JOINT COMMITTEE ON ENVIRONMENT, CULTURE AND THE GAELTACHT díospóireacht -
Tuesday, 24 Jul 2012

Report on Pyrite: Discussion with Pyrite Panel

Chairman

We are now in public session. We will discuss the cost of restoring the structural integrity of houses damaged by the use of pyrite in building materials. In doing so I welcome the members of the pyrite panel: Mr. Brendan Tuohy, chairman, and Mr. Malcolm Edger. Mr. Tuohy is a former Secretary General of the Department of Communications, Energy and Natural Resources and Mr. Malcolm Edger is a chartered civil engineer and former director of P. H. McCarthy Consulting Engineers. We are also joined by Oliver O'Brien, engineer inspector of the Department of the Environment, Community and Local Government, Ms Marion Kiernan, assistant principal officer, Mr. John Wickham, building adviser, and Ms. Sarah Neary, senior adviser, in the building standards section of the Department of the Environment, Community and Local Government. I thank them for their attendance today.

I draw the attention of the witnesses to the fact that by virtue of section 17(2)(l) of the Defamation Act 2009, witnesses are protected by absolute privilege in respect of their evidence to this committee. However, if you are directed by the committee to cease giving evidence in relation to a particular matter and you continue to so do, you are entitled thereafter only to a qualified privilege in respect of your evidence. You are directed that only evidence connected with the subject matter of these proceedings is to be given and you are asked to respect the parliamentary practice to the effect that, where possible, you should not criticise or make charges against any person(s) or entity by name or in such a way as to make him, her or it identifiable. I also wish to advise you that the opening statements you have submitted to the committee will be published on the committee’s website after this meeting. I will return to this point momentarily because we did not receive an opening statement.

Members of the committee are reminded of the long standing parliamentary practice to the effect that they should not comment upon, criticise or make charges against a person outside the Houses or any official either by name or in such a way as to make him or her identifiable.

Before commencing, I wish to point out that the committee is very thankful to the witnesses for coming to discuss this topic with us today. However, declining to provide an opening statement after being requested to do so is almost unprecedented for this committee. We have set out clear Standing Orders for when a witness appears before the committee. The report was only published a week ago and is 200 pages long, and the provision of an opening statement gives members of the committee a chance to prepare as it gives a context to the presentation. It is disappointing, therefore, that an opening statement was not provided. There might well be reasons for that but the committee insists that opening statements are provided and it is regrettable that it did not happen in this case.

This is a very important report as it affects the lives of thousands of citizens in a fundamental way with regard to the integrity of their homes, how it can be restored and how that will be paid for. This is the crux of the issue and I urge the witnesses to concentrate today on what the solutions are, how and when these homes will be repaired and, ultimately, who will pay for it. We should be aware of the anxiety this has caused for people who, through no fault of their own and having purchased their home in good faith, now find themselves in an unenviable position.

I am also particularly interested in hearing the views of the witnesses on HomeBond. The committee would like to be given clarification as to what interaction there was between HomeBond and the panel and what type of engagement or discussion took place. HomeBond has chosen to put its own interpretation on a court ruling. That is a legal opinion as opposed to a legal fact, and it has refused to discuss this for its own purposes. I wish to draw public attention to this. HomeBond, unlike Premier Guarantee, the other main provider of structural defect guarantees and warranties for purchasers of new homes, has withdrawn cover from damage associated with pyrite and, according to the report, has left the home owners who were covered by its warranty in very distressing situations, which does not say much for the warranty or for HomeBond. I will be interested to hear the witnesses elaborate on recommendation No. 9 in the report, which relates to the re-engagement by HomeBond in facilitating remediation.

Recommendation No. 9 states:

The Panel recommends that:

HomeBond should review its position on cover as articulated in its letter of 31 August 2011 and, as a matter of urgency, HomeBond should re-engage with homeowners in facilitating the remediation of pyrite-damaged dwellings. This should be addressed, in the first instance, by the members of HomeBond and, in turn, they should be supported in this process by the overall construction industry, which was involved in the establishment of the HomeBond structural guarantee scheme.

This would not preclude HomeBond seeking to recover costs from other parties whom they consider may have a liability.

The reason this committee is particularly focused on HomeBond is that on two separate occasions it wrote to HomeBond inviting its representatives to appear before it. On both occasions HomeBond refused, as is its legal entitlement. If the referendum last November regarding parliamentary investigations had been passed, it would probably have been the first group to be invited to appear before this committee under that legislation.

That said, there is more to the report than the HomeBond issue. The report was conducted under four phases, including the examination of the overall difficulty and its remediation as well as putting in place measures to ensure this does not happen again. I expect it will be a long engagement this afternoon with Mr. Tuohy and the other members of the panel, so I invite Mr. Tuohy to make his opening statement.

Mr. Brendan Tuohy

First, I apologise about the opening statement. I have been away on leave and returned especially today for this meeting. I was conscious that we are going into the summer break and that there might not be another opportunity. I also apologise for the absence of Mr. Noel Carroll, one of the members of the panel, who is also on leave. Rather than wait until September we thought it appropriate to come before the committee now. We promised the committee that as soon as the report was finished we would make ourselves available to answer questions, so I took it that having presented the report publicly last week we would be here today to answer questions after people had read it.

I will make four points about the structure of the report. We were asked to identify the scale of the pyrite problem, to identify some technical solutions for the remediation of pyrite damaged homes, to identify some possible sources of funding for the remediation and to discuss the robustness of the existing regulations and propose measures to prevent similar type problems in the future. During the process we engaged with the various parties affected. More than 44 different groups and individuals met us. We also engaged with Members of the Houses on at least four occasions, when different groups met us. The process was an open one in which we listened to people. We tested various theories that we had as we were assimilating information as we proceeded. We were very clear that we were not set up under statute to do anything and we were not in the business of apportioning blame. We tried to present the Minister and the Government with a way forward. I am more than willing to take specific questions because that is what members would like to do.

Chairman

Perhaps Mr. Tuohy can deal with HomeBond. The report includes specific correspondence on page 148, the famous letter from HomeBond in which it states that it does not have liability for the homes that are now falling asunder. One does not have to be a dean of law in a university to know that this is a legal opinion, not a judgment. HomeBond has taken its preferred interpretation of a court ruling and walked off the pitch. The report by Mr. Tuohy makes recommendations on the basis of HomeBond coming back onto the pitch. While there are 24 recommendations in the detailed and well-structured report, which includes an action plan for the recommendations' implementation, the elephant in the room is the level of enforcement and sanction that can be applied to the stakeholders.

It appears the report does not include sanction or enforcement measures. Should there not have been a recommendation in the report to rebalance the relationship between homeowners and HomeBond? Homeowners are not in the financial position to take on the construction industry, nor can they take on HomeBond. The asset they have, on which they have taken out substantial mortgages, is worthless and the report may have the same foundation as the houses in that it has no standing if HomeBond cannot be challenged. Should the report have recommended that the State should take action to clarify the issue in law? The only way to determine the full legal standing of the matter is by going to court and smoking out the position of HomeBond through the legal process of examination.

Mr. Brendan Tuohy

The report says that there are more than legal responsibilities, there are moral responsibilities on the various stakeholders. That is very important. There is a great fixation on legal responsibilities here and in other issues. While the courts take time to process matters, the builders should engage. In some cases they have done so but if they are not available, the insurers should engage. HomeBond and Premier Guarantee are the two parties involved and the latter has engaged. HomeBond has expertise and has dealt with these problems up to August of last year. Whatever the downside, it has the capability to set up another body but it will take a long time to do so. Why not use the expertise available? That is why we made the recommendation on HomeBond.

We do not have a legal status and we cannot force anything. This is about getting action and we are aware of some 850 houses in the red category, where there are signs of heave or claims have been made. We include cases where claims have not yet been processed. Those houses deserve to be dealt with immediately, not further down the line when the lawyers have worked through the system. There are two appeals to the Supreme Court and these cannot take place overnight. Action should happen sooner rather than later, which is why we felt the HomeBond issue needed to be dealt with now.

In 2000, the Law Society raised concerns about the HomeBond policy as it was at the time. The Law Society did not engage with us so we do not know what happened to those recommendations but changes were made to various levels of cover of individual house owners by HomeBond and the sum for builders. The figures were raised over the past number of years. In 2008, HomeBond changed its policy to a proper insurance-backed policy. Until then, it was not a regulated insurance policy like any other policy covered by the Central Bank and the Financial Regulator. In that sense, there was an issue. Some of the concerns were raised in 2000 and some may have been processed. We cannot determine that because the Law Society did not engage with us. HomeBond should get back in and deal with claims in front of it.

Chairman

I am sure other members will question the witnesses in respect of the 24 recommendations and the timeline that must be applied but I will return to my initial question. HomeBond has walked off the pitch and one quarter of the 24 recommendations are based on the idea of HomeBond coming back onto the pitch to engage with homeowners and discuss remedial processes. HomeBond does not have any moral or legal compunction according to the legal interpretation under which it is operating. What consideration was given to HomeBond not leaving the pitch and what sanction or enforcement can be placed upon it if it continues to maintain its position?

Mr. Brendan Tuohy

We were making recommendations for the Government and the Minister to follow and it is up to the Minister and the Government to decide. We do not make laws; people around this table make laws. This case is limited, legally, by what one can do. I am not aware of any cases against HomeBond. There is a facility for people to take cases. I am not 100% sure if the Government could do so because it does not have locus standi. An individual affected by the situation would have to take a case. One of the problems we have as a society is that we run directly for the courts. I would prefer to see the parties seeing what they are capable of doing. That is an attitudinal change as opposed to a legal change. It was doing so up until last year and we think HomeBond should consider the letter of last year and consider re-engaging. If we want things to happen quickly, that is the way to do it. HomeBond has the capability and has already processed some of these issues. That is my opinion and we are open to suggestions on it. I would prefer to see action quickly and to see houses repaired.

Chairman

Is the premise that HomeBond will rethink its position and things will happen after that?

Mr. Brendan Tuohy

When the Government of the day or the Parliament asks an organisation to do something, it should give serious consideration to it. Whatever the hue of the Government, it is a serious request if the Minister is asking on behalf of the Government that an organisation should reconsider. I would take it seriously if I were the organisation.

Deputy Barry Cowen

I thank the members of the panel for coming before us prior to the summer recess, rather than after, in order to address this issue in an efficient manner. I refer to the legal standing and enforceability of the recommendations. The panel was put in place by the Government and decided the means and methods by which it carried out its report. No legal standing has been given to any new recommendations and it is now in the Government's court to see how it will implement or add to the recommendations, based on the panel's information.

It is important the committee acts quickly to ensure the affected households are given all the support necessary to secure their homes. Last week, Senator Darragh O'Brien introduced a Bill to ensure homeowners still have access to the courts. The Statute of Limitations (Home Remediation-Pyrite) Bill 2012 will ensure homeowners have significantly more time to address the issue due to the Statute of Limitations coming into effect only after pyrite has been independently identified following an approved pyrite test. This is real action to help homeowners, many of whom are struggling with mortgages and negative equity, not to mind this issue. It will serve to address the issue to ensure their liabilities from the building guarantee companies are fully met. I hope this committee will support this legislation and help to provide the legal framework which is required by homeowners facing fresh costs to secure their homes from pyrite damage. This is pivotal and I would expect confirmation from other members of the committee to that effect in order to signal their support for that legislation which will provide a legal standing and will have a positive impact in helping those who face this problem.

I am concerned about the methodology used to quantify the number of houses affected by pyrite difficulties. According to the report, more than 12,000 homes in 74 unnamed estates could potentially be contaminated with the material from five quarries. Is it possible to name these estates? Is it possible to say how many multi-unit developments have been identified? If apartments have been identified, how are these to be compensated as against individual units? The figures stated in the report are in contrast to the previous estimate of 70,000 homes affected. Those figures were based on a scientific measurement of materials taken from quarries and the amount needed to build homes. It is a vast and significant difference. Homes are affected in the east of the country and down to my own constituency in Offaly. We need to know the scientific basis used to estimate that figure as against the previous figures. We are quite confident about those previous figures.

Mr. Tuohy stated that 850 dwellings currently have submitted claims to the guarantee provider and a further 1,100 dwellings have already been remediated or are undergoing work. Is it not Mr. Tuohy's considered opinion that the pace of remediation and funding provided by insurers who have been found culpable by the courts is very slow? Is this being done, perhaps, to allow the expiry of the Statute of Limitations and thus, by stealth, people will not receive the remediation required for their homes?

The majority of these works now under way are as a result of a case taken by a builder against a quarry. The report concludes that the remaining 10,000 or so floor dwellings represent a maximum estimated future potential exposure to pyrite problems. This is the issue to which I referred earlier. Tackling the pyrite problems by the laborious method of removing it requires major interventions and a typical cost for the average house is in the range of up to €45,000. This represents a massive cost to struggling homeowners. The scale of the problem means that strong legal support must be provided to those homeowners. Should the State provide legislation which would provide for a class action in this instance? The scale of the problem also underlines the support for the legislation published last week. The report does not comment on any retrospective compensation for those who have already found the means to carry out remedial works either from their own funds or from an insurance claim or from another source. In my view, they should be treated the same as others with the same problem.

The Minister has indicated that he will consult with all stakeholders before deciding on whether to introduce a levy on the industry in order to fund the resolution of the pyrite problem. The stakeholder consultation process is voluntary; neither the Government nor this committee nor anyone else with legal standing, will be able to compel parties who may be accountable to enter into the process. We do not think this is sufficient as such a consultation process will not have any teeth if there is no legislation behind it to allow compellability. This Government must drive that process with the resolution board, as advocated in the report.

The Chairman has mentioned that sections of the insurance industry did not co-operate with the report panel. Would the members of the panel have a view on a process to allow compellability? Local authorities have a role to play because they issued planning permissions to quarries and to developers. They have enforcement officers but perhaps they did not have the funds required for those enforcement officers to carry out their duties, as envisaged by the conditions attached to permissions. The legal resolutions have brought the quarries into the process. It is important that those at fault for the use of pyrite in the construction of these homes must be made responsible. The process needs more teeth and enforcement powers to back up the proposals of the pyrite panel. Each sector involved in the supply and use of pyrite must be forced to examine its role and made to account for it. A full and frank analysis of their culpability and accountability must be undertaken in order to deal with the future funding of remediation works.

The role of the banks is important. The proposals of the pyrite panel with regard to flexibility on mortgage issues - while they might be important in alleviating financial pressure on homeowners - are not the entire solution, in our view. The proposal that the cost of remediation be added to the mortgage would mean that the State or State agencies would not be culpable or accountable and it would be a complete derogation of their responsibilities. The Government also has a role to play in providing for exemptions for homeowners affected by the household charge until such time as remedial works have been carried out.

In 2009, the standard level allowable was 1% of pyrite. The English system has found that this standard should be 0.5%. I do not see any recommendations in the report in this regard. The regulation and control issue must be examined. There may be a liability on the part of the local authorities not necessarily through any fault of their own but by virtue of the standards they were forced to apply and by virtue of the fact that the enforcement of the standards and regulations was not funded sufficiently to allow for these issues to be discovered and addressed. I ask for Mr. Tuohy's response to the various issues I have raised, the main issue being the significant disparity between what the panel believes to be the number of buildings affected and what we believe to be the figure, based on quite sound scientific methods in our case.

Mr. Brendan Tuohy

Deputy Cowen's first point was about the Statute of Limitations. The report notes this and we point to the dangers. The Law Reform Commission has already done work on statute limitations and we recommend the commission should consider problems such as the pyrite problem which may not show themselves for a long time. While the pyrite problem showed itself here within two years in some cases, in Canada it took 15 to 20 years. The current law is weighted in favour of when the action started as opposed to when it was first discovered. The Deputy is correct in his view about the Statute of Limitations in that it could be a serious issue for people and this is flagged in the report.

On the question about the methodology used by the pyrite panel, our investigation used a number of different sources. We did our own analysis of the planning permissions granted. There are five quarries of which we are aware. In the main, there is a 25-km radius beyond which it is not economical to pull the material. That effectively imposed a physical limitation as to how far the material went. Given that the houses concerned were mainly constructed between 2002 and 2006, we were able to do an analysis of all of the estates built during that period in the areas to which we have referred. We met the groups concerned in the different areas, including the Pyrite Action Group. We also met the people who provided the structural guarantee and the insurers and, in fairness to them, there was an openness from all of them on an individual level. In short, we met anybody who made a comment to us or suggested there was a problem.

I am not aware what scientific method the committee used in collating its data. The approach we took was to triangulate the data using five different sources of information in order to come up with an analysis that was as accurate as possible. As a result, we identified 23 estates which were not previously identified. Others took a different approach to analysing the data. Some, for example, took the quantity of material that came out of the five quarries and simply divided it to arrive at an estimate of the number of houses affected. A factor to consider in our analysis is that we dealt only with private houses, although we did come across 850 local authority homes that were affected. We did not deal with road construction, although we have had feedback on the issue from the National Roads Authority, and we did not deal with private non-residential buildings that were constructed using material from the quarries. None of those aspects was included in our brief.

The numbers we have given are the best estimate we could arrive at of the extent of the problem. We have an entire page in our submission setting out how we came up with those numbers, which was based on the best information we had. The reality is that if people will not tell us there is a problem, we cannot presume there is one. Where an estate had a pyrite claim or pyrite was identified, even if it was not reactive, we counted every ground-floor property in the estate and added that number into the pot. That is why we consider our estimate to be at the outer limit. A problem we have come across, as many members will be aware, is that people are slow to admit they have pyrite because to do so immediately devalues their properties. In fact, we spoke to many householders who wanted any remedial work to be done quietly without even the neighbours knowing it was going on. It is a very sensitive issue. We gave a commitment to the people who provided us with information that we would not publish the names of the estates in which they live. We wanted to gather the information and make it available, but we considered this confidentiality undertaking only fair given that we would not have obtained the information without the home owners' assistance. As I said, we have tried to make our data as accurate as possible by triangulating information from five different sources and verifying it with the people concerned. My colleague, Mr. John Wickham, has been the key person in driving all of this. People have been very open with him, including consulting engineers and others who have done tests. If the committee has information on other estates and so on, we are more than willing to hear about it.

I take the point regarding the pace of remediation and the statute of limitations. Taking a cynical view, one might say that by delaying the process, certain parties are hoping the clock will tick down until such time as nothing can be done. That could be a motivation for some, but I cannot say so with certainty. If one were being cynical, it would be very easy to come to that conclusion. On the question of pursuing a class action, I understand we do not have that facility in Irish law. It is not for us to seek to change the law in this regard, as this is a much larger issue that would more properly be examined by the Law Reform Commission or others. Perhaps it is something the committee will recommend to the Minister for review. It is, however, way beyond the pyrite action issue.

In regard to the levy on the industry, the issue of compellability was raised and the fact there is no legal standing for the imposition of such a levy. We are simply saying this is one option. In fairness to the Minister - and we are entirely apolitical in our approach - he has taken on board the recommendations and has let stakeholders know they have until the end of September to come up with a solution; otherwise, the Government will decide what to do. The consistent message we received on this point, which tallies with our own view, is that those who caused the problem should pay to rectify it. That is part of the reason we did not start by saying the State was responsible. We outlined why we do not think the State is particularly responsible, but we did have some recommendations for the Government. The various stakeholders, including the Construction Industry Federation, county managers and others, are in agreement that the parties who bear most responsibility for what happened are the builders, insurers and those who provided the material. There is a moral hazard issue with regard to the State's deciding to pay out on this from the outset, in that it absolves these people of their responsibility. We have cited examples from other industries to make the case that those parties with foremost responsibility for causing the problem should meet the cost of rectifying it. In the case of the motor insurance industry, for example, drivers who are involved in a collision with an uninsured motorist can go to the Motor Insurers' Bureau of Ireland and claim compensation. This concept of collective responsibility is also at play in the travel industry, where customers affected by a travel agent's going bust, for instance, can seek recompense from the Commission for Aviation Regulation. There is a precedent there.

We indicated in our report that the quarrying sector produced some 30 million tonnes of material last year at an average price of €8 per tonne, which amounts to some €240 million. Based on those figures, a levy of 10% would yield a take of €24 million. One could do an ad valorem levy or one based on a quantity of the 30 million tonnes. We are pointing to the options that are available in accordance with the polluter pays principle.

The Irish Insurance Federation had one engagement with us before concluding this was an issue for individual insurers and it could no longer talk to us. This goes back to the fact that while sectors of industry have no problem lobbying as a collective when they want something themselves, the attitude when problems arise is that they are a matter for the individual. We are conscious that homeowners looking to get the tests done and so on are facing a very expensive and time-consuming process. Taking the judicial route is absolutely draining of resources, both financial and physical, at a time when people are already coping with the huge stress of physical problems with their home. It is our view that the Insurance Federation of Ireland should have engaged with us. A collective position should not apply only when there is a case to be made for advancing one's own position.

We have put forward specific recommendations in regard to local authorities and building control authorities. I understand the inspection rate was approximately 15% and that it was done on a risk basis. In fairness, residential properties were never seen as particularly high-risk. One of our recommendations is that the tests take place in the quarries once the material is extracted. We are discussing proposals regarding new standards, registration of builders and proper insurance for builders and quarries to prevent this type of problem recurring.

In regard to exemptions in respect of the household charge and the proposed household tax, we recommended to the Minister that consideration be given to exempting those households affected by pyrite. It is ultimately a matter for the Government, but we have made a strong case for exemption.

Specific reference was made to standard recommendation No. 21. We traced the history of that recommendation and argued that it should be reviewed and brought back into the new building regulations as necessary. What has happened in this country is being cited internationally as part of the global pyrite problem. Pyrite was not a major issue here until specific difficulties with it were identified in 2007. When we consulted the professions involved, we discovered that it was not really dealt with on engineering, architectural or design courses. People who studied geology knew it was fool's gold but those working in the area of construction were not aware of it. The experience in the UK was slightly different because the authorities there were dealing with problems from collieries, etc. They were not dealing with the type of pyrite with which we are concerned.

What strikes one with regard to the Irish situation is the sheer pace at which it developed, namely, within two years. That is what really threw people. In our report we detail the fact that over the years home owners found it extremely difficult to engage with anyone. For example, it took just over four years for the relevant Minister to formulate a response. Everybody was taking legal advice, the basis of which was that one should not either compromise or become involved. I return to the fact that there are moral as well as legal responsibilities in respect of this matter. While members of the public were suffering, lawyers for certain individuals offered the defence that they either did not have to or should not get involved. We are of the view that the law will do what it is there to do but that there should be a parallel process in place which would get things moving and ensure that matters are dealt with quickly.

Chairman

Is the panel still in existence or has it completed its work and been disbanded?

Mr. Brendan Tuohy

The panel has completed its work and submitted its report to the Minister. Obviously, we have come here today in order to clarify issues. If there are any matters arising, we can feed them back through the relevant officials in the Department. In the main, we have done what was asked of us. That is why we wanted to come before the committee today to clarify the position. The Department opened a telephone hotline last week and quite a number of e-mails have been received.

Chairman

If the committee wishes to take follow up actions, should it contact Mr. Tuohy or-----

Mr. Brendan Tuohy

No, the committee should contact the Department because the panel has a finite lifespan.

Chairman

I thank Mr. Tuohy.

Deputy Catherine Murphy

I thank the panel for its report, which contains much welcome and interesting material. An amount of work is going to have to be done on this matter and it is clear that some of this will fall to the Oireachtas. It is clear that regulation and legislation are going to be required with regard to some aspects of what is involved. The constituents I represent who were affected by this matter are seeking a solution and they want this to be put in place as soon as possible. Of course, a variety of solutions offer themselves and these depend on the category in which one finds oneself.

By and large, the homes and properties affected by problems with pyrite were sold prior to the crash and off the plans. Essentially, therefore, the builders involved were handsomely paid. We all agree that home owners are the victims in this case and that there is a moral obligation involved. Some of those involved in the construction sector - there are definitely one or two in my area - are carrying out remediation works. In such circumstances, there has been a variety of responses as opposed to one uniform response.

I had expected the report to be much more categoric in respect of the levy scheme. I fully acknowledge that this is identified as a source of funding. The possibility of introducing a levy was flagged, not necessarily by the panel, prior to the publication of the report and the construction industry was quick to comment on the matter. What kind of engagement or dialogue did the panel have with the stakeholders in that sector? Did the latter seek time to formulate a response in advance of the possibility of a levy being imposed being mooted? Does Mr. Tuohy believe that those in the construction industry are really engaged in offering a comprehensive response before the end of September? It is important that we should have some sort of a fix on this matter and I do not believe we should wait until the end of September to do that. In that context, the committee might be able to take meaningful action in terms of suggesting what form the levy might take. I do not believe that the Pyrite Action Group's request to the effect that an interim report be issued by the end of August is unreasonable, particularly as those involved have waited a long number of years for action to be taken. After all, we must remember that panel's report was delayed in order to ensure that it would be as good as could be expected. It would be useful if the committee could find a way to consider what shape a possible levy scheme might take. At the end of September we should not be sitting here stating that certain elements within the construction sector have not complied and that we should consider what action to take. In such circumstances, another six months would pass and, while we were playing games, people would be obliged to watch their homes fall down around them.

Some of the questions that have been asked relate to what constitutes a claim and what constitutes a complaint. Perhaps Mr. Tuohy might offer a view on that matter. There is concern with regard to people in the amber category. There is no solution other than remediation in order to underpin the safety of the relevant buildings and ensure that such people might sell their homes in the future.

Will Mr. Tuohy comment on the cost relating to the test for pyrite? It is not at all clear who should bear this quite extensive cost. Several people in my constituency to whom I have spoken informed me that they were obliged to pay several thousand euro for the test. That is a major issue for those who are already over-extended financially. The notion of adding the cost to the mortgage should not even be flagged. The panel's view on this matter is not clear and perhaps Mr. Tuohy might expand on it further.

The management of the remediation work is important. In that context, people do not have confidence in an organisation which shirked its responsibility in respect of this matter. I take Mr. Tuohy's point that said organisation has a certain expertise. However, it was very reluctant to use that expertise for the benefit of people whose homes were badly affected by the problem we are discussing. There is a reasonable argument in favour of the appointment of an independent individual to oversee the rolling out of the response in respect of this matter. Anyone who visits the home of one of the 850 people who are in the red category will be able to put their hands through holes in the wall, see fireplaces coming apart and tiles coming up off the floors and notice that it is not possible to open and close doors. Problems of that nature must not be allowed to persist beyond the end of this year, particularly when the remediation process is up and running. Irrespective of what we need to do, we cannot accept anything less than full remediation in respect of these people's homes. We must, therefore, consider any possible solutions from that point of view.

I have serious concerns with regard to management companies at some multi-unit developments frustrating the process. People who live in second-floor apartments at certain complexes have discovered problems which originated on the ground floor. These individuals have no control over what is happening and probably cannot even lodge claims.

There will be a need to ensure that structural guarantees and post-remediation certification will be provided. In that context, the Pyrite Action Group has highlighted a point in respect of the vetting of builders who undertake work. One would be obliged to question the bona fides of those who were part of the original problem in the first instance. I am sure that none of the builders involved intentionally set out to do damage but those who have really dragged their heels should not end up benefiting.

When Deputies met the panel previously, I made the point that a licensing system should apply in respect of the construction sector. I was elected to Kildare County Council in 1991 and I spent seven or eight years - perhaps longer - picking up the pieces in the aftermath of what occurred in the 1980s. Here we are trying to pick up the pieces again. I accept that they are not relevant to the work of the panel but it must be noted that there are legacy issues other than those relating to pyrite. In that context, I am of the view that we must move beyond regulation and introduce a full licensing system. I am very impressed by the model used in New South Wales in this regard.

The Pyrite Action Group has drawn attention to the need to notify Bord Gáis of the 74 developments that have been affected. The local authorities also need to be specifically informed. I agree that people do not want their estates named and they are sensitive about that. Only one or two houses in an estate might be affected and it is understandable that people would not want their estates named. The developments affected need to be flagged for safety reasons in that the problem could affect roads, footpaths and other utilities.

Building control is only taken seriously in many local authorities where estates are going to be taken in charge. Where an estate is comprises almost exclusively of apartments, the local authorities in many cases do not want to and will not take such an estate in charge. Less attention will be paid to them, even possibly less than in the case of the 15% indicated, which was probably averaged over all the developments concerned. Those concerned are interested in the type of problems that they will incur in the future. This matter needs a specific response if the local authorities will not have an obligation in this respect. The key element with which we should be concerned is the finding of a solution and acting on that. I would be interested to hear what Mr. Tuohy has to say about the engagement he might have and what the construction industry might-----

Chairman

A mobile telephone is ringing.

Deputy Catherine Murphy

I do not have mine turned on.

Chairman

I request all members of the committee, witnesses and members of the pyrite panel to turn off their mobile telephones. They create a distortion for the Broadcasting Unit and particularly for media coverage of the meeting. If there is any such distortion a meeting will not be covered by the media. I ask members not to put their telephones on silent but to turn them off.

Deputy Catherine Murphy

It would be helpful for us to have a sense of the type of engagement Mr. Tuohy had with the industry because we are not privy to the type engagement he had with the various stakeholders in the construction sector.

Mr. Brendan Tuohy

Yes. We did have such engagement. We met different groupings and came back to them, not least to some of the Deputies, the CIF and the concrete federation, on more than one occasion. We floated the idea of a levy and we state this in the report but as members can imagine that concept was not well received. We asked people to make written submissions and they stated in those that those who caused the problem should pay for it. We asked them how they would envisage that happening if a levy was not sought. The Minister has gone back on that basis and pointed to what was stated in the written submissions. Those submissions should be on the website and members can read them. There is an acceptance that the people who caused the problem should pay for its resolution. We have asked how is that to be done. In the event that does not work, we came up with the concept of a levy, which we discussed with the Pyrite Action Group and others, and subsequently it filtered into the public domain. We have no problem with that because we thought it was important in that unless there is some such concept, people will talk forever about the problem. The legislation to provide for it is a matter for the Minister and the Dáil. All we could do was say that if people will not do what is required voluntarily, there should be a backstop provision. I have given the members some of the figures for the industry. Nobody likes levies of any type but in regard to this issue I cannot think of any other way that one would be in a position to deal with some of the long-term issues.

There are 850 houses that fall into what we call the red category, which have exhibited signs of pyrite having been used or in respect of which claims have been submitted. We distinguish between claims and complaints. There is 25% more complaints than there are claims. Some of the claims have to be processed. They are not all necessarily pyrite-related problems. That is a matter for the people who are processing the insurance claims or others. The 850 figure we have included is based on the current claims that have been submitted. They may not all be pyrite-related but we have given the outer limit. In terms of the more than 10,000 houses, from our knowledge, that is the total number of houses in the estates that have pyrite. We are not saying all the houses have pyrite or that it is reactive pyrite but we have based the figure on the total number of ground floor units. This relates to Deputy Cowen's comment in that if one adds all the housing units in multi-units, one might get a different number. We took the number of ground floor units because the ground floor problem is the primary one.

The Deputy spoke about the houses in the amber category and conveyancing. We were trying to get the houses that fall into the red category deal with upfront because those are the ones that are causing a problem at present. On the other houses in the amber category, we know that other technologies are being developed currently that will mitigate and deal with the problem without having to remove all the material and disrupt the people for an inordinate amount of time. We are saying that until there is a standard test available to test for this and prove that once one does this there will be no problem in the future, it would not be fair to say to people that we will do this and if it does not work, we will have to take out the material subsequently. There are houses that have pyrite for 100 years because traditionally there was a different form of construction in that there was not such a level compaction. Pyrite could be present, timber floors could have been laid on top of it and people would not know that pyrite was present underneath the house.

Pyrite is an ubiquitous material and it is to be found everywhere in the county. It is present in different degrees in different places. It is the reactive pyrite and the conditions under which it went in that has caused this problem. In that sense, we say that the houses that fall into the red category should be dealt with and that time should be given to deal with the other issues. If there was a fund in place to deal with those, they could be dealt with as they become a problem and if a technique or technology was developed that would allow them to be dealt with in a less disruptive and easier way without having to remove everything. If it was proven to give the same result, that might be a better way of doing it. We realise that if we said that the 12,000 houses affected should be dealt with upfront, there would be no prioritisation of the units to be dealt. That is the reason we said that 850 houses should be dealt with upfront and then the others should be dealt with. We are not saying that the others should not be dealt with but there are different ways of dealing with them. It is important to have a fund in place because ultimately somebody has got to pay for this. If such a fund was in place, the issue to be addressed in that respect is the effects of pyrite today and the way in which it could give rise to another issue in the future. That is an idea about having some provision for the future.

The Deputy asked about the HomeBond issue and we talked to the Chairman previously about it. We believe it should re-engage and we have made that very clear. We believe it has an expertise. We accept that it has a credibility issue but, on balance, to set up something new now when we have all this expertise available would be to delay matters when what we should be dealing with the houses concerned.

From our knowledge, approximately three quarters of the claims are to HomeBond and other quarter is to Premier. If a claim is for €50,000 a house and that figure is multiplied by 850 houses that works out at a little more than €40 million. Therefore, more than €30 million worth of claims would fall to Homebond to deal with. That is not an inordinate amount of money. It is a good deal of money but in the context of the billions of euro we have been talking about in recent years, providing the money involved in this context is doable over a period. That is the immediate problem. In the longer-term with regard to the 10,000 figure, the figures we have for the houses affected vary from 25,000 up to 80,000. We have averaged it at 40,000 to 45,000 on the basis of what we have been told. In terms of the 10,000 figure, the cost of the claims involved would be €450 million and it would be a question of building that up over time. That is the model we put forward. It is one solution and there may well be others, and the Government in its wisdom may decide to do other things in time.

We fully agree with the Deputy regarding the vetting of builders, the construction industry and the registration process. We made specific comments in that respect. We take on board some of the comments that were made us, including perhaps by the Deputy and others but we strongly believe that there is a requirement for the registration of electricians. They must be registered with RECI and there is a similar registration requirement in respect of gas installers. Why should a similar registration requirement not on apply to builders?

We believe it is important that the insurance model is correct. We made a comment, which has not been picked up yet, that work should be done in regard to standard home insurance policy. We cite different people in that respect, including the Director of Consumer Affairs and perhaps even the Insurance Regulator. If one has a car, one must have at a minimum third party cover. One can have comprehensive cover, third party fire and theft cover but at a minimum one must have third party cover. We believe there should be a similar type of model for a house such that on purchasing a house a home owner would not have to be worried about being told that he or she was not covered for a risk while thinking that he or she was covered for it. Very few, if any, people read in detail all the exclusions that are in their policies. In fairness to the ordinary person - that includes all of us - this is an issue that should be addressed. The Chairman is nodding in agreement. He appreciates what I am saying. That is a very important issue. It might sound small or trite but it is not at all the case when one is affected.

We have talked to Bord Gáis and we have engaged with it on the issues. We have opened up a line of communication with it. We are sensitive to what has been said. It has been briefed on that. We have talked to local authorities to get information. Otherwise, we would not have been able to produce the report. We have not published the list of estates, out of respect to the people who gave us information in confidence and who did not want it made publicly. We have drawn a broad line on the map to show it is not a countrywide problem; it is confined to a specific area. We have not outlined the townlands or estates within that. We have a full database of information in the Department. Mr. John Wickham, who is sitting on my left, has access to it and we treat the information confidentially.

Reference was made to the taking over of estates. I do not disagree with the point. In the past the issue has been about taking over the estates. Some issues will arise. If an estate is affected, roads and footpaths in it might be affected and presumably the local authority will have an engagement if it is taking over an estate. We also make specific recommendations about local authorities using their powers under the Building Control Act to pursue the builders concerned. Again, there is a specific time limit involved of five years. The clock is ticking in that regard as well. We asked them to go back and look at the issue as a matter of urgency.

Deputy Dessie Ellis

I thank the witnesses for the presentation. The scale of the problem has been unfolding in recent years. In recent years I have experienced it in my area of Dublin North-West. Between Santry, Ballymun and Finglas there are several hundred places affected. Private developments were mentioned. St. Canice's school is also affected and that must be remedied. We have the Reco in Ballymun. The Department spoke to Ballymun Regeneration Limited, BRL. It was important to talk to it given the experience it had with the 138 houses in Sillogue that are being done and put back into the housing stock. They had never been released from the outset. Mr. Tuohy is well aware of that.

The big issue is how we will pay for this. Reference was made to levies on builders and insurance. What is the position with the banks? Many people are in negative equity and a contribution from the banks in a situation such as this would be important. No mention has been made of a Government fund. That has been done in other countries. If we could manage to persuade the Government to introduce levies then the money could be paid back into the Government fund. It has been done elsewhere. What is Mr. Tuohy's view in that regard?

Reference was made to Bord Gáis, the ESB and various groups. Proper on-site regulation is required to deal with the issue. Large-scale developers in Ballymun and other places are taking those projects on board. We will be able to observe how different companies perform and be able to recommend them. That will be useful. In other countries approximately three to four months is allowed to do the works on each unit. The timescale is important. We cannot wait indefinitely. We must move quickly. It is such a serious issue and time is not on our side. I hope the Government does move quickly.

Mr. Tuohy mentioned the amount of estates involved but in places such as Ballymun and the Carton development, even though we were fairly sure there was pyrite in a large section of houses, each house had to be checked because not every house was affected. Who will pay for the testing that must be carried out on each unit? It has been said that homeowners will pay but they cannot afford to do so. Testing takes time and causes much disruption and people will have to move out of their homes. A family could be out of their home for an average of three months.

Roads and paths have not been carefully examined. There is no evidence that highways have been affected, bar one section. Underground services such as sewerage and drainage pipes can be affected. We do not know what the repercussions will be over a period. Does Mr. Tuohy have any views in that regard? We can clearly identify who we can pursue in terms of houses but who will deal with these issues? It is the remit of local authorities. To date, local authorities have received funding for testing, which I welcome, in areas of Ballymun and Finglas. Much responsibility will fall to local authorities and therefore on the Government, which is why I believe the Government must set up a fund. There are many recommendations to improve the robustness of the present system. I welcome the recommendations that have been made.

Mr. Brendan Tuohy

I thank the Deputy. I will start on the BRL and St. Canice's school. They were identified and work is ongoing in that regard. Deputy Ellis is aware that there is a legal case involving Ballymun Regeneration Limited. We talked to the banks on more than one occasion and the Minister has met the Irish Banking Federation. We have made a specific recommendation that the banks will examine matters and be as flexible as possible in the way they deal with it. It tells us that the banks are covered by a specific set of rules from the Central Bank on how they treat people and that they cannot treat people differently. In that sense, we put in a caveat that is subject to whatever constraints are on them. That does not mean the issue cannot be examined separately by the Central Bank. Our hands were fairly well tied by what we could say.

Deputy Ellis and other speakers raised the fact that some people have already paid to have the work done themselves. If a house is suffering from pyrite, banks will accept that. We quoted a letter from Pat Farrell from the Irish Bankers Federation to Peter Lewis where he specifically states that the value of the asset is decreased if there is pyrite in the house. There is no doubt about that. I was not at the meeting between the Minister and the Irish Banking Federation last week but I presume he will give feed-back on it. Up to the point where we had finished our paperwork and when we drew a line very few people had come to them looking for specifics. That is what the mortgage providers said to us at the time. Perhaps people held back on talking about it but we are only going on what people told us. We had to take people at face value if they came to us with information. It was not a court of law. We took people as they came to us. In that sense, it might be worth talking to the Irish Banking Federation again.

Deputy Ellis referred to the overseeing of the works on-site and the expertise required. We accept that some of the developers and builders we have come across have taken the issue seriously. Some of them have done things quietly and do not want publicity while others have done things in a more public way because they have had to do it. We met a number of them and some of them were very sincere. They were appalled by the conditions people were left in and they wanted to remedy it. The double-whammy they got is that they could have done it gradually if it was one or two houses five or ten years ago when they had many other houses but now some of them have a problem. I am not saying all of them have a problem but they may either be out of business or close to going out of business, and they do not have that same revenue stream coming in. There was that balance, but where that happened many individuals simply went on and got it done. Many of the builders wanted to do that quietly and, in fairness, we will encourage that. No one needs to wait for someone to wave a magic wand on this. People should start to do the work, whether it is the builders, the insurers or whatever.

The Deputy raised the issue of payment for testing. Our figures on that vary from €1,000 to a few thousand euro, and there are different levels of testing. We recommend that the National Standards Authority of Ireland, NSAI, to which we have spoken, develop a standard protocol that would have flexibility and would be accepted by all parties, including insurers and banks. That is important, and it could be done fairly rapidly. We were keen on that when we met the NSAI, and it was very supportive of it. It is important that there be a standard test - one test to identify if pyrite is present and another on the remediation and so on - and we have protocols on that.

We did not deal with local authority houses but we are aware there are approximately 850 local authority houses involved, and they are being dealt with because they are owned by the local authorities. Presumably - I do not know for certain - they will proceed to take whatever legal action is necessary against the people concerned but the key aspect is that they are dealing with them up-front.

The Deputy spoke about the building control system. We share some of those concerns. We talk about self-certification and the limitations in that regard. We would like to see more inspections and building control properly resourced in local authorities with a sense of priority we believe it deserves. The most significant investment most people will make in their lives is their house, and in that sense it is important that they are protected.

Deputy Dessie Ellis

Was there any recommendation on the Government fund?

Mr. Brendan Tuohy

We talked about a fund being established through the levy or some other system. That does not stop. If the Government decided to front-load some of that while it is waiting for the levy to kick in, so to speak, that would be a political issue for Government. In other words, it might decide that it wants to start the process in the autumn of this year but I do not know what the books look like, apart from what I read in the paper. By the time that was set up there would not be a huge draw-down of it this year, but at least a process would be in place. Rather than do it sequentially, it could be done in parallel. That would not be unreasonable, but ultimately it would have to be a commitment funded by the industry levy to maintain the principle that the person who caused the problem should pay for it.

Chairman

Mr. Tuohy explains in detail where the responsibilities lie in recommendation No. 12.

Deputy Brendan Ryan

I thank Mr. Tuohy and the panel. I welcome the report, which, while not perfect, is a template for resolution of this problem. I am aware from talking to Mr. Tuohy previously that he did not set out to achieve perfection but to seek more practical solutions.

Mr. Tuohy has listed the recommendations in four categories, and category four includes measures to ensure this problem does not happen again. By and large, Mr. Tuohy has done a good job in that regard. It is a good, comprehensive section but the people affected now, who are covered in the other recommendations, have a sense that it falls short of what is required for their circumstances, and there are a variety of circumstances.

I want to deal with some of the issues that arise. First, the report recommends that only those homes that exhibit or develop significant pyrite-related damage should be remediated. It further recommends a series of certifications. No. 3 in that series is confirmation that where there is reactive pyrite in the hard core but no associated significant damage present, this status should not limit a homeowner's ability to transact in the housing market. However, given what we know about the unpredictable nature of pyrite, the length of time over which it can react and the stigma attached to affected properties and developments, is it not highly unlikely that people would buy such properties, potentially leaving large numbers of people paying for homes that have no financial value? Is that not a major problem and a big gap in the report for that category of homeowner?

Second, in the proposed amber category, who would conduct the monitoring on an ongoing basis, and who would pay for it?

The third issue concerns sulphate attack. The requirement for homes to exhibit significant damage before they are remediated does not appear to take account of the risk of sulphate attack. The report specifically states that sulphate attack has not been a significant issue and that a typical modern construction now separates hard core from concrete with insulation and radon or damp-proof membranes, thus reducing the likelihood of the problem in new buildings. It is well accepted that sulphate attack develops over a longer timescale than pyrite heave and therefore it is possible that its incidence could become much more widespread in years to come. Mr. Tuohy discounted the issue of sulphate attack somewhat in his report and there is a sense from experts in the field that it is and will be a real problem.

Mr. Tuohy is recommending new pyrite testing protocols. What will happen if the pyrite tests on which homeowners have already spent large amounts of money do not conform to the NSAI's new protocols? On the establishment of a mandatory registration system for builders, there is a suggestion from some sources that this could include developers also, and that where builders or developers have not engaged constructively with the Department, they should be excluded from that process.

What is the status of affordable homes? We spoke about local authority homes but many people live in affordable homes which they bought in association with the local authority. Is it envisaged that local authorities would take responsibility for the remediation, or will they be treated as private homes?

I agree fully with Deputy Murphy. The levy was the big-ticket item in the report. People who are out of time in terms of the statute of limitations and whose developers have gone bust will look to such a levy to get them out of the mess and give them some hope. I am disappointed that the Minister has indicated that it could be put off to determine whether there could be some voluntary engagement. My sense from the stakeholders is that they have not engaged voluntarily to any extent to date and they are not likely to engage at this stage.

Mr. Brendan Tuohy

On the point about homes exhibiting pyrite and heave, the Deputy spoke about certification and said that people will not buy the houses. We have to prioritise the houses that have exhibited heave. That is the first point. We are not saying that nothing happens ultimately to the other houses that have pyrite present. We are saying that other remediation methods are being examined but there is no test that will prove that if we deal with those houses in such a way, we will be able to say afterwards that they will have no future damage. We are saying there is research going on in that space and it would be a shame not to give it some time.

We are following the process outlined by Judge Charlton in his decision, which the Deputy can read in the report. He states that those houses that exhibit heave should be dealt with and that those that have pyrite but have not exhibited heave should not be dealt with at this time. I want to be clear that we are not saying they should never be dealt with. That is the reason we recommend the system of testing for the presence of pyrite.

In terms of what is happening with some of the pyrite testing - the protocol can examine this - if a number of houses in an estate are found to have pyrite present and it is realised that all the materials came from the same quarry at the same time, some insurers are not requiring every house to be tested because it is clear that all of those houses are affected. In other words, people are being reasonable in their approach, or they should be reasonable in that sense. That will be an issue for the protocol being developed on the testing side. Nobody is trying to make it very expensive for people to do the testing. I imagine what is happening is that the insurers must be satisfied that pyrite is the cause. If they are to engage in proceedings against quarry owners or others, they must have evidence. If they have paid out themselves, they must be in a position to take action against the people responsible. I understand why they would do so. In that sense, we are saying the reason we have the test certificates is to ensure houses with problems are put in the correct category, such as category three, so the problem will be dealt with. Thus, where there is a conveyancing transaction, the homeowner will be able to show pyrite certification and a guarantee that if the home moves into the red category on showing signs of heave, the problem will be dealt with. The ultimate solution for those concerned would be to remove everything. Any of us in such circumstances would want that to happen. All we are saying is that we wanted to prioritise the houses that are showing heave up front. I hope that explains it.

Mr. Malcolm Edger will discuss sulphate attack as he will have dealt with that issue.

Mr. Malcolm Edger

Sulphate attack can be a side-effect of pyritic heave and can also be due to sulphates in a different form in the hard-core materials. The panel examined a number of properties. We discussed the matter with a number of people who had done the remedial work and there was no apparent evidence of sulphate attack at that stage. The point was accepted that it could happen in time. This would require special conditions. The problem is more aggressive if there is a high water table and movement of that water table. When we are rectifying the problems of the 850 houses, we will be able to inspect the floor slabs and rising walls as part of the process. We can take guidance because it would be easy to protect from sulphate or do further remedial works, such as scabbling, at that stage.

Mr. Brendan Tuohy

Deputy Ryan raised the issue of mandatory registration, which we recommend. He referred to exclusion of people. He is getting into very technical and legal issues; we did not get into that level of detail. Where the exclusion of certain people is concerned, it must be remembered that people have certain rights. I am not a lawyer and would leave that matter to the parliamentary draftsman.

Deputy Brendan Ryan

What about the rogue developers who have not co-operated?

Mr. Brendan Tuohy

It is very difficult to introduce into law a measure such as that proposed. I would really leave the matter to the parliamentary draftsman. I am sure the committee will have a role in any legislation in this regard.

We engaged with quite a number of developers through submissions and panels but, to be fair, we cannot say we engaged with all of the developers because we did not. There were many small developers, etc., with whom we did not deal.

With regard to affordable homes, the 850 houses comprise local authority houses and affordable homes. The normal contracts apply in these cases. I do not refer to the 850 houses in the red category. One can revert to the Department on the local authority issue.

Reference was made to the levy. It is one solution, but there may be others. In fairness to the Minister, he stated that if people do not come up with the voluntary contribution to make this happen - this is the fastest approach if people are prepared to accept collective responsibility - he will, I presume, obtain his Government colleagues' support in September to introduce legislation, with which the committee would be involved. I cannot speak for the Minister, but he said what I have outlined last week at the press conference. Deputy Murphy talked about this subject. The fastest approach is for people to meet their responsibilities and look after the houses affected. The construction industry is a significant part of the economy, although it is not as large as it was five years ago. It comprises 6% of the economy at present, which is significant.

The quarries and the industry have asked why a builder in Cork or Galway should pay for something that has happened in Dublin. Our reply is that the cost of paying for an uninsured driver in Dublin is shared by all insured drivers according to the concept of collective responsibility. We have a similar approach to health insurance, as members know. There is a set of regulations stipulating that the burden be shared. This is the principle we are adopting and proposing.

Deputy Terence Flanagan

I welcome the delegates. I commend the Government on seeking to take action in this area. It is obviously a legacy issue pertaining to occurrences during the building boom. A number of estates in my constituency are affected. All members present wish to see the issue resolved and to help the homeowners who find themselves under extreme pressure.

How confident is the panel about the scale of the problem? There is a big difference between 12,250, as quoted in the report, and 100,000, as quoted in the media. Could the delegates comment on that? How confident are they that they have got to the root of the problem?

How was the system for classifying housing estates arrived at? What sources of information did the panel have to differentiate between red, amber and green estates? Could the delegates comment on HomeBond? The Chairman referred to its failure to co-operate with the committee and its ignoring of correspondence and requests to appear before it. What level of co-operation was received from HomeBond on information sharing?

Forty-five thousand euro is the figure quoted for the remediation of problems in homes. This seems to be a very large sum and thus presents a barrier to homeowners who seek remediation. Surely, given economies of scale and the desire to drive down the cost to an absolute minimum, something could be done in this regard and in respect of testing.

Could the delegates comment on the timescales? What progress do they envisage in the months ahead? How long will it take to carry out remediation measures on a home? What will happen to the homeowners during the process? What advice do the delegates have for homeowners? There are some homeowners who have not yet flagged the problem with their builders, HomeBond or the panel.

Mr. Brendan Tuohy

On the figure of 10,000, I will refer to the comments I made at the beginning. All we can do is to work on the basis of the figures we triangulated from different sources. If somebody else has information he has not made available, I suggest he feed it to Mr. John Wickham, who has compiled all the information. We have tested it and run it past various people. We do not give members numbers out of the sky. We have been as scientific as we could have been. If we are presented with a list of estates or houses, we will see whether they are in the database. If not, we will examine them. That is as robust as I can be.

Deputy Terence Flanagan

Have the media been asked how they came up with the number?

Mr. Brendan Tuohy

I am sure the Deputy knows more about the media than I do and whether the media pick numbers out of the sky. I will not comment on the media or we will be commented on tomorrow.

With regard to classification, we give an estimate. We have not tested the houses in question; what we are saying is that we are placing in the red category the 850 claims with the structure guarantee companies, although they are not all proven yet. In other words, they require immediate treatment and are exhibiting heave. Amber categorisation is based on the ground floors of the houses in an estate. In any estate that has been subject to a housing complaint owing to pyrite, we have added up the number of ground floor units and put them into the pot. The figure of 1,100 pertains to the houses subject to remediation. They should be treated like any normal house, although the insurers and others seem to have a problem with that, which is very unfair. Once there is remediation, there is remediation; let us be honest.

Deputy Terence Flanagan

Given that there is certification.

Mr. Brendan Tuohy

There has not been certification up to now. What we are saying is that the offending material has been removed, bearing in mind that I am not referring to the longer-term issues referred to by Mr. Malcolm Edger.

However, that is part of what we are trying to do here with the test protocols to which we refer.

The Deputy asked about HomeBond and in fairness, we engaged with it on a confidential basis. We have met HomeBond a number of times and have gone through the numbers, about which we are fairly robust. I do not know the joint committee's relationship with HomeBond, as I have not been involved.

Deputy Terence Flanagan

The joint committee does not have a relationship with HomeBond.

Chairman

It is not for the want of our courting HomeBond. It simply is not reciprocating.

Deputy Terence Flanagan

It has ignored the joint committee.

Mr. Brendan Tuohy

Perhaps the joint committee would have a better relationship with it, were it based in Cork. However, when we engaged with HomeBond it was almost as helpful as we would have wished. We engaged with it more than once, ran numbers and checked and so on. In that sense, it would be unfair of me to criticise it. However, we did comment on what we think it should do with regard to its treatment of the people with the structural guarantee. I differentiate between the process here and the normal sense of dealing, about which we think it should respond immediately. Moreover, in the report we recommend it withdraw the letter of last year.

On the €45,000 cost of remediation, the Deputy is absolutely correct. While the figures range from approximately €25,000 to €85,000, depending on the individual houses and so on, a number of the builders have made clear that once one knows one has a series of houses to remediate and can so do systematically, there is no doubt but that the unit cost can fall dramatically. However, we were asked and thought we should provide the joint committee with a ballpark average figure at this time, simply to put a number on it. We did not go for the lower end, although such costs may transpire were one to carry out the remediation systematically, but came up with a figure of €45,000. However, in the report we indicated a cost of somewhere between €25,000 and €85,000. Literally, every house and the associated cost differed.

The Deputy also referred to the period and we have heard figures of approximately 16 weeks and so on to remove people. Again however, it was necessary to put people into other houses and we have observed cases, as I am sure have members, in which the developers were able to free up and use other houses. This is the reason that doing this work systematically rather than on an ad hoc basis unquestionably is much better and one should be able to reduce the costs.

The Deputy talked about the testing and, again, we made specific recommendations on testing protocols. Someone also raised the question about existing houses that have been tested. This is an issue that may be considered when the testing protocol is being developed. The new testing protocol will be a standard test. While we do not seek the Rolls Royce version, we seek something that works, into which people can buy and that is used by all the different players. As for the timelines, the ball is now effectively in the Minister's court from that perspective and he has indicated his desire for those concerned to revert to him in September. In so far as I am aware, on foot of a radio interview with Tom Parlon last week, I gather he is scheduled to have a meeting with some of the stakeholders tomorrow as he called together all the construction people. In fairness, if people are now seized with taking action, this thing can happen and there can be movement. However, it really is up to people to not wait for the courts, which will take some time. Our point in this regard is that people can do things in the meantime and things can happen. This is the reason the report refers to people taking action. If builders are renovating or remediating, they should not stop and wait for the outcome of the court cases but should keep on doing it.

As for the advice to homeowners, the Department has set up a hotline and quite a number of queries have come in by e-mail and telephone, which will be responded to by people, including my colleagues here who are in the Department. In fairness, people have genuine concerns in this regard. At the outset, I noted that many people do not even wish to admit they have pyrite because they are afraid it will devalue the house. I have huge empathy, as does everyone, with that position. Our point is that if such people talk on a confidential basis, they will be provided with information. However, in the first instance people should not be afraid to identify whether a problem does exist because otherwise, it never will be dealt with. Consequently, our message is that people should not be afraid to say it. We will not put this information into the newspapers or anything like that. A hotline has been made available for people and the telephone numbers and e-mail address have been included in the report.

Deputy Terence Flanagan

In the case of people who have pyrite in their homes and who need the testing to be carried out, will that have to wait until the protocol is developed?

Mr. Brendan Tuohy

In the first instance, the normal thing for such people to do is to apply to the structural guarantee or whatever company is involved as the insurers. This is the point at which this is triggered and there is a series of testers and methods who do this. We propose the development of a new standard methodology in this regard but acknowledge a number of different testing methodologies are in use at present. While they are less or more expensive than one another, we propose having a standard methodology that is robust but is not at the top end of the range.

Deputy Terence Flanagan

The concern is whether it would be necessary for houses to be retested. In the case of householders who get their houses tested now, would it be necessary for them to have them retested because the standard has changed because of the protocol?

Mr. Brendan Tuohy

As for the insurers of which we are aware and certainly in the case of the premier one, they have guys who do the tests. These guys come back in and once the insurers are satisfied with their own tests and if the houses involved meet the conditions, they pay out on foot of that. Our proposal concerns a more general test and our hope is the companies will accept such a standard test because by so doing, one could reduce the cost of it and would be able to categorise. Moreover, in the case of estates in which it is quite clear that material from the same quarry went into 100 houses, it is not necessary to test each one of them to the full extent, as one can conduct sample testing. Our proposals pertain to that concept of getting scale and then being in a position to reduce the costs.

Chairman

I will now take questions from Deputies Darragh O'Brien, Clare Daly and Nulty together.

Senator Darragh O’Brien

If only.

Chairman

My apologies: Senator O'Brien.

Senator Darragh O’Brien

Perhaps that might happen next time but that is politics.

I thank Mr. Tuohy and everyone involved for the publication of the report. As many questions already have been asked, I will be as brief as possible. When did the panel actually submit the report to the Minister?

Mr. Brendan Tuohy

We gave the Minister a draft as he was going to the climate conference in Rio de Janeiro.

Senator Darragh O’Brien

When was that?

Mr. Brendan Tuohy

No, I am informed he did not take it then as it was not ready. It was the week in which he returned from the conference in Rio de Janeiro.

Senator Darragh O’Brien

When was that?

Mr. Brendan Tuohy

It was approximately four weeks ago. In fairness, it was only within the last few weeks.

Senator Darragh O’Brien

That is okay. I am specifically interested because timelines were given in respect of the report and many people had raised questions as to-----

Deputy Terence Flanagan

It was a matter of weeks.

Senator Darragh O’Brien

I know that but-----

Deputy Barry Cowen

The Senator is attempting to establish the timeline before publication.

Mr. Brendan Tuohy

In fairness, it got on the-----

Senator Darragh O’Brien

If I want to ask Deputy Terence Flanagan a question, I will but I wonder when-----

Mr. Brendan Tuohy

I will get a date for the Senator but it is not an inordinately long time.

Senator Darragh O’Brien

That is fine.

Mr. Brendan Tuohy

In fairness, it had to go before the Government.

Senator Darragh O’Brien

That is understood.

Mr. Brendan Tuohy

The normal procedure for so doing is that one circulates material two weeks in advance so in that sense-----

Senator Darragh O’Brien

It was approximately between two and four weeks ago.

Mr. Brendan Tuohy

I would say it was within four weeks.

Senator Darragh O’Brien

That is fine. I refer to aspects of the report, which is welcome on the basis of-----

Chairman

I note the foreword includes a letter dated on 27 June, which gives an indication as to when the report was given to the Minister.

Senator Darragh O’Brien

It was there or thereabouts. I thank the Chairman.

There are a few concerns about the report. The issue is the panel effectively has been stood down. I appreciate the witnesses' attendance at this meeting and acknowledge they have done their job and have produced the report. As they will have learned from today's meeting, there are many questions and queries on it, as would be expected in respect of any such report. To follow on from Deputies Cowen and Terence Flanagan - I will submit further information to the Department - I believe we are erring on the side of a much lesser figure for the potential number of dwellings affected. This is not just based on a simple extrapolation of what came out of the various quarries but members will submit the information they have to Mr. Wickham.

How did the panel find the State had no financial responsibility in this regard, particularly when one takes into account the Building Control Act 1990 and the role of the local authorities as the planning, building control and building enforcement authorities? The Building Control Act specifically mentions "Suitability, durability, classification, use and testing of materials and components (including surface finishes) used in buildings." Stating at the very outset that the State has no financial responsibility in this regard stuck out like a sore thumb. It obviously does so through the local authorities in respect of the local authority housing Deputy Ellis has raised today. Moreover, the local authorities themselves will be obliged to come up with the funds through the Department of the Environment, Community and Local Government, to remediate those houses. I take it that this will be done.

However, I refer to the whole swathe of houses in private ownership for which people do not have recourse to the local authorities. I recognise clearly that setting down future testing standards is important. What will happen in the interim and who should bear the cost of those tests? I would have thought a recommendation was in order. If home-owners get their homes tested, at the very least they should be allowed to claim those costs at the marginal tax rate in future. That should have been recommended to the Government to allay some of the costs involved.

I have a few more points. Recommendation No. 11 states that mortgage providers should consider providing funding for pyrite-related remediation, including work testing for home-owners, which would be in addition to their mortgage payment. Can Mr. Tuohy clarify that is what he said? I noted his interaction with the Irish Banking Federation. As regards the banks' own assets, it is true that for most people, the bank owns most of their house, so it is not acceptable for banks to say that it is nothing to do with them. Mr. Tuohy's panel made a recommendation that banks should be asked to be lenient and lend extra money to people so that houses, predominantly in negative equity, can be remediated. That seems to be completely off the wall, however, particularly as when people drew down mortgages the banks' own valuers signed off on them and on the property itself. One would have thought that the recommendation to the Minister would have been stronger on how to pursue the lenders in this regard, as they are major stakholders.

The levy fund has been referred to already. Did Mr. Tuohy examine the situation in Quebec? It is a smaller issue given the numbers, but the government there put money into that fund. Mr. Tuohy said the State has no responsibility or culpability, but is the State responsible for the flooding that happened in Cork a few weeks ago? Most people would probably say it is not. The State provided a fund of €30 million for homeowners who were affected by those floods. That is right and I agree with it. In this regard, however, because the Department of the Environment, Community and Local Government oversees local authorities and going back to the Building Control Act, it seems strange that the Government has no financial responsibility.

That leads me to my penultimate question. Did the Department of the Environment, Community and Local Government feed into the report itself at any level with regard to a government view on responsibility or culpability? Mr. Tuohy has stated that the Government is not financially liable in any way, shape or form. Did that view come by way of a submission from the Department itself or was it something that Mr. Tuohy's group came up with? If it did, how did it do so, given the terms of the Building Control Act 1990? It does not stack up to me.

My last point concerns the certification issue. I agree with Mr. Tuohy that one must start somewhere, but to have certification where one is not proposing across-the-board testing of all the estates that have been identified up to now, does not add up. For people's own peace of mind, it seems odd that Mr. Tuohy would say to someone that they are in the green category and will be parked there for a moment. I know this matter must go to the Minister, so it is nothing against Mr. Tuohy himself. However, it seems crazy that he would propose this certification and say that a person's property was all right for the moment when we know that houses in the same estates have shown very different levels of effect at different times.

Mr. Tuohy has a resolution committee but how long will it remain in situ? Why is there such a lack of timelines? The only timeline I can see in the recommendations is on the basis of what the Minister has said - that he wants to get the stakeholders to come back to him voluntarily by the end of September. It is not Mr. Tuohy’s role to legislate and I fully understand that. Fianna Fáil proposed a Bill on extending the Statute of Limitations that would give people more time to work out an overall solution. It is not an easy thing to solve. I wonder, however, why we did not have more datelines in the report to say that this or that should happen by a given date. I cannot stand over what has been proposed by way of a certification process and the green-amber-red light system. Perhaps Mr. Tuohy could elaborate on why he thinks that would be sufficient for homeowners.

Chairman

Thank you, Senator O'Brien. If the Senator wants to speak about Government action in Cork, I will give him as much speaking time as he wants.

Senator Darragh O’Brien

Obviously.

Chairman

I will take three speakers together, starting with Deputy Clare Daly.

Deputy Clare Daly

I thank the witnesses for attending the committee when they were on leave. The way in which they have conducted themselves and handled the whole process has been very good. I commend the amount of people they managed to interview, and the range involved, given that the pyrite panel cannot compel anybody. They managed through their demeanour to continue a process of engagement with many of those people, which is a tribute to the way they handled the matter. The residents must also be thanked for providing information.

We are in a peculiar situation in that the pyrite panel is not the cause of the problem. The panel members are charged with helping us and everybody else to identify a way out of the crisis. All we can do is use the opportunity to get more insight into the panel's thinking on some of its recommendations, rather than attacking it over any perceived shortcomings. If there are shortcomings - there are a few - it is up to the Government to deal with them. Nobody is bound by anything the panel has said, or not said. We have within our means the ability to do anything we want, if the will is there, even beyond this report. We must take that on board. Within the context of the report, the panel has done quite a good job.

Many questions have already been asked, but I would like to go over a couple of them. I am still struggling to get an idea of the traffic-light system. I can understand that it is being done to manage this problem but we are not talking about a bottomless pit of tens of thousands of houses. We can structure it so that it can be dealt with systematically, thus making it more appealing to the industry and all the stakeholders. I can understand the logic of that, but it is not hugely scientific either. I fully accept the sources from which the report has been drawn but we all know people who say they did not bother going to HomeBond. Last week, I advised two people to go to HomeBond, but they told me it does not deal with people who have a pyrite issue. There are many people who think that, so I imagine there are many more than the 850 who are displaying signs and in need of immediate remediation.

Like other members of the committee, I have a problem with the amber group, including the definitions. How will "serious damage" be defined? How will the protocol for that damage be monitored? Mr. Tuohy said there was a potential for new industrial solutions that do not require taking out the infill, but to the best of my knowledge none of those could be used now. None of the new solutions would be acceptable at this stage, so we are talking here about applying such a solution much further down the road.

I am still not clear how it will be monitored and how the fund will be dealt with. The full extent of the problem still needs to be identified and the best way to do that is by testing. The most efficient, cost-effective and comprehensive way is to do it systematically. As has happened already, that does not necessarily mean addressing every house but it needs to be done in such way and with economies of scale. Repair work also needs to be looked at in that regard. If one house is displaying serious signs of damage from pyrite, the impact of dealing with it can have a knock-on effect on a neighbouring house two doors along a terrace. It would be better, therefore, to deal with them all together.

I can see where Mr. Tuohy is coming from on the HomeBond issue. HomeBond has information but it clearly has a huge image problem at the moment. There are presumably other ways in which the Government could at least request it to hand over the files. Perhaps another independent agency could take that information and deal with it. HomeBond has been happy to share it with the pyrite panel, so could it share its information with another independent body that could administer these works? How many of the thousand plus houses that have already been remediated were involved in HomeBond? Mr. Tuohy said it has a certain expertise and I know it has a knowledge of the problem, but how much has it been engaged in the solution in areas? I am not fully sure, so I would be pleased if Mr. Tuohy had information on that.

The protocol for testing is out of Mr. Tuohy's hands. This committee and the Dáil in general can have an input in pushing the National Standards Authority of Ireland, NSAI, to speed up the process and make recommendations on who pays. I note the points about the property tax but it is up to the Government to pick that up. I believe no one should pay it but that is neither here nor there.

I fundamentally disagree that the State is not in part responsible for this matter. It is and it must be factored into the formulation of a remedial fund. Already, the State is paying for remedial works on local authority housing which have been affected by pyrite and where the builder has gone bust. All taxpayers are contributing to that but the State denies any role in providing for private home owners in the same boat. A certain pay-out into the fund has to be equalled with a levy on the quarries. The committee should make recommendations to the Minister.

Chairman

Recommendations will be made at the end of this meeting.

Deputy Clare Daly

It is important an interim report is issued by the end of August and we would get a check on what way the stakeholders are thinking. It is also important the committee recommends a debate in the Dáil on this and that headings of the necessary legislation to give teeth to some of the issues involved, such as the Statute of Limitations, are drawn up. The issues around the building regulations need to be examined as well. Today's meeting is about information gathering.

Deputy Patrick Nulty

It is obvious from the size and detail of the report that a huge amount of work was put into it by Mr. Tuohy and the panel. I thank them for this work.

Does Mr. Tuohy envisage any role for NAMA in the resolution process? In my experience, some of the builders and developers involved in building homes affected by pyrite are either in NAMA or in the process of being liquidated. Can Mr. Tuohy clarify the proposals for the suggested resolution board, particularly regarding the circumstances under which the board would be used and at what stage would it take over from the initial remediation process? Has he any advice for home owners affected who are already involved in protracted litigation processes?

The report by the panel asks why the County and City Managers Association did not review the reasons why building control authorities did not seek to utilise provisions in existing legislation as the problem with pyrite was emerging. On the one hand, the panel claims the State has no responsibility in this problem, yet, on the other hand, the panel asks why local authorities, and those in positions of authority within them, did not use the legislative tools available to them to deal with the problem. I am not a member of the committee but may I be so bold as to suggest local authorities mentioned in this report explain themselves to this committee. Questions on why existing legislation was not used need to be answered.

The report states four of the five quarries that supplied pyrite-affected material are closed. Why has one been allowed to remain open? The report recommends some pyrite-affected homes should be exempted from the property tax. Will Mr. Tuohy explain specifically which homes should be exempted? Should it be red, amber or green homes? Should homes tested in the future which are found with pyrite be exempted? Should they be given a claw-back on the property tax already paid?

A pyrite hotline has been set up, which is welcome. Will the panel meet with Pyrite Action and other groups? Will there be direct liaison points put in place for civil society groups and will all their queries be dealt with to their satisfaction?

Mr. Brendan Tuohy

We looked at the role of the State in this matter but we feel primary responsibility lies with the people who caused the problem. That is common in many of the submissions made to the panel. Those responsible are listed and the State is not named. No one who made a submission to us named the State. Mr. Justice Charleton stated in his judgment that the problems with the materials would not have been picked up at the point in the inspection by the building control authorities. Our report compares the building control regulations at the time with those in Northern Ireland, Scotland, the UK and Canada. There was nothing different in the main between the regulations. The knowledge at the time was such that the building regulations here were as good as any other.

(Interruptions).

Chairman

There is a mobile telephone going off somewhere.

Mr. Brendan Tuohy

It is mine, telling me my parking is up.

(Interruptions).

Deputy Dessie Ellis

It was the quarries that lacked controls.

Mr. Brendan Tuohy

There was testing of the material going into roads and concrete but none for the materials going into hardcore. In his judgment Mr. Justice Charleton spoke about the sale of goods Act and clause No. 804 of the National Roads Authority manual on road works concerning the high standard material which is normally used in road construction. The advice to us is if that material had been used in hardcore, the pyrite problems would not have occurred.

In fairness, the Minister took a leadership role in this matter and pulled people together. We were amazed, and it was stated in the report, that it took four and a half years for this to happen. All of the industry parties stood back. We state that whatever about the legal responsibilities, there are moral responsibilities. It is appalling that it took four and a half years for people to agree issues needed to be ironed out. When we met various parties involved, many of them told us they had not discussed this matter. We asked how they could not have discussed it as it is a significant issue. Many of them took the view that it was about the individual relationship between a builder and house owner. When matters reach the level they did in this case, then there is a public policy element to it that needs to be dealt with. We recommend in our report that there are collective responsibilities which must be taken. That is very different from taking financial responsibility.

Senator Darragh O'Brien proposed that affected home owners should be allowed to claim those costs at the marginal tax rate in future to allay the costs. That is a matter for the Finance Act. On testing, we spoke to one of the companies involved in this. While people can apply to get the testing done, they do so at their own expense. If their houses are remediated and if, for example, Premier subsequently takes action against others they can join in the action to recoup their money. However, Premier will not pay the cost of testing upfront. I have sympathy with those who must pay upfront for repairs. One of the reasons we recommended this course of action was so that the Irish Bankers Federation and mortgage providers would consider providing the money and seeking to recover it afterwards. The problem for many people is that it will cost several thousand euro at a time when they do not have much money. In that sense we speak about a need for flexibility.

In the Quebec case it is important to realise that pyrite did not become apparent for as long as 18 years afterwards. Many of the insurance policies had expired at that stage and a number of the builders were no longer in business. The Quebec authorities also realised that its building regulations were deficient because they failed to make reference to hardcore. It did not cover everything but it made a partial contribution. That was a reasonable response at the time.

Senator Darragh O’Brien

Would it be a reasonable response for the Irish Government to make a contribution?

Mr. Brendan Tuohy

We are in a different position. We are saying upfront that the people who caused the problem should pay to fix it. If the insurance does not work and the builders have gone the pyrite resolution panel is available to deal with the issue but the first port of call should be the builder, the insurer and the structural guarantee scheme. We must have a plan B in case nobody else is available, however, and it will be funded through a levy or other mechanisms. Most members will agree that builders should be the first step in remedying the houses because we should not be waiting for other mechanisms to be developed.

We called the Department of the Environment, Community and Local Government before us just like any other organisation. Officials from the Department were seconded to us as technical experts but they did not represent the Department. The panel rather the individual officials wrote the report.

Senator Darragh O’Brien

I was just wondering about the Department's input into the process.

Mr. Brendan Tuohy

We called the Department in like anyone else and it made a presentation to us. It did not make a case for the State because it was mainly focussed on technical issues around building regulations. I could not speak more highly of the officials who are accompanying me. At a time when public servants were being heavily criticised I was receiving e-mails from Department officials as late as 9 p.m. or 10 p.m. I want to state for the record the commitment shown by these officials. Mr. Malcolm Edger will agree because he has also been on the receiving end of e-mails.

In regard to certification of estates, we put all houses in an estate in the amber category if any is found to have pyrite. That may not be true, however, because material can be drawn from different quarries. Houses literally next door to each other have used material from two different quarries. One day it may be raining and the material in one house heaves but the other house is untouched. Pyrite produces a complex chemical reaction. We have encountered houses which were built on pyrite 100 years ago but never caused a problem. We included 850 houses in the red category. Perhaps other houses may be affected by pyrite but people have not complained about them. Our report indicates that the number could increase on foot of its publication because it could encourage further householders to submit claims. We encourage people to submit claims because they cannot be dealt with until they complain. The amber category encompasses houses where pyritic material is present but is not causing heave. In other words, it is not causing significant damage. Cracks can always appear in houses from settlement but pyritic heave is a specific type of problem and the experts will be able to identify it. Houses in the amber category should be dealt with but the first priority are those which are showing heave. That is the type of triage that would be practised in any situation. Houses in the green category have either been dealt with or have been certified as not having pyrite present. These houses should be treated like any other house. The banks issued circulars requiring that a surveyor state whether pyrites have been found in the area but the area could have a radius of 1 mile or 10 miles. The banks have agreed to reconsider that requirement. It is unfair because pyrite is a ubiquitous material and could be found anywhere.

Deputy Clare Daly referred to the protocol for serious damage. The National Standards Authority of Ireland has agreed to carry out work on the protocols and standard testing and it is doing so in an open way. Residents were keen to be represented in this work and I am sure the authority is open to that because it wants to develop a set of standards and protocols that are acceptable to everybody. It is important that we proceed quickly, however, because we do not want to be still discussing protocols in 12 months' time.

We did not include timelines but we outlined a set of recommendations and action points and identified who should be responsible for implementing them. Timelines are a matter for the Government to decide. The Minister has stated that he wants the financing and funding finalised by the end of September but that does not mean nothing will happen between now and then. Deputy Catherine Murphy pointed out that certain actions could be taken by this committee. It is not necessarily a sequential process because it can also be done in parallel. The NSAI revised Standard Recommendation 21 in an inordinately quick time when it came out first in 2007 and it was out by November and back in the building regulations by the following spring. That is a very prompt turnaround time but I think there is a willingness to make it happen. These are real problems but one must not sit on them because other priorities might arise next week.

The issue in respect of testing houses is that once Premier and others realise they do not need the full suite of tests on every house because they know the material came from the same quarry they will be able to scale down their testing. It is only sensible and responsible not to require everything to be done all the time.

In regard to whether HomeBond can share information with Premier, HomeBond is a private company and it has directors like any other company. The provisions of the Companies Acts must apply. Our report recommends that it reconsider the letter it issued last August in order to engage with people sooner rather than later. However, an issue arises in that people believed they had a certain level of cover but they are now being told they are not covered because of the material used. This is very unfair but it brings us back to the issue of standard insurance policies that do not allow for opt out clauses.

Deputy Clare Daly

How many of the remediated houses were covered by HomeBond?

Mr. Brendan Tuohy

HomeBond covered approximately three quarters of the market, which equates to approximately 750 to 800 of the 1,100 remediated houses.

Mr. John Wickham

They were only a handful of the 1,100.

Mr. Brendan Tuohy

Approximately three quarters of the 850 were HomeBond and a quarter were Premier.

Deputy Clare Daly

The reason residents asked the question was to find out how its expertise was developed if it does not have a track record in remediation. Why are we saying it is the agency which should be responsible for the work? I accept it has the information required to deal with the problem.

Mr. Brendan Tuohy

HomeBond has been in business for 30 years. In fairness to it, it has done good work on its housing manual, which has effectively become the bible for the industry. We argue that it already has available the expertise and the processes in place. To try to set that up again takes time, and all of this is about time, given people are suffering. We must move on that, although this is not to suggest we cannot look at different options where we could, to think out loud for a moment, have a supervisory board working with HomeBond, for example. While that might not be the way, there are options within that, if one wanted to be flexible. What we wanted was for it to re-engage because, in my view, to sit back and not engage is not the right solution.

With regard to Deputy Nulty's comments on NAMA's role, NAMA has stated that while it is involved with some of the developers, it does not actually own any of the houses itself, so there are issues in that regard. I think I have explained the point in regard to the resolution board. The Deputy also raised the issue of exemptions from property tax and the issue of the hotline. Basically, the hotline feeds in to Mr. Wickham, Ms Neary and Ms Kiernan, who will be in a position to respond to those who make requests. They have an upfront series of questions and answers and, beyond that, they will respond to people. In the experience of all of the groups, the main point is that they have been responded to by Mr. Wickham, Ms Neary and Ms Kiernan in a positive way, and I believe that will continue.

Chairman

In conclusion, I want to put six recommendations to the committee. The first is that the correspondence from what I assume was a pyrite action group, which outlined a series of questions and considerations to be put to the Minister, Deputy Hogan, and the pyrite panel, will be sent to the Minister and that his Department officials would reply back to this committee, not on behalf of the group but on the committee's behalf. When we receive the response, we will forward it on to the action group.

Next is a separate piece of correspondence with a number of action points. The correspondence is to the Minister, Deputy Hogan, asking what measures or actions he will give consideration to in the event of HomeBond failing to co-operate with the pyrite panel's recommendations. Furthermore, it asks what timeframe the Minister considers as appropriate with regard to the implementation plans set out in the panel's 24 recommendations. Senator Darragh O'Brien suggested a similar timeframe.

Furthermore, it asks whether the Minister will give immediate attention to the recommendations contained in the report which pertain specifically to his Department, such as exempting affected properties from the household charge and the establishment of a resolution board. There are a number of actions in the report that come within the remit of the Department. Furthermore, it asks whether the Minister intends to bring forward specific legislative proposals on foot of the publication of the panel's report and, if so, what proposals are under consideration.

Finally, I suggest the committee would send a letter to the Ceann Comhairle seeking that the report be afforded speaking time in the Dáil and that we deal with the question of how the issue was progressed from today. Is that agreed? Agreed.

Deputy Catherine Murphy

I sought an interim response at the end of August.

Chairman

The pyrite action group's questions deal with some of the interim issues.

Deputy Catherine Murphy

One of the points I made in my contribution was that the committee would look at putting some nuts and bolts together in regard to the levy system. We may be able to gather information with a view to being ahead of the curve on that, and this is something we can meaningfully do.

Chairman

That is an issue we can look at when we recommence in September. It will not happen in the next couple of weeks.

Deputy Barry Cowen

The recommendations the Chairman has summarised encapsulate all that has been said and ask the Minister to bring forward legislation on the recommendations, if it is required, and, if he does not accept the recommendations, what recommendations he will make himself on this issue. From our perspective, we would like him to respond to that in so far as he can and as soon as possible so all parties are aware of what we can expect in the autumn Dáil session in regard to legislation that might be necessary from him to resolve this issue. The onus of responsibility now falls back on him and his Department.

Deputy Dessie Ellis

The key issue is from where money will come. There is the whole issue of the insurance companies putting forward a proposal in regard to the levy but, in the interim, we have to press for Government funding to be available pending the levy being gathered at a later stage. That is the key issue.

Chairman

I thank the witnesses for coming before the committee and for facilitating us with so much of their time, particularly their parking time, which has now expired, so I will not keep them much longer. Regretfully, given the context, the issue has not been concluded this afternoon but it has been progressed somewhat further.

The joint committee adjourned at 4.55 p.m. sine die.