Paschal Mooney (Fianna Fail)

I welcome the Minister of State, Deputy Cuffe, and compliment him on his initiative some months ago to try to establish accurate figures. While they are the subject of debate, they can no longer be challenged. I am particularly pleased, therefore, that he took the initiative because it brings to an end speculation in this regard.

There has been great deal of soul-searching and wringing of hands about what the Government did or did not do during the housing boom. As early as 2004 or 2005 it became apparent that it was unsustainable that 25% of national wealth was being generated in the construction sector when the European average was 10%. I made this point in the House on a number of occasions. It was also becoming evident to the Government which began to dismantle the tax incentives available. If I have one criticism of the Fianna Fáil Government at the time - I am a member of the party and was a Member of the House during that period - it is that despite my strenuous objections to the extension of what was known as the Shannon tax incentive scheme, it continued. The scheme had worked exceptionally well. It set out to achieve the objective of ensuring the repopulation of counties such as Leitrim which had been ravaged by emigration dating back to 1840. It also provided a corporate tax break which resulted in significant investment in the county. One need only look at Carrick-on-Shannon today and when it was a small sleepy town through which people passed without giving it a second thought. Now it is a cool place to be.

The downside of the scheme was that too many houses were built. Up to 2004 most of the building activity in my county had taken place in Carrick-on-Shannon, Manorhamilton and Kinlough which is only two miles from Bundoran. However, it was not until the extension of the tax scheme that significant numbers of housing estates started to appear in my home town of Drumshanbo and outlying towns within travelling distance of Carrick-on-Shannon. It was at that point that people motivated more by greed than housing demand started to pay inflated prices for land and, subsequently, to charge enormous prices for their houses. I do not want to single out a particular builder, but two or three years ago one would have paid €350,000 for a four-bedroomed house in Drumshanbo. The prices asked for were outrageous.

The Minister of State and his colleague, Deputy Finneran, have acknowledged that the housing market overheated between 2004 and 2007. However, they make the defence - I am inclined to agree with them - that during that period the Government tried to give hard working families what they needed, a crack at home ownership. Also, no one said at the time that we should build fewer houses.

I would like to make it clear that developers were not offered special rates. Any tax measures designed to encourage the freeing of lands for development were not aimed at a particular group or an elite few. In other words, farmers and other owners of small amounts of land were able to avail of the measure. I can give examples in my county where some 90% of the land is marginal and on which nothing is grown apart from rushes. For a period in the late 1990s and early 2000s land prices were inflated, but like many others I did not object. Farming families with surplus land which was fallow and only used for grazing livestock were able to generate real money for the first time since the Famine. No one resented them for doing this.

The motion claims there is no clarity around who would pay to complete unfinished estates that are still lacking completed roads, pathways and open spaces. An interesting phenomenon has occurred since NAMA was established. NAMA has taken on a significant number of undeveloped or partially developed estates in Leitrim. The agency has either begun or instructed receivers to sell these properties. The buyers, in turn, are completing the estates. The downside of this was seen recently in my home town where houses, sold at the peak for €320,000, are now being sold for €140,000. While some may argue this is bringing house prices to sustainable levels, it is depressing the housing market. It is difficult to tell where this particular trend will go.

One key priority has been leasing unsold housing stock by local authorities and voluntary bodies for social housing purposes. More than 2,500 units have been sourced and approved for use under this scheme. It will be an increasingly important component in the State's response to housing needs in the future.

Taking a base vacancy rate of the national housing stock at 6%, Fingal County Council has a 2.1% oversupply while South Dublin County Council has 9% and Meath County Council 7.9%. Galway City Council is at -0.1% and has a slight potential of undersupply. In these local authority areas it is estimated stock should be taken up relatively quickly when demand returns. In my part of the world, oversupply figures amount to 35% in County Roscommon, 24% in County Sligo, 21% in County Leitrim and 19% in County Longford. The extent of oversupply is not near as great as had been thought. In some areas, the oversupply equates to a few quarters of normal demand.

Another interesting aspect of this debate is that Ireland did much better during the housing boom than Britain. In Ireland houses were built whereas in the UK the phantom housing boom added very little new housing stock. Why were so many housing starts spatially decoupled from economic activity? That is the problem facing us with the overhang in the north west and north midlands.

As a result of the tax incentives, houses were built far removed from locations where jobs were available. In my home town, people asked who would live in the new housing developments because no extra jobs were being generated in the locality. Instead, people were choosing to live in the town while willing to commute longer distances. Many residents in my area commute to Sligo, Cavan, Enniskillen and Longford, a 45-minute journey in all. This raises the problem, as outlined by the Minister of State, of a greater reliance on private transport and greater pressure on transport infrastructure. This is a legacy of these years with which we will have to deal.

I applaud the Minister of State for ensuring the planning process will be examined and it is to be hoped we will never have to face over-demand coupled with underresourced planning departments as was the case in Roscommon. The Heritage Council published a report in 2006 which was highly critical not of those working in the planning departments in Roscommon and Leitrim but of a system that had allowed huge demand for planning applications without sufficient resources to address them. Monitoring and enforcement were not up to the efficient standards they had been in the past with the result that the eye was taken off the ball when it came to housing standards and, in some instances, unauthorised buildings were erected. This is not as simple as it may seem to the outsider. Dealing with the legacy of oversupply in certain parts of the country, especially in those areas where industrial development and job creation were minimal, is a complex matter. I welcome this timely and accurate amendment to the motion.