Mr. John McCarthy:

In terms of its purpose, I would describe the scheme as an effort to address what was a serious financial issue for local authorities. This issue arose from a process which was well established and understood and through which land costs would be remunerated when projects were brought forward. The problem was that the funding for bringing forward projects was not contained in the quantum that was needed.

Given what has happened in the housing and land markets, obviously the value of these sites has been significantly reduced. The Comptroller and Auditor General's report highlights a number of sites in respect of which the actual value has dropped substantially. From the point of view of the Department and local authorities, the value of a site is tied in to its potential use for housing purposes. The intention would be that the vast bulk of the sites that have been accepted into the scheme will continue to be used for social housing purposes, albeit in the medium to long term rather than the short term.

The sites were not bought for the purposes of resale. If they had been, then certainly a change in valuation would have been a significant issue.