Mr. Noel Cahill:

That recent NESC report on housing outlined the institutional changes which would ensure that key public actors have a strong developmental mandate and the capacity to drive sustainable urban development, including the provision of affordable housing. These actions include establishing the Land Development Agency, LDA, on a statutory footing as a matter of urgency. The second part of the report called for more effective application of existing measures to ensure more affordable housing happens in the near term. These actions include, first, the establishment of a national cost rental programme at scale, with access to land on favourable terms, low cost finance, and conditions to ensure that homes remain subject to public ownership and that the rents are affordable; second, the tailoring of the application of Part V to make it more effective by increasing the proportion which must be affordable, but tailored on a county-by-county basis; third, the introduction, across the various funding streams, such as the serviced sites fund, of separate funding streams focused on developments which are high impact in terms of the number of affordable houses provided and the achievement of compact development; fourth, the examination of differences between the compulsory purchase regimes under different legislation and their respective usage, with a view to identifying the most effective and efficient regime; and, finally, the outlining of a programme of flagship projects to demonstrate how a system-wide approach can deliver tangible results.

In the third part of the report, the council recommended that time be devoted to finding new solutions or ways of working around long-standing challenges. These areas include tackling the off-balance sheet issue for cost rental, examining how the State could acquire land in designated development areas at existing use value plus some premium, review and reform of the vacant site levy if it persists in being ineffective and considering further actions to reduce vacancy and the under use of existing property. On affordability, the council has argued the goal should be permanent affordability. The leasing of public land is a mechanism that can be used to reduce costs and improve affordability in the short term while preserving the value of the subsidy for future buyers and improving long-run stability in the housing market. With this approach, the land could be provided without an upfront charge while the public landowner would retain long-term ownership of the land. Others, including owner occupiers, could then own dwellings on the land.

Of particular relevance to our discussion today is the recommendation by the council to develop a national cost rental programme at scale. The council first highlighted the need for Irish policy to consider cost rental in a 2004 report. The different elements needed include land, low cost finance, a regulatory structure and organisations. The new cost rental equity loan, in conjunction with long-term low interest loans from the Housing Finance Agency, HFA, is a way of achieving reasonably low cost finance for cost rental. The proposed legislation will be a basis for regulating a cost rental sector. It is our understanding that the loan is initially being used for acquisitions of properties. Over time, if we are to substantially add to the housing stock in a way that is not dependent on the development cycle, it would be desirable to create new cost rental developments on public land. If cost rental, affordable purchase and social housing developments can be combined on large sites, this would facilitate having larger developments than would otherwise be possible.

The focus of the actions proposed by NESC on housing is on bridging the supply gap by actively managing land for the public good and bridging the affordability gap by engineering in permanent affordability.

We are happy to assist the committee in its discussions.