Mr. Michael Walsh:

I am glad to be here. I thank the committee for the invitation. I am joined by my colleagues, Mr. Joe McGuinness from Louth County Council, and Ms Catherine Keenan from Dún Laoghaire-Rathdown County Council. With the Acting Chairman's permission, I will not read the full written statement. I might comment on and elaborate on some of the topics that have arisen here already. Regarding voids, we in the local authorities are more aware of the reality than anybody else. We are at the interface, along with some of the non-governmental agencies, of the distressed housing situation. We are working to significantly improve the voids situation regarding our stock. We are satisfied that significant measures have been implemented during recent years, and they continue to be implemented. During the past two or three years, the Government and the Department have made available funding of approximately €30 million of €40 million per year, which has been particularly helpful in void recovery. It is bringing about significant improvement and will bring further improvement this year. All local authorities are moving towards choice-based letting, which will bring a further improvement in tenanting. We are satisfied that by the end of the year we will have a good handle on the overall voids position.

Sometimes, the voids situation is presented in a facile manner. A number of matters are certain. Our statistics on return of voids in 2015 showed it took around 20 weeks to return voids. The figure is very significantly skewed by long-term regeneration projects. There is no such thing as a zero-week return, given that we must go through the letting process at a minimum. We have to do basic inspections on the properties and even when we get back a really good property, it takes some weeks to re-let it, no matter how we go about it. We are satisfied that we are getting a handle on it. We are not for a minute saying we are there, but we are getting there. We are in a better position and we will be in a better position by the end of the year.

In the written document we submitted, I have commented on some of the matters of consequence regarding the timeframes.

When it is broken down, we are spending an average of €13,000 per individual unit. In a way, we are not getting back normal vacancies for re-letting. With the private rental market the way it is, people are not leaving local authority housing to go to the private sector. They may have done so historically through moving job or other factors. There is a slightly different scenario than used to exist previously. We now tend to get back older stock, often due to the demise of the tenant. Some of that stock can be 60 years old, reflecting the age and longevity of the tenants involved. We are also getting back some stock which is fire-damaged or otherwise significantly damaged.

Local authorities have a statutory obligation to house everyone. A cohort of our tenant population has a difficulty in capacity terms of managing the houses. As a consequence, significant interventions must be made. Our position is that when we are re-letting those houses, we are actually re-letting a home for a long-term proposition to meet not just people’s housing needs but to give them a home. We are conscious of returning a unit to a standard which will allow them a good quality of life for 30 years.

In terms of doing work which averages at a quantum of €13,000 and doing it in the context of health and safety around people in the home, that is not viable. We are concentrating on getting the time down significantly. We are beginning to succeed with that.

Capacity in the construction sector was referred to earlier. I would not go any stronger than to say we would like to see more competition in the marketplace. In some instances, we are not seeing massive competition. In our view, it impacts only a little bit on price but it impacts more on time. No more than a private householder will find, getting a contractor to turn up when they say they will, and do what they said they will in the time they said, is becoming a little more difficult.

Significant concentration needs to be placed on vacant properties in the private sector because there is low-hanging fruit to be got at. I am not trying to be negative but I will point out some difficulties which were not encountered previously. Over the past six months, Waterford City and County Council is involved in a repair to lease scheme while Louth County Council is involved in the buy and renew scheme. While the period might not provide substantive statistics, we have some experience in this area. Waterford city is not in the worst position in that it is an old historical city centre with small streets and older properties. On the edges of that, we have housing of different standards and ages. Our experience is that we have had significant interest. We will deliver 40 units this year and could easily end up delivering 80 to 100 units. If we were to do that over several years, it would add to a substantial number of units.

I agree with Mr. John O’Connor from the Housing Agency in that we need to get more data quickly. We would have done some work on the ground in the electoral districts reflected in CSO's census reporting on vacancies. While I would not extrapolate the Waterford figures to the national position, we found there were fewer vacancies than suggested in the CSO figures. We used local knowledge and sources, even knocking on the doors of houses next to vacant sites, to ascertain what the case was. In some cases, the figures were 50% less than the census data.

We were finding two primary causes. First, in the older areas of the city, houses or over-the-shop units were unfit for occupation and needed physical intervention. They could range from substantial dereliction requiring major renovation in some cases to adaptation for disabled access. The second reason was financial or legal distress. Legal can involve probate or intestacy issues while financial involves a bank trying to recover a property or abandonment due to financial distress. Some of those houses affected were historical buy-to-let properties.

The instruments available to county councils to deal with derelict or underused sites include the Derelict Sites Act and compulsory purchase powers, attendant on either the Derelict Sites Act or general planning and housing legislation. Sites which are derelict, or lying idle for long enough to become derelict, are generally in distress in terms of ownership or otherwise. Historically, we have found that the derelict sites levy, a 3% levy which can be applied to the valuation of the property which tends to be low on derelict sites, is non-functional. We cannot collect it and it places a burden on properties which are already burdened by distress in some form or other. That is not insignificant in the context of considering a tax on vacant sites. I would separate that from the vacant site levy, which is targeting viable sites that should not be hoarded and kept out of the marketplace where there is clear ownership, resources and so forth. That is a different matter to distressed properties which have legal, financial or ownership issues. One is actually adding more elements to the equation to try to solve the problem.

We need to be careful. Like the Housing Agency, I would love to see greater detail because we need it. Even if we say there are not as many vacant properties, there are still a lot of them by any stretch of the imagination and we agree that we need to get there. The committee can be sure that we see ourselves as having a role. We would be worried about the resource demands because we are coming off a base of very little data. About 30 or 40 year ago, property rates were there and we held all the data in terms of the ownership of property but that data is not there now. The work we have done locally involves literally knocking on doors and doing the legal searches and all the other things that are required to get there.

For all that, we welcome the repair and lease scheme because it allows us to get at the low-hanging fruit reasonably quickly. In respect of the ad in the newspaper, if people are suffering a capital deficiency and if the figure of €30,000 or €40,000 allows it to be brought back, it gives us an instrument that did not previously exist. My understanding is that the Minister intends to make it a national scheme straightaway and we would recommend accordingly because there is a reasonably quick win there. In respect of following through with some analysis of vacant sites, there are other instruments but simply taxing them may be a bit simplistic because there are issues to be considered.

Another area I would like to address is the compulsory purchase order, CPO, powers we have. We certainly have CPO powers. There are a few difficulties with them. It is one of the reasons local authorities only pull the power when there are compelling reasons to do so. Some of it derives from our historical constitutional position on property because down through the years, our court cases have been based on the right to ownership of property. The CPO scenario has a few features. Yes, we can carry out compulsory purchase but it leaves uncertain cost and a timeframe difficulty in terms of arbitration processes that seriously compound things. In respect of compulsory purchase, you push the button - in fairness, An Bord Pleanála is very good in terms of the timeframe for making decisions - it is a two to three-month process and you come out it, conclude and serve notice to treat. The valuation of the property is to be fixed at the valuation of the date when the order is completed. However, you are uncertain about what that valuation is because until the statutory property valuer concludes the process, every owner is entitled to go to arbitration and we generally have to carry their costs, which is the other issue here. The timeframe in respect of the valuation process is significant and runs into a year or over a year generally speaking. In budgetary terms, this makes it very uncertain about what you have to pay and when you have to pay it. The other very significant element here is that there is a really significant cost associated with the CPO process. I can give the committee examples. One example involved us doing a CPO where the valuation was defined at €500,000 but the costs ran into the middle part of between €100,000 and €200,000. That makes that property really expensive. Where you have complexity around the ownership, marriage values and any other things that go with it, it is an uncertainty in valuation and budgetary terms that retards people from pulling that trigger. I am sorry for using that term but that is the reality. There has been a bit of resistance to using it unless a compelling reason exists. If you were to take it in the extreme, even though I cannot cite an example, you could be looking a derelict house that would be only €30,000 or €40,000 but the same costs or half of those costs could accompany it so that what was a reasonable value could end being significantly more expensive once you carry out the refurbishment. I would like the committee to understand that.

I thank the committee and assure it that our people are at the coal face of this, a point I was very glad to hear somebody reflect earlier. We are very aware of the pressures in society in terms of this problem. We are not right all the time. We do not say that for a minute. The way I would put it is that we are doing our best in difficult circumstances but I welcome the opportunity to present to the committee.