Mr. Ray Fanning:

I thank the Chairman and members of the committee for the opportunity to address them this morning and to raise our issues of concern. Respond! is Ireland's largest housing association with more than 5,000 homes developed over the past 30 years. We currently manage approximately 4,000 units of housing along with a number of day care centres and child care centres for after-school and preschool programmes.

We also provide a homelessness service for women who suffer domestic violence. We are also a FETAC and HETAC accredited college. We can provide a broad range of activities.

What we propose in our submission could be implemented without great cost to the Government. We are trying to unlock €50 million in private investment in social housing. We have held a number of discussions with institutions in Ireland and the UK. The UK has more extensive experience of delivering social housing through pension funds and other means. There are a number of obstacles to delivering housing, most of which arise from the payment availability agreement and the current level of capital advance loan facility, CALF, funding. The charge that local authorities have on their houses needs to be released if we are to be able to provide collateral so that private investors have security over existing stock. If we are asking somebody to provide €25 million to build houses, there will be a period of up to two years in which nothing is built. The question arises of what security he or she will have in the meantime.

We are also calling for a more responsive and flexible capital advance loan facility. We welcome that the Government has provided this facility but it offers up to 30% capital funding without set criteria on what one will get. One might ask a bank for 85% in the assumption that CALF will provide 15% only to find that it is providing 10%. The criteria are not clear. Furthermore, a programme of €50 million might deliver 450 houses, thereby providing only a small uplift in the current number for a significant investment. If 20% of that money is provided through CALF as a 2% loan over 30 years, the loan cannot be drawn down until the houses are ready for delivery. This means that one would require 25% of €50 million, or €12.5 million, in bridging finance at a time when it is impossible to get bridging finance.

Payment availability is paid at a rate of 92% of market rent. Investors have pointed out the danger that the market rent could drop. We ask the Government to set a floor for market rents below which rates will not fall. They could increase with inflation because we will have mortgage increases down the line but we need some kind of floor.

Currently payments are not made on voids lasting longer than 13 weeks. According to the local government indicators, the turnover times for local authorities are 29 weeks but approved housing bodies are expected to turn around a void in 13 weeks even though the local authorities have the housing lists. We ask either that the period be extended or that the clause be removed altogether.

Our last proposal is that allowance be made within the payment availability agreement and differential rent for us to be able to use these funds for community development and education programmes rather than solely for mortgage repayments.