Mr. Seamus McCarthy:

As the Chairman said, the Housing Agency's financial statements for 2021 were certified by me on 25 November. As these have not yet been presented to the Oireachtas, I have to confine my comments to the agency's 2020 financial statements.

The Housing Agency's statement of income and expenditure is arranged to reflect the agency's three main areas of activity, namely the pyrite remediation scheme; the purchase of housing units mainly through the revolving acquisitions fund; and operational activity. The agency acts on behalf of the pyrite remediation board, managing the pyrite remediation scheme and making payments for remediation work.

Funding for the scheme is provided under Vote 34 - Housing, Local Government and Heritage. In 2020, €13 million was provided from the Vote and a further €2.3 million was recovered in settlements with builders and developers. Expenditure on the scheme was €15.5 million. The revolving acquisitions fund was established as part of the action plan for homelessness. In 2020, the Housing Agency had income of just under €30 million from the sale of housing units and spent almost €31 million on the purchase of units. Operational activities of the agency, including administration and employment costs, are predominantly grant funded from Vote 34. In 2020, income for operations totalled €11.1 million. Operational expenditure totalled €10.6 million.

A significant portion of the agency's fixed assets comprise plots of building land acquired under the land aggregation scheme. In 2010, 73 sites were approved to transfer to the agency. On 31 December 2020, 65 of these sites continued to be held by the Housing Agency. These were valued at €51 million. I issued a clear audit opinion in respect of the agency's 2020 financial statements.

The revolving acquisition fund was formally set up on 1 January 2017 for the purposes of acquiring vacant residential units from financial institutions and selling them primarily to approved housing bodies for social housing use. The proceeds from the sales would then be available to be recycled for new purchases. Utilising a fund of over €70 million, the aim was to deliver 1,600 properties by the initial target date of the end of 2020. The target delivery date was later deferred to the end of 2021.

The examination found there was a significant shortfall in the delivery of residential units through the fund. By the end of 2021, the agency had completed the acquisition of 868 units, or 54% of the planned number of acquisitions, and had disposed of 735 of the acquired units, mainly through sales to approved housing bodies and local authorities. Initially, the completion of a sale to an approved housing body was considered to represent delivery of a housing unit, however, since 2018 residential units placed on caretaker leases with approved housing bodies have been reported by the Department of Housing, Local Government and Heritage in its delivery figures for social housing. While 130 units were held under caretaker agreements at the end of 2021, around 40% of these were in fact vacant at the time. The examination also found that, at the end of 2021, the cash balance of the acquisitions fund was €37.7 million, representing around half of the total fund value. This is indicative of underutilisation of the fund's resources.

The Approved Housing Bodies Regulatory Authority was established in February 2021 to oversee the effective governance, financial management and performance of all voluntary and co-operative housing bodies. The authority's first annual financial statements were prepared for the 11-month period ending on 31 December 2021. The authority recorded income for the period in the form of grant funding of €1 million from Vote 34. Gross expenditure by the authority recorded for the period was €1.1 million. The largest expense in the period of account was payroll with the authority employing a total of 19 full-time equivalents at a cost of €672,000. Other significant expenditure includes €132,000 paid to the Housing Agency for a range of support services provided under a service level agreement. During 2022, the authority started to unwind the agreement and to procure the required services from external providers. Again, I issued a clear audit opinion in respect of the authority's financial statements for 2021.