Thursday, 14 June 2018

Ceisteanna (75)

Barry Cowen


75. Deputy Barry Cowen asked the Minister for Public Expenditure and Reform the purpose for which the €400 million proceeds from the sale of Bord Gáis have been used; if it is still available for an off-balance sheet housing model; if it has been allocated elsewhere in housing; if it has been used to pay down the national debt; and if he will make a statement on the matter. [26051/18]

Amharc ar fhreagra

Freagraí scríofa (Ceist ar Public)

I assume that the Deputy is referring to the €400m of proceeds from the sale of Bord Gais Energy that the Government announced, in Budget 2015, would be made available to support the Government's Social Housing Strategy.

As the Deputy will be aware, the intention at the time was that this €400m would be made available to establish an off-balance sheet financial vehicle to provide financing to Approved Housing Bodies, together with additional private funding, with the aim of facilitating the provision of additional housing units in support of the Government's Social Housing Strategy.

However, despite a detailed investigation of options to use the available funding in this way, including a high level of engagement with potential social housing providers and potential financiers of social housing, no new model that would, of itself, be capable of providing and/or financing social housing on an off-balance sheet basis could be identified that would be capable of utilising the €400m of Bord Gais Energy proceeds available.

Notwithstanding this, it was noted that there were aspects of some of the proposals considered that did appear to offer potential, in terms of a possible model or models that could be developed on an off-balance sheet basis. This included, in particular, a model for a potential ‘affordable rental’ scheme to provide long-term affordable residential accommodation for low to moderate income key-worker households in urban areas of high demand.

In response to this outcome, it was decided to convert the commitment from a single lump sum payment into a commitment to provide €10m per annum, indexed for inflation, over a longer period (20 years), which could be used to secure the development of a pilot affordable rental scheme as envisaged in Rebuilding Ireland. Provision was made for this €10 million in annual funding to be allocated to the Vote of the Department of Housing Planning and Local Government in 2017.

I am informed by the Department of Housing Planning and Local Government that, after further consideration and as set out in the Strategy for the Rental Sector, the commitment to develop an affordable rental model is now being progressed through kick-starting supply in rent pressure zones. Lands held by local authorities in such zones are being progressed with a view to leveraging the value of the land to deliver the optimum number of units to rent, as part of mixed-tenure developments. This is intended to allow the rental units to be made available at cost without the need for on-going rental subsidies.

Accordingly, the provision of €10 million earmarked for the affordable rental scheme has now been redirected to support additional activity under other housing programmes. Detail of the specific measures can be provided by the Minister for Housing, Planning and Local Government.