Dr. Larry O'Connell:

I will take the Deputy's question on affordability and whether all State land should be made 100% affordable first. Local governments have autonomy and own land, and they have pressures and responsibilities. If central government were to attempt to do what is proposed, it would be very difficult. I am not saying it would be the wrong thing to do necessarily, but it comes back to the process. Let me give an example. Mr. Cahill gave an example from Vienna. Even there, where we see an effective housing market, the authorities are now finding it very difficult to get land to build more affordable housing. They have now reset it and have subsidised housing zones. In particular areas, where there is a development of more than 50 units, two thirds must be subsidised or affordable. A law came in stipulating a reset in all those areas.

If we considered such a rule here, it would have considerable implications for local authorities in every single area where they own land. It would have to be teased through. If we did not do it, we would have to ensure negotiation. This would involve creating an agency in the State with the power and staff to negotiate with individual local authorities. It seems this is what the Land Development Agency was set up to do. It is another question as to whether we are tying the agency's hands a little by deciding only 40% needs to be affordable. Should we change that? The policy at the moment is to have a 30:40 split. While it is tempting to think there could be some sort of central law requiring all State land to be affordable, it would create enormous difficulties and resistance. One would have to figure out how it would work.

The Land Development Agency is an institution that could deal with the profit margin of developers. As it writes contracts and works with the private sector, it is clear that it will try to get the best value for money for the State on public land.

I do not know the answer to the question on how well the vacant site levy is working. I believe, however, there is an important distinction between a vacant site levy and a site value tax. From our perspective, we have been saying for quite some time that a site value tax might yield more benefits than a vacant site levy. This is for many reasons. There are practical difficulties in identifying vacant sites, and there is the matter of what people might do in terms of declassifying sites such that they will no longer be regarded as vacant if certain works take place, etc.

The vacant site levy is on the development land only so, in a sense, it raises the costs around the site. A site value tax generates revenue from the land in an area. In a sense, there would be a wider tax base to bring money in to fund development. We can talk more about our views on this but it is important to make the distinction between a site value tax and a vacant site levy. They are quite different and would have a different impact.

Mr. Cahill might want to say more on planning and what is done in other countries.