Hoarding rezoned land has the effect of hindering any type of planned development and needs to be phased out. The perception that developers are keeping prices artificially high should be examined with the option of developing co-operative housing if middle and lower income earners are being deliberately priced out of the market.
The increasing cost of housing has come about partly because of the Government's ever-increasing take from home builders and the possibility of greatly increased development contribution charges in response to sections 48 and 49 of the 2000 Act. These increased charges along with the increase in VAT and the abolition of the first-time house buyer's grant pose a real threat to the continued growth in housing supply in order to meet demand. Recent figures published by Permanent TSB show that house prices rose by an average of 1.3% in April and 1% in March. Other factors such as the Government's failure to deal with high insurance costs pose further threats. It is estimated that sharp rises in insurance premiums have added between €3,000 and €4,000 to the price of a new house.
For example, it is known that a small family-owned housing contractor paid €10,000 for employers and public liability cover in 2002 and faced a bill of more than €75,000 for the same insurance cover in 2003, which must have a major knock-on effect on the price of housing. The Government should consider the abolition of the 2% insurance levy which would, at least, have a knock-on effect in reducing the rate of increase of house prices.
Homelessness is not only but is primarily a housing issue. The Government appears unconcerned that 50,000 people are waiting for council housing and 5,580 are without a home. An integrated addiction and mental health strategy needs to be implemented to first find out exactly what the problems are and then what to do about them. Homeless persons, by their very circumstances, have few support structures around them. Local groups and bodies should be co-ordinated by the local authorities and sufficient funding to deal with homelessness must be a political imperative for the increasingly unaccountable Government.
Construction of more student campus accommodation and senior citizen complexes would free up housing stock and ease the strain on the rental sector.
Housing is not a comfort, but a necessity. The shame for this Government is that it has not taken seriously the crisis that tarnishes politics as a result. In County Cork in the neighbouring local authority to mine, more than 500 elderly and disabled people are going without essential facilities like downstairs toilets, stair lifts and showers because of Government cutbacks. That is the hidden reality of Ireland where people with disabilities everywhere are being deprived of essential facilities which they need in order to get on with their day-to-day lives. Deputy McGinley has highlighted the same problems in County Donegal, which are replicated throughout the country.
In the year of the disabled, the disabled persons grant scheme is collapsing. This appalling situation has come about because of cutbacks in the disabled persons grants, which are administered by local authorities that have been starved of finance this year. In Cork County Council, official figures show that the Government provided slightly more than €6 million this year for the scheme whereas the council actually needs more than €15 million to keep pace with demands. There are approximately 15,000 applications nationally for the disabled persons grant scheme and, despite the fact that demand is increasing and construction inflation is high, the 2003 Estimates show that the budget has been cut by more than €250,000 has been cut from the budget, which is substantial.
The national spatial strategy, which has been debated everywhere except in this House, recognises the need for increased housing in the gateways and hubs. Therefore, additional measures are required to ensure the spatial strategy report does not just go on the shelf gathering dust but that the gateways and hubs are allowed to develop as proposed in that plan. The Government must look at the need for investment in physical infrastructure in the gateways and hubs and must look particularly at our transport infrastructure and the proposals for linkages between gateways and hubs allowing them to maximise their potential.
The 2002 annual housing statistics report of the Department of the Environment and Local Government showed that the number of new houses and apartments built last year totalled 57,695, an increase of 9% on 2001. However, these statistics alone do not show that in the last few years, 30% of all new residential units in the private sector were bought by investors involved in the rental sector and we must take into consideration that there are approximately 340 houses for every 1,000 people in this country compared with the European average figure of 450 for every 1,000 people.
Two other factors must be taken into account when considering future housing demand and supply. The Central Statistics Office's quarterly national household survey showed that the average household size declined from 3.28 in 1991 to 3.04 in 1999 and to 2.97 in 2002 and that the average household size is expected to converge rapidly towards the EU average of 2.63 by 2011 with a significant number of single person households. The number of people in the main household formation age group is expected to rise by 141,000 by 2006, an increase of 27%. Because of these two factors, it is expected that the number of households in Ireland will increase from its current base of 1.25 million to more than 2 million by 2020, which creates an enormous challenge for the implementation of the spatial strategy. If current trends continue, much of this development will take place in the greater Dublin area adding to the congestion of that area as well as driving prices in the greater Dublin area even higher, not to mention the impact on the quality of life in the region.
If we are increasing housing output, it must be done in the right locations based on the national spatial strategy in order to achieve a greater balance of regional development, which will bring about an increase in population in different parts of the country rather than creating greater problems in the pressure pot that is Dublin.
I am proposing six points that should be debated in order to secure the housing future of the Irish people: the creation of a national housing agency; the easing of barriers to the supply of building land; the creation of an environment where the average young couple can afford a home of their own and start a family of their own which is vital to our society; the creation of a rental sector which will involve rights and responsibilities for both the tenant and the landlord; the greater development of specialised housing groups for homeless people, students, senior citizens and the Travelling Community; and the implementation of the spatial strategy, which is imperative.
This issue is too important to be ignored and it is far too important to be left to the Government. I am glad this House has the opportunity to highlight the failure of the Government to act up to now. Let us hope the House can compel it to act in the not too distant future before it is too late.