Mr. John O'Connor:

My colleagues and I are pleased to accept the invitation to discuss the operations of the Pyrite Resolution Board. With the indulgence of the committee, I will use the acronym PRB for brevity as I go through my statement. The board is now a little over a year in existence.

The Pyrite Resolution Act 2013 was commenced by the then Minister on 10 January 2014 and the board was appointed immediately thereafter. The board consists of myself as chairman and three other members. It has a small staff supplied from existing staff of the Department of the Environment, Community and Local Government and the Housing Agency. The board does not employ any staff directly. Some administrative, information and communications technology and legal services are provided by or through the Housing Agency.

At the request of the clerk to the committee we supplied in advance an opening statement for the information of the committee. We hope the committee finds this helpful. It sets out in detail the provisions of the pyrite remediation scheme and the arrangements in place for the implementation of remediation of eligible dwellings, current activity levels, funding and other significant aspects.

The Oireachtas passed the Pyrite Resolution Act with the purpose of providing for Exchequer-funded remediation of houses and apartments suffering significant damage due to pyritic heave of floors in cases where the owners have no other practicable option. The PRB, which had previously been operating on an informal basis, was appointed under the Act and mandated to draw up a scheme for the remediation of pyritic damage to dwellings, accept applications from affected homeowners and direct and oversee the implementation of a pyrite remediation programme. Responsibility for the testing of dwellings and the execution of remediation works is assigned to the Housing Agency.

The pyrite remediation scheme sets out the conditions that must be satisfied to qualify for remediation under the scheme. They require, inter alia, that a dwelling must be assessed and certified in accordance with the relevant Irish standards as having a damage condition rating of 2, attributable to pyritic heave; a dwelling must be located in Dublin city, Fingal, Meath, Kildare or Offaly, although this has now been extended to include South Dublin and Dún Laoghaire local authority areas; a dwelling must have been constructed and completed between 1 January 1997 and 12 December 2013; and the applicant must be able to satisfy the PRB that he or she has no other practicable option to remediate the dwelling.

The terms and conditions of the pyrite remediation scheme were produced by the PRB on 13 February 2014 with the approval of the Minister. They are bound by the parameters set out in the Act and have regard to the findings of the pyrite panel that reported to the then Minister in June 2012. Following consideration of representations and evidence from affected homeowners in locations outside the remit of the original scheme, the board has now amended the scheme, with the Minister's approval, to include South Dublin and Dún Laoghaire-Rathdown areas.

For a dwelling included in the scheme, the costs to be met out of public funds in addition to remediation works include the services of a building professional to specify and supervise the works, the general cost of managing the programme and necessary vouched costs incurred by the applicant on alternative accommodation as well as removal and storage of belongings. The building condition assessment will also be met within stated limits.

As I have said, the Act sets out the respective functions of the PRB and the Housing Agency. I am pleased to note that the two bodies have been working together efficiently and effectively. This co-operation is underpinned by a memorandum of agreement that sets out the respective roles in the interests of clarity and accountability. Financial accountability is vested by the Act in the Housing Agency. The PRB and the Housing Agency have collaborated in the design and installation of an online system for the making, receipt and processing of applications. The system is working efficiently, it is user-friendly and enables applicants to track the progress of their applications online.

The PRB has secured an agreement with the HomeBond company, under which the company is committed to provide staffing and services to the value of €2 million towards the implementation and administration of the pyrite remediation scheme. These arrangements, which include the provision of testing of hard core, are working satisfactorily.

The PRB is acutely conscious of the need to ensure that the draw on public funds is kept to a minimum consistent with achieving the scheme's objectives. To ensure value for money, framework panels have been set up for building professionals and contractors following open tendering. Contracts for individual projects are subject to further tendering from these panels. There will be strict control on cost overruns. Individual applications, when approved, are grouped into projects to secure maximum efficiencies consistent with the need to ensure that the works are not unnecessarily prolonged for the homeowners. The Act recognises that it will not be possible to carry out all these remediation works at once and provides that the PRB will progress the remediation programme in accordance with a system of priorities based on given criteria. The pyrite remediation scheme makes provision for the ordering and prioritisation of works in accordance with these provisions. The PRB and the Housing Agency have put in place procedures for the creation of an orderly schedule of projects to be progressed through the implementation stages of the scheme. We are keen for this to be seen as an informative, objective and fair process.

With regard to activity in terms of applications received by the PRB, up to end January 2015 632 applications had been received, of which 146 are still awaiting validation - stage 1 - mainly due to the issue of alternative practicable options not being resolved. A further 158 cases are at the testing and verification for pyrite stage and 328 applicants have been notified of inclusion in the scheme, of which 230 are in the process of having remedial works plans prepared. A further 73 cases are in the tendering process and work is about to commence on a project covering 20 dwellings. Five dwellings have been already remediated and I am glad to say that this pilot project was completed on time and within budget. The homeowners concerned have expressed satisfaction with the process. The stated aim of our strategy and business plan is the remediation of 600 dwellings over this year and next year.

On funding, total expenditure on the process in 2014 was €1.1 million. This money was made available, as required, through the Department's Vote and at year end the PRB was allocated a further €1.1 million to cover contractual commitments at the end of the year. The Department's Estimates for 2015 provide a capital allocation of an additional €10 million to fund the programme going forward. The availability of funding has not been an issue that in any way affected progress on the scheme.

The legislation provides that the PRB will recover from any party with a liability and the capacity to pay all or part of the cost of remediating a dwelling. While the PRB does not consider the initiation of legal proceedings to be a practicable option for homeowners it is taking action where considered appropriate to pursue builders or developers for a contribution towards the cost of the works. The level of co-operation forthcoming from builders and developers varies but some success has been achieved, thus reducing the burden on public funds. This is a legally complex and demanding area.