Dáil Éireann Debate, Thursday - 7 December 2017
1. Deputy Barry Cowen asked the Minister for Housing, Planning and Local Government the impact the potential reclassification of approved housing bodies as general Government debt will have on Government housing policy and if he will make a statement on the matter. [52432/17]
Amharc ar fhreagraWe can see that local authorities are not building houses at the rate one would hope. In quarter 2 of 2017, 76% of completions were by approved housing bodies. Of the sites started at that time, 63% were by approved housing bodies. There appears to be an over-reliance on approved housing bodies. I know the question has been put to EUROSTAT, which is investigating the fact that these bodies and the funding associated with them are off-balance sheet. If that is proven to be the case, what provision have local authorities made to ramp up the provision of local authority housing by local authorities themselves? Looking at the statistics it appears to be Government policy to predominantly allow approved housing bodies to be the ones building homes currently rather than local authorities.
The Central Statistics Office, CSO, is responsible under EU law for the reporting of Government finance statistics, including deficit and debt. It is currently undertaking a review to determine whether the approved housing body, AHB, sector or part of it should be included as part of the general Government sector and whether AHBs should be classified as on-balance sheet or off-balance sheet for Government accounting purposes in accordance with EU rules.
Under a previous review of the sector in 2014, the CSO classified these entities as being outside of the general Government sector. It indicated at the time that the status of these bodies would be reviewed if there was a change in the relationship with the housing authorities, that is, local authorities, or any other Government body. In October 2016, EUROSTAT requested the CSO to review the classification of AHBs expressing the view that the role of Government financing should be given greater weight in the classification decision than had been the case at the time of the 2014 review.
My Department has been engaging with the CSO on the review while respecting the independence of that office. We are keeping the matter of the potential reclassification of the AHB sector or part of it and its implications under continuous assessment and the Cabinet was also briefed on the issue in July 2017. However, until the CSO's examination is completed and the factors underlying the position to be adopted by the CSO become clear, I will not be in a position to assess the full impact of any decision arising from the review.
It is not the case that there is an over-reliance on AHBs. We have stressed at every local authority meeting with councillors of all parties and officials that we expect local authorities to be the lead in delivering housing. The AHB sector accounts for about one third of the planned delivery over the next four or five years under Rebuilding Ireland. That is very clear with less than 17,000 direct build, acquire or lease units through all the various schemes.
Regarding the pipeline of projects, the Deputy's concern is what the local authorities will do if this becomes an issue. We have clearly told local authorities to bring forward a greater pipeline of projects across the board. They have a pipeline of about 12,000 units. To put the Deputy's mind at ease on this issue, we have asked them to at least treble that so we have asked them to put them into the projects pipeline so the capacity to deliver will not be affected by any decision by the CSO or EUROSTAT on this issue in the year ahead. To be very clear, local authorities are the main body to deliver social housing on behalf of the State.
I have a direct question. In the event of this being adjudicated to be off-balance sheet by EUROSTAT, can the fiscal space cope with the increase in funding that would be required? The Minister of State has intimated to us that he is asking local authorities to redouble their efforts and ensure that they are the lead agency regarding the provision of houses and that funding is not an issue or an obstacle to them becoming that lead agency and providing the sort of units and numbers of units we deserve. That is one thing. It is the public pronouncement we hear week after week but if we look at the facts associated with the Government's programme, we will see that 76% of what is being built in quarter 2 of 2017 is by AHBs. With regard to sites that have commenced in quarter two of 2017, 63% are by AHBs and with regard to what is being tendered for, the percentage relating to AHBs is 73%, so the facts do not bear out the Minister of State's pronouncements. The facts will have to come into line with pronouncements eventually.
If, despite the Minister of State's pronouncements, commitments and what he has told us on a continuous basis, there is no capacity there to address this then let us find a different way to proceed. The Minister of State spoke about re-purposing NAMA at one time with a view to it possibly contracting builders to provide local authority houses and for them to be leased over 70 years or whatever the case may be, but we have heard no more about that. We heard in the budget about €750 million being provided for builders to provide social housing units but we have heard no more about that either. The Government might be getting the kickback in respect of its announcements but the people on the ground are not seeing results. We are not seeing action to match the rhetoric.
I disagree with that. AHBs are partners in the delivery of social housing. We are very clear on this. The target is over 50,000 social houses built on behalf of the State in the years ahead. Local authorities will account for the majority of those house while AHBs will account for about 17,000 in total across all the various schemes. They have about 5,000 units coming through the pipeline on 300 sites but over 720 sites are being planned that will deliver over 12,000 houses by local authorities.
I agree with Deputy Cowen that we want the local authorities to do more in this space. We have asked them to do so and their capacity has been strengthened in terms of resources, people, and finance. We have also put in place a new delivery team and agreed a new timeline of 59 weeks to be on-site with the housing, which is also in line with the private sector. This puts the local authorities in the position of being able to deliver the quantities of housing that they used to many years ago. Deputy Cowen is asking what happens if EUROSTAT makes a decision. The local authorities have been asked to increase their capacity every year over the next number of years. We will, then, be in a position to deliver our targets; that is not a concern for us. If the local authorities decide to operate either on- or off-balance sheet then we can deal with that. Capacity is being put back into the system to deliver housing. There will be an issue with funding and with the administration of balance sheets but we can deal with that. We will wait for the decision in the years ahead.
The statistics bear out my contention that the Government is putting all its eggs, or at least 75% of them, into the one basket of approved housing bodies for delivering units to those on the ground. I accept that many people who are waiting on housing and who want to see progress on this matter do not care where the houses come from as long as they get one and as long as there is potential for hope. In the event of the Department's statistics indicating that this is on-balance sheet, has the Minister the funds available to meet the shortfall in terms of what he can provide? This shortfall will obviously become apparent at this point. The mantra put forward by the Minister and his colleagues is that money is not an object. It is certainly not an object when it comes to his commitment at this stage because it has taken between two to three years to get from inception to delivery. If this were happening at a greater pace, which I hope it will, can the Minister confirm that there is funding available to meet the shortfall so that local authorities can take up the mantle that the Minister says he wants them to? The Minister says that he wants the local authorities to be at the forefront of this but, based on the statistics, which do not lie, they are not there at the moment.
I want to deal with this myth that I have heard repeatedly from many of Fianna Fáil's own councillors as I go around the country, namely, that local authorities are not being made responsible for, or being put in the position to drive, local authority and social housing. They absolutely are. We are not solely dependent on approved housing bodies, even if Fianna Fáil Deputies and councillors keep repeating this. This is not the case. I ask Deputy Cowen to look at the projections for the next three or four years. The approved housing body sector has been allocated less than one third of responsibility for this matter in the plans ahead. Let me very clear on this because it something that I hear repeatedly. It is a five-year plan and I urge Deputy Cowen to look at it. Yes, we have made it very clear that the fiscal space can deal with this, both in terms of the existing approved housing bodies and in terms of what we are looking at now, which is future funding.
A total of 73% of those who have tendered-----
The Minister of State is to continue without interruption.
It is probably a while since Deputy Cowen read the Action Plan for Housing but he should take a look at it. It shows where the money is allocated and who is doing what.
It is probably a while since the Minister and the Minister of State have done anything about housing.
Stop that now Deputy Cowen.
Approved housing bodies are responsible for less than a third of units. We have asked local authorities to take the lead across the board and I again want to emphasise that they are all delivering social housing and that the supply of social housing has gone up for the last two years and now this year again. It will continue to go up in the years ahead. What we are trying to do is to achieve the target that everybody here wants to hear, which is 10,000 houses delivered per year. We will achieve this.
