Oireachtas Joint and Select Committees

Tuesday, 31 May 2016

Committee on Housing and Homelessness

National Treasury Management Agency and Department of Finance

10:30 am

Photo of Bernard DurkanBernard Durkan (Kildare North, Fine Gael) | Oireachtas source

I welcome the witnesses and compliment them on their work over the years. The NTMA has been known to invest wisely in such a way as to achieve reductions in debt. I am interested in particular in the extent to which the NTMA borrows money and lends on to bodies such as the Housing Finance Agency, which we had before the committee recently. I seem to recall that its interest rate on lending was a bit higher, but I might be wrong about that. To what extent can the NTMA be assured that the bodies to which they lend money, having borrowed at a very competitive rate, do not take a handling fee off the top of it, any more than the NTMA does?

I am not a great supporter of housing bodies. The information came through that housing bodies are an option. That option failed. That is one of the reasons we have the current problem in respect of the deficit of local authority housing because there was a shift from the dependence on local authorities to the private sector and that did not work. My question is to what extent the NTMA can enter into an arrangement with local authorities to lend money to them, directly or indirectly, by way of housing co-operatives or by way of association with other bodies in such a way as to make the maximum amount of money available and at the same time keep within the off-balance sheet requirements.

What does the NTMA believe are procurement difficulties which obstruct the progress of what it is interested in doing, which we appreciate, because of the necessity to make rapid progress in the immediate and urgent situation of homelessness and impending homelessness arising from the issue we read about every day?

I have two or three more questions if you will bear with me for a moment, Chairman. Given that interest rates internationally are at an all-time low, there is always a tendency for people to invest in areas that produce a greater return, which in turn competes with the building of houses and the availability of money to build houses. To what extent is the NTMA conscious of that and to what extent can it take steps to ensure the vital requirement of funding and the availability of funding to build houses now is ring-fenced to a considerable extent?

My final point relates to universities. I live in Maynooth and the university there has a significant development programme, which I presume is being considered in the context of the required student accommodation and funding for same. Reference was made to that at a committee meeting last week.

I note the NTMA has told us to dampen our expectations about the debt accumulation as time goes by. We know about that. The debt will also reduce as time goes by, in particular relative to economic growth. That has been the internationally accepted norm and expectation. Could the NTMA give the committee any indication or assurance on our rate of economic growth now and for the foreseeable future if prudent policies are followed to try to reassure our constituents - the people of the country - who made considerable sacrifices to bail out the financial institutions and are anxious to see some recognition of their efforts? I refer, for example, to the way some financial institutions are progressing to make many people homeless at present, which I believe is an issue that will have an impact on the work of the NTMA and the work of this committee.

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