Oireachtas Joint and Select Committees

Tuesday, 23 September 2014

Joint Oireachtas Committee on Environment, Culture and the Gaeltacht

Commercial and Domestic Property Supply and Demand: Property Industry Ireland

3:35 pm

Photo of Ruth CoppingerRuth Coppinger (Dublin West, Socialist Party)
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I apologise for missing the delegates' presentation due to having another meeting to attend, but I studied their document.

Deputy Michelle Mulherin spoke about a communistic solution to the housing crisis, but I think it was with tongue in cheek. We have a housing emergency which has never been so acute. Some 100,000 families need homes, but the solutions being put forward not only by the delegates are token and would not deal with the issue. Their document indicates that it is expected there will be 8,400 completions in the private sector this year and obviously very few of those units will be allocated for social housing. That number will not go anywhere towards dealing with the housing catastrophe. During the height of the boom 80,000 houses a year were being built, yet all the Government and the agencies are talking about is the provision of a few thousand units a year in a piecemeal fashion when we know that if the necessary resources were provided, the housing crisis could be solved much quicker.

At the weekend we heard that container homes were being put forward as a solution for people who were homeless; meanwhile, on the other side of the spectrum, the price of mansions is rocketing, in Dublin in particular. The pattern is not uniform throughout the country.

I served as a councillor in Fingal for 11 years. I sat through discussions on many development plans; there was probably more development in that area than in any other in the country. Planning permission has been granted for the building of 17,000 houses in the area, while land has been rezoned for the building of 30,000 plus houses. The availability and zoning of land are not the problem in many cases. The dysfunctionality is evident from practices in the banks and the actions of the developers who are still reeling from the results of their speculation. I do not see any resolution of the problem unless the State plays a massive role, although I do not think that is the opinion of the delegates, but the only way we will solve the problem is by public intervention.

I do not believe the private sector has an interest in the provision of social or affordable housing. In their document the delegates seek tax breaks in terms of VAT and a windfall tax to incentivise developers, but it was the availability of tax breaks that led to the last bubble. Developers were given huge incentives and we all know what happened as a result. In terms of public and social housing provision, the delegates speak about the provision of 1,100 extra units per annum. In terms of giving developers tax breaks, under a model that was in place in the 1930s and 1970s, thousands of social and public houses were built every year. What has happened is that there has been an ideological opposition to the building of public and social housing by successive Governments, leading to a situation where there has been a collapse on the supply side and people are finding themselves on the streets, including two pensioners whom I saw in their nightclothes.

What the delegates are advocating is a continuation of the same policies, but there is an emergency and the Government must intervene to invest and build social and affordable houses. It would be best to allow councils to do this, not housing agencies which are new to this and also have a private sector ideology in that if one is given a house, it is like being given charity, rather than having an entitlement to a house. Councils built houses before and they should be allowed to build them again, but, unfortunately, they are not allowed by EU and troika rules to borrow money. This is one of the most inhibiting factors in solving the housing crisis. It is not being highlighted by any of the housing agencies, many of which are being given grants and paid by the Government; therefore, they do not criticise it. A crucial factor is that councils be allowed to borrow money, but this has been ruled out under EU rules.

Since the Deputy mentioned communistic solutions, certainly the private sector is not particularly interested in providing social housing but only houses for profit. In fact, some are happy with the shortage of housing because it is a chance for them to sell houses they have on their books.