Dáil Éireann Debate, Tuesday - 20 March 2018
92. Deputy Thomas P. Broughan asked the Minister for Finance his plans to utilise the credit union movement and its resources to develop new affordable housing financial products; and if he will make a statement on the matter. [12513/18]
Amharc ar fhreagraThe Government's Rebuilding Ireland Action Plan for Housing and Homelessness emphasised the need to look at new ways of funding social housing delivery, in particular the need to provide structural, funding and policy supports to increase delivery of social housing by Approved Housing Bodies (AHBs).
My colleague Eoghan Murphy, the Minister for Housing, Planning and Local Government, committed to providing support to the AHB sector to develop innovative financial models to enable AHBs to further enhance their contribution in the delivery of additional social housing. His Department announced in May 2017 that funding of €49,000 would be provided to the Irish Council for Social Housing (ICSH) to support an initiative through which they would develop proposals regarding special purpose vehicles. The purpose of this initiative was to provide a mechanism that would enable the sector to attract investment in social housing projects from potential investors, including the credit union movement. The ICSH has completed 2 of the 3 phases of the project and anticipates that this work should be completed later this year.
Moreover, the Government acknowledges the affordability pressures faced by some households with low to moderate incomes in particular parts of the country. It is precisely for that reason that the Rebuilding Ireland Action Plan for Housing and Homelessness has also prioritised the supply of new and more affordable homes. On 22 January 2018, a package of initiatives to help alleviate affordability pressures faced by households, particularly in areas of high housing demand and high accommodation costs were announced by Minister Murphy. The measures announced were the new Rebuilding Ireland Home Loan, a new Affordable Purchase Scheme and a new Affordable Cost Rental Scheme. Further details on this suite of initiatives are available on the Rebuilding Ireland website at www.rebuildingireland.ie
Officials from my Department and the Department of Housing, Planning and Local Government have met with the credit union representative bodies on a number of occasions to examine how credit unions can assist in the area of social housing.
Following engagement with the credit union sector on proposals for credit unions to provide funding for the provision of social housing, the Central Bank undertook a review of the investment framework for credit unions in 2017. On foot of this review, revised Regulations with the addition of investment in Tier 3 AHBs as a permitted investment class for credit unions commenced on 1 March 2018. The revised Regulations could facilitate a combined sector investment in Tier 3 AHBs of close to €700 million.
The Programme for a Partnership Government recognises the potential role that credit unions can play in housing finance. To that end, this new investment framework for credit unions clarifies the scope and the manner in which credit unions can support the development of social housing.
Ultimately, any funding mechanisms will have to be put in place in the first instance by the credit unions themselves, with the support of their members, and with the agreement of the Central Bank.
