Oireachtas Joint and Select Committees

Tuesday, 28 June 2022

Joint Oireachtas Committee on Housing, Planning and Local Government

Inflationary Costs in the Construction Industry: Discussion

Photo of Richard O'DonoghueRichard O'Donoghue (Limerick County, Independent) | Oireachtas source

Okay. Regarding social housing in Limerick, such a policy would discriminate against many people. The reason is we cannot even build social housing because we have no infrastructure. The Land Development Agency, LDA, was referred to a few minutes ago. It is only looking at locations within a 15-minute proximity of Limerick city, which includes Croom, Adare and Patrickswell. Everything else is counted out. This leaves out more than two thirds of County Limerick. There is no sewerage capacity in Dromcolliher, Hospital, Kilfinane or Askeaton. Therefore, bringing this measure in, with all the best will in the world, is not going to build social houses in County Limerick because there is no capacity.

Then we have people who want to build houses themselves. Those supplying their own sites, sewerage capacity and water supply and building their own houses are paying 13.5% VAT. Those people are no burden on the State at all. On one hand, then, it is being suggested we should have a 0% VAT rate on social housing, while on other hand, these people who are no burden on the State should continue to be charged a VAT rate of 13.5%. Those building an average house of 2,000 sq. ft in the countryside, which is a nice-sized house there, pay approximately €40,000 in VAT. Mr. Doyle wants people living in the towns and cities to pay a VAT rate of 0%. Even then, this could not happen in Limerick because we have no infrastructure.

Regarding Croom, I spoke to a developer on the way here this morning. He is waiting on Irish Water to provide a water supply. When we had representatives from that company before this committee, they gave us guarantees that things would be put in place for phase 1 of this development of 56 houses in Croom. Those are being held up. We were told those houses would have a water supply and that contracts would be in place in this regard for the first quarter. The contracts have been signed by the contractors, but there is still no water supply. This site is 15 minutes from Limerick city and 56 houses are being held up. There are also contracts for 24 houses and 12 houses and they also cannot be built because there is no infrastructure. This initiative we have been discussing will benefit people where there is infrastructure, but it will not benefit the people I represent in Limerick.

Another point mentioned by Mr. Doyle, and one I agree with, was living over shops. An undertaking was mentioned where four or five shops that were never used were removed and the buildings done up. We stopped that in a couple of towns in Limerick. We want to rebuild towns and villages. In one of the locations I referred to in Limerick, taking out the shopfronts that were not being used would have meant we would have been left with only three shops on the main street. We had more housing, but we could not then encourage people to come back in to open sustainable businesses. Even though we were going to have extra footfall, we were not going to have any businesses. The situation was encouraging people to build shop units outside that town. Shops would have been taken from the main street and brought out to the outskirts of the town. I agree that people should live over shops. I do not agree, however, that shopfronts should be taken away. I believe everything should be done on the second and third storeys in this regard.

I should have mentioned at the outset that I am a building contractor. I was on the site this morning before I came up. I am on sites all day, every day before I come up to Dublin. I can see first-hand the weekly price increases. I got a letter last week notifying me that the price of insulation produced by Kingspan was going up by 25% on 1 July. The situation is out of this world. Last week, I said that prices in Limerick were at approximately €180 per square foot. Now, they are close to €200 per square foot.

Another thing is the cost of trades. For the first time, I had a stall at the Charleville agricultural show last weekend. Many young people told me they could not afford to do their apprenticeships or to go to work. Those included apprentice blocklayers and plasterers. Young people of all ages, and many girls and young women, came up to me. It was not only those young people and their parents who were talking to me but also younger children aged 13, 14 and 15. They were now feeling the pinch because they could see their parents feeling it. Now, these children are starting to feel it as well. They were at an agricultural show.

A total of 98% or 99% of the machinery there comprised fossil fuel vehicles and machinery that was made using fossil fuels.

That brings us back to building. Housing for all must mean housing for all. We cannot exclude social housing or people who want to buy homes. We cannot discriminate against people. We need to build a lot more social housing. I want to build social housing and rebuild our towns and villages in Limerick. My hands are tied because of the lack of vision from previous governments which have not invested in infrastructure. We have Croom and some capacity in Kilmallock, Newcastle West and Adare. After that, we are gone. Over two thirds of people in County Limerick have their hands tied, so to speak, which means social housing cannot be built there.

As I said, I am a building contractor. A person contacted me yesterday regarding five houses in a town. The person contacted the local authority to tell it they would build the houses and come to an agreement, but the local authority told them it has enough houses. We have a housing crisis. I have received four phone calls from people who have said they told local authorities they would build houses for people with special needs. They have sites to build on, would come to an amicable fee and build housing, but local authorities have told them-----

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