Michael McCarthy (Cork South West, Labour)
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This meeting is convened to allow the Dáil Select Sub-Committee on the Environment, Community and Local Government to consider in detail the 2015 Revised Estimate, Vote 34 - Department of the Environment , Community and Local Government, and to question the Minister on it.

To bring a more focused, performance-based approach to consideration of the Estimates, the committee secretariat was asked to provide a revised scrutiny process for the three committees.

This is reflected in the briefing material prepared by the committee secretariat for programme A,which is housing. The Department has made considerable additional effort in the limited time available to assist in this regard, and the officials involved deserve to be commended on their contribution. This briefing has sought to focus primarily on performance, specifically departmental target-setting and information and performance related issues arising, and to treat changes in financial allocations as ancillary. Briefing for the remainder of the Estimate reflects the more traditional approach.

The proposed structure for the meeting is in two parts, A and B. Part A is to test the value of the approach that is being piloted. It is proposed that the meeting will consist of an initial session dealing exclusively with issues of performance relating to programme A, which is housing. This is highlighted in the performance-based briefing material and otherwise raised by members. To examine performance effectively, existing Government policy should be taken as a given except to the extent that the committee may consider that some clarification is required. That is part A. Part B, which is the remainder of the meeting, including the supporting briefing material, will follow the traditional format but will include a revisiting of the housing programme if it is necessary.

I welcome to the meeting the Minister for the Environment, Community and Local Government, Deputy Alan Kelly, the Minister of State at the Department of the Environment, Community and Local Government with special responsibility for housing, planning and co-ordination of the Construction 2020 strategy, Deputy Paudie Coffey, and the Minister of State at the Department of the Environment, Community and Local Government with responsibility for local community and rural economic development issues, Deputy Ann Phelan, who is also Minister of State at the Departments of Agriculture, Food and the Marine and Transport, Tourism and Sport with special responsibility for the implementation of the CEDRA report. I also welcome all of the officials from the Departments and thank them for their attendance. I invite the Minister to make his opening statement.

Alan Kelly (Tipperary North, Labour)
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I thank the Chairman and sub-committee members. I welcome the opportunity to discuss with the sub-committee my Department’s Revised Estimate for 2015. I am accompanied by the Ministers of State, Deputy Ann Phelan and Deputy Paudie Coffey. To assist in the work today, we have prepared briefing on the Department’s Vote for 2015 which sets out details of the Vote and related funds as well as other key information.

Budget 2015 marks the end of an era of budgetary austerity. That the Government is in a position to increase expenditure in 2015 reasonably indicates the progress we have made following expenditure reductions over the past six years to address the perilous financial situation we inherited on coming into office. As a Government, we have never believed in austerity for austerity’s sake. What was done was done because we were left with very little choice. I am very pleased, therefore, that the hard-won flexibility we have to meet emerging demands and invest in our public services following the greatest economic crisis in our history has very immediate and positive impacts on the Vote before the sub-committee. The provision of €1.3 billion being made available to the Department for 2015 is firm evidence of the Government’s commitment to the sector. It is made up of more than €800 million in current spending and almost €500 million in capital investment and represents an increase of €460 million on the 2014 Estimate. Department programmes will also benefit in 2015 from resources available from both the local government and environment funds.

The year 2015 will see a very significant level of new investment in housing across a range of measures which will increase the supply of homes to be made available. The overall provision for housing has increased by €230 million, with capital funding increased significantly by €180 million. This will result in an investment of €800 million across a range of programmes. This investment will allow for significant expansion in social housing provision, with more than 7,400 new homes to be provided under a range of social housing initiatives in 2015. Combined with a target of more than 8,000 transfers from rent supplement to housing assistance payment, HAP, almost 16,000 housing units will be delivered this year.

Social housing is a top priority for the Government and this is evidenced by the additional €2.2 billion in funding announced for social housing in budget 2015 to support the implementation of the Social Housing Strategy 2020. The Government is committed to dealing comprehensively with the housing list through a wide range of measures, including a comprehensive return to mainstream local authority builds. The total targeted provision of more than 110,000 social housing units, through the delivery of 35,000 new social housing units and meeting the housing needs of 75,000 households through HAP and the rental accommodation scheme, will address in full the needs of the 90,000 households on the waiting list, with flexibility to meet potential future demand. In committing to provide these 35,000 new social housing units, at a projected cost of €3.8 billion, the strategy marks a fresh start for social housing that was badly needed.

The local government fund has undergone significant change in recent years. While motor tax continues to be paid into the fund, local property tax, LPT, collected by the Revenue Commissioners is now also coming into the fund. This year sees the ending of the general purpose grant payments and the introduction of LPT being paid to local authorities through the fund. A total of 80% of LPT will be retained locally to fund vital public services. The remaining 20% will be redistributed to provide top-up funding to local authorities that have lower property tax bases due to the variance in property values throughout the State. These measures are necessary to create a balanced system of funding across local authorities. The Government has devolved more powers to local authorities by giving elected members discretion to vary the rates of LPT by up to 15%. This allows for greater transparency and accountability at a local level. Fourteen local authorities lowered their basic LPT rate for 2015. The income sources available to the local government fund this year are estimated to be motor tax of €1.167 billion, LPT of €440 million and a payment from the Exchequer of €233 million. My Department will make payments estimated at €1.839 billion from the fund in 2015, including LPT payments to local authorities of €459 million, payment of €364 million for the maintenance of non-national roads to the Department of Transport, Tourism and Sport, and a payment to the Exchequer of up to €484 million.

The transfer of water services responsibilities from local authorities to Irish Water took place on 1 January 2014. This major reform will drive improvements in water services in the coming years and decades. Irish Water published its capital investment plan for 2014 to 2016 last May. A total of €222 million has been provided by the Government to Irish Water in respect of its capital expenditure in 2015. This will fund progress on projects set out in the plan, including key water and waste water infrastructural projects. In addition, €399 million from the local government fund will be provided to Irish Water in 2015 in respect of operational subvention. This will fund the allowance of 21,000 litres of free water that is being provided to all children in the State along with the cost of capping domestic water charges at the levels set out in the Water Services Act 2014.

The 2015 Estimate for my Department also contains an allocation of €130 million for the new water conservation grant which I announced last November. To promote sustainable use of water and to enhance water conservation in households, the Department of Social Protection will administer, on behalf of my Department, a €100 water conservation grant in respect of principal private residences. The allocation of €130 million is based on an estimate of up to 1.3 million households applying for the grant. This estimated level of demand for 2015 takes account of the number of primary residences recorded in the 2011 census as well as experiences with other similar demand-led schemes.

My Department, in consultation with the Department of Social Protection, is finalising the modalities of the water conservation grant. Following this, I will make regulations which will provide for the terms and conditions attaching to the grant, including the date by which households will need to have responded to the Irish Water campaign if they are to be eligible for the grant. All households registered with Irish Water under its application campaign will be contacted directly by the Department of Social Protection in due course.

The Government remains committed to supporting the group water sector as an important element of the water industry in Ireland. This is reflected in the provision of €17.5 million in 2015 for my Department’s rural water programme, under which funding is provided for group water schemes.

In environment and waste management, the programme provides for expenditure of €35 million, largely to meet the cost of the important work of the Environmental Protection Agency, including the work of the former Radiological Protection Institute of Ireland which was merged successfully with the agency in 2014. The environment fund, financed from the landfill and plastic bag levies, will provide a further estimated €45 million to be directed to key priority areas such as environmental enforcement, waste prevention and recycling.

In community and rural development, the Leader elements of the rural development programmes provide for voted expenditure of €45 million in 2015. A total of €30 million of this is to meet the outstanding commitments under the 2007-2013 programme, which has been very successful, with more than 9,000 projects receiving funding. Indeed, financial support has been provided to more than 8,000 enterprises and more than 4,000 full time jobs have been created. In addition, €15 million has been provided for the new 2014-2020 Leader programme which I expect to be operational this year.

This programme will build on the previous programme’s success in creating new and innovative opportunities for rural businesses and communities.

The Vote also provides funding for the local and community development programme, LCDP, which will conclude later this month and for its successor, the social and community activation programme, SICAP, which will be rolled out from April. SICAP takes account of the new aligned structure in its delivery and objectives. In particular, SICAP will be managed and implemented through the new local community development committees, LCDC, as the new governance model for local and community programmes in each local authority area. The allocation of over €45 million for 2015, to cover the funding requirements of both programmes, LCDP and SICAP, will allow further progress to be made in this vital area.

Chairman, members, I have kept my remarks as brief as possible so that we can have a full discussion on the activities of the Department and how our programmes, and the very significant resources we will deploy in support of them in 2015, will benefit communities and citizens throughout the country, make the maximum contribution to job creation and economic recovery, and help the less well-off in our society.

I look forward to hearing members' thoughts and contributions. The Ministers of State, Deputy Paudie Coffey and Deputy Ann Phelan, and I will be happy to deal with matters that members wish to raise.

Michael McCarthy (Cork South West, Labour)
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The briefing material has been supplied to members. The Estimates have been divided into two parts, part A and part B. I will call speakers in the normal rotation, first, Deputy Cowen, to be followed by Deputies Dowds, Stanley and Murphy. All members will be called again to speak on part B of the proceedings

Barry Cowen (Laois-Offaly, Fianna Fail)
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I thank the Minister and the Ministers of State, Deputy Paudie Coffey and Deputy Ann Phelan, for making themselves available and for providing the documentation.

It is welcome that the time has been allocated to deal with housing in the first instance, as it represents 52% of the Vote. I want to clarify an issue relating to new units that are being provided this year as part of the five-year programme that was announced some months ago. There are proposals for 7,400 new social units and there is an additional 8,400 households who will be assisted through the housing assistance payment. Of the 7,400 new social units, some 1,400 will be built or acquired. Do we know at this stage whether that number will be built based on the Minister's consultations and negotiations with the management of the local authorities? Have the proposals from the local authorities been assessed? Is the Minister in a position to provide a breakdown of each local authority's proposals to build or acquire housing units? We would like to know which local authorities will be involved in a house building programme. All the stakeholders recognise that we must address the issue of supply and one addresses that by providing more units.

The proposed 7,400 social units will comprise 3,000 units under the social housing leasing initiative. Will the Minister clarify if the proposed 3,000 new units will be provided by social housing agencies and, if so, have the social housing agencies been granted planning permission to construct the units? Will the units be constructed this year? Can we state definitively in which local authority areas they will be built?

It is also proposed that 1,000 vacant local authority dwellings will be refurbished and returned to use. We would expect that all local authority units would be in use. In real terms that is not a new allocation of 1,000 housing units. There is also a proposal for 2,000 new rental accommodation scheme units. Is that 2,000 new units under the RAS schemes?

I have heard the Minister of State, Deputy Aodhán Ó Ríordáin, state that he would bring forward legislation to address the case of the many local authority tenants who are being refused access to accommodation under the RAS scheme because the landlords will not accept local authority tenants. That may take some time.

The Minister made an announcement on rent caps and I hope he will elaborate on how he will address people's inability to afford the increased rent? Will new RAS schemes come on stream? The supply issue is pivotal. The demand far outweighs the supply. I meet people daily and the issue they raise is their inability to find a home under the rental accommodation scheme, RAS. I am glad to hear the Minister say that it is at the top of his agenda. I am nervous that the units are not available. The Minister is hoping that units will become available to be leased.

In the course of his speech the Minister has set a target of over 8,000 transfers from rent supplement to housing assistance payment, HAP. Is the Minister referring to existing families that are getting assistance at present and will be assisted again in the coming year? The headline rate is 15,800 units, but how many new units will be delivered by the end of 2015?

What role do public private partnerships play in the provision of housing? What is the level of Exchequer exposure to public private partnership agreements? I did not hear that mentioned. Should the proposals for public private partnerships not be taken up, what money has been put aside and has provision been made in the Estimate for that? What is the total amount of money being spent on housing assistance payment? What is the timescale for its roll-out? Will the Minister elaborate on the HAP scheme, when it is enforceable and when is it expected to be completed? Will it assist new families? Based on his negotiations with local authorities is he satisfied that the units will become available? We need to build units, and if we fail to do so we cannot satisfy the demand. If the units are not provided the crisis will deepen.

While I appreciate the Minister's commitment and the effort he and his Department are making, if we do not succeed in having shovel ready projects the units cannot be provided and the crisis continues.

Alan Kelly (Tipperary North, Labour)
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I thank Deputy Cowen for his comprehensive list of questions. It is correct that 52% of the Vote is allocated to housing. That reflects the priority of Government, which I am sure he welcomes. We have an issue with the supply of housing because of the way that social housing was dealt with in the past 20 years. I am not blaming anybody. There was a failure to build sufficient social housing and this is now critical. There was a lack of activity for a number of years which caused a perfect storm and gave rise to issue which we now must now address.

We have had comprehensive discussions with local authorities. For the 1,400 built or acquired we sent out request calls to every local authority in the country. We got them back last week. We are doing the analysis now and will verify the exact numbers in the coming weeks. We are going through the list local authority by local authority. I was pleasantly surprised at the capability they have for new builds, which is a good sign. We will determine how that figure is broken down on the analysis of every single local authority. We are heat mapping this to prioritise areas particularly around Dublin and larger cities where we have a larger demand. I expect quite a number of these will be new builds. There are areas where it still makes more sense financially to acquire, which does influence one's decision - one is not hitting supply and if there is availability at a cheaper rate than it would cost to build it makes sense to purchase rather than build. There is a deep analysis going on in our Department, which has been ramped up for the purposes of doing this work.

A question was asked about leasing. It is a mixture. I believe there is a volume of them ready to go and we are happy with that. There are some areas where there are specific issues we isolated as part of this analysis. This is almost a pick and mix style. If we have problems in one area of build or buy because of the costs in purchasing in high demand areas, we can have other options regarding leasing.

I will turn to the question on local authority units.

Barry Cowen (Laois-Offaly, Fianna Fail)
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I asked about the 3,000 units for the social leasing initiative. Will social housing agencies be charged with responsibility to provide them? Have they submitted a response to the Department similar to the local authorities' responses and are they competent to deliver these units? Are these 3,000 new units?

Alan Kelly (Tipperary North, Labour)
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It will be a mixture, and yes they are competent. We are in continuous discussions with them. We meet weekly at different levels and I chair the monthly social housing implementation strategy meeting. We met with them last week, so "Yes" is the answer to the Deputy's query.

Questions were also asked about the rental accommodation scheme, RAS. There will be 2,000 more in the RAS scheme. One must also remember there are a few areas which do not have housing assistance payment yet, so bringing in more RAS is a necessity. There are areas where RAS is more successful than in other areas but we still need to use it. It is a very important scheme. We have rolled out HAP in seven local authorities with five more are to come on stream. It is an analysis we have just made and I expect to make an announcement on those five in the next week or so. There are over 1,000 people currently signed up to HAP. Percentages of transfers from RAS into the new HAP are in the region of 50%.

Barry Cowen (Laois-Offaly, Fianna Fail)
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Can the Minister clarify the 2,000 figure as new rental accommodation scheme contracts, new units provided for people on local authority housing lists?

Alan Kelly (Tipperary North, Labour)
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Yes.

Barry Cowen (Laois-Offaly, Fianna Fail)
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Of the 8,400 assisted through the housing assistance payment, are these 8,400 new contracts for those on housing lists who do not have units at present?

Alan Kelly (Tipperary North, Labour)
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As I have said, it is a mixture of 50/50. It is a mixture of those transferring and those coming straight on.

Barry Cowen (Laois-Offaly, Fianna Fail)
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Is that 4,200 new units being provided under that scheme?

Alan Kelly (Tipperary North, Labour)
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It is 50/50 at the moment.

Barry Cowen (Laois-Offaly, Fianna Fail)
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The figure given for the year is 8,400. Is that 4,200 new units?

Alan Kelly (Tipperary North, Labour)
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It is transfers.

Barry Cowen (Laois-Offaly, Fianna Fail)
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So it is not 8,400 or 4,200 either? Are there are no new units in that 8,400?

Ms Bairbre Nic Aongusa:

To meet the target of 8,400 will require the transfers from rent supplement to be increased also. The exact breakdown of the 8,400 will depend on how the HAP project rolls out.

Barry Cowen (Laois-Offaly, Fianna Fail)
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What does the Minister estimate? I know 8,400 is the target, but I am conscious, as I am sure he also is, of people on waiting lists. How many in that figure of 8,400 will be new contracts?

Alan Kelly (Tipperary North, Labour)
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Yes.

Barry Cowen (Laois-Offaly, Fianna Fail)
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How many?

Alan Kelly (Tipperary North, Labour)
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It depends on the roll out of HAP and how successful it is. We are looking at variations in relation to it because of where it is being rolled out. We expect a substantial amount to be new contracts. It would be impossible to give you an exact percentage for the future.

Barry Cowen (Laois-Offaly, Fianna Fail)
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Minister, I do not mean to be confrontational, we are only trying to get information for our constituencies.

Alan Kelly (Tipperary North, Labour)
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We can base it on previous analysis of 50/50. Our ambition is to improve that statistic so it heads more in the direction of new contracts.

Barry Cowen (Laois-Offaly, Fianna Fail)
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The total figure here is 15,800 units. The impression is given that these are new housing units available to people on housing lists with 1000 already in local authority ownership. I am pulling that figure back.

Alan Kelly (Tipperary North, Labour)
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I know exactly what the Deputy is getting at, and he is right to get at it, but what we are presenting here is the amount of 8,400 units. As we roll this out to more local authorities and as we broaden the spectrum of local authorities, we expect to be able to take on more new applicants. The current percentage is 50/50. We expect that to grow substantially in the direction of new applicants.

Barry Cowen (Laois-Offaly, Fianna Fail)
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It would be safe to assume the Minister would be doing well to achieve 4,000 new units.

Alan Kelly (Tipperary North, Labour)
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I would not safely assume that at all. I would not assume that in any way, shape or form.

Barry Cowen (Laois-Offaly, Fianna Fail)
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What does the Minister think would be safe to assume?

Alan Kelly (Tipperary North, Labour)
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We base it currently on 50/50, but into the future with the roll out and expansion of HAP I expect that percentage to grow higher.

Barry Cowen (Laois-Offaly, Fianna Fail)
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How many new units in total does the Minister expect to provide to local authority applicants in the coming year?

Alan Kelly (Tipperary North, Labour)
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Previously it was on the basis of 50/50 and I hope that will grow into the future.

Barry Cowen (Laois-Offaly, Fianna Fail)
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Will this Vote satisfy 10,000 applicants this year? Will 10,000 applicants find themselves in homes they are not in today?

Alan Kelly (Tipperary North, Labour)
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The total figure is 15,925.

Barry Cowen (Laois-Offaly, Fianna Fail)
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We cannot quantify the 8,400.

Alan Kelly (Tipperary North, Labour)
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The Deputy is arguing over the 8,400.

Barry Cowen (Laois-Offaly, Fianna Fail)
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We cannot quantify the 8,400 figure. The 1,000 units are already in local authority ownership.

Alan Kelly (Tipperary North, Labour)
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The totals for new units and the totals for HAP are two different figures. The total for new units is 7,536. The total for HAP is 8,400. One separates HAP and new applicants. We want to get as many new applicants into HAP as possible.

Barry Cowen (Laois-Offaly, Fianna Fail)
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I appreciate the Minister's breakdown of figures but we would be doing well to realise 10,000 new housing units or solutions for people.

Michael McCarthy (Cork South West, Labour)
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We are 17 minutes into this segment and there will be duplicate material also. You can come back in again, Deputy Cowen, for the next part of the meeting.

Barry Cowen (Laois-Offaly, Fianna Fail)
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That is public private partnership questions.

Michael McCarthy (Cork South West, Labour)
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Can the Minister do the PPP?

Alan Kelly (Tipperary North, Labour)
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We are looking at various options on public private partnerships and providing housing. We have been quietly happy with the volume of interest and how it is going. There are a number of vehicles being looked at and various funding models. There are many people approaching our Department wanting to be part of PPPs into the future.

Barry Cowen (Laois-Offaly, Fianna Fail)
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Is the Minister saying that he is assessing the potential it may have but there is nothing in the Vote whereby funding is set aside to match any progress in respect of PPPs?

Alan Kelly (Tipperary North, Labour)
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It is in the Vote.

Barry Cowen (Laois-Offaly, Fianna Fail)
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How much is it? How much has been set aside?

Alan Kelly (Tipperary North, Labour)
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It is coming on stream for 2016 and 2017 so it is not in the 2015 Vote.

Barry Cowen (Laois-Offaly, Fianna Fail)
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There is no provision this year for any housing use to be provided by means of PPPs.

Alan Kelly (Tipperary North, Labour)
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Given the legacy we were left with, our policy is to front load the development of housing and to build and lease as many as we can directly. In 2016 and 2017, we will be using PPPs to develop that even further.

Barry Cowen (Laois-Offaly, Fianna Fail)
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I cannot quantify how many units are being provided this year in this Estimate.

Alan Kelly (Tipperary North, Labour)
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I can tell the Deputy how many. It is 1,500 houses by 2017 through the PPP model.

Barry Cowen (Laois-Offaly, Fianna Fail)
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Not this year.

Alan Kelly (Tipperary North, Labour)
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I already said that.

Robert Dowds (Dublin Mid West, Labour)
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I welcome the fact that the Minister is making housing a priority. He is right to do so because it has become a great crisis and has not been helped by the fact that previous Administrations left it to private landlords to deal with people on housing lists. I am sure the Minister will not be able to give an accurate figure but is there a good indication from the four local authorities in the Dublin area that they are coming up with sufficient numbers for the Department to get ahead with building in this area in particular and also in other cities such as Galway and Cork where there is great pressure to provide housing?

Has any thought been given to the type of units that are being built because the traditional three-bedroom unit is suitable for some families but not necessarily for others? Could the Minister comment on the voids situation, particularly in Dublin city, and whether it is getting on top of voids?

My constituency is in one of the pilot counties for the housing assistance payment, HAP. My impression is that it may be easier to roll out HAP when more housing becomes available. Does the Minister think there will be problems? My fear is that landlords may not bite. Can it be made as easy as possible for landlords to get involved in that because at the moment, they tend to want to take private customers who are paying their own rent?

Alan Kelly (Tipperary North, Labour)
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The Deputy will be glad to know that Dublin is a priority. We have a specific task force relating to Dublin and another task force relating to the rest of the country. I chair an oversight group. We have a specific group that delivers on that and we meet with it every week. The chief executive officer of South Dublin County Council is the chairperson of it.

We have issues relating to other major urban areas. Something that is often underestimated is the fact that we have major issues in some major towns, including commuter belt towns, which I see as a priority. That commuter belt is extending further than it had been expanding a few years ago. I regard it as a priority area for social housing and members of the committee would probably agree with me. I will certainly focus on that as regards looking at allocations and where we are going.

The question about the type of units is a very good one. There is a difference between the type of units and the percentage of them that were required in years gone by and what we need now. I am not sure if colleagues are aware of this statistic but it is one that always startles me. Approximately 70% of all people looking for housing are either single or single with children. This changes the dynamic of everything one does and reflects the way Ireland has changed. The volume of 20 or 30 three-bedroom houses built on the edge of town when we were building houses on a grand scale in the early 1990s will not work anymore. For starters, we need to deal with the demographic change. Second, we also need to deal with the fact that mixed tenure is probably the way to go and we need to work towards that in some fashion. The type of units is changing and we need to ensure that we adjust to meet that.

In respect of how we are analysing what we require across the country, I am happy to tell members of the committee that the Housing Agency has been working very closely with us on a deep analysis of the multi-units we need and where we need them so we will certainly be influenced by that.

HAP will be more successful as it is being rolled out. It is being rolled out further. We did some analysis relating to where we want it to be rolled out in the next five local authorities. I expect to be able to announce that in the next week. It is important. There is no doubt that HAP is dependent on supply. Having said that, with some tweaking, it can be more successful.

Voids are social housing units that are boarded up. Nothing infuriates me more than this subject. As one drives around Dublin, a city I know very well having lived here for nine years-----

Robert Dowds (Dublin Mid West, Labour)
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It seems to be much more of a problem in the city than in the county.

Alan Kelly (Tipperary North, Labour)
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I agree with the Deputy. A total of 2,300 units were returned to use in 2014 and 1,000 units are targeted for 2015 so there has been a lot of progress. There are issues that relate specifically to the city centre that I have seen myself. We have spoken with Dublin City Council about them. In 2014, Dublin City Council returned 467 units to service. Fingal County Council brought 165 units into play while South Dublin County Council brought 92 units back into service. Dún Laoghaire-Rathdown County Council does not have many such units. Somebody else is usually bringing them back into play, not the taxpayer. However, the council brought back five units. Cork City Council brought 212 units back into service while Cork County Council brought back 155 so quite a volume of them have been brought back into service. A total of €5 million is there for voids in the 2015 budget. We are adamant that the voids programme is critical because one gets stock back into place very quickly. I always concentrate on this issue. I have gone as far as identifying voids myself and bringing them to the attention of local authorities to be turned around.

Robert Dowds (Dublin Mid West, Labour)
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The Minister should not have to do this.

Alan Kelly (Tipperary North, Labour)
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One gets pretty annoyed when one is driving by and sees local authority stock that has been boarded up for a number of years, particularly when one cannot understand why that is the case. The target in 2015 is to get another 1,000 of these void units back into operation.

Robert Dowds (Dublin Mid West, Labour)
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I understand that there is significant pressure on housing in some of the satellite towns around Dublin, particularly Kildare and Meath. In terms of providing accommodation for those people, could I suggest that they are asked whether they want to move back to Dublin if they happen to be working in the Dublin area?

I do not suggest that the genuine need in County Kildare, which I know is huge, should not be addressed. However, if some of those people want to move back to Dublin because they are working in Dublin, it would be better that their needs were met in the greater Dublin area. I am just asking for that to be considered.

Paudie Coffey (Waterford, Fine Gael)
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I will respond on the issue of voids. We detected some inconsistency across local authorities regarding the cost of refurbishment per unit and the turnaround times. We are looking closely at that in regard to measuring performance. Obviously where we have existing stock and assets that can be quickly turned around, that must be the priority for local authorities. Some have been very good and some have not been so good. We will be measuring those and future funding will be allocated based on good performance. It is a message for local authorities not to leave houses lying vacant while they have people on housing lists waiting to get into those houses. They should bring them back into beneficial use as soon as possible.

In recent years they might have had the valid complaint that they did not have the funding to do it. That is no longer the case because the funding has been provided in recent years and it will be provided again this year.

Alan Kelly (Tipperary North, Labour)
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On the Deputy's suggestion about people moving from Kildare, Meath or Wicklow back to Dublin, that can be further facilitated with the planned passport in the proposed planning legislation. The proposal is for people to have a housing passport allowing them to move between local authority areas more easily. That will be helpful in that regard.

Brian Stanley (Laois-Offaly, Sinn Fein)
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I welcome the Minister, the two Ministers of State and the officials. I would like to know the number of voids in Laois that were funded. As far as I am aware there is only one void house not in use that should be in use. The county has boarded up houses all right, but they are private houses. I have raised this issue previously with the Minister. I believe there should be a bar on landlords buying houses that were previously local authority houses in order to rent them out.

Alan Kelly (Tipperary North, Labour)
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The Deputy has raised this previously.

Brian Stanley (Laois-Offaly, Sinn Fein)
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A person should have the right to purchase his or her house after a period of time and sell it to someone who wants to be an owner-occupier. However, houses that were built by the taxpayer should not be sold and within a couple of years be in the hands of a private landlord. Then the taxpayer is paying a rent supplement to the tenant in that house. The public purse is being hit twice. I am in favour of rent allowance and people being able to buy their local authority house. I support tenant purchase schemes, but there should be a clause whereby houses that are provided under a social housing scheme and subsequently sold cannot be purchased by a landlord and rented out with the taxpayer then having to cough up again to pay rent allowance to a social tenant. There are many such examples.

In Laois it was stopped because I highlighted it. That local authority introduced a 20-year rule whereby a house purchased in the previous 20 years from the local authority could not be rented out. When I first raised it at a council meeting, it was nearly devoured. However, it is quickly seen that in local authority estates landlords were coming in and buying social housing to rent back to people who are on rent allowance.

Alan Kelly (Tipperary North, Labour)
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I will look into that.

Brian Stanley (Laois-Offaly, Sinn Fein)
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Any new housing policy should have that. I am in favour of rent allowance and tenant purchase, as is the party I represent. I highlight the huge demand in Monasterevin, Portarlington, Mountmellick and Portlaoise. There is a demand across the constituency, as there is in south Kildare. I am sure the Deputy beside me will highlight the issue in north Kildare. However, there is pent-up demand in south Kildare. It is absolutely diabolical at the moment and needs to be addressed.

What is the number of new housing starts and units purchased in 2014? I know that units are purchased for good reasons at some times. From what the Minister has said, I take it that 1,400 units were given the go-ahead to start or be purchased in 2015. Will the Minister clarify that figure? In the mid to late 1930s some 8,000 or 9,000 houses were being built.

How many of the 1,400 units will the approved housing bodies have and how many will the local authorities have? By and large the approved housing bodies do reasonably good work. However, there are some issues. There is a huge amount of housing being built from the public purse and I strongly defend that. The approved housing bodies have a role, but they are registered charities. Some of them operate very much like companies. Apart from some of the older ones, they are very much commercial operations. These approved housing bodies have already acquired a large housing stock over which there is concern. There is also concern within the local authorities about allocations in that the local authorities do not have full control over the allocations to those most in need.

There is an issue with some housing bodies cherry-picking, with what are described as the worst, more difficult or troublesome tenants winding up in the local authority estates. I can show the Minister examples of that if he spends an hour or two with me some day.

Alan Kelly (Tipperary North, Labour)
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I can show him myself.

Brian Stanley (Laois-Offaly, Sinn Fein)
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The Minister knows what I am talking about. Given the performance over the past year, I can see it developing further across the housing sector. I am highlighting it with the Minister and two Ministers of State present. I want them to hear what I am saying because there are serious issues in this regard. While it is public money going into them, the local authority does not have a huge amount of control.

There is also the issue of cherry-picking with what are regarded as the best tenants going into the approved housing body schemes while the ones deemed to be more difficult - perhaps they have a drug habit or whatever - going into the local authority housing. In terms of social integration we are winding up with another form of segregation.

The affordable housing scheme has dried up completely as we know. Does the Minister have plans to restart that? I know he will say that in parts of the country there are houses for sale on the open market that could not be matched with any affordable scheme and that is a reality. In parts of the country that is not the case. There are huge schemes of houses lying empty that are either with a receiver or with NAMA. Could we not take a more imaginative approach?

Many people are caught in what is called the grey area. The income thresholds for local authority housing are too low. A person who earns more than €25,500 is out of the loop and that does not take into consideration deductions from wages. Those thresholds are not realistic and need to be reviewed. There is a cohort of people with income above that and up to €40,000 or €45,000 who cannot buy on the open market and are continuing to rent. I am sure the Minister, the two Ministers of State and the Deputies present recognise what I am talking about. There is a huge opportunity and a huge gap in the market to be filled. If those people could be placed on a loan scheme, there are houses in the constituency where I live that could be bought for between €50,000 and €80,000.

In the part of the world where I live landlords are not interested in RAS. Landlords are getting out of RAS as quickly as they can because they do not want to be on 80% or 85% of the market value.

They can get more than that. There were a number of new RAS contracts last year. Is there a figure for that?

My next question concerns HAP. Given the level of rents, we will end up with the same problem in many parts of the State. We will certainly have the same problem in Laois and Kildare, in terms of the levels of rent that can be achieved on the open market. The Minister will have to be bold and do what he said he would do about rent controls at the weekend, something to which I will hold him over the next year or so because he said he will be in office for more than a year. He will upset some people.

I refer to some of the PPPs that have been entered into. I and others were told at the time it was the only way it could be done and would provide value for money; it could be front loaded and this, that and the other could be done. It has been a noose around the necks of taxpayers and ratepayers. I caution the Minister against entering into any PPPs. We all want new programmes, but we need to be very careful about the long-term costs. The problem is that the officials sitting around the Minister will not be able to tell us the terms of the PPP for next year or the year after because it is commercially sensitive information. Despite the fact that the public will fund it, we will not know its terms. I can show the Minister some awful examples of PPPs that were rushed into during the terms of previous Governments.

Alan Kelly (Tipperary North, Labour)
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I will begin by complimenting the Deputy's local authority as it overshot its allocation on voids. Percentage wise, it was probably one of the most successful in the country.

Brian Stanley (Laois-Offaly, Sinn Fein)
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It is down to the Deputies in the constituency.

Alan Kelly (Tipperary North, Labour)
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I know that. There are a couple beside the Deputy who did not do too badly. From a void point of view, the returned units were substantially more than what it was allocated. That must be acknowledged. For statistical purposes, I can state that 43 units were brought back into play.

Brian Stanley (Laois-Offaly, Sinn Fein)
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To which county does the Minister refer?

Alan Kelly (Tipperary North, Labour)
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That was in Laois. In Offaly, the figure was 35 and it was given 31. Laois beat Offaly in that sense. We will see how it gets on in another year's time.

I refer to the Deputy's comments on social housing. He referred to it before and it is a valid point. We are considering a new tenant purchase scheme and all of the issues around that. Maybe as part of that we could examine this issue. The Deputy referred to the policy in Laois. We do not know how many other local authorities have adopted a similar approach. It would not be a bad thing to find that out. We might send out a question on that. It is something which could be examined.

I did not say what I said earlier on demand and the heat map because three Deputies who are not a million miles from each other are sitting here. There is a demand for accommodation in Dublin and large commuter towns within a certain distance of it, which needs to be considered. I have visited or spoken to most local authorities. The Deputy met me at one. Some are fairly well advanced. We would reward those who are, because there is a need for that.

The Deputy asked for outputs for 2014. I have the figures. Local authority housing totalled 285, the capital assistance scheme totalled 357, voids and vacant units totalled 2,333, regeneration totalled 247, leasing totalled 1,062, RAS totalled 2,173 and HAP totalled 485. We exceeded our targets as a Department.

I will come to the question on AHBs. In terms of local authorities versus AHBs, we are probably touching just below 1,000. The Deputy raised many issues in respect of AHBs. That is a real issue. We have plans to introduce legislation to regulate AHBs, which is necessary and will be helpful. The way in which AHBs work in this country is a little bit different from others, which has positive and negative aspects. We have a large volume of AHBs, but many are small. The critical mass in terms of what can get out of them is not necessarily there.

A voluntary register is in place and a Bill is expected to be in place by quarter three of this year. It is currently being prepared and will regulate AHBs and all issues relating to them. It will also be helpful to them as regards structuring them into the future and how they can work with us and finance themselves to deliver more. We are also examining EIB investment and the HFA.

The Deputy raised social issues regarding AHBs and local authority houses, which were raised with me before. The regulatory process to which I referred will deal with all of those issues. He also asked about affordable housing. It is something that is under review. He raised a valid issue. The problem is that in many parts of the country the price of units is so low that it is not worth doing. As the market changes and recovers, it is something we will revisit. I raised the issue internally in the past couple of weeks, in terms of revisiting it in the near future. We would have to geographically zone in on where we target.

The Deputy asked about RAS, which has been quite successful. There are issues in certain areas which we are trying to address, but we see it as being part of the mix in the future while the HAP is being rolled out. HAP is being rolled out across the country. We have picked five more local authorities and as it is rolled out it will become more successful. That is why we have made certain provisions.

PPPs were another issue he raised. The issue is the value we can get. We feel we can get very good value from PPPs, in terms of what was thought of them in the past compared to now and the models in Britain and other countries. We have had a substantial amount of contact from various different people with various different models. Our analysis shows that there is good value. I expect it to be quite successful as we roll it out next year and into 2017. The Deputy should not think we are necessarily looking in any way, shape or form at the models of the past.

Nothing is defined in respect of PPPs, but how people will partake will be very different from the way things were done in the past. I expect there will be very good value for the State and there is quite a level of competition out there in terms of the groups which are coming to us to work with the Government in that regard.

Brian Stanley (Laois-Offaly, Sinn Fein)
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I want to ask the Minister about RAS. He said it was very successful. My experience is that landlords are exiting as quickly as they can. The HAP scheme is based on the same principle, namely, that the local authority leases the house.

However, the house is leased below the market rent and over a long period. How will that work in counties where landlords are ditching the schemes as quick as they can? They can get up to 30% more rent on the open market than from RAS or HAP. Rent control is the only way to solve the matter.

Alan Kelly (Tipperary North, Labour)
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I have made similar statements.

Brian Stanley (Laois-Offaly, Sinn Fein)
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I heard the Minister.

Alan Kelly (Tipperary North, Labour)
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I am glad the Deputy heard me. From our analysis of the market, we have found that issues exist in certain areas, so we need to look at the mix of housing. On the other hand, the system works quite well in other parts of the country.

Catherine Murphy (Kildare North, Independent)
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I welcome the Minister. Discussion of this matter is welcome as it pretty much dominates our daily routines. For example, this morning six new families visited my constituency office. All of them told me they will be out the door of their accommodation within the next week or two. Also, there are people with families who are homeless.

Alan Kelly (Tipperary North, Labour)
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We all must deal with difficult situations.

Catherine Murphy (Kildare North, Independent)
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The problem is out of control in some places and, therefore, it is important that it get the necessary attention. Just as there are two Irelands in terms of the recovery, there are two Irelands in terms of the housing issues. Six local authorities make up exactly half of the housing waiting list - three in Dublin, the two Cork authorities and the Kildare authority. Their prospective tenants make up 50% of the 90,000 people who are on the housing waiting list. There are also six local authorities in which it makes a lot more sense to buy than to build, because there will be available stock. These six local authorities make up 3% of the waiting list. It is important that we strike the right balance and adopt a strategic approach to deal with the housing crisis.

I wish to refer to an aspect that gets under-counted. The document before us states that 139 people slept rough in the greater Dublin area last November. I know that the crux of the problem, in part, has been dealt with, but an increasing number of families are homeless or at risk of being made homeless. I acknowledge that some improvements have been made in terms of crisis management by community welfare officers, but that situation can only last for so long. We are not counting the people who are couch surfing, the families who have split, the families who have difficulties getting their children to school and the families that must store their belongings because they have had to move out of their accommodation. Local authorities need to capture that information so that we can go after the problem.

Alan Kelly (Tipperary North, Labour)
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I ask the Deputy to clarify her remarks. Is she suggesting that homelessness is under-reported in terms of the collection of statistical information?

Catherine Murphy (Kildare North, Independent)
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Yes. People may not be sleeping rough, but what I have described is homelessness none the less.

Alan Kelly (Tipperary North, Labour)
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Is the Deputy talking about people who do not have their own housing unit?

Catherine Murphy (Kildare North, Independent)
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Yes. A family may no longer live together or they may be split up, so they are at risk of being made homeless as they will be out of their accommodation in the next two weeks. If one can captures statistics on a problem then one can deal with the matter. Some local authorities have a different way of capturing such information than others. We need a constant way of capturing the statistics.

The HAP scheme has been piloted in a number of areas. I want HAP to be successful and I see its value in solving the poverty trap that many of us have complained about for years. I want people to be able to go to work, which is the intention of the scheme, and RAS has done the same to some extent. I know of instances in which landlords have been actively talked into withdrawing from the RAS scheme.

Alan Kelly (Tipperary North, Labour)
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By whom?

Catherine Murphy (Kildare North, Independent)
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By auctioneers and so on. Some auctioneers will say part of the reason they do not encourage people to engage in RAS or rent assistance is due to the red tape involved. Therefore, the schemes need to be simplified.

The number of people on waiting lists differs from area to area, as do the staffing ratios in local authorities. Some authorities have the ability to deal with an additional workload while some are at the bare bones in terms of staff. The embargo has been a very blunt instrument from that point of view. The staffing ratio is an important issue.

The Minister outlined the make-up of waiting lists, which I was aware of, but I wish to caution against something. It can be very bad value to build a lot of one bedroom houses, as it can lead to less flexibility. Someone may live on his or her own but later on in life he or she may need a carer or someone similar in the house. Therefore, it is important that we have correct housing provision.

In terms of approved housing bodies, I have some good experiences and some not-so-good experiences. The Minister is right: we have a large number of small bodies and there is a bit of cherry-picking. In my experience, quite a bit of cherry-picking takes place. We should look at the way this is handled in other European countries where the likes of the European Investment Bank act as co-funders. When the housing associations met the committee they talked about the need to have a co-guarantee with Government because they are charities. I hope this issue will be addressed because a very large amount of money could be leveraged. I hope there will be a mixture of tenure and renters in some of the schemes developed, because renting must be an option into the future. For a cohort of people, renting is about security of tenure and affordability of rents, but it is not the same issue for every group of people. I hope we will adopt a more European approach to renting because it will be increasingly difficult for people to purchase homes due to restrictions that have been placed on mortgages and also because a lot of people live on fairly low incomes.

I wish to mention a number of specific issues.

Michael McCarthy (Cork South West, Labour)
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I will give the Deputy another chance to comment later in the second batch of questions, if she wishes.

Catherine Murphy (Kildare North, Independent)
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That is the way to approach this. Can the Minister give me the number of people who have moved from RAS to HAP and from rent allowance to HAP?

An issue that has not been specifically addressed here is the delay in the PRTB process, which causes problems for landlords and tenants. That matter needs to be addressed.

Alan Kelly (Tipperary North, Labour)
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The Deputy has raised a number of issues.

In response to her suggestion that local authorities adopt a strategic approach and the fact that certain local authorities have longer waiting lists, I said the same earlier about a number of local authorities, such as those in Dublin and Cork and the commuting counties around Dublin. We have specific issues in Galway, Waterford and Limerick as well as in major towns. One learns something new every day, but the Deputy will be surprised to learn that some of the major towns around Ireland have specific issues. Departmental analysis has been carried out and we have heat-maps with a lot of detail.

As I said in my earlier reply to Deputy Cowen, some local authorities require a different mix of housing. How we address the matter will depend on what stage some of them have reached and, therefore, we need flexibility, but the Deputy can be assured we will address the matter. We will announce the allocation in a few weeks' time.

I am glad Deputy Catherine Murphy raised the issue of homelessness. She was the first Deputy to do so. The community welfare officers are doing a lot of good work and it must be acknowledged that their intervention mechanisms are working. I accept that they are not the be all and end all, but they are targeting certain families and ensuring that they can remain in their homes.

As regards homeless in the greater Dublin area, analysis has shown that the actions we took before Christmas were successful. To be fair to the three Deputies opposite, they were part of the process and I took their comments on board. However, we now see that there is a pull towards Dublin in the services that are being provided. I can assure Deputies that we are looking at other ways and resources that we can utilise to deal further with the issue of homelessness for both rough sleepers and homeless families. Families are a priority for me, including how quickly we can get units for them and turn them around. I have made commitments in that regard. I do not want to be dealing with NIMBY syndrome, although there will always be a bit of it. Let us call a spade a spade. We will make the hard decisions and will get the units in place for families in particular.

The Deputy referred to statistical analysis. One cannot be absolute about it, because some local authorities do things in different ways. Our analysis shows the difference between housing need, which is 89,000, and specific issues concerning homelessness. In November 2014, there were 168 rough sleepers in Dublin. In December 2014, emergency accommodation nationally was 2,858, while the figure for Dublin was 1,868. We have undertaken analysis but are constantly examining how we can refine data coming through from local authorities in order to create a consistent approach and categorise the people concerned.

I appreciate the Deputy's analysis regarding the HAP. It is a necessity that it works in order that people can avoid the poverty trap, and the 30-hour period is a critical issue in that respect. We have already spoken about simplifying the bureaucracy around the scheme and we are examining that matter.

The Deputy also referred to staffing ratios and waiting lists, and I wish to give an assurance on this point. I have spoken to almost every local authority in the country. In addition, together with the Ministers of State, Deputies Paudie Coffey and Ann Phelan, we have visited many chief executives, particularly in priority areas. Local authority staffing issues are a priority for us, including in the Deputies' own local authorities. If staff are required for any specific housing issues, this will be addressed if it is not already being addressed at the moment. Some 300 extra jobs in local authorities have already been sanctioned to deliver the social housing strategy.

Brian Stanley (Laois-Offaly, Sinn Fein)
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They were advertised.

Alan Kelly (Tipperary North, Labour)
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It was necessary to do this and it is being done. If Deputy Catherine Murphy has any specific issues she should raise them with me directly and I will address them myself.

I take on board her point concerning the mix of houses. When I referred earlier to singles or singles plus children, I did not mean that one-bedroom houses would be built. I was just reflecting on the current demographic situation in the country, which amazes me because it just shows how substantially Ireland has changed in recent years. I agree with the Deputy that two-bedroom units would be more prevalent.

I also take on board her comments about approved housing bodies or AHBs. I had some very good experiences with them before taking up my current ministerial post. There is a need to examine the whole AHB area more holistically. In my earlier reply to Deputy Stanley I said we would be bringing in regulations on that.

The Deputy also asked specific questions about HAP. Some 1,000 households are in HAP and the breakdown is 50-50 new versus those on rent supplement. Did she ask another question also?

Catherine Murphy (Kildare North, Independent)
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Yes, concerning the number of people moving from RAS to HAP.

Alan Kelly (Tipperary North, Labour)
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They are not going across yet. That applies when the tenancy has finished.

Catherine Murphy (Kildare North, Independent)
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Okay.

Alan Kelly (Tipperary North, Labour)
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I am happy the Deputy also asked about the PRTB. In the broad structure of where we are going on housing, and elaborating on my comments at the weekend, that is an area we will also be looking at from the point of view of resources.

Catherine Murphy (Kildare North, Independent)
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May I come back in on a couple of things?

Paudie Coffey (Waterford, Fine Gael)
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There were some concerns about the average time taken to resolve disputes through the PRTB, but good progress is being made in that respect. In 2012, the average time was 12 months, in 2013 it was seven months, and five months in 2014. We are continuing to streamline that process to ensure we reduce those times further. That will also be helpful regarding tenancy disputes, about which the Deputy is concerned.

Michael McCarthy (Cork South West, Labour)
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I ask Deputy Murphy to contribute quickly.

Catherine Murphy (Kildare North, Independent)
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I have a number of points, including the one I made earlier about capturing the number of people at risk of homelessness. Local authorities have different approaches. The problem with community welfare officers is that, with the best will in the world, some people, including families, are being captured far too late. When people contact me I encourage them to talk to the local authority officers dealing with homelessness.

Alan Kelly (Tipperary North, Labour)
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The protocol is working where it exists, but we are trying to roll it out further. It is in Cork now as well.

Catherine Murphy (Kildare North, Independent)
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Yes, but there is a difference in the way some local authorities handle it. We could prevent people from getting to that stage. If we can get over this year, we may well see more housing stock starting to come in. It is critical this year that, as far as possible, we deal with families in particular. It is much more difficult to find accommodation where children are involved because of keeping them in school and all the rest of it. Some local authorities are capturing it in different ways, however. I will discuss some of the issues separately with the Minister.

It is one thing to get landlords to include their properties in RAS or HAP, but it does not stop there. The ongoing management of those schemes is quite labour-intensive. Given the number of houses that will end up in that sector, which will be the dominant one, has the Minister considered the management issue and what the needs of local authorities will be? Are those matters being examined? Others will not come into the system if it does not work, so word of mouth is really important from a landlord's perspective.

Alan Kelly (Tipperary North, Labour)
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I will deal with the second point first. We have a project board and a site group which are dealing with the whole issue of HAP. We are nuancing it all the time and as we roll out the process we are learning more. We are taking on board what we learn all the time and are adapting to the new process. Ultimately it is the right direction to take, although one does not get everything perfectly right on day one.

It takes people out of the poverty trap. I will take the Deputy’s comments on board directly. If she has any individual problems she should please bring them to me as well. That is chaired by the Department of the Environment, Community and Local Government and the Department of Social Protection, which is directly involved.

I am very interested in the prevention of homelessness, which the Deputy has raised several times in different fora. Last year was the first in which we had composite national data on homelessness. That is a fact. We publish quarterly reports on this. I agree that the focus has to be on prevention. The tenancy sustainable protocol, of which the Deputy is well aware, has been rolled out and has had an impact. We might need to roll it out even further. There is also the Private Residential Tenancies Board, PRTB, educational campaign on people’s rights. We have also stressed an enhanced role for the local authorities, for them to be as active and involved on the ground as well in prevention. It is not just a question of addressing the problems as they arise but of trying to facilitate and prevent families in particular coming in. I accept and agree that if, in the next 12 months or so, we can do that in a nuanced and better way it will be quite helpful because the economic turnaround and the supply coming up will redress the problem. We have had detailed discussions with all the organisations I mentioned, on how to roll the protocol out even further, with the PRTB on the campaigns, and Deputies can expect to see them, and with local authorities about being more hands-on.

Michael McCarthy (Cork South West, Labour)
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I propose a sos before we start part B of the meeting.

Michael McCarthy (Cork South West, Labour)
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We will now begin part B of the meeting. Members have the headings in their briefings. I propose to take the three contributions together, try to break them down into questions and elicit answers from the Minister and Ministers of State. Is that agreed? Agreed.

Barry Cowen (Laois-Offaly, Fianna Fail)
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I will follow the order in the Minister’s opening statement, starting with local government fund payments. Notwithstanding that the Department is no longer paying the general purpose grant to replace the local property tax allocation, the local government fund is being robbed of the rates associated with Irish Water. Even at that, the valuation throughout the country is €60 million. In early December the Minister gave me details of the rate applicable in each county, which brings the total figure to €48.7 million.

The estimate valuation of the assets on transfer was €11 billion. Now we see applicable commercial rates of only €59 million or €60 million. If I look at my constituency, the rate bill in Offaly was €15,000 for last year. There was a lot of money spent on building new plant during the course of the past ten years in the county. It amounted to a multiple of millions; far in excess of €1 million. The general rule of thumb one might expect on commercial rates on property is 1%. When the figures are €11 billion and €59 million, something does not add up.

This plays into the subvention issue and the ongoing process on whether we are on or off balance sheet to be adjudicated by EUROSTAT. We never paid the commercial rates of the ESB, Bord na Móna or the parent entity of Irish Water, Bord Gáis. However, the Government is subventing the commercial rates which were to accrue to the local authorities. This is one issue. The local government fund is another issue. I would have expected a lot more funds to accrue to the revenue streams of the local authorities. This is not the case.

As we know from the Taoiseach's response to a parliamentary question tabled by Deputy Fleming, Fianna Fáil's spokesperson on public expenditure, there is a delay concerning the process involving EUROSTAT and the CSO. The CSO continues to deliberate on the process of making the application to EUROSTAT. We now understand that this will not be returned until June at the earliest, which is a bit longer than we had expected. However, it is vital that we state definitively if €59 million is or is not the exact figure. If it is not, and if it is to increase in the coming year further to continued re-evaluations - it has been completed in only three counties - will the local authorities, which have a wrong rate at present, be reimbursed in the future? The other issue is the on-off balance sheet issue. It may be no harm if it is off balance sheet or if it is on balance sheet because it would be two and a half times less than what Irish Water is paying for the €300 million it borrowed recently. This is my question on the local government fund.

What level of subvention cuts, if any, are being rolled out to the group water schemes in the coming year? What process or level of finance is being put in place for subvention levels to proposed new group water schemes in the future? Are there any changes to the mechanisms which were in place prior to this?

On community and rural development, when will the new social inclusion and community activation programme, SICAP, be rolled out? Is money being put aside for potential legal action which may arise from the tendering process? I am not being facetious, but rather I am conscious of the representations I am receiving from many of the staff in the various programmes throughout the country who are worried and nervous that their role will be diminished by this new body. Will the same level of funding that was there in the past be put in place? Is there a threat to the existing employment rights of those who are involved in various schemes which will now fall within the remit of SICAP?

Will the Minister address the issues raised about the local government fund and, in particular, the commercial rates that have been apportioned to the assets that are now in the ownership of Irish Water. The payments to local authorities are far less than I had expected. It could be argued that this is the difference between passing the EUROSTAT test or not. It, therefore, needs to be clarified.

Brian Stanley (Laois-Offaly, Sinn Fein)
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I will keep this as brief as possible. There were 32 recommendations in the report of the Commission for the Economic Development of Rural Areas, CEDRA, which falls within the remit of the Minister's Department. The Minister of State, Deputy Phelan, has a particular role in this area. There is a concern that Pat Spillane and the committee went away, put together a good report, came back with it but, as I understand it, there is not much allocated for this year. A figure of €1 million has been mentioned. Are there any plans to ramp this up, given the pressure that rural Ireland, in particular, is under? Has consideration been given by the Government to this issue?

The funding for the group schemes is down to €17 million this year. That is a drop of about €10 million or €11 million on last year. Is there a concern about this? Will it meet the needs of the group schemes?

On the local government fund, what is the overall figure for the amount collected in local property tax in 2014? I am looking at the local government fund figures. It is made up €440 million from the local property tax. A full collection would have brought in approximately €530 million. I am open to correction on this. This figure is fairly similar to Fianna Fáil's figure. A figure of €440 million has been pencilled in for it. If there is a balance, where did it go? Some 80% of the tax is supposed to stay with the local authority. The other 20%, from the better off local authorities, is supposed to be distributed to more rural counties such as Leitrim. What has happened? There is potentially €100 million as láthair.

Some €1.167 billion in road tax is being collected. Another €223 million is coming from the Exchequer. This gives a total income of €1.85 billion in the local government fund. There may be a good explanation for the payments out, but some €459 million is due to be disbursed under the local property tax allocation. I am referring to both last year's and this year's figures as they will be roughly the same. Some €364 million is allocated for what is called local and county roads. This brings the expenditure figure up to €823 million. Some €1.85 billion is coming in and €823 million is going out. There is about €1 billion or so to be accounted for. A sum of €484 million of that is accounted for because it is fed back to the Exchequer. Therefore, €459 million is disbursed under the local property tax heading, €364 million is disbursed under the local and county roads heading and €484 million is being sent back to the Exchequer. It presumably goes into something such as housing. However, this brings the figures up to approximately €1.3 billion. There is approximately €550 million missing. Will someone please tell me where it is gone?

We all know that local governments are starved of funds. We are always speaking about it and how to fund them. We have a gap of €500 million. Where is it gone? Why is it not going to local authorities? This money is collected through motor tax for roads. It is collected through the local property tax because, as the Minister and his predecessors have always stated, it is for footpaths, lighting, libraries and parks.

Will the Minister also comment on the EUROSTAT issue? An official from EUROSTAT was quoted recently in the "paper of record".

Alan Kelly (Tipperary North, Labour)
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The Irish Examiner?

Brian Stanley (Laois-Offaly, Sinn Fein)
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The Minister will have to go further north. It is inside the pale. A senior official from EUROSTAT was quoted as saying that the €130 million water conservation grant, which we all know is not a water conservation grant but that is for another day, will be counted as a direct subsidy to Irish Water.

Catherine Murphy (Kildare North, Independent)
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Is the 20% distribution of the local property tax to the local authorities based on the needs and resources model or is it related to a lower property tax?

Very often, what happens is that local authorities are deemed to be quite well off because, for example, they have a staffing complement they have to pay and they have a number of swimming pools, libraries and so on. However, very often, the local authorities, particularly in developing areas, are playing catch-up and it can work hugely to their disadvantage. What is the mechanism used for the 20%? Is it about higher property tax ratios? Is it to do with the requirements to fund what they already have in place? What mechanism is used to calculate that?

I also did my tot on the same figures as Deputy Stanley so I will not repeat that one except to say I also could not see where the €532 million was accounted for. With regard to the capital investment for Irish Water, this is no longer very transparent because of the way development contributions are now handled, given the local authority no longer applies them in regard to water and wastewater on a planning application since 1 January 2014. With Irish Water, it seems to be hit and miss and it is quite difficult to get information on this. Therefore, we do not know the position. I understand something will be published in the next few weeks by the Commission for Energy Regulation but, if we cannot get an answer on that today, can we get some sort of a comprehensive answer on how that is handled and what legislation it comes under? I am only annoying the Minister by writing parliamentary questions and not really getting to the answer I am trying to get to, which is an explanation of how it is actually done.

On the conservation grant, in a reply last week the Minister for Social Protection told me the Department needed additional staff to deal with that but the Minister, Deputy Howlin, said on Friday or Saturday that it did not. The Department of Social Protection tells us it is being handled almost on an agency basis for the Department of the Environment, Community and Local Government. Is any contribution being made by the Department of the Environment, Community and Local Government to process that? What involvement is there, if any?

In regard to the figures Deputy Stanley highlighted, why are we being shown the €484 million, which is a contribution to the Exchequer, as though it was a contribution to local government? It is almost a dishonest way of stating it.

The Minister said in his statement he is finalising matters with Irish Water in regard to the conservation grant and that he will be issuing regulations. Will it actually be regulations or will it involve primary or secondary legislation?

The last Leader programme was renegotiated with the result that we got a reduced amount from Europe, if I remember rightly, but we were able to reduce the contribution we made. What will be the approach on this occasion? Will it be the same as the current situation or will we revert back to making a higher contribution but getting more funds into the country? Has the approach been decided at this stage? Clearly, there is huge demand on that fund, which has been one of the success stories over the years and has produced some very interesting initiatives.

Alan Kelly (Tipperary North, Labour)
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There is quite a volume of questions across a wide range of topics.

Michael McCarthy (Cork South West, Labour)
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I kept a few notes just in case.

Alan Kelly (Tipperary North, Labour)
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I know that. The Chairman has always been beside me down through the years.

Michael McCarthy (Cork South West, Labour)
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Deputy Cowen spoke about local government.

Alan Kelly (Tipperary North, Labour)
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Yes, I have a note of that. I have been down the road on this a few times before with Deputy Cowen. There is no robbery going on here. The €59 million, which was estimated to rise, is in the local government fund, as the Deputy knows. If this change had not been made, a global valuation would have been made, similar to other utilities. Certainly, the estimated rates bill would not have risen above €59 million. Therefore, we were quite happy with the €59 million and believe it is accurate.

Deputy Cowen asked in regard to the group water schemes. I had a very good meeting in Galway with representatives of the group water schemes and they had very few issues. I would make one point. We have a combination of various political representatives here. These people supplied water throughout the country at their own cost for years, which should be acknowledged. They have paid for water for decades. I will certainly support them in whatever way I can because they deserve to be supported for the efforts they have made throughout many parts of Ireland where it is very difficult to provide water.

As regards new group schemes, the grant increase in 2014 is to €7,475 per house and they will continue to be part of the rural programme. We will announce the allocations shortly. The reductions in subsidy were agreed with the national federation. When I met the representatives in Galway, we spoke at length on a number of issues. The only request they had was that they wanted a multi-annual framework. I have agreed to that because I recognise the work they do and want to ensure they are able to plan ahead. I believe Deputies across the House will welcome the fact I made that decision.

Deputy Cowen's next question related to SICAP, the social and community activation programme. That has been announced and the groups have been told. As the Deputy will be aware, there is a two-week cooling-off period so people can decide if they want to do something or question the process in one way or another. Outside of that, I simply make the point that those groups have been notified.

I committed to dealing with a number of issues that were outstanding and which everyone in this room knew about. As part of the process, there were specific issues in regard to women's networks, the islands and Traveller groups, and there were other smaller issues. I am confident that, across governmental processes, we will be able to deal with all of them.

The Deputy asked about employment rights. That is a matter for each organisation, not for me. However, I would expect the allocations given and the way in which we have managed this would, by and large, maintain jobs if not create jobs in some cases. The ins and outs of every individual company is their own business and neither the Deputy nor I can get involved in that. They are the entities in their own way.

I am not sure if the Deputy asked a question about the Leader programme. If not, I will move to the next set of questions.

Barry Cowen (Laois-Offaly, Fianna Fail)
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If I could be indulged, on foot of my first question, would it be possible to provide a breakdown county by county basis of the valuations applicable in arriving at the figure of €59 million? I do not expect that today.

Alan Kelly (Tipperary North, Labour)
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I do not know but I will look into that for the Deputy. If it is possible, we will do it. I will ask the Minister of State, Deputy Phelan, to comment on the Commission for the Economic Development of Rural Areas, CEDRA, report. Deputies opposite would agree it is a great document and much work went into it. There is an allocation in that regard. Over the coming months, however, we will be looking across Government funding mechanisms to enhance it as well. There are a number of programmes that could do this, and in particular I will look to ensure, with my colleague, the Minister of State, Deputy Phelan, that this happens. It is a lifeline and a great project for rural Ireland. I have answered the question about group schemes.

Brian Stanley (Laois-Offaly, Sinn Fein)
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The Minister mentioned the grant, which was up to €6,000 per household. The group sewerage scheme figure was trebled from approximately €2,100 to in excess of €6,000. Does the Minister have the figures for sewerage and water schemes?

Alan Kelly (Tipperary North, Labour)
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I will get that in a moment. The local property tax figure for 2014 was €491 million and for 2015 it is to be €440 million. Some 80% of the local property tax is retained locally to fund various public services. The remaining 20% has been redistributed to provide additional funding to certain local authorities, as the Deputy is aware. There have been lower property tax bases due to variance in property values throughout the State. It is there to ensure no local authority received less funding than in the previous year. Authorities could work from this baseline. The issue has been raised in other forums and confusion arose at times. All local property tax proceeds are funding local authorities. I am quite categorical in that regard.

Brian Stanley (Laois-Offaly, Sinn Fein)
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What was collected in 2014?

Alan Kelly (Tipperary North, Labour)
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I read it out a moment ago. It was €491 million in 2014 and is to be €440 million in 2015.

Brian Stanley (Laois-Offaly, Sinn Fein)
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The difference is €51 million. If €440 million went to the local government fund, where did the €51 million go?

Michael McCarthy (Cork South West, Labour)
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No, the yield in 2014 was €491 million and it is to be €440 million for 2015.

Brian Stanley (Laois-Offaly, Sinn Fein)
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It is smaller this year.

Alan Kelly (Tipperary North, Labour)
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We are putting in €458 million to the fund this year instead of €440 million, so we are putting in €18 million as a top-up of the €440 million. The difference is between €491 million in 2014 to €458 million this year. The Deputy asked about motor tax and funding arising from that. Motor tax has always been paid to the Central Fund. There have been questions about triple taxation and motor tax being used to fund 34 local authorities and their water services.

Brian Stanley (Laois-Offaly, Sinn Fein)
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We have had a democratic revolution since. That was then and this is now.

Michael McCarthy (Cork South West, Labour)
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We can finish this now and have the democratic revolution afterwards.

Alan Kelly (Tipperary North, Labour)
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The only swap is that instead of the funding going to 34 local authorities to provide water services, it is going to Irish Water. The Deputy subsequently referred to EUROSTAT and the water conservation grant. EUROSTAT has not delivered on this at all. If the Deputy has some commentary from EUROSTAT on this, I would like to see it. It is an independent body and it will give its deliberations in time. I am absolutely confident we will pass that test.

Brian Stanley (Laois-Offaly, Sinn Fein)
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I want to ask about the €552 million. There is a gap between what goes back from the LPT and what comes in. The figure for this year will be €458 million.

Alan Kelly (Tipperary North, Labour)
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The local property tax yield is €440 million. There are gross motor tax receipts of €1.167 billion, with a payment from the Exchequer of €233 million.

Brian Stanley (Laois-Offaly, Sinn Fein)
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What about the €1.307 billion figure?

Alan Kelly (Tipperary North, Labour)
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It is all laid out. There is the Irish Water subvention of €399 million, the local authority rates payment of €59 million, as we spoke of previously and other miscellaneous and various schemes of €75 million. I can provide a copy of the statement to the Deputy.

Brian Stanley (Laois-Offaly, Sinn Fein)
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I have it here.

Alan Kelly (Tipperary North, Labour)
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It is on page 16 of the briefing.

Brian Stanley (Laois-Offaly, Sinn Fein)
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That is all right. It is Irish Water that is getting it.

Alan Kelly (Tipperary North, Labour)
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Deputy Catherine Murphy also asked about the local property tax. Absolutely all of it is used in local authorities. It is used, from an equalisation perspective, to ensure nobody is worse off.

Catherine Murphy (Kildare North, Independent)
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I have been critical for donkey's years about a historical model being used to calculate these issues. For example, there were wide variations with regard to staffing ratios of local authorities, and that is factored into their baseline. A local authority in Meath has half the staff of Kerry but it has more people living in the county. Kerry is a net contributor, as it happens, so I am not being unfair to the authority. When do local authorities in growing areas ever play catch-up in an equalisation fund?

Alan Kelly (Tipperary North, Labour)
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I would say most of them saw increased funding. Any of them which are growing got more from the local property tax. It is a not a fund that we can fully control either. The idea is to ensure we have created a system with a floor based on fairness. That is what we did. It has been broadly accepted. The Deputy had a similar question to that of Deputy Stanley and we have outlined those issues. There will be a capital investment plan for water announced in the near future. Initial plans have been announced. I have forgotten the Deputy's specific question.

Michael McCarthy (Cork South West, Labour)
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It referred to the staffing of the ESB.

Alan Kelly (Tipperary North, Labour)
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We can come back on that. The ESB will not be given extra resources to administer the grant and it will have to absorb that cost in its allocation. The water conservation grant will be done through a regulation.

The Leader programme has been very successful and has made a great contribution throughout the country with regard to volume of schemes. Deputies opposite would agree with that comment. We can learn from the process and I have very specific ideas about it. I am working very closely with the Minister of State, Deputy Phelan, in this regard. The bottom-up approach, dictated through a process from Europe, is good and we will see the results of that in the near future as the process kicks off quite soon.

Catherine Murphy (Kildare North, Independent)
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There was a specific question about changing mid-stream. We got less but we had to contribute less. What is the approach in that regard?

Ann Phelan (Carlow-Kilkenny, Labour)
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The Leader programme from 2007 to 2014 received €235 million from the EU and €135 million from the Exchequer, totalling €370 million. There was a change because commitments were already made. The funding for the new programme is €250 million, with the rate of co-funding still to be finalised.

The rural development programme is still being signed off at European Union level. It is important to note that I will shortly be in a position to call for expressions of interest in the new programme. My priority is to ensure the €250 million available under the programme is allocated to facilitate new projects in the community.

On the Commission for the Economic Development of Rural Areas, CEDRA, the €1 million allocation was for projects specified in the commission's report, which makes 34 recommendations. The focus of the report is the co-ordination of existing funding for rural areas across various Departments. The CEDRA report does not identify a new budget but addresses ways of ensuring existing budgets are spent in rural areas.

Under the social inclusion and community activation programme, SICAP, which will be rolled out from 1 April 2015, €28 million will be allocated to communities. The tender process was won by 44 development companies. The major concern among the Leader companies was that the process would result in privatisation. This concern has not been realised.

The Minister addressed employment issues. Such matters, including legal issues, are for the Leader companies to address. The Minister also noted that community funding for women, Travellers and the islands has been ring-fenced. Additional funding has been provided for community development programmes in the inner cities. In addition, €400,000 was provided for an Cosán in Cherry Orchard and Changing Ireland and €9.5 million interim funding has been provided to the local and community development programme. We are managing the entire process. The tenders were announced yesterday and we understand most people are very content with the outcome.

Catherine Murphy (Kildare North, Independent)
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I asked about development contributions.

Alan Kelly (Tipperary North, Labour)
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I apologise for overlooking that issue. The funding correlates precisely to the previous formula. To give an example, if €10,000 was development levies and €2,000 was water, the same ratio in respect of contributions will be adopted in the new system.

Brian Stanley (Laois-Offaly, Sinn Fein)
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According to the Estimate, local government fund income will exceed expenditure by €77.3 million. What will happen to this money?

Alan Kelly (Tipperary North, Labour)
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The €77 million in current expenditure and €77 million in capital expenditure cancel each other out.

Michael McCarthy (Cork South West, Labour)
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That concludes the select sub-committee's consideration of the 2015 Revised Estimate. In accordance with Standing Order 87, the clerk to the committee will convey a message to this effect to the Clerk of the Dáil. Under Standing Order 86(2), the message is deemed to be the report of the committee. Is that agreed? Agreed. I thank members, the Minister, the Ministers of State and their officials for attending and assisting the select sub-committee in its consideration of the Revised Estimate.