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Housing Policy

Dáil Éireann Debate, Wednesday - 24 October 2018

Wednesday, 24 October 2018

Ceisteanna (61)

Richard Boyd Barrett

Ceist:

61. Deputy Richard Boyd Barrett asked the Minister for Public Expenditure and Reform if he has assessed the impact on State finances of the reliance of Rebuilding Ireland on private tenancies to deliver social housing in view of the report on current and capital expenditure on social housing delivery mechanisms of July 2018; and if he will make a statement on the matter. [43923/18]

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Freagraí ó Béal (8 píosaí cainte)

I find the failure of the Government's social housing policy infuriating for many reasons. The targets are never met, the human misery continues and the plan is fundamentally flawed in its reliance on the private sector. Aside from all of that, has the Minister actually looked at the insane cost if the Rebuilding Ireland policy were actually to work? Some 137,000 units that the Government hopes to deliver under that plan are going to be sourced from a private sector in which rents are going through the roof. Has the Minister worked out the crazy cost of that?

In order to ensure an effective and efficient response to urgent social housing needs, Rebuilding Ireland provides for a range of delivery mechanisms for social housing. There are a variety of objectives behind this mix including the appropriateness of support, flexibility and speed of delivery, as well as value for money for the Exchequer. The paper from my Department to which the Deputy has referred on other occasions sets out the relative cost of these delivery mechanisms based on data across six local authorities. The report is careful to acknowledge that there are factors which may vary by local authority area, for example prices within the wider housing market, the availability and cost of land and the level of demand for social housing.

There are two current expenditure-funded schemes analysed in the report, which utilise private rented tenancies to deliver speedy responses to social housing requirements. The housing assistance payment, HAP, and the rental accommodation scheme, RAS, are important components of the accelerated delivery of social housing envisaged under Rebuilding Ireland. It was noted in my Department's report that it may be more cost-effective for the State to provide private tenancies in the short term to meet social housing needs where limited public land is available, where the cost of constructing social housing units is prohibitive or, more broadly, where timing is the key issue.

Following the review of Rebuilding Ireland at the end of 2017, there has been a renewed emphasis on increasing the number of social housing units through build programmes. In addition to this, the Minister for Housing, Planning and Local Government, Deputy Eoghan Murphy, has agreed delivery targets that are appropriate for particular areas, with due regard to timing, capacity, flexibility and the cost implications highlighted in the paper from my Department.

When we trawl through the jargon, the paper to which I referred, produced by the Minister's Department, shows that 97,000 of the social housing units the Government plans to provide between now and 2021 will be provided by the private sector. Only 33,000 units will be directly built. The Department's paper actually states that in cities such as Dublin, that is going to blow a black hole in the public finances. The cost of property and rents is ratcheting up at a dramatic rate. We are going to be paying the landlords month after month, year after year, reaching up to a target of 97,000 different units that we will be leasing and renting. In Dublin, rents are now between €1,500 and €2,500 per month. One estimate suggests this could cost us €23 billion over 20 years.

Let us look at the figures for 2019. For 2019, the capital funding the State is making available is €1.1 billion to provide new social housing solutions and directly build homes, with the provision of €150 million of current funding to do it. The total amount of funding next year going into delivering additional units is €1.25 billion, with most of that in capital funding. In terms of social housing support, the Deputy is correct that it is a high figure for next year of €557 million, the majority of which is going into housing assistance payments.

What is the Deputy proposing that we do as an alternative for 2019? There is a great level of social housing need, of which I have as much experience as Deputy Boyd Barrett given the constituency I represent. While we are building the homes, as we are doing in O'Devaney Gardens and will be doing in Dominick Street, do we not have a responsibility to ensure that accommodation is provided by other means to our citizens who need support in getting homes? That is what we are doing and even for next year, as the Deputy can see on the basis of the figures I have shared with him, we are investing more in building new homes than we are in making use of homes that are already built for our citizens who deserve support.

HAP is precarious. It costs a fortune. People who get HAP end up back in homeless hubs. From the point of view of people, it is not good. From the point of view of the public finances and a sustainable plan, it is going to be a disaster. In 2019, the Minister is proposing 16,000 new HAP tenancies as against only 6,000 council house builds. In 2020, he is planning 13,000 new HAP tenancies and only 7,000 actual builds. In 2021, 10,000 HAP tenancies are planned and only 8,000 builds. All along the way, even if there is something of an increase in direct builds, HAP tenancies dwarf what is going to be built by a factor of three or four. It is about 100,000 of the 137,000 units. It is not going to work and is going to cost us a fortune. From every point of view, financial and social, would it not be better now to ramp up the direct construction of council housing?

From the point of view of people, to use the Deputy's prism, while we are increasing the provision of social housing for next year - as we are doing with 6,545 homes being delivered through local authority construction, Part V provision and the refurbishment of long-term voids, 1,300 units being delivered through acquisition programmes and 2,130 units being delivered by leasing - is it not right that, as we increase that output and seek to get it to the level that will in time meet the existing level of need, we also make use of stock that is already built and use those houses to provide homes to citizens who will need social housing that is being built at present?

The Government has to do that. I accept that. That is not my point.

I put it to the Deputy that over time, as our social housing output gets to the level we want it to get to - and I reiterate my view, which is the view of the Minister, Deputy Eoghan Murphy, that those houses should be built directly by the State - we should also make use of homes, many of which have been delivered by the private sector, to house our citizens, who will be able to use that social housing stock in the future.

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