managed private rented sector, something which Fine Gael forgot about when it was in government. We established the Commission on the Private Rented Residential Sector to examine the issues of security of tenure, supply and development constraints and the balance of rights and responsibilities between landlords and tenants in July 1999.

There are no landlords left.

This was the first comprehensive review of the sector undertaken by a Government appointed body. The commission reported to me in July 2000 and Government proposals for reform of the sector arising from the recommendations contained in the commission's report were announced in January 2001.

A number of relevant measures have already been implemented in the Finance Act, 2001, including a reduction in the stamp duty rate for new residential investment properties, tax relief on rental income in respect of refurbishment capital expenditure, the reintroduction of interest relief on borrowings in the case of certain properties meeting specified conditions—

None of which will ever be claimed.

—and rollover relief on capital gains tax in respect of qualifying reinvestment in the sector.

Why have all those measures failed?

Implementation of reforms relating to improved security of tenure, graduated notice to quit periods, tenancy termination, landlord and tenant obligations and rent aspects requires new legislation, including amendments to the existing landlord and tenant legislative code. The necessary legislation is being drafted.

It is too late.

In the meantime and pending the enactment of the necessary legislation, the Private Residential Tenancies Board was established on an ad hoc basis in October 2001 to deal with disputes and perform other research and information functions.

It is at present developing the necessary procedures to allow it commence dispute resolution early in the new year. The resolution of disputes in this manner will be faster, less confrontational and less costly than the present court system and will benefit both tenants and landlords.

As well as measures to improve the operation and regulation of the private rented sector, the Government has taken measures to boost supply of private rented accommodation.

Where are they?

Over 800 units of student accommodation, providing over 3,100 bedspaces have been provided on foot of measures introduced in the Finance Act, 1999. A further 3,800 units are at various stages of planning which will provide an additional 14,000 bedspaces—

There are a lot of things at various stages of planning.

A new rent-a-room scheme was introduced in this year's Finance Act which provides for an exemption from income tax where gross rental income does not exceed £6,000 per annum, for accommodation provided in a person's principal private residence. The scheme will increase the availability of accommodation, will assist affordability for house purchasers and will also make better utilisation of the housing stock. In addition, the ceilings for income tax relief in respect of rents paid by tenants in the private rented sector have doubled over the last two budgets.

Regarding the rent supplement scheme, there are a number of key facts that the Opposition needs to understand. This scheme forms an integral part of the social welfare system and provides necessary income support for over 42,000 households renting privately whose means are insufficient to meet the rental costs. This Government has made significant improvements to the scheme. For example, we have taken action to address employment disincentives by extending and increasing entitlement to retain rent supplement for people on special back to work schemes. There are around 5,000 people claiming rent supplement on this basis. We went a step further last year by allowing long-term unemployed to retain rent supplement on a tapering basis without having to go through a special employment programme.

These and other improvements cost money of course, but I challenge the Opposition to show that spending to reduce unemployment traps and other anomalies is not justified. Do they also think it wrong that we are now disregarding the first £5 of pension increases in calculating rent supplements? Are we wrong to disregard the first £25 of income from part time work and training allowances? Was the decision to increase by £10 per week the amount of rent supplement payable to voluntary housing tenants under the capital assistance scheme excessive? Fine Gael seems to think so.

A second key factor affecting rent supplement costs is that the scheme is now providing assistance for over 5,000 asylum seekers, a factor that was largely absent during the Opposition's last sojourn in government. I will assume that even they would not suggest withdrawing this essential support.

I would prefer to see them working.

The third main factor influencing rent supplement costs is the trend in market rents. As is the case with every other segment of the housing market, the private rented sector has come under considerable pressure from the scale of economic growth and demographic change in recent years. The rent supplement scheme cannot be insulated from the effects of this. Its whole purpose is to provide necessary support for people renting in the private market. Consequently, rent increases have exerted strong upward pressure on rent supplement costs. This can only be addressed by promoting general rent moderation through increased supply of rental accommodation. The measures we took in the last Finance Act, and which I have already outlined, should have a positive effect on supply of rental accommodation. We are also looking at how the structure of the rental assistance scheme can be improved. There needs to be support for tenants who cannot afford reasonable rental costs. However, any scheme that consists purely of providing subsidy which goes into the market without reference to overall supply is potentially inflationary. We signalled in our Action on Housing policy statement last year that more supply based approaches to rental assistance would be explored. Proposals in that regard will be outlined in a forthcoming report by a planning group that is examining the role of local authorities in this area.

I would envisage local authorities playing an important role in securing availability of good standard rental accommodation on a long-term basis for households in need of assistance and promoting the development of new accommodation for such households in partnership with the private sector. In addition to availability of accommodation, this approach can help to ensure proper standards of accommodation and promote rent moderation, security of tenure and greater stability for households depending on rent assistance.

Administration of the rent supplement scheme has improved significantly in recent years, particularly with completion of a comprehensive information technology system in 1999 that integrates it with the overall social welfare system. Further significant improvements in both the structure and administration of rental assistance will be pursued following the forthcoming planning group report. The focus of reform in this area must be on ensuring that needs are met as effectively as possible with adequate supply of good standard accommodation at reasonable cost, not on simplistic approaches or bureaucratic issues.

The freedom to quote figures without regard to the underlying realties is one of the luxuries of sitting on the Opposition side of the House. In this case, a bit more homework would have been advisable. Despite the wider eligibility and improved entitlements that we have introduced and notwithstanding the added pressures in the housing market, the rate of increase in rent supplement expenditure under this Government is less than the equivalent figure during the Rain bow period when we were led by Fine Gael. Perhaps the Deputies should have another look at the terms of the motion.

The Government's response to overall housing needs is credible, it is comprehensive, it is well funded and crucially it is working—

I cannot stick lies.

Deputy, I ask you to withdraw those words.

I apologise. I withdraw those words.

We have been consistent in our approach since the day we took office. We have repeated that we will increase supply to meet demand – we have done that. We have said that we will secure stability in house prices – that is now happening. The Government's amendment clearly sets out the range of actions being taken by the Government in relation to housing and these actions need the continued support of the House.

I move amendment No. 1:

To delete all words after "That" and substitute the following:

"Dáil Éireann acknowledges the achievements of the Government in

–supporting record levels of housing output since 1997,

–moderating the rate of house price increases,

–increasing the share of the housing market going to first time purchasers,

–introducing for the first time a multi-annual and greatly expanded local authority housing programme which has led to the highest number of starts for 15 years,

–increasing voluntary housing output to the highest levels ever,

–introducing an integrated strategy on homelessness,

–establishing the Private Rented Tenancies Board as a key measure in securing a strong and well regulated private rented sector and supports the continued action and commitment by the Government to expand the supply of housing across all tenures and to improve access by all income groups to suitable housing accommodation."

I commend the amended motion to the House.

With the agreement of the House I wish to share my time with Deputy Moynihan-Cronin.

The Minister's speech reminded me of the song of the bumble bee – full of activity and utterly pointless. He referred to what he called underlying realities. I would like to draw his attention to these underlying realities. If he and his Government profess to have been so active on the issue of housing over the last four and a half years, why do we have the underlying reality that it is now impossible for young working couples to buy a home of their own; that it is more expensive to rent accommodation than to pay a mortgage on it; that we have the highest number of applicants on local authority waiting lists in the history of the State and that in the lifetime of this Government the number of people who are homeless in our country has doubled?

Those are the underlying realities after four and a half years of this Government. Last Tuesday at Question Time I asked the Minister to change Government housing policy, considering the continuing inability of families to purchase a home of their own; the low number of local authority houses currently being constructed and the general downturn in housing construction activity. The reply from the Minister on that occasion was typical of his response to the housing crisis over the past four and a half years and was similar to the response he has given us tonight. Essentially, there is no problem, everything is under control, things are getting better and the Government is doing what it can.

I am glad to be able to speak on Deputy Mitchell's motion which is essentially calling for a change in Government housing policy. What is Government housing policy anyway? When this Government took office it pinned its housing policy on the concept of home ownership. When this Government is finally driven from office it will be remembered as a Government which put home ownership beyond the reach of those who could traditionally afford it – young working couples. At the end of this Government's term of office, two young teachers in their mid to late twenties, setting up home together, cannot afford to buy from their own resources of two salaries the kind of starter home which their parents could buy 30 years ago on one salary.

When the Government took office in mid-1997 the average price of a new house was £73,523. Today it is £147,892, an increase of over 100%. In mid-1997 it was possible to rent a family sized house or apartment in the city for approximately £450 a month. The same accommodation today costs approximately £1,000 a month, an increase of over 100%. In mid-1997 some 26,000 families were seeking local authority housing. Today the figure is closer to 60,000. Every housing affordability indicator has doubled under the Government. House prices, rents, the number on council housing waiting lists and the number of homeless people on our streets have doubled.

All this has happened during the four and a half years of the State's greatest wealth. Previous Governments, during the country's worst economic times, were able to house our people, yet this Government, with no shortage of financial resources, has failed to satisfy the housing needs of our population. This is not just a matter of poor economic performance or a social policy failure. It is a human and personal problem. I will tell the House about some of the people I met yesterday at my constituency advice centre. To protect confidentiality I will not use their real names.

Mary has two children. Some 14 months ago she was evicted from the flat she had rented for four years. She has been homeless since then, getting overnight accommodation in a bed and breakfast and walking the streets with her two children every day. She told me yesterday that she does not want to be homeless for a second Christmas in succession. She told me that some of last year's Christmas presents for the children are in a black bag in her sister's house because the children cannot play with them in the bed and breakfast. Last week her doctor put her on antidepressants. It is the first time in her life that she has been prescribed such medicine.

Nora has one child who is ten years old. They were evicted from their private flat in September and are finding it very difficult to manage in the bed and breakfast accommodation issued to them by the homeless persons unit. The ten year old attends a local primary school, but has been off school for the past week because he is sick. The doctor put him on an antibiotic, but unlike any other child off school with the flu, he cannot go home to bed. He must spend the day walking the town with his mother.

Michael and Celine and their two children, aged ten and 14 years, were evicted from the house they rented last February. They told me about the difficulties the children face doing their homework in bed and breakfast accommodation and the embarrassment the children feel among their friends about their living circumstances.

That is the Celtic tiger for the Deputy.

These are just some of the examples of the human misery and suffering which are a direct result of the Government's housing policy. The daily experience of 1,000 homeless children and their families in Dublin city alone is the same as I have described it for those three families.

Some 60,000 families are on council housing waiting lists and becoming increasingly desperate about their prospects of being housed. Some are living in expensive or unsuitable private rented accommodation. Some are living in overcrowded and uncomfortable conditions with families or in-laws. The couple and two children sharing a box room in an overcrowded house are the legacy of four and a half years of this Fianna Fáil-Progressive Democrats Government. Marriages and relationships are falling apart. The health of many housing applicants is deteriorating. The education and personal development of children being reared in such circumstances are suffering. The country will pay for the Government's neg lect of housing for decades in its health, education and social welfare budgets.

Judged either by results or the efficacy of individual initiatives the Government's efforts on housing have been a succession of failures. At first the Government appeared to regard the housing crisis as a market problem – indeed, it appeared to welcome it. If land speculators and sections of the building industry were making a killing, why would Fianna Fáil and the Progressive Democrats not be happy? Demand had increased and if housing supply could be increased, prices would stabilise. This was the conventional market theory.

Supply increased from 34,000 units in 1996 to almost 50,000 units last year, but prices continued to go up. Not only did increased house supply not succeed in calming prices, particularly at starter level, but housing supply now appears to be falling. For some time the Irish Home Builders Association has been drawing attention to the decline in homebond registrations and planning applications for residential development, pointing out that this inevitably means a downturn in housing supply. The recent pre-budget submission prepared by DKM economic consultants for the Irish Home Builders Association predicts that private house completions will fall by about 10% this year and that the total number of private completions is forecast to decline in 2001 for the first time since 1993. The prognosis for the longer term is not much better. The Irish Home Builders Association is predicting a fall in private completions of a further 15% in 2002, based on, among other matters, the fall in planning decisions, which are down 7% in the first six months of 2001, and the fall in planning applications, which are down 9% in the same period.

The Government does not appear to have succeeded in any aspect of its housing policy. Prices have doubled and the supply on which the Government had pinned so much hope is now beginning to fall. The serviced land initiative, introduced following the first Bacon report to subsidise building sites, will have produced only about half the number of projected sites by the end of this year. The 20% provision in the Planning and Development Act has yet to deliver a single house and will not do so for about another two years.

If at all.

However, the Government's biggest failure on housing has been in the two areas over which it has had direct control for the past four and a half years, that is, the provision of social housing and the regulation of the private rented sector. In the Programme for Prosperity and Fairness, which the Government negotiated with the social partners, there is a commitment to provide 25,000 social housing units over a four year period, 2000 to 2003. Against a background of 60,000 applicants on local authority housing lists this target was too low in the first place. However, it is now becoming painfully clear that even the modest housing target set and agreed in the PPF will not be reached.

In reply to a parliamentary question last week the Minister of State, Deputy Molloy, told the House that 3,207 social housing units were provided last year, that the expected output would be approximately 5,000 this year and that there would be a similar level of output in 2002. The Minister of State's most optimistic expectation is that only half the houses promised in the PPF will have been delivered as we enter the last of those four years.

In the private rented sector the Government has turned its back on the country's 150,000 tenants. Pushed by the Opposition and organisations such as Threshold the Government established a commission on the private rented sector, which reported in July 2000. It took the Minister over six months to give his response to the commission in January this year. So far he has failed to produce the legislation promised to give basic rights to tenants. When he announced his decisions in January he undertook to establish the Private Rented Tenancies Board on an ad hoc basis in the autumn. All he has done so far is announce the membership of the board. He again confirmed last week in the House that the board will not hear its first case from either a landlord or a tenant in respect of a dispute until some time next year. God knows when he will introduce the legislation necessary to underpin the workings of the board, give it statutory effect and provide some regulation in the private rented sector.

The Government has pursued housing policy which has given us the worst of all worlds. Young working people cannot afford to buy and can afford even less to rent. Those on council waiting lists face unprecedented waiting periods. The Government's policy has produced the most remarkable of all outcomes in that it has resulted in what appears to be the beginnings of a collapse in housing construction. In a scenario where house prices have increased, where rents are so high and where the Government has failed to provide the necessary regulation in the private rented sector, how has it managed to bring about a set of circumstances which are resulting in a downturn in housing construction? We are facing into the turn of the year with the prospect of substantial lay-offs in the residential construction sector.

It is past time the Government acknowledged defeat. After four and a half years it has failed in the crucial area of housing and must change its housing policies. If it does not do so in recognition of its failure in this area, there must be a change of Government in order that policies may be introduced which will provide housing and shelter for Irish people and reverse the scandalous situation which pertains. I have described the circumstances in which people on council housing waiting lists find themselves and could equally describe the difficulties experienced by those who must drive 20, 30 or 40 miles from their place of work in order to be able to afford to buy a home. This presents other difficulties and hardships in terms of time spent travelling, child care, distance from families and anti-social hours etc. Government housing policy must change if we are to provide some relief for the people concerned.

I was very disappointed to hear the Minister of State reading out the usual litany of so-called initiatives, reports and allocations. None of these has worked. Given the miserable results on housing produced after four and a half years of the Government's time in office, there is something fundamentally wrong with the policies it has pursued.

I welcome the opportunity to contribute to this debate. Deputy Gilmore referred to the difficulties experienced by those on housing waiting lists. The same difficulties are experienced by people in towns and villages throughout Ireland. The housing lists are increasing and people cannot even put a roof over their heads. One of the acid tests of any society is its willingness and ability to provide housing for its people. People have a fundamental right to have a roof over their heads. This should not merely be the test of a booming economy; it should be its hallmark. Sadly, this is not the case in our economy because the Government has created a market economy rather than a social economy. Ideologically driven by Fianna Fáil and Progressive Democrat right wingers, the current Administration has no interest whatsoever in providing our people with the requirements essential to live a comfortable and secure life. The Government's epitaph may well include its gross negligence in regard to housing provisions as one of its total failures. After four and a half years in office housing continues to epitomise the Government's incoherent approach to public policy.

As a representative of a constituency which has borne much of the Government's failure on housing, I want to give some facts. There are currently more than 700 people on the waiting lists in south Kerry, the majority located in Killarney. These numbers are unprecedented and growing on a daily basis. The numbers on the waiting lists are qualified applicants, but local authority housing officers point out that some people in employment and above the qualifying threshold for the housing lists cannot afford to buy houses of their own. These people, who are in limbo, should also be on the lists. The real figures, therefore, are much higher.

The Minister of State must be proud of these statistics if the attitude he and his colleagues have displayed over the past four and a half years is anything to go by. Site and house prices in Killarney, Kenmare, Dingle and other parts of south Kerry are now so expensive that they are out of the reach of any average couple. Why has no effort been made to curb these prices or provide additional housing? As the demand for housing in the private sector slows, the capacity of the construction industry should now be used by the Government to increase the scale of its response to social housing needs. The average rent currently paid by my constituents is an outrageous £100 per week, in many cases for sub-standard accommodation. The amount of rent allowance paid by the Southern Health Board has rapidly escalated in recent years, not least because the Government has presided over a widening gap between rich and poor.

I regret the Minister is not present because I want to raise the case of a 50 year old widow in my constituency who has no living relatives. There is grass growing in the windows of her front room. I am going on my hands and knees to the county manager, the health board or anyone else who may be able to assist her. She needs a couple of thousand pounds to get proper windows but cannot get a disabled person's grant because she is not disabled and too young to qualify for an essential repairs grant. This woman will have grass in her sitting room for Christmas. This is the Celtic tiger.

Irrespective of what figures the Minister of State trots out, they cannot hide the fact that the housing problem is more serious than ever. The Labour Party in government has a proud record of house building. If one looks at any of the Governments in which it served, the facts are there for all to see.

Debate adjourned.