Oireachtas Joint and Select Committees

Wednesday, 14 November 2018

Joint Oireachtas Committee on Housing, Planning and Local Government

Financing of Social Housing: Discussion

9:00 am

Photo of Maria BaileyMaria Bailey (Dún Laoghaire, Fine Gael) | Oireachtas source

That is fine. I have a number of questions before I call on Senator Murnane O'Connor.

Following the establishment of the framework, how much time will be saved in the overall process, if planning and procurement are being streamlined as much as possible? Can we presume that inflation is still included in any tender document? I get very nervous when I hear witnesses saying that something came in below benchmark because I am not in favour of lowest-price tendering. I ask the witnesses to elaborate on that issue. Sometimes necessary elements are taken out of tenders in order to win a contract. What is the minimum number of units required before the NDFA gets involved? Are all sites earmarked now or are there more in the pipeline for the future? In terms of local authority staff, somewhere between 700 and 900 additional posts have been approved, predominantly in Dublin, Cork and Galway. It obviously takes time for the public appointments process to work itself out and by the time posts are finalised, some candidates have been snapped up by the private sector. Ms Myler referred to the opportunity for local authorities to enhance their project knowledge by taking on the developer-promoter role. How long will that take?

Deputy Boyd Barrett made reference to the site in Shanganagh and while I disagree with him on the breakdown of the housing mix, we both want to see homes built on that site. A proposal was made by three local authority members, namely, Councillor John Bailey who is my father, Councillor Michael Merrigan and Councillor Shane O'Brien of Sinn Féin more than two years ago. It took about nine months to put together their very detailed proposal and we are all exceptionally frustrated at how long it is taking to get any responses to that proposal. Rent-to-buy was part of the proposal but I understand that the local authority is opting for the cost-rental model. I do not understand why a portion of the cost-rental homes could not be rent-to-buy. A rent-to-buy scheme was piloted in 2006 or 2007 in Stepaside and was very successful. After a number of years of renting, people were given the opportunity to purchase properties at an affordable rate. I hope that model will be considered again in the context of the Shanganagh site. That scheme also contains housing options for older people. This committee has prepared an extensive report on options for older people to downsize in both the public and private sectors. If one looks at the population in Dún Laoghaire-Rathdown one sees that the demand for one-bedroom units is significant and increasing.

On the skills shortage issue, I know how proactive the SCSI is in this area. It is constantly engaging with its membership and actively encouraging those who emigrated to return home. In order to get the professionals to come home to fill the gaps, they will need to see continuity and certainty in the construction sector. Does the Project Ireland 2040 plan provide some of that? I am also aware that housing projects are competing with large-scale infrastructure projects. We had a meeting yesterday on the impact of Brexit on housing. We had a very interesting discussion with representatives from the ESRI and the Nevin Economic Research Institute who spoke about the building materials that we import from the UK, which can range from 30% to 50%. They also referred to inflationary costs that could come down the line once Britain leaves the EU. I ask the witnesses to give their views on that issue.

Mr. Cleary said that we need to look beyond the immediate and that is what we are doing with the Land Development Agency. The interim CEO of the agency, Mr. John Coleman, appeared before this committee recently. He talked about derisking sites and how that will take place in practice. It was a very informative and encouraging meeting. I presume that the SCSI has met or intends to meet representatives of the Land Development Agency and that engagement is ongoing. On the issue of risk and the removal of same, while we must consider pre-development risks we cannot forget the risks when workers are on site. That aspect is often underestimated. People seem to think that builders are just there to make money and that there is no risk involved in actual building. Whether one is talking about a single house or 500 units, there is always a risk when builders are on site. There are numerous risks involved in construction of which people are not really aware. I ask the witnesses to talk through that.

Do the witnesses believe it would be possible for local authorities to deliver the same quantity of housing without land initiatives or PPPs? Land initiatives rely on private developers to deliver units but is this the best use of public land? The Land Development Agency is a good initiative. At yesterday's meeting witnesses said that we cannot do everything in one year. Given that very little construction happened for a number of years, it has taken time to get back up and running again. It will take some more time before the sector is capable of delivering 30,000 units per year.

I now invite Senator Murnane O'Connor to pose questions.

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