Dr. Larry O'Connell:

I will make a more general point. It is clear that affordability will drive the value of land. It is an instrument, so in a sense that is why Mr. Cahill made his reference. This would require a wider decision, but if the part V requirement was increased, that would set the parameters. I refer to a requirement to provide 20% social housing and that being strictly enforced. People would have to take that into account if they were considering bidding on land, but that is a wider policy issue. I am not sidestepping the Deputy's question on the 60:40 split, but it is worth noting that principle in housing policy.

The market-non-market distinction might not be quite so black and white. The cost rental model in Austria has what is called a "limited profit". It is not, therefore, the case that the 60% has to be completely market-based and extract full value, while a profit does not have to be made in the social and affordable area. The Austrian example allows for a regulated return of approximately 3%. Most of that is reinvested, but some of it can be taken out by the people putting in the equity. There can, therefore, be a market element in that kind of model.

It would be hoped, however, that the 60% side would not involve unfettered market exploitation to get the full value of the land. Having listened to the dialogue with the LDA earlier, my sense it that will be part of what it will try to do. I acknowledge O'Devaney Gardens is a poor example, but it should be ensured in future developments that the idea is that the private sector does not run riot. How can that be done? An agency can be created with people in it able to go toe to toe with the private sector. That is what Transport for London, TfL, did. It got people in the room who were expert at negotiating non-deals and at buying and selling real estate. It was then able to negotiate, understand construction costs and ensure that it was getting good value for money. The market-non-market polarisation, therefore, needs to be slightly nuanced and that needs to be reflected in how things work in future. That should be done instead of a critique that takes 60% as negating the whole function and preventing delivery of what we need.

The Deputy also asked about the locational value mechanism. Mr. Cahill is the expert on that area.