Mr. Barry O'Leary:

We will go back to the beginning. First, the HFA proposal is just a suggestion which has not yet been approved by the Department of Finance.

We will lend to the local authorities if they have two things: a council resolution and sanction from the Department of the Environment, Community and Local Government or the Department of Housing, Planning and Local Government, as it now is. Once they have these two elements, they will receive funding from us within one week. No further due diligence is required on the assumption that the State is not going to let local authorities go bust. Local authorities have no arrears and have never had any in our 30-year existence; therefore, we do not waste time in engaging in due diligence. We give them the money and they pay us back. We are very keen to get the money back, as Deputy Fergus O'Dowd suggested, and that is how it works. We engage in due diligence with AHBs, 15 of which we have approved, which we listed in our submission.

On the lending rate to local authorities, our margin typically is of the order of 25 basis points, or 0.25%. The indicative rate in our proposal is 1.75%. If we can do it at a lower rate, we will do so, but we have picked 1.75% as the potential rate. We are not getting money from the EIB at the rate suggested by the Deputy. The State may get it at that rate, but we are getting it at a slightly more expensive rate. If we can get more money from the Council of Europe Development Bank and blend it in such a way that we will have no interest rate risk exposure, we will be delighted to lend it at a rate of less than 1.75%. We included 1.75% as a number with which to work.

I do not know if we have any particular comment to make on over-dependency on the private rental sector. On dealing with the local authorities, we could do more than a figure of 13,500, but that number ties in with the social housing strategy of the Department of Housing, Planning and Local Government. If it was decided that more needed to be done, it could be done. There would be no particular difficulty in doing so. AHBs certainly have a big part to play in the delivery of those 13,500 houses and the reality is they are providing general housing units also. Our suggestion is that local authorities need to contribute more and be asked to borrow to do so.

On money being available, a question which was raised by Deputy Fergus O'Dowd, it is certainly available. The EIB, in particular, has indicated to us that we could get more money from it at any point. The barrier to spending it is the financial constraints within the budgetary environment; therefore, the decision is in that domain rather than ours.