Financing of Social Housing: Discussion (Resumed)

We now resume our discussion of the funding and delivery of public housing under Rebuilding Ireland. On behalf of the committee, I welcome Mr. Brendan McGrath and Mr. Dermot Mahon from Galway City Council; Mr. Conn Murray and Ms Aoife Duke from Limerick City and County Council; Mr. Joe McGuinness and Mr. Paddy Donnelly from Louth County Council and Ms Moira Murrell and Mr. Martin O'Donoghue from Kerry County Council. I draw the attention of 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 the committee. However, if they are directed by the committee to cease giving evidence on a particular matter and they continue to so do, they are entitled thereafter only to a qualified privilege in respect of their evidence. They are directed that only evidence connected with the subject matter of these proceedings is to be given and they are asked to respect the parliamentary practice to the effect that, where possible, they should not criticise or make charges against any person, persons or entity by name or in such a way as to make him, her or it identifiable.

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

Due to the tight schedule, the committee has decided to take the witnesses' opening statements as read. If they are agreeable, we will go straight into questions rather than reading out the statements.

I thank the witnesses for taking the time to travel to the committee meeting. Key issues for the committee are the targets for meeting social and affordable housing need under Rebuilding Ireland and the delivery of those units. I have the same questions for each local authority on that. Many members are concerned that the targets, in particular for what many of us call "real social housing", namely, units owned by local authorities or approved housing bodies, are far too low to meet the overall level of need in each of the witnesses' local authority areas. What I mean by that is that if one takes the current net housing list and the HAP transfer list, it gives one the real social housing need in a local authority area. If one matches that against the targets in Rebuilding Ireland, including builds, acquisitions and leasing, one third at best of the real social housing need will be met over the next three years. While the Minister will reply "Yes, but everyone's need will be met through HAP and RAS, etc.", are local authorities concerned about the wide gap between additions to the real social housing stock and the level of need according to their housing and HAP transfer lists?

The next matter is affordable housing. I appreciate that many local authorities are waiting to see what happens with the cost-rental pilot projects in Dublin, Dún Laoghaire-Rathdown and Cork. The serviced sites fund was initially made available to only a small number of local authorities, that is, to 11 of them, but the expectation is that it will be made available to others. What is the view in the housing departments within the witnesses' local authorities as to the level of need for affordable housing, including purchase and rental, in their administrative areas? If they have no idea of the need, which I suspect is the case given that I have no idea of what it is in my own local authority area, what must we do to establish what the level of need is? Is the delivery of affordable rental or purchase homes led by local authorities and approved housing bodies factoring into their plans over the next number of years?

The third question relates to the infamous one-stage approval process. Have the local authorities represented here today used the one-stage process? If so, how much use was made of it? If not, why has it not been used? Is it because there are no projects of larger size or due to the risks involved? What would the local authorities like to see in the amended one-stage process regarding the upper financial limits or a greater sharing of risk with the Department? The age-old question is whether the four-stage process is improving. We are talking to some local authorities which say it is not improving and that timelines are too slow with too much back and forth between local authorities and the Department at the approval stage. When the witnesses' counterparts from other local authorities appeared before the committee recently, we asked them what we could do to speed up procurement. Have any of the witnesses' authorities considered moving from having to tender every new build project to regional framework agreements whereby clusters of local authorities would work together on a big bag tender to get a certain number of contractors on the shelf for developments of up to 50 to 100 units? What can we do? Based on the witnesses' expertise on the procurement end, what could the committee argue for with the Department to speed that up? The delay this causes in delivering projects is a source of frustration for many local authorities.

As I am not a member of the committee, I am delighted to have been given the opportunity to come in for a few moments. Can the chief executives outline how many people in their areas are in emergency accommodation and what they plan to do to get them out of it and into proper accommodation? Are the numbers decreasing or increasing? Is it still down to the developer, landowner or householder selling houses where people have rented houses? Is it still due to banks repossessing or is it just that they are selling houses on the open market with an increase in the valuation of houses?

I will direct a few questions to Galway City Council. I welcome Mr. Brendan McGrath, the chief executive, and Mr. Dermot Mahon. How many houses is Galway short of at the moment?

How many houses are needed to get over the crisis? What is being done to try to deliver that? How many houses are the councils hoping to build between now and 2021? What plans are in place to build these houses? Have they been approved? Have they gone to tender? What blockages are there to completing projects? Is it with getting approval from the Department or with getting contracts signed to get houses? We have a major crisis. I am sure every county has that. As my colleague, Deputy Ó Broin, said, there has to be a mechanism for fast-tracking the building of houses. I am aware of a scheme in County Galway which was held up in the Department of Housing, Planning and Local Government for months to get approval, particularly about where windows would be in part of the development. We were told there was only one architect in the Department. Do the councils find that that still happens?

Does Galway County Council have enough land to deal with the housing crisis, not just for those in social or affordable housing, but for the ordinary people who want to buy a house? We seem to forget about the young couples who do not qualify for social or affordable housing who want to buy a house. I see it in Galway. Is it happening in other parts of the country? Is the State coming in and buying full housing estates? I see there are a number of estates in Galway where the State has bought the whole lot in one fell swoop. It is unfair on young couples who want to get on the property market. They cannot bid against the State. We have a housing crisis, including for young couples. Many are heading back home and staying with their parents because they cannot afford to pay rent or to get on the property ladder, because the prices are going up, and they cannot bid against the State.

There is an issue in Galway which may be present around the country. I go into Galway early every Sunday morning. From the top of Shop Street to its end, I think I counted 22 rough sleepers indoors in the space of, at most, 100 m. By 8.30 a.m., they were gone. There was no sign of them. They walked down the side ways. It was as if they disappeared. They come back at night between 11 p.m. and 12 midnight. What is being done about that? It is a disgrace to see so many. I have walked along and looked at them and they are all foreign. None is Irish. I ask Mr. Brendan McGrath, as chief executive in Galway, if anything has been done. Has there been a survey? Has the council talked to them? Who are they? Where are they from? What is being done to deal with that? It is terrible looking in the mornings. Many tourists walk around the city early in the morning and see that. Is that being addressed?

Will Mr. McGrath outline the future development of Galway city? I know he has done a lot of work, for which I compliment him, in progressing the Ardaun corridor on the east side of Galway city. The road has been downgraded. Funding has been received to get access to it. When does Mr. McGrath expect to see houses built on that? How many houses does he hope will be built? When does he expect to see people move in to these houses? Will he outline how many people are in emergency accommodation in Galway? When does he expect to be in a position to get that down to zero? What is the trend of people getting into emergency accommodation? How many present to Galway City Council as homeless in a month, on average? Are they families, couples or single people? Will Mr. McGrath and other chief executives outline the monthly trends of those presenting as homeless?

I am not a member of the committee but I thank the Vice Chairman for the opportunity to ask a few questions.

Maybe we will get answers to the first two questions first. We will start with Galway.

Mr. Brendan McGrath

I will deal with Deputy Grealish's questions later if that is okay or does the Vice Chairman want me to answer them first?

Mr. McGrath can answer whichever he wants but I know that Deputy Grealish is in a hurry to leave us.

Mr. Brendan McGrath

I think he is going to leave so I should give the answer.

We might be glad to get rid of him.

Mr. Brendan McGrath

Mr. Conn Murray who is here, is chief executive in Limerick and happens to be chair of the housing subcommittee of the County and City Management Association, CCMA, so may address some of the general issues too.

Sadly, the homeless figure fluctuates in Galway. We have 189 adults and just over 100 children in emergency accommodation. We recently opened the winter beds initiative, with which we increased capacity since last year. We will have 36 beds available and we also have contingency beds if that is insufficient. That will run through to next April and extend beyond that if necessary. We also have a men's hostel, Fairgreen Hostel, run by COPE, a homeless charity in Galway, with 36 beds which are full. The female hostel, where there are 13 beds, is also full. This year, we have allocated social housing to 20 homeless families. It is a difficult cycle and problem. We have another 49 families on notices to quit who will conceivably come on to our homeless list in the first quarter of 2019.

We have made a significant number of interventions to deal with the homeless challenge. It includes a homeless housing assistance payment, HAP, placefinder service which has been running since June. We have already been able to house 27 families under homeless HAP. Some 17 couples and single people who were registered have been housed under that initiative. I referred to the cold weather response. We recently purchased a family hub. Renovation work is starting next week. It will be up and running in the first quarter and that will accommodate 12 families. We are rolling out a modular housing scheme comprising 15 prefabricated two and three bedroom units on lands in city ownership. That will be up and running in early 2019. Through the Housing First initiative, where we set ourselves a target of 30 Housing First tenancies, we have also secured funding through the social reform fund, a philanthropic fund. It provides a wraparound service to homeless people who we are providing accommodation to and works with disability services, mental health services and the HSE. Work has recently commenced on a new domestic violence refuge in the city which will be ready late next year. That will provide nine additional accommodation units.

We have a rough sleeping problem. We have and will have beds for everybody who needs a bed this winter. The rough sleepers are largely non-habitual residents. They do not have residency status. They are generally eastern European. We have engaged with them consistently but they have refused offers of support other than winter packs. They are sadly destitute in their own countries. Young people going out at night might give them money etc., and they do not want to engage with services. They disappear the following morning and it is a problem we are trying to address. To be frank, a policy intervention is probably needed involving the Departments of Foreign Affairs and Trade and Justice and Equality, relating to non-habitual residency, which would help to ameliorate the challenge.

With regard to housing supply, very little private housing has been built in Galway since 2007. We estimate that there is a shortage of approximately 3,000 units. The city's population is growing organically by approximately 1,000 people a year. That would typically suggest that 300 or 350 units of accommodation are required to keep pace. We probably have pent-up demand that needs to be dealt with.

Extant planning permissions in Galway city can deliver 6,020 units. Our work on brownfield sites and the new suburb at Ardaun have the capacity to accommodate 3,500 accommodation units. As Deputy Grealish mentioned, we have begun work on Ardaun. In the past fortnight, we have attracted urban regeneration funds to deal with the access issues. That funding will go to site in 2019.

The city council faces a challenge in terms of its landbanks. We have 18 ha that are suitable for housing and are building on or are about to start building on 10 ha of that. The next 6.5 ha will go to site next year.

Galway City Council has approximately 2,300 social houses. By the end of 2021, we will have increased that number by 50%. That will create its own challenge for us in terms of the maintenance and management of the increased stock and developing sustainable communities, but we are making significant inroads into tackling the issue.

One of the quirks of the lack of private building in Galway is that approximately 85% of what is being built is either going to approved housing bodies, AHBs, or is local authority building. This means that there is a severe shortage of affordable and other housing options for people who fall outside the social housing qualification criteria. The situation is exacerbated because, on the one hand, those people are generally in rented accommodation and rents are increasing because of the market shortage and, on the other, they are under pressure to meet the Central Bank's mortgage affordability criteria.

I believe I have answered most of the Deputy's questions. If not, I will happily speak again.

I appreciate that. We will move on to Mr. Murray.

I also wish to contribute in due course. I just want to be sure the Vice Chairman has seen me.

I can see the Deputy. How could I not?

I know the Vice Chairman's vision can be myopic sometimes.

If I do not see the Deputy, I will definitely hear him.

There is no way we would miss him.

A wise Galway man.

I call Mr. Murray.

Mr. Conn Murray

I will address some of the general questions that have been raised. I will gladly address any Limerick-specific question as well, but we have given a detailed submission on what we are doing.

As to whether the targets in Rebuilding Ireland are realistic, they are the targets that have been set for the respective authorities. We will achieve them. Deputy Ó Broin asked a specific question on direct builds, which have always been the subject of many questions.

Not on direct builds, but on additions to the local authority and AHB stock through builds or purchases as opposed to leased private sector units.

Mr. Conn Murray

Apologies. I misunderstood. In terms of the policy that we work under, all aspects of Rebuilding Ireland are worked on and delivered in order to provide appropriate accommodation for the people on our housing lists. It is a different debate as to whether that is long term or another tenure element. We will work to deliver on that in terms of whatever direction comes to us. We have been successful in delivering under the policies that have been set to date, be that under the housing assistance payment, HAP, or the increased amount of leasing. In turnkey operations, direct builds have been important.

We need to see a strong balance emerging between private sector building and public housing if we are to ensure an appropriate tenure mix while also meeting market demand. This relates to the question of affordability. Unless we start seeing a significant improvement in starter homes, we will never move to address that aspect of the situation. One of the key areas that we would like to see more advancement on is the affordable loan that is available to people. It is an excellent loan at a good rate. It is a question of how to mobilise it and get it working more quickly so as to enable people to get starter homes and take some of the pressure off other sectors.

A question was asked about the speed of delivery. Various policies over the past 30 years - I have worked under most of them - have seen the local authority being the provider, the introduction of AHBs and, at one stage, an emphasis being placed on AHBs. Addressing that saw shifts in the various elements between private provision, AHBs and us. Consequently, and particularly in the past eight years, local authorities have not been as geared up for delivery because a different sector was providing housing. It has taken time to resource and rebuild our respective departments, personnel and expertise to drive forward with various types of build. We have ramped up considerably.

The 2018 targets will be achieved overall, although individual targets pose challenges for the authorities for which they are set. That is down to some of the processes. Authorities will be up in some years and slightly down in others, but it is important that we be measured as a sector overall. Turnkey operations are a vital part of that. The four-stage process was mentioned but, in terms of direct build, committee members will see the speed with which turnkey operations can be turned around and delivered as distinct from the four-stage process. That depends on the activity that is taking place within the respective county.

I will comment on the four-stage process. There have been improvements. The introduction of the 59-week process has enabled us to work to more clearly defined timelines. We would like to see further improvements. It has been indicated that the four-stage process could be reduced to two. The first stage would be a combination of the current stages 1 and 2, which would increase its sufficiency prior to formal planning permission. That would be done to ensure we had confidence going forward. I am a great believer in-----

May I ask a question on that?

Mr. Conn Murray

Of course.

If the process is reduced to two stages, what will be the reduction in the time from conception to construction site? Currently, it is approximately 18 months depending on the project.

Mr. Conn Murray

Answering that question is difficult. Stages 1 and 2 are dependent on the planning process, which can differ depending on the local authority, the issues that arise or the locations where one wants to build. Once planning permission has been acquired and the formal adjudication process has started, one can accelerate the time. The initial projects are always hard to judge, but once a project gets to the point of having planning permission and surety around the capital appraisal, it can move forward.

Does the new statutory timeframe for the Part 8 process not reduce the time significantly? At least we now have a start point and an end point in statute for Part 8 projects.

Mr. Conn Murray

We have-----

Surely the delay is now outside the planning process. Before, that process was clearly a problem.

Mr. Conn Murray

I do not want to blame the planning process, but challenges often face our elected members at local level in terms of what is being produced. I am fortunate in Limerick, in that we have supported the delivery of a number of critical Part 8 projects in recent times, which gives me a 2019 programme. That does not happen everywhere, though, and depends on the challenges facing authorities. The statutory timeframe does not take away from our obligation to ensure that the community is heard and the elected body has its say. If we bring more surety to that and the staged process then delivers, local level will be given more accountability and responsibility for what it does. That is the argument I would put forward.

Emergency homeless accommodation remains a serious challenge in various parts of the country. We discuss it at an individual authority level as opposed to a sectoral level, as the challenges differ depending on where the authority is. In my area, 31 families are in bed and breakfasts. By the end of 2017, we had reduced the overall number of 79 families by 93% to five, but that number increased again during this year. We have introduced two hubs with ten families and other sheltered accommodation. Finding housing first is critical. We are embarking on that successfully and ensuring that there is support for the families. It is also important that the communities they are moving into be supported in looking after them. Doing this has worked well for us. In terms of the 31 families, I hope to have a new hub early in the new year. There will be accommodation for everyone as we face into the winter, as Mr. McGrath indicated.

I should have referred to the delivery programme at the start. People quickly forgot that we had an extraordinary winter that lasted five months at the beginning of the year. It had an impact on direct delivery, not just for the public sector, but also for the private sector. If we get a fair wind, we will see a continuous increase in delivery.

We have used the emergency planning powers to deliver hubs in the community.

It is not something we want to do in going against the wishes of the community or the council but it is there and we have used it practically to ensure it can be delivered. The other aspect that perhaps will require a little more debate is the single stage, which is something we are looking at directly. We have not used it to date, although we have one going through at this time. Because of the complexity of the areas we were dealing with in the context of the city and metropolitan area, the single stage did not give the assurance in terms of the challenges that are sometimes faced on brownfield sites. It is worth looking at. It should be greater than €2 million and should be far greater than eight units. Perhaps-----

Does Mr. Murray care to put a figure on that?

Mr. Conn Murray

Perhaps €6 million.

To be clear, while that is a commitment, it is not something that has happened yet and it is not available to local authorities.

It will be available from January. I assume they will plan for that.

Mr. Conn Murray

As I said, we have one going through the pipeline at this time. We will increase that. It depends on the area of the country and the demands in terms of spend, going back to the list. I believe it could be increased to €10 million depending on the cost of operations in the area. That could be looked at on a regional basis, as distinct from a specific local authority aspect. The processes and the relationship with the Department at this time are excellent. We find we are getting the type of response expected and we are supported in delivery on the ground.

Mr. Joe McGuinness

On behalf of Louth County Council, I will address the Deputy's questions. In regard to target versus need, the Louth target for 2018 is for 308 units, with a three-year target of 1,147. We will be close to the 2018 target and I am confident that we will exceed the three-year target. That target is largely being delivered through AHB-CALF funded units which are produced in significant numbers in Louth, largely due to the rent levels that can be achieved because the rental market is strong so close to Dublin. That is probably the reason for the success of the CALF scheme.

In regard to the specific question on target versus need, if members refer back to the 1980s, which was seen as the most buoyant time for local authority construction, we were probably constructing in region of 250 units whereas our target now is 308. While we feel our target is challenging, we will be close to it. There will always be housing need and there always was – that is a fact of life. It is a matter of catching up with what has happened in recent years.

On whether we think there is a need for affordable housing, there are two elements. First, the market is not yet supporting affordable housing, and market price and construction price have not yet matched. The availability of construction labour is heavily influencing the price of construction, particularly in Louth, because Dublin is sucking in all the skilled labour. For us to get local labour, we have to cross the Border and most of our contractors are from Northern Ireland. All of this is affecting the market price of a house. The second point is whether there are people fit to acquire affordable units, and the financial institutions have a part to play in providing finance for those units. We look at our rent schemes and our average rents are going up. There is more money, therefore, and tenants have more money. It is a question of supply and demand. The Deputy is correct that it is a hard question to answer.

We have used the single-stage process once and we are currently using it for our CPO units, which we do in bundles. It requires an element of work, particularly pre-planning work in preparing schemes and to ensure we have the costings correct. The single-stage process has worked for us. We welcome the first increase in the limits and we will welcome the second increase that is coming in January. It requires an element of work which we are happy to take on.

With regard to emergency accommodation, Louth has a range of 120 to 160 adults in emergency accommodation, and we peaked at 160. There are various reasons for presentation. Our submission states that, traditionally, we always had a homeless population of perhaps 40 to 50 individuals, going right back to the 1980s. The issue is the difference between 50 and 160. It is a different cohort from previously. We are talking about people who have lost units, particularly from the buy-to-let sector, where units have been taken back by the financial institutions. One of the more significant grounds for presentation is where the landlord has lost the property and the tenant presents as homeless. We never had families presenting as homeless before but we do now. We have opened our first hub and used private leases and the HAP scheme to get accommodation for those people. Nonetheless, homelessness is an everyday challenge, even in a small county like Louth.

Ms Moira Murrell

In Kerry we have strong, high targets. Our target to the end of the period is 1,780 units, of which 840 are build, 310 are turnkey, 360 are acquisitions and 270 are lease. They are strong targets and when we look at authorities in Cork, Dublin and Kildare, we see we have the highest targets in the country. We certainly have a significant focus on achieving those targets. With regard to land and social housing, we are building on every piece of land we can to achieve the targets, as well as actively acquiring land to build for our purposes.

With regard to affordability, Kerry is different from Louth in that there is the tourism factor. With 2 million visitors to the county each year, the short-term lets and the Airbnb factor are strong in the competition between residential and tourism. The change in policy will impact on Kerry. Separately, we have seen some green shoots in the private market in parts of the county but there is little activity in other parts of the county. Through our strong programme, the council will be the one developing houses in many areas across the county. From meetings with the CIF in the county, we find that, as in Louth, it is cheaper to buy a property than it is to build one in parts of the county.

The matter of procurement was raised. When looking at how to deliver in this regard, procurement is a vital part of any process, and there is also the rural factor. Kerry County Council has built 65 local authority houses directly this year. These have been small schemes of some 20 units and our programme has few large schemes because that is the type of county it is. I take the point on regional procurement but it is important for our local labour market to have local procurement. Having the skills and the contractors locally to deliver at a time we need them is important.

There is an increase in homelessness, with 131 adults and 63 dependents now homeless. We do not have rough sleepers in the county. While we are dealing with the situation, it is certainly something which has increased in the county.

We are working very closely on a cross-agency basis. The wraparound services are strong and working well in the county. We have seen an increase in resources recently, which is welcome. We have had approval from the Department to use our resources for HAP placements, as has the HSE.

The HAP has been important for us in placing people. With the HAP placement officer, we will continue to see that activity even within a shrinking market of available properties. It will be important for us. The strong housing programme should create some space within the private market in respect of homelessness and we are also in discussions with the Department about the creation of additional family hub facilities in the county.

I remind members that we must conclude this meeting at 11.30 a.m. as we must have a 15-minute recess before we return to the Local Government Bill. Perhaps members will keep their contributions brief.

Déanfaidh mé mo dhícheall. Cuirim fáilte go dtí an choiste inniu. I thank each of the witnesses and their housing teams for the work they are doing. The homelessness crisis is acute throughout the country and I am aware from visiting local authorities and my own local authority in Fingal of the volume of work and emergency work that takes place. The response has to be almost immediate and it is stressful for staff, which we cannot forget. It is also stressful for people who are presenting in chaotic and difficult circumstances after being evicted or where a tenancy has been, or is due to be, ended. I ask our guests to convey to their housing teams and the people associated with them my thanks and the thanks of the committee for the work they do every day, seven days per week. I genuinely appreciate it.

My colleagues have covered a number of items so I will just make some brief comments. I was interested in the question about affordability. It emanated from the fact that the serviced site fund has increased to €310 million over three years. An affordable housing scheme will be established and it will focus on areas where there are affordability issues. I do not expect that it will be opened in areas where there are no such issues. I have a question on the Rebuilding Ireland loans, improvements to that system, common criteria and common financial underwriting. Is Mr. Mahon the chairman of housing in the CCMA?

Mr. Dermot Mahon


I am sorry, it is Mr. Murray. Are the criteria for financial underwriting for the Rebuilding Ireland loans uniform among local authorities? I have evidence they are not. I raised it with the Minister, Deputy Eoghan Murphy, and he said there is a review taking place to ensure that is happening. Can Mr. Murray advise the committee on the interaction with the Housing Agency vis-à-vis the loans? Is each loan application going to the agency for oversight if not approval?

I refer to the use of CPO powers, which all the witnesses alluded to it in their opening statements. It has been useful to get a picture from four local authorities outside Dublin and to consider the different housing issues throughout the country. The figures are different. In each of the opening statements the witnesses referred to purchasing units. Louth County Council has 84 completions, according to the latest figures, in acquiring vacant houses and bringing them back into use. That is a good performance and I commend the council on it. The council has been put forward as an example of how this can be done. There have been no completions in Galway city. That is also the case in Kerry County Council and Limerick. This is since 2011 and under the CPO powers. That information was received under a freedom of information request I made. I note that the witnesses spoke in their opening statements about acquiring buildings, but the information I received from the Department states that Louth is miles ahead of other councils. Is there an issue with using the CPO powers? Do local authorities not want to use them? The Minister has said on a number of occasions that the threat of the use of CPO might be enough.

I acknowledge the success Louth has had in bringing vacant units into use. Galway City Council has identified approximately 500 derelict or unused buildings:

...the council prepared a vacant home strategy which is currently being implemented. The initial estimates put the number of vacant homes in the city at circa 500.

However, the council has completed no CPO since 2011. Why is that? What other strategies is the council using? I am seeking the council's feedback on that; it is not a criticism. I want to get under the bonnet to see what the issue is.

The discretionary cap has been referred to in the single stage process that Mr. McGuinness has used. What impact will the increase in that cap to €6 million have when it is introduced in January with regard to giving councils control over delivering smaller social housing schemes? The increase was agreed in the last budget.

I was interested to hear Mr. McGrath speak about the HAP homeless placefinder service in Galway. Does each local authority have that service? One of the issues our party is considering is people presenting as homeless after the fact. In some local authorities - I do not know if this happens in the ones represented by the witnesses - people are told to come back when the tenancy has ceased. If people come to the local authorities represented here and they know they are going to be evicted or their lease expires in 60 or 80 days, what is the process in the local authority? Will Mr. McGrath speak in more detail about the placefinder service with which the council has had some success?

I will conclude with a question on HAP. Do the councils represented here remove their HAP clients from the main housing list and put them on the transfer list? Some local authorities have stopped doing that. What are the witnesses' views on it? It is not a policy question. I am asking it from an operational perspective. I disagree with it. HAP tenants should stay on the main housing list where there is proper oversight. Do the witnesses remove somebody who is placed in a HAP tenancy from the housing list? My main criticism of Rebuilding Ireland is the overdependence on the private rental sector and particularly HAP. More than 50% of our targets are to be met by people being deemed housed when their need is met by entering into what is mainly a short-term lease. My party's view of that is that their housing need has not been met.

It is not often one gets an opportunity to praise one's council's officials and former officials. Mr. Conn Murray was the manager in Louth for a successful period. Mr. Joe McGuinness has been fantastic in his commitment and the work he has done in County Louth in respect of CPOs, as has Mr. Paddy Donnelly. They are changing roles at the moment. The benchmark for efficiency and accountability is what Louth County Council is doing on housing. I was glad to hear Deputy Darragh O'Brien praising the work in County Louth.

I have said a number of times in this committee that the CPO project needs a national lead. I have also said it to the Minister. We ought to have somebody in charge of CPO nationally for the councils that are not doing their job. I am not naming any council here other than Louth, which is doing a great job. We could get 2,000 to 3,000 homes in the space of 18 months if it was properly led with the enthusiasm and commitment shown in Louth County Council. I have travelled around my town with a housing body and the body has picked up a number of homes and is refurbishing them. The easy win is where one has the services and one does not have to open up any land. One has to reconstruct or rebuild the property but all the services, such as the footpaths, roads, lighting, sewerage and water, are in place so it is a cheaper operation. The witnesses can confirm this but I believe the average cost was €100,000 to €110,000 for the CPO purchase from start to finish. That included all legal and reconstruction or refurbishment costs.

That is very advantageous to the taxpayer and to the families who go in there. It is a real blindspot in other counties and has to be driven. I would appreciate the views of the witnesses because every town centre is full of properties that could be activated. Do the council officials feel there is a need to, or what do they do, to generate business in this area?

I know the council identifies empty homes that are boarded up and there is a website for that. How active are councils where properties are unoccupied particularly in town centres or in brownfield areas in chasing up the owners to see what they are doing with them and engage with them? What incentives are available to property owners even if they are commercial properties to make them into family homes or one or two bedroom units? That would make a huge difference.

I wonder if any of my colleagues from the county council remember – I might have served even longer than they have – when people were on the housing list for one year before getting a house. That went out to maybe three years, when Fianna Fáil was in power.

Now it is nearly 13 years under Fine Gael.

I am talking about Louth County Council. To ask a family with children to wait, when the eldest child is ten years of age puts families in an appalling situation. This continues to improve but it is still very difficult.

I can remember when Drogheda Borough Council wanted to build 20 or 30 houses and did not have the necessary specialities in house the National Building Agency at that time would construct 30 or 80 houses for the council. All the design, professional fees and input that was needed was supplied. Dublin City Council is acting in that respect in some way. Maybe that could be clarified. It seems that if there is that agency or a like body that will design and build for a council to the correct and proper standards it will take up a lot of the hard work that individuals in the council might have to do.

We have a crisis in Drogheda because there is no money available to develop the town on the northern side which would increase the population by 20,000 over the next few years. Is the council making applications under other funding to open up that land? I know its recent application was not successful. Will it be making an application to open up that land and build some of that northern cross route? Will it apply to Departments for that?

The McVerry Trust is a very proactive agency for people who are homeless. It is in County Louth now. I welcome the new connection between Louth County Council and agencies such as the McVerry Trust and others. There is an increasing opportunity for councils and approved housing bodies to work together.

Mr. Brendan McGrath

I will first deal with the CPO issue. We have completed three CPOs this year. We have already brought proposals to table to build a seven-house scheme on one of those. The CPO is not always necessary because we have made 30 acquisitions of vacant homes this year, where we have negotiated the purchase.

That is true but Mr. McGrath mentioned that there were 500 vacant units in the city. Are they the ones the council is targeting?

Mr. Brendan McGrath

Exactly that. The Central Statistics Office, CSO, said we have 3,500 vacant homes. The Geodirectory said we have 200.

Through our vacant homes office we have gone out and identified what is there. Approximately 100 of those are potentially available to us. We did a survey of 100 homes and discovered 70 were not vacant. Of the remaining 30 there were problems to do with gentrification, people in nursing homes, "fair deal", probates and family disputes. The number of houses available is considerably lower than appears on paper.

We are actively looking at the brownfield sites and have processes in place to deal with several of those. Where we can acquire properties we are doing that. One of the reasons we have more than 60 void homes at the moment is that the ones we have bought are now in our void stock, being renovated to go into the social housing stream.

Mr. Conn Murray

Picking up on the CPO aspect, we have commenced three recently but we were using the Derelict Sites Act 1990 for a compulsory acquisition which might not come under the heading of CPO. It is slightly different and we have used it successfully because we established an urban and village renewal unit to work throughout the county and we carried out a full land management assessment within the metropolitan area to identify lands and areas for development. We used a different process.

We have successfully acquired properties, where necessary in order to deliver, and our housing programme is part and parcel of our overall regeneration programme and that must be part of output that we deliver on. It is not that we do not use the CPO. We know when to use it. That is an important aspect of this. Every authority has to make the call on that.

We have now restructured within the organisation thanks to the opportunities for the merger with a social housing directorate specifically to respond to Rebuilding Ireland. We have a design and delivery unit with the expertise now built in and the resources to manage design, delivery and procurement as a single unit and develop that expertise. That can be shared too as we go forward.

In response to the question about the loans we are aware that the Minister is carrying out a review. As a sector we looked for that. We are participating in it. I do not have the statistics to date as we are going through the process and will feed into that. We believe it is an excellent product. We believe there are more opportunities there.

A low cost loan is great. I thank Mr. Murray for his answer. Is every application going to the Housing Agency in all the local authorities?

Mr. Conn Murray

It is. I sit on the Housing Agency too.

Does it go for final decision or recommendation?

Mr. Conn Murray

For recommendation primarily but we have made decisions at local level based on the candidates we have produced which may be different from the recommendation from the Housing Agency because we know the locality.

Oversight is important. On average by how much does that lengthen the term of the processing of the mortgage application? How long does it sit in the Housing Agency?

Mr. Conn Murray

I would not have that detail but I have a question in my mind as to whether we are not given the responsibility as we have the authority to make the decision at local level as to why the oversight exists. I understand oversight but I know who is accountable.

That would be my question. I appreciate the answers.

Mr. Joe McGuinness

Every loan application goes to the Housing Agency for its recommendation and comes back to the credit committee. There is no delay in that journey to the Housing Agency and back.

How long does it stay in the Housing Agency?

Mr. Joe McGuinness

A short number of weeks.

Ms Moira Murrell

I suppose we have not used our powers on the CPO. We have a very significant acquisition programme. There is still good value for us and, as Mr. Murray mentioned, many of the units we acquire are vacant sites so it is achieving that purpose. We have carried out a health check on two towns in the county.

In the Tralee area, in particular, we have identified and analysed vacant units. We are examining where CPOs may be appropriate and are assessing each of those units in terms of those that are derelict and vacant.

On a related point, we have introduced a significant change towards the development contribution scheme to stimulate the reuse of vacant properties. We have exempted from the development contribution the reuse of the first floor premises. We have significantly changed the contribution to stimulate the reuse of the smaller house, which is a positive development.

I asked about that to get clarification on the use of CPOs and other measures within the local authorities' armoury that could be used. I welcome that the representatives of each of the local authorities have been able to clarify what they are doing. I take it that any vacant house within their areas is on their radar. That has come across in their responses.

As Deputy O'Dowd said, it is great to see some former and current colleagues at this meeting.

Mr. Joe McGuinness

Are we going to have a problem here?

That is all the praise the representatives are going to get.


Professor O'Brien always has a problem with me. I hope I am not repeating what has been said already as I was a little late in arriving.

Is the degree of pressure on the local authorities regarding land purchase loans in terms of the availability of money to repair voids an issue? The Minister told me in the Dáil that if any local authority is not in a position to repair voids in its area and it submits an application in that respect by 14 December, he would be prepared to provide additional money for the repair of voids. He said that categorically last week.

On the issue of CPOs, I will not repeat the praise of various local authorities in that respect. As a few of the representatives will be aware, I have had a bee in my bonnet for many years about the issue of vacant rural housing. There has been a great concentration on addressing urban vacant housing. Anybody who was a candidate in the local authority elections and has traversed the roads will know the degree of vacant rural housing. Those properties have been identified. If one or two such properties were taken back into use in every parish, it would rejuvenate local schools facing challenges and it would provide funding for the local community. By developing the synergies of the IFA and community organisations and making funding available, not necessarily to the local authority but with the help of the local authority, many of those vacant properties could be identified. Such vacant properties exist and in some of them there is furniture, although I acknowledge there are legal issues regarding some of them.

I refer to the issue of student accommodation. I note that many of the traditional houses in the vicinity of Dundalk Institute of Technology in my constituency have large gardens. I mentioned to Deputy Darragh O'Brien that an incentive should be offered to encourage homeowners to build granny flats or single extensions to the rear of properties with large gardens in the vicinity of college areas. Incentives could be offered to property owners, many of whom would be elderly, to provide a sun-room type accommodation for students and a grant could be provided to people who own plots of land for such development. Has any of the representatives a view on that proposal?

To return to my original question regarding the gap between the real social housing need and the targets in terms of the increase in real stock, the problem is that in each of the four local authorities represented, the gap is very stark. For example, in Galway, the gap between the additions to the stock over the lifetime of Rebuilding Ireland and the real level of need is about 65%; in Louth, it is 74%; in Kerry, it is 59%; and in Limerick, it is 71%. Given the fact that a number of the representatives have said that private sector activity is very slow, if so much of social housing need is to be met outside of local authorities' approved housing bodies' builds and acquisitions, and if the private sector is not building, they will not be able to meet the housing assistance payment, HAP, scheme and the rental accommodation scheme, RAS, targets. Leaving aside the fact that HAP and RAS provide security for two or four years, and therefore are not necessarily in the best interests of tenant or good development of communities, that gap is massive. It is very worrying. I acknowledge the representatives have to work within the existing policy and that the targets are set not on the basis of what they would like to do but by the Department. The gap is very big and that will create some difficulties.

In terms of the Rebuilding Ireland home loan, the product is very good but the figures as of September for the four local authorities are troubling. For example, Galway city and county councils sent 83 loan applications to the Housing Agency for underwriting, 22 were recommended and as of September zero have been drawn down. In the case of Louth County Council, 50 loan applications were sent to the Housing Agency, 19 were recommended for approval and only five have been drawn down. In the case of Kerry County Council, 60 loan applications were sent to the Housing Agency for approval, 26 were recommended and zero have been drawn down. In the case of Limerick, the respective figures are 46 loan applications, 28 were recommended and zero have been drawn down. I acknowledge it is only the first three quarters of the scheme and that does not give us a full indication but clearly there is a problem. Is it that the period between the date of application and the date of final approval is longer than is necessary for the person meant to be able to purchase his or her home? Is it that the amounts being offered are less than what the applicants need to purchase their home? This is not a critical comment of the local authorities or the Housing Agency but clearly the draw downs indicate there is a problem. Those figures I gave for the local authorities sending loan applications to the Housing Agency represent approximately half of the number of applications received. Half of the applications made, on average, are not sent to the Housing Agency. I would be interested to hear the representatives views on that matter.

On the issue of Traveller accommodation and taking account of the budgets for last year and this year, Limerick had a significant overspend in its Traveller accommodation budget last year but as of half way through this year it is way behind the completion of the full spend this year. Louth did not have an allocation for or a spend on Traveller accommodation last year but it is significantly behind its allocation for this year. Kerry spent roughly what it was allocated for Traveller accommodation last year but as of half way through this year it has not spent any of the allocation. In Galway City Council there was a dramatic underspend on Traveller accommodation last year; there was no spend on it in the Galway County Council despite a significant allocation and as of half way through this year the county council had not drawn anything down and the city council had drawn down a fraction of the €1 million or so that was allocated. My specific question is whether the representatives envisage their local authorities will spend all the money that was allocated this year and whether those that underspent last year will carry that over. One of the major concerns of this committee is that year on year there are very significant underspends. While I live in the real world and there is a large Traveller community in my constituency, I understand the complexities involved. We are due to have Revised Estimates next week. There has been a significant overspend in social housing and we had a significant overspend in social housing last year. That is very welcome but there was a significant underspend on Traveller accommodation over the last three years, which is very troubling.

I will bring in the representatives starting with those representing Galway.

Mr. Brendan McGrath

I will let Mr. Conn Murray pick up on some of the general questions. I represent Galway City Council and am not here on behalf of Galway City Council. I am just the chief executive of one council.

That will depend on a vote we will be taking in two hours' time.

That could change shortly.

We will have a chat about that afterwards.

Mr. Brendan McGrath

We can tell the Deputy what the bills are.

The draw downs are zero in both the city and the county councils.

Mr. Brendan McGrath

The approval periods are short with fewer than three weeks involved in terms of the turnaround by the Housing Agency. We approve up to 90% of the cost involved. Part of the issue in Galway is the lack of private house building that is taking place. People have loan approvals in their back pockets trying to buy a house but the lack of housing is a problem. There are no significant delays in the recommendation process. The decision comes back to our credit committee and we do not always agree with what the Housing Agency recommends. There is not any delay at that end.

The student accommodation in Galway is quite significant and 1,000 student beds have recently come through, or are in the planning process with An Bord Pleanála. We have a requirement for a further 1,000 beds and brownfield sites are being looked at for them, along with other proposals that are coming through. Three strategic housing developments which involve student beds are going to the board. Student beds will reduce pressure in the private sector which, in turn, will help social housing demand.

We have exceeded our HAP and RAS targets to date in 2018 and we will meet our targets under Rebuilding Ireland because of the work being done by the housing team, through the HAP homeless placefinder and the vacant homes officer.

I am delighted to report that we have had some success recently, with the HAP homeless placefinder service securing homes for members of the Traveller community. There are very significant proposals in the pipeline and under discussion with the Department on new, bespoke, culturally appropriate facilities for the Traveller community, in which its members have been involved. We are doing something relating to the Cúl Trá site in Salthill, the Carrowbrowne site on the Headford Road and on Circular Road. They are multimillion-euro investments and the more money in the kitty for such developments, the better. We do not underestimate the difficulties we have had in trying to convince our elected members to support this or in dealing with the concerns of the wider community. We understand, appreciate and value the needs of the Traveller community and that is why we have formulated the proposals about which we are currently talking to the Department.

Mr. Conn Murray

We fully drew down our capital and are having further capital appraisals with the Department in respect of the Traveller community. The amount for the work we are doing is €6.4 million and we would welcome more. If there is some left over we would like it to be passed on as quickly as possible.

There has always been a gap between lists and needs. I have been working in housing for a long time and I have seen my housing list reduce by 35%. This is a fact that is never mentioned. I have seen 2,500 tenancies given in the past 18 months or two years, which means decent accommodation is provided under a housebuilding lease, a 50% RAS scheme or otherwise. We will exceed the targets for the current year, which was 251 homes while we expect to deliver maybe 300 through the buy, build and lease programmes. We have set up a specific unit to target dereliction in villages and have assigned staff directly to the municipal districts on that. The repair and lease scheme is exceptionally valuable for keeping life in the communities and not allowing them to disappear over time.

Mr. Joe McGuinness

There was a question on land loans versus voids in Louth. We have €60 million of land loans which we are repaying from internal capital receipts and that is impacting on the spending of internal capital receipts. We have used CPOs for vacant rural housing in limited cases, where they are required. We are doing it for Traveller accommodation and disability needs at the moment, specifically in rural areas. Deputy Ó Broin is correct that the Rebuilding Ireland loan offers are not always what applicants are looking for and the value has been reduced. Applicants are making multiple applications with adjoining counties and we get a good number of Dublin applicants who also apply to Meath and Fingal and may not take up a loan offer with us.

We have an underspend on Traveller accommodation this year. We have particular issues where the needs have changed and where people have withdrawn their aspirations. Traveller accommodation programmes have changed, whether this was at the review stage or at a new stage due to feuding.

Ms Moira Murrell

The voids programme is very valuable to counties such as ours, which is a rural county with a big housing stock. The allocation for Traveller accommodation was for a particular project and the needs of the family involved were dealt with elsewhere. We are satisfied that there was the same provision with a different allocation. We have some very strong proposals for the new Traveller programme in 2019.

Has the application to open up the land for the northern cross route development been made?

Mr. Joe McGuinness

The application has gone into the Department but no decision has been made.

Under what funding was the application made?

Mr. Joe McGuinness

It is under bundle 3 of the public private partnership, PPP, project.

I found Mr. McGrath's response to be very positive. There was a significant underspend in the city last year and there is a gap in the spend for this year. Is Mr. McGrath confident that most of it will be spent this year or will it be rolled over for completion next year? I appreciate that pipelines are moveable feasts but the underspends, in the city in particular, have been very significant for a number of years. It is to be hoped that all the money will eventually be spent. When does Mr. McGrath think it will be spent?

Mr. Brendan McGrath

The review of the Traveller accommodation programme sat on the council agenda for 18 months. I was pushing for it but it took that length of time to get support for it. The allocation was made to us in 2018 but we did not look for it - it was given to us in error. We are very definite about the money we are looking for in 2019.

I thank the Chair for taking our submission as read. We made eight recommendations to the committee and we ask the committee to look at them in its deliberations.

We will do that. In the context of local authority voids, has any local authority sold its stock of housing because the cost of refurbishment was excessive, or because of a lack of funding from Central Government to bring houses back into use? Galway City Council is represented today and Deputy Anne Rabbitte was in my ear last night about the difference in the qualification thresholds for local authority housing in the city, at €35,000, and the county, at €25,000. Does that have an implication for housing in Galway? Is the homeless HAP officer in Galway city able to locate tenants in Galway county and take stock out of Galway county? Is the gap of €10,000 causing problems for tenants in the county who are trying to get accommodation in Galway city, or vice versa?

Mr. Dermot Mahon

It is. We have had a number of county applicants who were above the county limit but made an application to the city, which has higher income eligibility levels. Some require HAP accommodation in the county and secure a property and have a willing landlord but they cannot enter into a HAP arrangement because they do not meet the eligibility criteria in the county so they drift to the city, where they seek to get on its waiting list with a county preference. Our HAP placefinder officer has secured a number of properties in the county based on the individual preferences of families and of 44 tenancies to date, eight are in the county. We have not sold any voids.

Mr. Conn Murray

We have not sold any voids but we have transferred stock to an approved housing body, AHB, to deliver, which is a slightly different process.

To answer Mr. McGrath, the recommendations will be taken seriously by the committee. The one that concerned me was the value for money exercise drifting down to €15 million.

That does not seem to make any sense at all. Is Mr. McGrath saying that he is being asked to undertake those exercises for projects below €20 million?

Mr. Brendan McGrath

Like County Louth, we have legacy land loans to the value of €32 million. Funding those loans and bringing those loans on the land we can build on obviously affects the value we can achieve. In the case of one scheme, the business case has gone to Department of Public Expenditure and Reform and it is taking time, but because some of that land has been put forward in other schemes, we find the threshold is being brought down to €15 million in respect of that. That is our experience.

What is the rationale for that, from the Department to the National Development Finance Agency, NDFA's point of view?

Mr. Brendan McGrath

I would presume that it is the cost of the land loads. We are carrying €32 million of legacy loans that we bought at the height of the market in accordance with Department policy. We are carrying that in the city. We are trying to use that land for various purposes, but the cost of those land loans is impacting on what we are trying to do.

How much additional time in terms of the overall development does that cost benefit analysis take? Does it take three months?

Mr. Brendan McGrath

It is significant. One of the projects involves a bespoke Traveller accommodation programme solution.

Are we talking in terms of months?

Mr. Brendan McGrath

Yes we are talking about months.

I thank all the witnesses for their attendance and engagement with the committee. We will acknowledge all of the opening statements and take them into account.

The joint committee adjourned at 11.35 a.m until 9.30 a.m. on Wednesday, 12 December 2018.