Wednesday, 14 November 2001
Dáil Eireann Debate
–moderating the rate of house price increases,
–increasing the share of the housing market going to first time purchasers,
–introducing for the first time a multi-annual and greatly expanded local authority housing programme which has led to the highest number of starts for 15 years,
–increasing voluntary housing output to the highest levels ever,
–introducing an integrated strategy on homelessness,
–establishing the Private Rented Tenancies Board as a key measure in securing a strong and well regulated private rented sector, and supports the continued action and commitment by the Government to expand the supply of housing across all tenures and to improve access by all income groups to suitable housing accommodation.”
–(Minister of State at the Department of
the Environment and Local Government).
Mr. Rabbitte: I wish to share my time with Deputy McManus.
An Ceann Comhairle: Is that agreed? Agreed.
Mr. Rabbitte: When we talk about squandering the boom and the four and a half years that the Government has been in power, in no area is that more manifest than in the area of housing. I know that there are colleagues who will argue that the inequalities in the health services, the traffic gridlock and appalling failure in transport are grimly serious issues, but nothing is as bad as the parade of hopeless cases to the clinics of every Member of this House every week who have no prospect of being housed under this Government.
Mr. Naughten: Hear, hear.
Mr. Rabbitte: With some difficulty I found out at the beginning of this year that in my own county council area, South Dublin, last year a miserable total of 103 new county council houses were built in an area with 4,010 applicants. I was unable to attend yesterday's county council meeting because of commitments to the mini-CTC inquiry, but my colleague, councillor Joanna Tuffy, contacted me to tell me that she established that in the 11 months of this year South Dublin County Council, the second largest local authority, has completed 51 new houses. That is scandalous by any yardstick.
It is impossible to understand how, in such propitious times, the Government allowed this crisis to worsen to such an extent. As my colleague, Deputy Gilmore, stated last night, all the affordability indicators have doubled under this Government – the price of houses, the level of rents, the number on council waiting lists and the number of homeless. The Government has presided over a situation where home ownership, which it professes to cherish, is beyond the reach of a young couple on modest incomes. Not only can they not afford a house of their own, but, ironically, they can no longer afford to rent a house. In my constituency, a modest three bedroom house in dilapidated condition is rented at £800 per month. A woman with three children, who returned three years ago from Birmingham, was in my clinic on Saturday. She pays £800 per month for a poor quality house and has received notice from the landlord that he wants to raise the rent by £100, which she cannot afford and so is facing eviction. This is not an unusual story. This town's hostels and bed and breakfast accommodation are full of single mothers living in appalling conditions who must spend the day on the streets. This is the great scandal of the Government's time in office.
Ms McManus: It is clear that the housing crisis is deepening rather than receding after almost five years of this Government. A new initiative is needed of the same magnitude as the crisis. People mentioned the doubling of figures. In Bray, there are 885 families and individuals, about 7% of the town's population, on the housing list, which is unprecedented and unbelievable. When I asked, as others have, how many houses were completed this year, I was told eight. While more houses will be completed next year, it is more worrying that there is no landbank available to the local authority which means that we will face a famine in housing.
What is happening in the county, as it is nationally, is that the county council acquired land where it is less expensive but where the housing need is least, which means that where the need is greatest there is little or no land. I am concerned that the provisions in the new planning and development Act are in danger of being used as a substitute for a housing programme by local authorities. To be fair to the Minister for the Environment and Local Government, when he introduced the 20% measure he made it clear that it was not to be a substitute for the social housing programme which local authorities have a statutory responsibility to provide. However, it is clear that there is an over-dependence on potential private development to meet the housing need of the thousands on housing lists, which is unacceptable. It must be reiterated that the people who pay the price for the housing crisis are children. Thousands of children are suffering poverty because of it.
Minister of State at the Department of the Environment and Local Government (Mr. D. Wallace): I wish to share my time with Deputies Carey, Power, Moloney and Brendan Smith.
An Ceann Comhairle: Is that agreed? Agreed.
Mr. D. Wallace: I am pleased to have the opportunity to contribute to this motion because the priority afforded by the Government to housing is clear. Last evening my colleague, the Minster of State with responsibility for housing and urban renewal, Deputy Molloy, outlined what is, by any standards, a remarkable record of achievement by the Government in housing and the effectiveness of our approach. It must have made dismal listening for the Fine Gael Party and exposed the shallowness of its housing policies and its motivation for bringing forward the motion now. The Government has a clear, comprehensive housing strategy, whose emphasis, as outlined by the Minister, Deputy Molloy, is on maintaining a high level of housing output, expanding the range and supply of social and affordable housing, developing the private rented sector and improving the quality of the management of the public housing stock.
The challenge, which we are meeting successfully, is to achieve these goals and ensure that housing is well planned and sustainable, especially at a time when we may seek to redistribute housing and other development in accordance with the proposed national spatial strategy. It is worth repeating that the total provision for housing in 2001 is over £1.1 billion, up more than one third on 2000 and treble the amount provided in 1997 when the Government came into office. The Government has breathed new life into the local authority house building programme and the capital provision for this year is just over £448 million. This will enable the housing authorities to meet commitments arising in 2001 on works in progress and commence or acquire an additional 7,000 houses this year. We will complete in excess of 5,000 units this year. The combination of social housing measures, including the shared ownership scheme, affordable housing schemes, voluntary housing and the traditional construction programme will meet the needs of an estimated 11,000 households in 2001.
Under the four year multi-annual programme, Cork Corporation plans an expanded programme to provide 1,000 houses between 2000 and 2003. The corporation's provision for its construction programme this year reflects this increased activity. A sum of £21 million in funding is being provided, which is an increase of over 50% over the original allocation of £13.8 million last year. This indicates the Government's commitment to addressing social housing needs in Cork city.
The Government recognises the unique contribution that the voluntary housing sector can make to middle and low income households and special needs groups. We are expanding the sector to 4,000 units of accommodation per annum by 2006, with substantial funding and a new voluntary housing unit in the Department to drive the sector. Cork Corporation is a strong supporter of the voluntary sector and at the end of June this year, 75 dwellings were under construction. The national development plan provides for area-based regeneration initiatives to restore the physical fabric of established areas and to support communities, notably the redevelopment of Ballymun. Earlier this year we approved proposals for the redevelopment of the Glen area in Cork city. This will involve the upgrading of the housing stock on a number of fronts to include new housing, comprehensive regeneration of existing housing and an expanded management and maintenance programme at an estimated total cost of £40 million. I understand that work is due to start early next year on the first phase of the redevelopment that will involve construction of 48 new dwellings and the refurbishment of 66 existing dwellings. The work will also include demolishing one block of flats and refurbishing the remaining 12 blocks. This is a major undertaking for Cork Corporation and I am happy to give the redevelopment my full support. It will contribute enormously to the regeneration of the Glen area.
Plans are also being advanced for the comprehensive redevelopment of Knocknaheeney area. The opportunities presented by the regeneration and refurbishment programmes are being utilised by authorities to put in place more localised housing management arrangements and to promote better communication with tenants through improved consultation and participation. Resources are also being provided under the remedial works scheme that targets the upgrading and improvement of low cost, pre-1960 dwellings and run down local authority housing estates. Nationally, more than £50 million has been provided under this scheme since its inception. A number of major projects are currently under way in Cork city involving the refurbishment of 732 dwellings at an estimated cost of £20 million.
A key concern for the Government has been to meet the special needs of particular categories of households such as the elderly and the disabled. This concern is reflected in the substantially increased funding for the task force on housing aid for the elderly, the disabled persons grant scheme, the essential repairs grants scheme and the scheme of improvement works in lieu of local authority housing. The total number of grants paid under the disabled grants scheme and the essential repairs grant scheme in 2000 was just over 5,000 with a value of approximately £25 million. The number of houses improved under the task force and improvement works in lieu scheme was just under 4,000. Activity under these schemes in the first half of this year points to an even higher level of activity in 2001.
Last evening, the Minister of State at the Department of the Environment and Local Government, Deputy Molloy, outlined the major advances the Government has made in tackling the issue of homelessness. Record levels of funding and the necessary organisational arrangements to ensure that homelessness is tackled in an integrated manner match our commitment in this respect. Earlier this year, I launched the Cork action plan which presents a clear framework for tackling homelessness in Cork over the next three years. The purpose of the plan is to address current gaps in services for the homeless, to create an effective service delivery system for the homeless and to ensure that housing, education and health policies are focused on the prevention of homelessness in Cork. The preparation of the Cork action plan was very much a collaborative effort involving a range of statutory and voluntary bodies and, most importantly, the homeless people themselves. I would take this opportunity to once again commend everyone involved.
I express my appreciation to Deputy Molloy for the work he has done and the success he has achieved in the area of housing. The Fine Gael motion, like its other failed policies, should be consigned to the scrap head. I wholeheartedly support the Government's amended motion.
Mr. Farrelly: What about the 35,000 people who will be unemployed after this?
Mr. P. Carey: I am pleased to see Deputy Farrelly arriving for a bit of a spat.
I am pleased to support the Government's amendment. Do Fine Gael want us to reverse the policies that have yielded record house completions? Last year there was an output of 50,000 units nationally – the sixth consecutive year of record housing output. Does Fine Gael want us to reverse policies that are now yielding significant moderation in house prices? Data show that house price rises are now lower than at any time since 1996.
Mr. Farrelly: That is not what we said last night.
Mr. P. Carey: Last night, Deputy Farrelly's colleagues were talking about Part V of the Planning and Development Act, 2000, and they were giving out about the negative impact that the two year withering clause has on house building. I remind Deputy Farrelly that this is a measure that his party supported when the Bill was before these Houses.
The last bright idea Fine Gael had in housing policy was the £5,000 new house grant. What did the £5,000 new house grant do? If denuded Darndale, Tallaght, Ballymun, Clondalkin—
Ms O. Mitchell: The Deputy should go back to pre-history to see if he can find anything.
Mr. P. Carey: I am just reminding Deputy Mitchell of the facts. The grant left us with hundreds of empty flats in Ballymun, hundreds of empty houses in Darndale—
Mr. Farrelly: The Ballymun flats should never have been built and it was Fianna Fáil who built them.
Mr. P. Carey: Fine Gael is looking for it both ways but it cannot have it both ways. When I joined the city council in 1985, Fine Gael was in Government. It had dominated the city council prior to that and had done very little by way of a capital programme. When Fianna Fáil took over the city council in 1985 we had hundreds of properties that had become derelict. Fine Gael did two things, it created ghettos that have taken years to reverse and drove up prices in the private sector. People who could not afford a new house were shoved out by the attraction of £5,000 in order to live in so-called middle class areas. Many of them ran into trouble and had to come back into the social housing market. If that is what Fine Gael is proposing, I look forward to having a nice joust with them during the next election campaign.
Deputies: So do we.
Mr. P. Carey: It is really quite pitiful. The Ballymun project is the biggest refurbishment project in this State, £1 billion of Government funding will be put into it.
Mr. Farrelly: Why has that to be done? These blocks should not have been built in the first place.
Mr. P. Carey: If Ballymun had not been allowed to be run down as an estate we would not be spending half the money we have to spend now. This is a model of best practice. We have provided sewerage and water facilities.
Ms O. Mitchell: Great.
Mr. P. Carey: Deputy Mitchell has been around for the last 25 years and remembers it. Everybody said we needed a north ring sewer but nobody did it. This Government provided the serviced land initiative, and to be fair to Fine Gael, their members on Dublin City Council supported Fianna Fáil on the Pelletstown initiative. As a result of the careful planning of Ballymun, we have 500 houses under construction in the first phase. The first group of tenants have now moved into their houses. There will be a mix of tenure of houses. There will be people in rented accommodation; they will be able to buy under the shared ownership scheme. People will be able to avail of the affordable housing scheme, the rental subsidy scheme and will be able to buy their rented property on very competitive terms. These schemes are part of Government policy and cannot be denied. The Government is promoting housing co-operatives, an extremely important initiative. Voluntary housing associations, for example, the Respond! Housing Association, have been given £7.8 million to build an attractive, integrated housing development in Finglas. This initiative is being replicated throughout the country. Fine Gael is afraid to admit that these projects are coming on stream and the policy is coming right.
Mr. Farrelly: On a point of order, will the Deputy tell us what the 35,000 people who will unemployed after Christmas are going to do?
Mr. P. Carey: I was quite impressed to hear Fine Gael talking with concern about the house building sector. If Fianna Fáil had done what Fine Gael did last night, we would be accused of being in builders' pockets. We have taken on the building sector and have taken radical initiatives which have, and are, making a difference. Fine Gael was not prepared to do that and is still not prepared to do it.
Mr. Power: When one is in Opposition, the barrel is always half empty. There is not much fairness in some of the contributions. I would be the first to admit that all is not well in the housing industry. The Government was faced with the serious problem of rapidly increasing house prices. The big concern expressed was about first time buyers and the difficulties they were having in getting into the property market. Last year in particular there were a number of measures taken by the Minister to try to deal with this. Any fair minded person would say that they have brought about major changes. Now could be seen as an excellent time for first time buyers to make their purchase. Interest rates are at historically low levels and house price inflation has stabilised while in some areas prices have reduced. There can be no denying the measures taken by the Government last year have yielded positive results. The number of houses completed in the first nine months of this year has increased by 4% compared to the corresponding period last year. First time buyers comprised 38% of the market in the first six months of 2000 and this has increased to 44% in the corresponding period this year. More first time buyers have been attracted into the market by the Government. Such an increase had been sought by the House and the Government has delivered on it.
I refer to a recent statement by An Taisce. It said it will object to planning permission granted for any single dwelling in rural Ireland and it has already objected to a number of applications which were approved by Kildare County Council. There has been a significant increase in the number of appeals to An Bord Pleanála. Last year there were more than 5,300 appeals, which was a 13% increase on 1999. We are all aware of the backlog and difficulties experienced by the officials working for An Bord Pleanála as they try to reach decisions on time. The decision of An Taisce displays its total ignorance of what life in rural Ireland is about.
Mr. Farrelly: The Government should withdraw the grant to An Taisce.
Mr. Power: I agree. Guidelines have been issued by Kildare County Council for people who are eligible under the county development plan to build in a rural part of the county. Those guidelines are stringent and it is very difficult for people to qualify. It is a costly exercise to buy a site and build a house without a group such as An Taisce objecting without regard for the function of the planning authority or of elected members. An Bord Pleanála should treat the objections by An Taisce as vexatious and throw them out.
Mr. B. Smith: Hear, hear.
Mr. Power: It is an insult to people that this should be so and it is not right that the Government should provide funding to An Taisce. I appreciate the good job that has been done by its members in the past but what An Taisce is doing now is nothing short of a disgrace and it should change its policy immediately.
Most of the development in County Kildare has taken place in Kildare North and in our development plans we have tried to encourage people to move to the middle and south of the county. That has paid dividends in recent years and the Government's decision to reopen the train station at Monasterevan will make that part of the county much more attractive to people.
We must not look to the Government to implement every initiative. Local authorities have flexibility and they should introduce initiatives and not look to others to do the job for them. The 20% social and affordable housing provision under the Planning and Development Act, 2000, has been met by Kildare County Council and it is taking up land wherever possible. While there are difficulties in housing, the measures that have been introduced will pay rich dividends in the long term.
Mr. Moloney: Like my colleagues, I recognise there are problems in the housing industry and we do not pretend that all of them have been resolved over the past four years. Nevertheless, the combination of initiatives taken by the Government has led to a reduction in the numbers on waiting lists throughout the State and has encouraged—
Ms O. Mitchell: Is the Deputy out of his mind? Waiting lists have trebled.
Mr. Moloney: I am not losing my mind and if I am allowed to continue without interruption, I will be able to prove that. A combination of Government initiatives to front load the housing programme through local authorities over the past two years has dealt effectively with housing waiting lists in my constituency, similar to most other rural constituencies.
Ms O. Mitchell: Have the waiting lists only doubled?
Mr. Moloney: Waiting lists have been reduced. If the Deputy spent less time criticising the Government and more time encouraging her local authority to front load housing and allocate social housing, she might recognise that decrease. However, if she spends her time coming into the House raising an issue for the sake of it, she will not do much to reduce waiting lists.
Last week the Minister of State with responsibility for housing, Deputy Molloy, visited my constituency and commended the initiatives taken by the local authority. I congratulate him and the Government for taking a wide range of measures that have helped to reduce house price inflation, increase housing output, address practical difficulties such as the lack of infrastructural support through water and sewerage grants, etc., create easier access to the market for first time buyers and improve affordability for first time buyers and low income households.
The facts speak for themselves. Government initiatives are working. Last year 13 houses per 1,000 head of population were built, which was the highest rate in the EU. We must be doing something right if Ireland can brag and boast definitively that it has the highest rate of house building in the EU.
Ms O. Mitchell: It had the highest rate.
Mr. Moloney: Housing output in Ireland is four times that of the UK. Last year house completions reached 50,000 nationally and it was the sixth consecutive year there was record housing output. I do not know what the Opposition Members find so funny because those are the facts and people recognise that.
The Government's policy has been to ensure that first time house purchasers are prioritised. They account for a large share of the market as the number of applicants for new house grants has increased by 6.3% for the first four months of this year following an increase of 4.8% during the corresponding period in 2000. Opposition Members are not amused but I am quite happy to report that statistic.
A significant measure taken by the Government is the provision of £6 billion in the national development plan for social and affordable housing. The Government has committed a further £1 billion to the initiative and the total provision for social housing in 2001 will be more than £1.1 billion, an increase of one-third on last year.
My only criticism of the housing industry is that more should be done to encourage local authorities to permit house building in rural areas. The increase in water grants some years ago led to a significant increase in house construction in rural Ireland. I would like the Minister to increase sewerage grants to a similar level.
Mr. Farrelly: I agree.
Mr. Moloney: That is mighty. I support Deputy Power's comments but do not wish to waste time criticising An Taisce. Water and sewerage grants should be increased so that rural communities can become established and develop. If grants were approved for communal schemes, large numbers of people would be removed from the waiting lists.
I hope the Minister will encourage local authorities to become more proactive in the voluntary housing sector.
Only last week in my constituency 76 units were opened by the Minister of State, Deputy Molloy. That can be combined with the other initiatives throughout the county in the last four years. The waiting list in my constituency could be halved and that might come as a shock to Deputy Mitchell who seemed to think that I was plucking these figures out of the air. We could reduce that waiting list by half by further encouraging the voluntary sector. The feeling out there unfortunately is that voluntary housing is not successful in rural areas. We have disproved that in four towns in County Laois. As a new Deputy I am very pleased to say that the Government has responded to this urgent need and the next five years in office will clear out any difficulties in the housing sector.
Mr. B. Smith: I support the amendment. I congratulate and commend the Ministers, Deputies Dempsey, Molloy and Wallace, on their stewardship of the Department of the Environment and Local Government since June 1997. I am very confident that they will continue to give that Department good leadership until next June and indeed beyond. This Government has introduced many innovative measures and I congratulate the Ministers concerned. The Government's housing policy is sound, well funded, credible and it is working.
The housing output has increased dramatically since 1997. For the first time, local authorities can operate a multi-annual housing strategy and voluntary housing is being provided at the highest level and with the best level of assistance. I compliment and commend the various voluntary groups throughout this country who are doing excellent work and availing of the very substantial and generous grant assistance that is available towards the provision of housing.
In my own county, voluntary groups in many areas are providing housing in some of the more remote areas where the local authority in the past did not see fit to provide it. One of the most innovative measures for rural Ireland is the small towns and villages water and sewerage schemes. The Minister has approved funding for the provision of sewerage and water facilities in a number of villages in my own county. Those villages now have the level of services that can support housing and a credible land bank can be built up and housing provided at a very affordable price.
Deputy Power voiced his serious concern about the announcement by An Taisce that they would object to all one-off house building planning applications in County Kildare. It is scandalous that any credible organisation would launch such a policy or make such an announcement. That type of objection should be regarded by An Bord Pleanála as vexatious. Nobody can implement a blanket policy of objection to everything.
I have a serious concern with An Bord Pleanála because it takes far too long for decisions to be made. The Minister has provided increased resources and personnel for An Bord Pleanála. Surely it is not beyond the capability of the board to fast track and prioritise major projects which come before it for decision. I know of an instance in my own county where it took far too long for a decision to be made in relation to a major project. This is not acceptable.
Another helpful and important initiative particularly in the rural counties is the serviced land initiative. Land is being serviced with water and sewerage and that extra land bank is being made available for affordably priced houses for the people of those areas. Thankfully housing being provided by the local authorities is of a first class standard. The best houses being built in many parts of the country are not being provided by the private sector but by the local authorities. They are sound, good, modern houses, as they should be.
The introduction of the multi-annual approach was a very important decision. That has allowed housing officers and other officials in the local authorities to make greater use of forward planning. It makes for greater economies of scale. This year 5,000 housing units will be completed and this year will also mark the start of 7,000 other housing units.
There are now for the first time local authority houses and housing schemes being provided in the smaller towns and villages and indeed in some parishes that do not even have a village status – parishes that may just consist of a church and a school. Housing is being provided for the older people in society and this enables them to remain in their own parish or village and not have to move to a town perhaps eight or ten miles away. That is very progressive planning on the part of the Department and the Ministers who introduced that are to be commended. Those policies will pay dividends for the future and are paying dividends today.
Very substantial improvements have been made in the disabled persons grant scheme and the essential repairs grants schemes. All of us who are familiar with rural areas see far too often houses that are derelict or in poor condition. I am pleased that the Minister substantially improved the essential repairs grant scheme and the disabled persons grant scheme. I hope that the Minister will introduce a house improvement grant scheme in order to extend those schemes. I support the work of the Ministers and the Department.
Mr. D'Arcy: I wish to share my time with Deputies Cosgrave, Tom Hayes, Crawford, Killeen, Ulick Burke, Ring and Healy.
Acting Chairman (Mrs. Moynihan-Cronin): The Deputy has six minutes and four minutes for the others.
Mr. D'Arcy: Very little time is being made available to speak in this debate. This is a serious issue and I am glad to see some of the Government Deputies acknowledging that there is a serious situation in respect of housing. We have never been able to establish the number of people on the current housing lists in the State. The Minister has been asked many times to give us some indication of the numbers but he has refused to do so. It is believed that the number is between 60,000 and 80,000 people. However, he cannot hide the figures about our own constituencies. I have the figures from Wexford County Council, Wexford Corporation, New Ross UDC and Enniscorthy UDC. That is the constituency of Wexford. In 1996 there were 1,200 people on the housing list; there are 1,800 people on the current list in the same area, an increase of 50% and, whether we like it or not, the situation is the same right across the country. Those are the facts. As I said, the Minister has avoided answering questions on this subject several times.
Indications from the Irish Home Builders' Association are that the supply of houses is falling and the housing crisis is set to intensify. The Government's ad hoc stop-start approach has completely destabilised the market at a time when the demands on the industry are for vastly increased output. The same uncertainty which pervades among builders is also causing banks to be much more cautious when it comes to finance for house building. The result is that the builders are moving to the more certain market of commercial and industrial development. This is bad news for prospective house buyers. Rising prices will push more and more young people into the categories of those who can never hope to own a house. At the same time, the supply of rental accommodation has been completely decimated by the removal of tax deductibility on interest from rental income.
Any Government should ensure balanced regional development by identifying national growth centres and an adequate supply of houses which will be serviced to accommodate a 20 year target population. Besides basic services, all other facilities required to attract and retain the young population of the growth centres, such as schools, health centres, shopping, public transport, child care, recreational and cultural facilities, should be channelled to those areas. Job creation should be actively encouraged and facilitated through the IDA and the use of strategic development zones. All future land zoning by local authorities should be informed by the targets set in the national spatial strategy. They will then be required to prepare plans to service zoned land, if necessary in conjunction with adjoining local authorities in the region, to ensure that their lands can be brought to market when required.
To build sustainable communities, all future housing should be planned in a way that facilitates efficient public transport use and provided in clusters close to existing or planned public transport routes. To encourage increased supply of rented accommodation, providers should be allowed to write off mortgage interest against the rental income of the property. To prevent speculative buying, such reliefs should apply only if the property is retained as rental accommodation for at least five years. The recommendations of the commission on the private rented sector should be closely examined to give greater security and certainty to tenants and landlords.
Local authorities should be resourced with planners and the other professional and support staff necessary to ensure the highest quality built environment and to speed up the planning process. Initially, this will require some short-term contracts and possible housing subsidies to attract planners, particularly from abroad. Local authorities should be directed to make greater use of voluntary housing associations to deliver social housing. They have the flexibility and the expertise to manage larger building projects and they have a proven track record of successful estate management and social integration.
The funding for home improvements for the elderly should be quadrupled to protect the housing stock and also to ensure that older people can remain as long as possible in their own homes. This is a most important point. We have heard the Government bragging about what it has done for older people, but it has done very little for them. Health board programmes are way behind. In my constituency of Wexford, 40 houses are awaiting work but only one a month is being completed. These important areas have been overlooked.
The Government has made many promises but the point about the price of houses in every constituency has been well made in the debate. The price of houses is forcing young people on to the housing list. The cheapest three bedroom house in my town of Gorey is £120,000. The repayment on that type of borrowing, even with the current low interest rates, is in the region of £650 a month. Young people with a take home wage of £300 or £350 cannot afford that type of mortgage. The level of subsidies is completely inadequate.
Mr. Cosgrave: Every Member of the House is aware of the failure of the Government to ensure that an adequate supply of new homes is available to satisfy the needs of young people. The Government's housing policy has failed in every aspect; it has achieved the opposite of its stated objectives. It has pushed up rents and allowed the cost of houses to move beyond the reach of young working couples. The supply of new houses is far from adequate and the number of new starts is well short of a figure which would ensure that supply outstripped demand.
The Government has not addressed the issues which challenge the ability of the construction industry, which is under stress, to deliver to young families the houses of their dreams. Something is seriously wrong when nurses, gardaí, mid-ranking civil servants and local government officers cannot afford a door of their own. There has been a baby boom over the past 15 years. Due to the Government's health policy, most of those babies were born in corridors and due to its housing policy, they will be living in corridors for the next 15 years.
The problem of resources in local authorities and An Bord Pleanála contributes to the delays in the system. The Minister must address the remuneration packages in these bodies and ensure they are adequately staffed with the best professionals. The delays caused by appeals to An Bord Pleanála must be halved. This could happen if resources were put in place. If council planning departments were manned adequately, many planning decisions might not be appealed. The issue of withering planning permissions after two years must be revisited. The uncertainty involved is not beneficial to the long-term development of good community housing and the problem must be tackled now.
The social and affordable housing requirement has not had a significant effect in terms of putting on the market homes in the required locations for those who most need them. If anything, a lack of commercial confidence exists due to the requirements not only among property developers, but among their selling agents, the investment sector and the purchasers, who are making lifetime investments. These people are unsure of what they are buying into and the measures are causing great uncertainty in the construction sector.
The Government's policy in the context of the implementation of the Bacon report has forced up the cost of rental property. The Government is responsible for this price hike and its strategy means people face rents of up to 30% higher than should be the case. It denies young couples the right to own a home of their own. Instead of delivering homes for our people, the miserable measures have caused hardship among the nation's Celtic tiger generation. A loss of £1 billion worth of investment property has occurred as the sector moved into other markets. The Government should reintroduce rental property interest reliefs and encourage investors back into the marketplace. It should force rents down and support the construction industry. The Government should help it to maintain the employment level and assist it in producing the housing output that is required to meet the needs of people who are looking for homes. The planning issues being pushed by the Minister and his Department will create social problems in the long term.
Mr. T. Hayes: I am delighted to have the opportunity to contribute to this important debate. The housing issue touches many people and there is widespread concern about it. One of the Government's legacies is the failure of its entire housing policy. When it came into office, it promised to solve all the problems in the housing area and everybody believed that would happen. However, it has totally failed in every area.
I could mention many aspects but I will refer to some of the smaller schemes that could have been hugely successful. The housing aid for the elderly scheme has the potential to be one of the best schemes, but money is not available for it. If one asks any of the health boards or county councils that are administering it, one will discover that there are insufficient funds for the scheme. In my constituency of South Tipperary, the money for the scheme was exhausted by April. The amount of money available could only meet 30% of the requirement. This scheme could be extremely effective but it is a total failure. It could give a better quality of life to many elderly people who contributed to the State and gave much to their communities. They only need grants of £1,500 or £2,000 to repair their doors and windows, small things that would improve their quality of life, but the Government has not provided sufficient finance to make the scheme work. I agree it could be a great scheme but it needs adequate resources. If money is not provided for it, the scheme will be no good.
The works in lieu of re-housing scheme involves huge delays and bureaucracy. If somebody applied for assistance under the scheme, he or she would be lucky to have the work done within seven or eight years. The amount of work in lieu carried out in most council areas is very small compared to the need that exists.
The disabled person's grant scheme is another failure. Huge numbers of people in every council area are waiting for their applications to be considered, but there are not enough people available to administer it in health boards. This is another example of a scheme with the potential to enhance people's quality of life. However, the funding necessary to administer the scheme has not been provided with the result that there are huge backlogs, particularly in my constituency. The Fianna Fáil members on my local authority spoke about this matter only last Monday and intend to contact the Department to discuss it further.
It is now more difficult than ever for young people to acquire their own houses, whether they are building or buying them. They face difficulties at every stage of the process from obtaining planning permission to meeting qualifying income thresholds. This issue must be addressed.
Mr. Crawford: I welcome the opportunity to speak on this important motion. Coming from a rural constituency, I am aware that councils are discriminating against those who want to build houses in rural Ireland. The Minister for the Environment and Local Government must take a strong lead in addressing this issue. Local planners are citing all manner of technicalities to prevent houses being built in rural areas, houses whose occupants would sustain populations in areas where farming is becoming an increasingly difficult way of life. This issue must be examined if the population levels necessary to sustain rural football clubs, churches and schools are to be maintained.
One of the Ministers of State at the Department of Agriculture, Food and Rural Development recently launched a programme which is completely at variance with the attitude displayed by the Minister for the Environment and Local Government. While one is trying to attract more people into rural areas, the other is trying to get them out. To add insult to injury, An Taisce seems to be jumping on the bandwagon.
Previous speakers addressed the difficulties faced by the elderly in local authority and health board areas and these must be dealt with. Two people working in reasonably paid jobs today cannot get a mortgage and this is exerting huge pressure on local authority housing lists. There has been a colossal increase in house prices over the past four and a half years. Single people also face difficulties. A young single woman from a small village in my constituency has spent eight years on a housing list and has no hope of getting a house in the near future. She is not well and cannot even afford a self-contained flat. What hope can the Minister offer this woman? Broken marriages also cause difficulties, particularly for men. Many men who vacate their family homes do not qualify under the current regulations for local authority housing. The criteria must be changed and suitable accommodation must be provided for these people.
The cost of housing in Dublin has a serious ripple effect on my constituency 80 miles away with students leaving Monaghan and Cavan to attend college in the city. The closure of St. Patrick's College in Monaghan represented an obvious opportunity for the State to develop a third level college in the town but the Government walked away from it. The property will certainly not be used for students. The policies pursued by the Government have resulted in dramatic increases in the cost of rented accommodation in Dublin, causing problems for students and others.
I welcome the commitment given by Deputy Brendan Smith, my constituency colleague, to push for a housing repairs grant. The tremendous scheme introduced by the previous Fine Gael led Government was scrapped by the current Government. The terms of the scheme could, if reintroduced, be improved and I urge the Government to consider this.
Caoimhghín Ó Caoláin: I thank the Fine Gael Deputies for sharing time. There is no doubt whatsoever that the Government's housing policies have failed miserably. Some 50,000 applicants, representing in the region of 130,000 people in need of accommodation, languish on local authority housing lists. There are at least 5,500 homeless people on our streets. Since 1996, the number of people on local authority waiting lists has risen by 43%. At the root of this crisis is the Government's near total reliance on the private sector and its failure to fully equip local authorities to house our citizens.
Incredibly, given the massive need we see all around us, only 8% of all houses are being built by local authorities or the voluntary sector. This is by far the lowest share for any period in the past century. The soaring house prices of recent years drove increasing numbers of people on to local authority waiting lists and into private rented accommodation. While house prices have moderated somewhat in 2001, this has clearly done nothing to alleviate the crisis. In the property supplements of today's newspapers, we read that the site of the former Clancy Barracks in this city is still for sale after the Department of Defence refused to countenance the proposal from Sinn Féin and others that it be made available to Dublin Corporation as an ideal location for local authority housing. Instead, the Minister for Defence is holding out for his £20 million asking price, the proceeds to doubtless be used to buy military equipment to meet the requirements of the Rapid Reaction Force and NATO's Partnership for Peace. The Government would rather provide tanks than houses.
New house starts are down by 20% in 2001 and the slowdown in the private housing sector provides an opportunity for the Government to use the available capacity of the construction industry to attack the housing crisis by increasing resources for public sector housing. Earlier today I launched Sinn Féin's pre-budget submission and our key housing recommendation is for a major renewed State investment in a comprehensive social housing programme with front loading of funding under the national development plan to allow local authorities to house our citizens. We call for the elimination of waiting lists by local authorities with an immediate target of 70% of applicant units to be provided with suitable accommodation within two years of being on the list.
We need control of land prices with a statutory ceiling on the price of land zoned for housing to stop speculation and reduce house prices. There should be statutory control of rents in the private rented sector, strengthened laws to set standards for accommodation and additional resources to implement those regulations. We also seek a renovation grant of up to £5,000 to assist home owners to improve their properties and a special grant to encourage utilisation of urban and rural derelict sites for new domestic dwellings.
I commend these proposals to the Government and record my opposition to its amendment.
Mr. U. Burke: The motion's underlying motivation is the restoration of confidence in the housing market. Those who heard last night's address by the Minister of State with responsibility for housing will know his comments were totally at variance with the reality on the ground. The Minister of State referred to house prices. Anyone who examines house prices from 1997 to the present will see they have escalated out of control. The Minister for the Environment and Local Government and his Ministers of State have dismally failed to restore confidence in the housing market, confidence required to allow young people to access housing as they have in the past.
The Government and the Department of the Environment and Local Government have failed to do anything constructive to make housing more accessible to young people. The Government's spatial strategy will deny young people in rural Ireland the right to build even a single dwelling on a family farm. Is that constructive? Is that encouraging young people to get a house of their own? The answer to my questions is “No”. This Government has a spatial policy strategy for Dublin, Cork and Limerick. The rest of the country has to comply with the edict regardless of the serious consequences. This Government has ensured that housing lists have increased dramatically. I heard a complaint from a constituent today that a developer in Loughrea has offered 20 houses to Galway County Council under the affordable housing scheme in order to offload property as a result of the decline in the private housing market.
If the Minister, Deputy Dempsey can sit there and say he is satisfied with the Government's housing initiatives, it is time he looked at himself realistically. The people will say they have had enough of the Government, as it has failed in relation to housing on every count. This Government has failed to take the initiative to tackle An Bord Pleanála, which is out of control. The people outside Dublin and the major cities will suffer until the authority is replaced by regional appeals boards.
Mr. Ring: I want to take up where Deputy Ulick Burke finished, by condemning the Dublin 4 thinking of An Taisce. The most outrageous statement since the foundation of the State was made by an official of An Taisce who said there will not be any more development in rural Ireland. I condemn such remarks and those who make them will be fought every step of the way. We had to fight for our freedom in the past and if we have to do so again in the west, we are happy to do so. We do not accept dictatorship from An Taisce. The Minister should take on another statutory agency, the fisheries board. When county councils grant planning permission, people wonder if it will be An Taisce or the fisheries board that objects. Bord Gáis is now objecting to planning permission in the west, which leads me to wonder if we have gone mad in this country.
We have a great deal of legislation in relation to Travellers and asylum seekers, but the needs of women need to be similarly addressed, as they have been let down by every Government.
Ms O. Mitchell: Hear, hear.
Mr. Ring: Landlords do not accept women looking for rented accommodation if they have children, regardless of whether one, two or three children are involved. The abortion debate in this House has shown that everybody wants to help women, but nobody is doing anything for homeless women. A woman with five children contacted me to say that she will have no home from next Friday evening, as her husband has been allowed to stay in their three-bedroom local authority house following their separation. The fact that she is on social welfare and has a health board book means she has to look for rental accommodation. It is time legislation was brought in to deal with the plight of women. The women of this House and of this country have had to put up with too much for too long and it is time they annoyed men. They should stand by one another, rather than allowing men to legislate for them. Women have to look for accommodation, look after children and make requests to the council or to politicians, but they encounter nothing but disrespect.
Ms O. Mitchell: That is brilliant. It is time the Government did something for women.
Mr. Ring: What will happen the woman with five children who will not have any accommodation next Friday evening? I do not know what will happen her. I will send a letter I received recently from the local authority to the Minister so he can read what it had to say. It did not demonstrate much respect for women. In the next six months, every political party and all the do-gooders, including priests and bishops will say that we should do more for women, but nobody is fighting for them when they are seeking accommodation or looking after their children. It is time our women were protected.
Mr. Healy: I thank the Fine Gael Party for sharing its time with me and allowing me to record my support for its motion. The Government amendment asks the House to acknowledge the achievements of the Government in housing. In 2001, I wonder if it is an achievement that 50,000 families are on local authority housing lists, which makes a total of about 100,000 individuals. Is it an achievement of which the Government is proud? I suggest it should not be. Is it an achievement that 1,200 applicants, or between 3,500 and 4,000 individuals, are on the local authority housing list in south Tipperary? The numbers on the list in my constituency have increased by 40% since the Government took office. Is it an achievement that the Department of the Environment and Local Government will only allow South Tipperary County Council to build 150 houses each year? It will take eight years to clear the existing waiting list at such a pace.
Is it an achievement that 500 people are homeless and live on the streets of this country? The figures have increased by more than 100%. It is time the Department of the Environment and Local Government ensured that local authorities are allowed to build houses. It is despicable and disgraceful that only 8% of all houses are built by local authorities. The Minister should allow local authorities to build enough houses to ensure that at least 50% of people on their lists are dealt with within a year and a half or two years. This can be achieved if the Minister shows the political will.
Millions of pounds are being spent on rent subsidies which go directly into the pockets of developers. One wonders if the Department's policy on the building of local authority houses is unavoidable because of the fact that millions of pounds are being spent on subsidies by health boards and the Department of the Environment and Local Government.
Minister for the Environment and Local Government (Mr. Dempsey): As we can appreciate from the contributions over the past two nights, many people have an interest in housing, not least Fine Gael Deputies who have built on the shaky foundations of an ill-considered motion. Their arguments collapsed around them last night and tonight.
Ms O. Mitchell: The Minister's arguments are up in the sky.
Mr. B. Hayes: He must not have been in the House.
Ms O. Mitchell: Is this the Minister's best response?
An Ceann Comhairle: Order, please. The Minister should be allowed to conclude without interruption.
Mr. Dempsey: Politicians are not the only people with an interest in housing, as speculators, investors and first time house buyers also have an interest. These groups are not all equal, however.
Mr. U. Burke: That is for sure. It has always been the case.
Mr. Dempsey: In contrast with what appears to be the Opposition's belief, the Government does not believe that speculators are equal to first time house buyers. When the Government took office, speculators were having a great time in the housing market. They were buying numerous houses, getting rich quickly and squeezing first time house buyers out of the market.
Ms O. Mitchell: The Government has squeezed everybody out of the market.
Mr. Dempsey: Despite what the Members opposite may say, that has changed significantly—
Mr. B. Hayes: Rents have rocketed.
Mr. Dempsey: —as a result of this Government's actions.
Ms O. Mitchell: I would not say that the people renting houses are thanking the Minister.
Mr. Dempsey: It is good that speculators and their money have gone elsewhere.
Mr. U. Burke: There are no houses.
Mr. Dempsey: Speculators, unlike the Government, have no interest in people, communities or a stable society. This country has a proud tradition of owning homes.
Mr. B. Hayes: There was a proud tradition.
Mr. Dempsey: When I took office, I made it clear that this Government and I felt strongly about maintaining and promoting that tradition.
Ms O. Mitchell: It is now a tradition of the past.
Mr. Dempsey: Unlike Fine Gael Deputies, I have no problem if speculators decide to take their money out of the housing market. I welcome it if speculators cannot make excessive profit out of the housing market. I have no problem if people who can afford houses that cost £300,000, £500,000 or £1 million see a slowdown now when it comes to selling. They can afford that and can handle it. However, I do have a problem if two people on middle incomes cannot succeed in putting a roof over their heads.
Mr. Barrett: It is the Minister who failed them.
Mr. Dempsey: All of us should have a problem with that including the Opposition who seem to hunger and yearn for problems everywhere. Problems can only be solved by actions not avoidance. The Rainbow Coalition avoided issues when they had a problem. They avoided the housing issue as they faced the electorate in trepidation in 1997. In 1996 they authorised 3,700 local authority housing starts.
Mr. B. Hayes: Rubbish, look at the housing lists.
Mr. Dempsey: House prices had started to spiral in the middle of 1995. They ignored that. In 1997 they actually reduced the number of local authority housing starts to 3,600. In the four years since we have taken office we have averaged 6,000 housing starts per annum.
Mr. B. Hayes: They cannot even build them.
Mr. Dempsey: This Government takes action – for example, the action taken to balance supply and demand for housing and action which has given us stability in house prices. In taking that action we knew that we must also lay the foundations for a fairer housing system – a system that would never again see people on reasonable wages priced out of the market. In Part 5 of the Planning and Development Act, 2000, I took ruthless and radical measures to secure a just housing market which will meet the housing needs of people on low and middle incomes.
I was supported by the Labour Party on that but not by the party opposite which tabled this motion and tried everything it could to prevent Part 5 from becoming part of legislation. At that time I stepped into the market and told builders that out of every five homes they build one would have to be an affordable home.
Mr. B. Hayes: Is that in Spain, Portugal or Austria?
Mr. Dempsey: A builder who takes a risk and buys a chunk of land and sees it going up enormously in value because it is rezoned from agricultural use to development use is entitled to make a profit but he should also contribute to the common good. This contribution should not be punitive but he should use 20% of that land for affordable or social housing. That move alone is already making a difference to first time house buyers and to those who need social housing.
Mr. Dempsey: I take it that Fine Gael will reverse Part 5 if it ever gets into power again. Fine Gael will look after the developers.
An Ceann Comhairle: Order, please.
Mr. Dempsey: I hear Deputy Farrelly acting for the auctioneers again.
Mr. Farrelly: The Minister has many family members in the business. What have they done?
Mr. Dempsey: This policy secures for us a bright future of mixed housing, stability, civilised living and access to housing for those who need it.
Mr. Farrelly: I am worried about the 40,000 jobs. What will be done about them?
Mr. Dempsey: I am worried about the first time buyer and the Deputy has made a lot of money on their backs over the last four years.
An Ceann Comhairle: Order please. The Minister, without interruption.
Mr. Dempsey: This Government has taken action on housing, knowing one simple fact that the Opposition, in their mad rush to curry favour with speculators and other vested interests, seems to have missed. The fact is that demand may have slowed down in November but it cannot slow in the long term. It cannot slow down because of demographics. There are more people coming into the country, more people staying in the country and more young people coming to the age when they want to settle and have their own home. The need is there and will continue. The demand may take a dip but that is because at this moment nobody is advising people who want their first home to buy. Nobody is telling them to go for it. This is the best time to buy a house and they should not wait. The commission for auctioneers might not be as big but people will at least get a reasonably priced house.
Mr. Farrelly: Personal remarks are unbecoming to the Minister.
An Ceann Comhairle: The Minister should conclude now.
Mr. Dempsey: The supply is there and prices have come down and are holding. Interest rates are also down.
Mr. Farrelly: The Minister's remarks are scurrilous.
An Ceann Comhairle: Order, please allow the Minister to conclude. He has been unable to finish because of interruptions.
Mr. Dempsey: I want any potential house buyer gambling on the situation getting even better not to gamble. Anybody with a vested interest in the housing market will try to distract from reality. Anyone who wants a State handout, speculators and those looking for unreasonable profit will want to distract from the fact that in a market affected by unprecedented pressures, some very recent and very tragic, this Government has still managed to deliver on its concerns for first time home buyers. The Fine Gael motion and speeches show that party speaks for those with a vested interest.
Mr. Barrett: I will share time with Deputies Brian Hayes and Olivia Mitchell.
We have a serious housing problem in this country, but having listened to the Minister I regret to say that the person in charge does not recognise it. Fianna Fáil has been in Government for 12 of the last 14 years but can only harp on the two year period when the Rainbow Coalition was in place. What a pathetic argument. The Minister should consider what is happening in the Dún Laoghaire-Rathdown area. Colleagues should read the stupid amendment to this motion. The Government actually congratulates itself on all it has done for housing, including moderating the rate of house price increases. Is the Minister aware that a local authority house in the Dún Laoghaire-Rathdown County Council area is selling for over £200,000? Does he realise that not one young person or first time buyer in the area can afford a house in the area in which they were born? They have to go to Wicklow. One of my own children had to pay £195,000 for a three bedroomed semi-detached between Bray and Greystones.
Mr. Dempsey: That is why Part 5 will be helpful to the Deputy's constituents.
Mr. Barrett: Can the Deputy imagine the trauma facing young people on low incomes with mortgages of £170,000 or can he imagine the fear and trepidation they must face with the downturn in the economy? In the Dún Laoghaire-Rathdown County Council area there are over 3,000 people on the waiting list and there were only seven houses built for the area. The Minister has a cheek telling us that the Government has done marvels for first time house buyers and for those on the housing list.
Mr. Dempsey: For how many did they have approval?
Mr. Barrett: It just shows how out of date the Minister is in dealing with the job. What else has been done? Let us look at supply and demand. It is a basic principle that if demand increases and supply decreases things get more expensive. The Government has driven investors out of private rented accommodation and sent £1 billion of investors' money to Portugal and Spain. The Minister has not come up with one suggestion as to how private rented accommodation is to be got. The rent for a three bedroom semi-detached house in Wicklow is £1,000 a month. Is the Minister telling us that people who cannot afford to buy a house should pay £250 a week out of taxed income to rent a semi-detached three bedroom house and at the same time try to save to buy a house?
The Government has had four years of a Celtic tiger economy to solve this problem yet people do not have the basic requirement of a decent home. Will the Minister come to my clinics and tell people with three or four children who are living in one room or with their parents that he has done marvellous work for them? Most of these people do not have a chance of getting a house in the next five years because of the inability of the Minister and his two Ministers of State to do the job the taxpayers pay them to do and to do it properly.
Mr. B. Hayes: It was Deputy Pat Rabbitte who said that whatever one might say about former Deputy Ray Burke, he at least could get up a few houses. In the past four and a half years the Government could not even do that.
Mr. Dempsey: There are record levels of house building. Last year 50,000 houses were built.
Mr. B. Hayes: It is interesting to look across at the three amigos. Their appalling record has been rightly pointed out in Deputy Olivia Mitchell's motion.
In Dublin, people have been forced out of the private rented sector and into homelessness. When the Finance (No. 2) Bill, which my party opposed, was introduced in 1998 and did away with mortgage interest relief on rental property, the rent on a semi-detached house in Ballycullen in my constituency was £700 per month. The rent on a similar property now, since the introduction of that interventionist measure in 1998, is £950. That is an increase of 30% in two years. The measure which the Government introduced to bring down the price of rented property in Dublin has increased rents by between 25% and 30%.
The Minister of State, Deputy Molloy, established a housing commission but he still has not introduced the most basic reforms in the private rented sector to ensure better standards of tenancy for our people. The result of his bungling is a 30% increase in the cost of renting in Dublin. The amount of money the State has had to give in rent subsidy is being forced up and it is now mainly women who are on the homeless list. The only advice I can give my constituents who cannot afford to buy or rent a house or who cannot get a local authority house is to go on to the homeless list. The same advice is being given to people in Dublin and the surrounding counties and the homeless list has increased in the past two years since that measure was introduced.
The Minister lays much claim on the Government's increased investment in social housing. There is more money for social housing but the local authorities are not building these houses. A much more radical approach must be taken, particularly in Dublin, to the building of local authority homes. The four Dublin local authorities do not have the individual capacity to build the massive number of social houses required in the city. Intervention is required by the Government to give one authority in Dublin the task of building houses quickly.
The Government has failed to deal with the housing issue and it will be remembered for it. If the Government put half as much energy into building homes as it spent on its national stadium we would have had many more homes many years ago. That is why this motion is before the House. The Government will be hounded on this issue between now and the election by the thousands of people who have been let down by the Government.
Ms O. Mitchell: Last night and again tonight we were subjected to further examples of ministerial empty rhetoric from a Government which knows it has squandered the opportunities of the past four years, but is choosing to stick its head in the sand and by denying the reality hopes other people will not realise the extent of the crisis. The rest of the population must live in the real world and deal with the realities this crisis means for them.
The Minister told us he has firm evidence that his policies are succeeding. If the Government's intention was to sap all confidence from the industry so that buyers, builders and lenders are leaving the industry in droves it has succeeded, but I do not think that was the Government's intention. It is impossible to believe the Government, with all its advisers, could be so out of touch as not to realise that its prime policies are totally counterproductive and have produced results which are the opposite of what was required. The combination of the Government's policies have been disastrous for everyone concerned.
Mr. Dempsey: Will Fine Gael remove Part 5?
Mr. Barrett: We certainly will not take advice from Mr. Bacon.
Ms O. Mitchell: Last night we were given a litany of Government successes. One of them was that output of house building has been going up in recent years. The Government is right. Output has been going up.
Mr. Molloy: Output is the real test.
Ms O. Mitchell: However, to claim credit for this is either to miss the point or to be disingenuous. The houses which were built last year were the result of investment decisions made at least four years prior to that. The Minister is responsible for what is happening now. He is responsible for all of the policy decisions made since the first Bacon report. Fine Gael predicted the results at the time and now we see the painful evidence of the outcome of those measures.
We now have a Government induced crisis much deeper and more serious than the one with which we started. That was merely a supply shortage. We now have a supply shortage, a reduction in demand which is totally artificial and nobody, neither buyer nor seller, willing to fund the industry.
Mr. Dempsey: Supply is up 4% this year so far.
Ms O. Mitchell: If the Government will not accept responsibility for what it has done it should resign and let someone else take over.
Mr. Molloy: Deputy Mitchell should tell the truth.
Ms O. Mitchell: In those circumstances Fine Gael undertakes to remove the two year limitation on planning permissions – a bizarre measure. The Minister should not hide behind legal advice. We will rationalise and reduce stamp duty to a maximum of 6%, applicable to houses up to £500,000.
The Government has reduced mobility of labour, increased the cost of housing unnecessarily and reduced the optimum use of houses.
Fine Gael will immediately restore interest deductibility to borrowings for the provision of rented accommodation. Deductibility is available to every other business in the economy and it makes no sense to remove it from the one business to which we want to give an incentive. This has had devastating results. The Minister knows it and he cannot be so intransigent as to ignore it.
As well as putting confidence back into the market, what is required is to make houses affordable again and to give some hope to those who in the past could have aspired to buying a house. I made suggestions last night. The Minister would have heard them if he had remained to listen. Even if prices were to fall through the floor – and this is not desirable from any point of view – this would not offer hope to those who are in need of housing if confidence is so absent from the market that builders are afraid to build and buyers are afraid to buy. This is the climate the Minister has created and will remain for years to come if the Minister persists with his policies. Even if the Minister changes his policies now it will take years for supply to crank up again.
If the Minister does not care about the social misery caused by the lack of housing, he cannot ignore an industry which last year paid into the State's coffers £1.5 billion, which the Government subsequently squandered, and which employs 70,000 people. These jobs are now being shed from building sites throughout the country and huge layoffs are being predicted for Christmas.
It is time for the Government to admit it got it wrong, reverse its existing policies and try to retrieve the situation so that the downturn in the housing industry does not become a general trend in the entire economy. If this happens it will be at the Minister's door. I commend the motion to the House.
Browne, John (Wexford).
McGuinness, John J.
Ó Cuív, Éamon.
Woods, Michael. Wright, G. V.
Belton, Louis J.
Broughan, Thomas P.
Browne, John (Carlow-Kilkenny).
Ó Caoláin, Caoimhghín.
Tellers: Tá, Deputies S. Brennan and Power; Níl, Deputies Bradford and McDowell.
Amendment declared carried.
Motion, as amended, put and declared carried.
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