Oireachtas Joint and Select Committees
Wednesday, 18 September 2019
Joint Oireachtas Committee on Housing, Planning and Local Government
Update on Rebuilding Ireland - Action Plan for Housing and Homelessness: Discussion
At the request of the broadcasting and recording services, members and those in the Visitors Gallery are requested to ensure that for the duration of the meeting their mobile phones are turned off completely or switched to airplane, safe or flight mode, depending on the device used. It is not sufficient to leave one's phone in silent mode as it will maintain a level of interference with the broadcasting and recording systems.
We resume on item No. 5, an update on Rebuilding Ireland - Action Plan for Housing and Homelessness. I welcome the Minister for Housing, Planning and Local Government, Deputy Eoghan Murphy, and his departmental officials.
By virtue of section 17(2)(l) of the Defamation Act 2009, witnesses are protected by absolute privilege in respect of their evidence to the joint committee. However, if they are directed by it to cease giving evidence on a particular matter and continue to so do, they are entitled thereafter only to qualified privilege in respect of their evidence. They are directed that only evidence connected with the subject matter of these proceedings is to be given and asked to respect the parliamentary practice to the effect that, where possible, they should not criticise or make charges against any person or entity by name or in such a way as to make him, her or it identifiable.
Members are reminded of the long-standing parliamentary practice to the effect that they should not comment on, criticise or make charges against a person outside the Houses or an official, either by name or in such a way as to make him or her identifiable.
The committee has agreed to take the Minister's opening statement as read.
I thank the Chairman. I am joined by Mr. John McCarthy, Secretary General, and Ms Maria Graham, Ms Mary Hurley and Mr. Paul Lemass, assistant secretaries. Members have received a copy of my opening statement which, if it is acceptable to them, we will take as read. I congratulate the Chairman on his appointment and wish him the best of luck. He has big shoes to fill because Deputy Bailey was an excellent Chairman.
I welcome the Minister and his officials. On social housing delivery, I note from the statement provided by the Minister that more than 6,400 homes are on-site. All present are acutely aware of the need to expedite the delivery of social housing. Has the Minister written to local authorities about raising the discretionary cap to €6 million, a measure negotiated for inclusion in budget 2019? In my view and that of my party, that would assist local authorities to build developments of 40 to 50 houses without having to go through the five-stage process with the Department. It was agreed to before the budget. The last time I asked about it, I was told that it was being assessed by the Department of Public Expenditure and Reform. That did not form part of our discussions on the matter last year. Has the Minister issued a circular to local authorities to advise them that the discretionary cap has been raised to €6 million?
How much social housing does the Government expect to build this year? I discussed this matter with the Minister of State, Deputy English, and tried to tie down the number of homes we were building, rather than buying. We are still operating in a shrunken market. Last year 18,000 homes were built. The State bought approximately 2,760 of them, while the investor and cuckoo funds, to which I will return, bought slightly less than 3,000. Approximately 4,700 were one-off rural homes, most of which were not offered for sale. That left approximately 7,000 homes available for purchase on the market in 2018 before any consideration of affordability. The average house price in Dublin equates to approximately nine and a half times the average industrial wage, which is a big problem. Supply is a big issue. What is the Department's stance on purchasing homes through the Housing Agency or otherwise? I know of quite substantial developments which the Housing Agency is seeking to purchase. I am delighted that people are being housed, but we are in a shrunken market and competing against people who want to try to get their foot on the housing ladder.
Are there plans within the Department to arrest the march of cuckoo and investor funds in acquiring build-to-rent properties? A report in The Sunday Business Postlast Sunday examined planning permissions granted for some developments. In Walkinstown, Dublin 12, there were 757 new units, of which more than 500 were built-to-rent units. Some 1,258 units were approved in the greater Dublin area, 965 of which are build-to-rent properties. Of course, we need to increase the supply of rental properties, but investors are pouring into the market because of the high rents payable across the country and the tax-free treatment they receive, which is taking many prospective homes off the market. In the area I represent it has happened in Taylor Hill in Balbriggan and Semple Woods in Donabate where family-sized homes were sold directly to real estate investment trusts, REITs by some of the larger builders such as Glenveagh Properties. That is a big problem which needs to be tackled through planning and otherwise. There is a role for investors in the market, but that role should be appropriate and proportionate. They are taking over swathes of Dublin and the rest of the country, which is a serious concern.
The cost-effective analysis requirement which the Department has put in place for schemes worth more than €20 million was previously known as cost-benefit analysis. When local authorities submit schemes to the Department, they face the new hurdle of cost-effective analysis. Effectively, the Department has set down a criterion for schemes worth more than €20 million, whereby it asks the local authority whether the plan stacks up, which is understandable. However, my understanding from research we have carried out is that the development of almost 2,000 homes in the Dublin city local authority area alone is being held up by the cost-effective analysis hurdle.
From correspondence I have seen there is a frustration with some of the local authorities that no criteria has been set down or published as to how they would meet the requirements of this cost-effective analysis. One would think that at a time when we are trying to increase the supply of public and private housing - in this instance, it is public housing - we would actually make it easier for our local authorities to deliver and not make it more difficult. Why is this cost-effective analysis in place and why has the Minister not seen fit to move forward with raising the discretionary cap to €6 million?
I thank the Deputy for his questions, which covered a couple of different areas. I will start with the Deputy's first and last point around the cap and the move from €2 million to €6 million. To be able to raise that cap we would require a derogation from the public spending code from the Department of Public Expenditure and Reform. We would need to seek that derogation. I have looked at this in a lot of detail because we discussed it last year when we were talking about the budget for this year, and I believe the benefits of such a move are questionable. We have a 59-week process now within the Department where we are working with local authorities to get housing from local authorities approved so they can get on site to start building. Raising the threshold from €2 million to €6 million would perhaps save six to eight weeks. Six to eight weeks is not nothing but in return for that time saving we would lose oversight of some 44% of the capital spend on housing nationally. Obviously there are risks in that when we consider the loss of oversight and the uncertainty around value for money. There is also the more worrying problem that when the projects come to us for final approval, which they would have to, if they had made mistakes along the way, we would not have seen them. At that point we might have to refuse, which would mean projects would have to go right back to the start. Local authority projects have been brought forward previously where the individual home to be built might be at a cost of €750,000 based on how they inspect it. In that kind of a situation, if we had not been keeping an eye through each of the stages we would be telling them to go right back to the beginning. That would mean the shortened six to eight weeks timeline would need to go right back to the beginning again. We have examined this and it would require a derogation from the public spending code from the Department of Public Expenditure and Reform. Based on that kind of information, and I can give the Deputy further detail on it, I am not sure that either Department will be recommending going forward with that. The benefits versus the risks are questionable.
I will now turn to the build out this year, what we will build and will tear out lease and acquisition from that. The target is at least 6,200. I did a review with local authorities in the summer and have had a number of engagements on this. I will meet with the County and City Management Association, CCMA, again tomorrow. So far our targets are looking good with regard to the pure build number. The Deputy referred to the Housing Agency and acquisitions. The Housing Agency is leading on acquisitions from bank-led vacancies. These are homes that are vacant because the banks have them vacant.
The Housing Agency has a mandate to lead on bank-led vacancies and that is what it is doing. One of the things we have made clear to local authorities is not to compete with private buyers when it comes to new houses. That is separate from the issue of turn-key properties where the homes would not have been built at all were it not for the interest of the local authorities in spending the money.
We are in an expanding market for new houses being built. More than 2,000 homes start under construction on site every month. This is very welcome. The Deputy mentioned once-off homes. People are living in these so they are also meeting demand.
The Deputy spoke about the figure for the market last year but I would dispute that. On the recent mortgage numbers, I believe that 24,000 mortgage were approved. I saw something else recently talking about 50,000 transactions. The market is a lot bigger than 7,000 so I am not quite sure where Deputy O'Brien got that number from.
On institutional investors, the current data I have is that from the approximately 350,000 homes and apartments to rent, 10,000 are owned by institutional investors. This is a tiny portion. I am keeping this under review, as is the Department of Finance from a tax perspective, and I am in discussions with the Minister for Finance on this. It is important to say that institutional investors are increasing the supply and that build-to-rent is needed. These institutional investors are now captured by rent controls for the new stock they are bringing on line and if one is a tenant it does not matter if the landlord is a once-off investor or somebody who owns a number of properties. This is also important. We need to find the right balance in the sector so that we are not losing landlords from the market and so tenants are not exposed to the volatility we have had previously due to an over reliance on individual landlords. We also need to make sure that this type of finance is not crowding out the kind of finance that builds homes for people to buy for themselves. This is why we are keeping an eye on things, to make sure we do not tilt in a negative way.
The cost-effectiveness analysis is for projects estimated to cost over €20 million. I understand the Department of Public Expenditure and Reform is currently reviewing this. We have 22,000 homes in the pipeline with the Department, with more than 6,000 homes currently under construction on sites up and down the country. There are no unnecessary delays with regard to what is happening in the Department. We constantly look to streamline things. Provided today are the new specifications for internal guidelines for layouts of social housing homes schemes and for the type of fit out. The purpose of finalising and providing those is that local authorities can take standard layouts and designs off the shelf. These are not done for the exterior layouts and designs because the exterior design needs to be sympathetic to the receiving area and we do not want social housing to look the same throughout the country. If we can provide 25 to 30 different types of design and specifications for internal layouts, it will be good and will help to cut timelines. There is also a proposal from the CCMA on restructuring the housing delivery office, on which I will hear more tomorrow. These are further reforms that will improve timelines for delivering social housing. There are big numbers this year: 10,000 in the stock for social housing, the majority of which will be built.
I have one final point. The Housing Agency is buying whole estates and large parts of estates. It is not buying estates that would not have been built were it not for the agency. It is doing that, and the Minister knows this is happening.
My question is across the pillars. It relates to the #sexisnotrent question raised in the Dáil earlier today by Deputy Coppinger. Deputy Coppinger and I met with the woman in question, and I will talk about this in a moment. First I will ask the Minister four questions. Does the Minister accept the housing crisis seriously increases the vulnerability of women in such situations? What steps does the Minister propose to take to ensure that people in such a situation are safe to speak out without fear of eviction? What steps does the Minister propose to take to gauge the prevalence of this problem in society in this State? I am getting messages as I speak to indicate that our office and Deputy Coppinger's office have been contacted by many people in the last two hours who are housing assistance payment, HAP, tenants. We are now contacting these people to get exact details, but it seems that some landlords who interview people for HAP tenancies are raising the idea of sexual favours if the person gets the nod for the tenancy. Perhaps the Minister will comment on this, and if it is the case, what action might be taken. I met recently with the woman concerned in this case, with Deputy Coppinger-----
I have the correspondence here. It is clear who the correspondence is from, but I will not name any names at the committee today. I recently met the woman, along with Deputy Coppinger. She is a young woman who is working. The idea of having a place on her own was a real difficulty because of the high cost of rent. She had been sharing accommodation with a friend. There is a direct connection between the housing crisis being experienced by this country under the Government.
The friend decided to leave the accommodation for her own reasons as she was moving on with her life, and so the woman in question was facing the threat of homelessness. Once again, the housing crisis we are experiencing under this Minister and Government was a factor here. The landlord then found himself in a position of power over this young woman and some of the texts containing these suggestions were sent only a matter of days before she had to leave the premises. Three offers were made to this woman by the landlord, who she estimates to be in his mid-60s. One offer was to solve her problem by going to live with him. Another option was to go for dinner with him, see what happens and continue to pay rent at the same rate, which would be half the rent on the property. He also suggested that if things went the right way, the rent could be free. It is estimated that there are 250,000 cases of this type in Britain and I think there must be many cases in this country too. This could be a #MeToo moment for the housing crisis and while I have asked questions of the Minister on this, I also appeal to people generally and encourage them to speak out about this issue. I would be stunned if this was the only case. I know it is not the only case. Now is the time for people who have had this horrible experience to speak out in order that we can lift the lid on one of the uglier and murkier aspects of the housing crisis under this Government. I would appreciate it if the Minister could answer those questions.
I addressed this issue in the Dáil earlier today. If what the Deputy is alleging happened, it is illegal and a matter for the Garda. I have already attempted to make contact with Deputy Coppinger to get information about the case. My office is also contacting the Department of Justice and Equality to see how we might compile statistics or evidence in this area. As with any other issue, it is important to get the best information possible in order to know what policy responses might be needed. Such responses would not relate only to housing and would not fall to just this part of the Government because this is a wider criminal issue. A number of people are vulnerable because of the housing crisis. There is a housing shortage, which we are trying to address. People find themselves in incredibly difficult circumstances because of that. The case the Deputy has outlined is one example but there are also issues around families having to go into emergency accommodation or people being housed in substandard and dangerous accommodation. That is why we have brought forward rent reforms and are building tens of thousands more homes than we were previously. It is also why we have put better emergency supports in place for people who find themselves vulnerable at this time of crisis.
I would caution the Deputy on linking this allegation to something specific like the housing assistance payment, HAP, just because he received a few phone calls on the issue. HAP is working successfully for tens of thousands of people and if the payment were not in place, those people would be even more vulnerable because of the housing shortage. Comments from colleagues in the Deputy's party have served to undermine that support. HAP helps people so let us be very careful about the comments we make around this sensitive issue. Let us also ensure the help we are trying to give everyone suffering as a result of the housing crisis is directed in the best way possible to actually help them.
I welcome the Minister, the Secretary General and their team, and thank them for appearing before the committee. I place on record my appreciation and thanks to the Minister's team in the Custom House. I have found them to be exceptionally helpful and supportive whenever I have requested information on Rebuilding Ireland. Much of our work can be done in that way, which works well for me. I just want to acknowledge that.
I congratulate Deputy Rock on his appointment as Chairman and wish him well. I also extend my best wishes to Deputy Bailey who served this committee with distinction. The Chairman has big shoes to fill, as the Minister said, and I want to wish Deputy Bailey well. She contributed greatly to this work and that is important. I have no doubt she will have a continuing role in relation to housing.
I have had a look at the Rebuilding Ireland programme. As I indicated to the Minister's predecessor, the Tánaiste and Minister for Foreign Affairs and Trade, Deputy Coveney, it contains 168 key actions in five pillars. It was a brave and courageous move for a Minister and Government to set down all those tasks because once one starts setting down tasks in a format like this, one always has to deliver them and account for them. I do not think the Minister or his team has any difficulty with that, and much has been achieved. When we look back at this original document, we have to acknowledge where we have come from and where we are now. Much of the work involved putting down strong foundations and getting things done but there is much more to be done.
I have about 12 questions and I intend being simple and to the point. I will tee off the reference points for these questions in the Rebuilding Ireland status report. Actions 1.3, 1.4, 1.5, 1.7, 1.8 and 1.9 all relate to Tusla. I have serious concerns about the safety protocols there. We all need to feel safe wherever we live and we also need to feel safe and secure, particularly in emergency accommodation. Without commenting on a particular case currently before the courts, there was a description in the papers yesterday of emergency accommodation that was "chaotic", "unsuitable" and "unsafe". That is the allegation, which must be a worry for anyone involved in housing. People are vulnerable, as the Minister said. People feel isolated and vulnerable when they are homeless and they need our help. We all accept that but it is important to state it.
I will make a few requests of the Minister. We should review and examine the protocols in relation to Stay Safe and child protection. Every local authority should be reissued guidelines on what to look out for and what the statutory obligations on child protection are. This is really important. I ask the Minister to request a review and that a protocol and circular be issued to all housing authorities and people dealing with housing in relation to this matter.
It is time that we look again at action 1.7, which refers to a renewed focus on people living in institutional and State care. They are particularly vulnerable and we know from our research and work on the ground that many of them end up homeless after leaving care. We need to look at this objective again.
The HAP place finder services are working exceptionally well and we need more of them. I would like to look again at providing additional people and resources for local authorities and HAP. I know one or two local authorities said they did not want those resources but we need to look at the ones that do because it is a good system.
Action 1.35 deals with non-Irish nationals without residency entitlements, which is a particular area of vulnerability for people who need safe housing like anybody else. I ask that we look at that again to ensure we are picking up on all the issues and fulfilling our commitments on it. This is a group of people that needs to be supported and cared for as much as anybody else would be in this country. I ask the Minister to look into that.
Could the Chairman flag my time?
I note that the Minister says he is currently gathering up the social outputs for local authorities for quarter 2, and that they are on their way. I would like to hear about that at some point.
The report states that of €2.4 billion available for 2019, €1.224 billion had been spent by the time of publication. That is a considerable amount of money but we are now into the ninth month of the year. I ask the Minister to address that matter.
I thank the Senator for his questions. I refer to the points he raised about Tusla. When the Ombudsman for Children released his report, perhaps three months ago, I met him and we talked through the different recommendations in the report. We discussed the need to ensure all necessary care and supports are being put in place, including by agencies that do not report directly to me, of which Tusla is one. We needed to make sure there is a line of sight between the people providing the care and the parent Departments in order that the right procedures and protocols were being followed.
We had a conversation around that. One of the important outcomes of the work we have been doing with the NGOs is the quality standards framework. We had it as a pilot project but it has now been rolled out nationally, which is important.
Regarding private operators, a number of whom I have visited in the last couple of months because I wanted to look into it in more detail, everybody working in the these facilities are Garda vetted and trained in child protection and there is other mandatory training to take place also. We are in continued engagement with the ombudsperosn on things we want to do around standards, inspection, care and safety for people in emergency accommodation.
On institutional care, the Senator is correct. One of the things I remember addressing initially when I came into the Department was where people leave hospital or prison, for example, and do not have a home or accommodation sorted, ensuring arrangements in place. It has been happening between some NGOs and hospitals, for example, on an ad hocbasis, but through the interagency group I established in September of 2017, we are trying to put in place more formal engagements in that regard. Some things are moving well on the health side, for example. There will be some new facilities coming on board and the health side has made a commitment to support these facilities if we support the capital contribution to get them open. Where people might be in long-term institutional care, we must ensure it is the right kind of care and they are not just seen as being in emergency accommodation. They will not be able to maintain an independent tenancy on their own and will need these long-term supports and we must ensure these are in place for them.
On the Place Finders service, it is proving successful. They were new when I came into office. We have offered Place Finders to every local authority. Most importantly in the Dublin area, we recruited 15 new staff members to the Place Finders service who will be starting work in the coming weeks. I spoke to Dublin City Council about that earlier in the week and I am sure they will do much the good work there.
On the question of non-nationals and those who do not have rights, it is important for the public to understand that where outreach teams go out at night to people sleeping rough, they do not ask any questions about people's rights. Their immediate concern is to get them into safe care. I saw that happen quite dramatically at the time of Storm Emma, where many people who were squatting or otherwise were brought into the system. It is then a question of trying to get them through the system in the most effective way possible for them. We had a protocol agreed with the Department of Justice and Equality. That was one of the outcomes of the interagency group, that is, to have a person in the Dublin Region Homeless Executive, DRHE, to help with these types of issues. There is a protocol now in place for the sharing of information, which is important.
It is also is important to ensure emergency accommodation is emergency accommodation and not a substitute for direct provision or other care and supports needed by people who do not have rights, or are in the process of establishing their rights, or who are fleeing persecution or seeking asylum. It is about getting the right kind of care and support. To be honest, people in the Dublin Region Homeless Executive and other local authorities are not trained in those types of supports. It is important we keep those two things separate, notwithstanding the fact that, immediately, whenever we come across an individual who needs help, he or she gets that help, regardless of his or her status and rights. The most important thing is to treat people with compassion and care.
On social house building and the numbers for the first and second quarters, 2,537 was the increase in the stock of social housing in the first half of this year. Like in other years, the programme ramps up in the third and fourth quarters. That speaks to the question the Senator asked about the financial drawdown so far from the Department in that we always see it, and, from memory, we have never underspent on our capital side. We always get there or thereabouts towards the end of the year. In fact, I had to seek additional funding towards the end of last year because we were doing better than expected in the supports we provided in the course of last year. That is not an option open to me given the financial considerations that we are all aware of and that are on the way because we are planning for no-deal Brexit. We will be spending our budget in full this year and will be delivering the supports that we said we would.
I thank the Chairman. I have three questions in this round and will come back to the other pillars in the second round.
I want to pick up on the Minister's exchange with Deputy Darragh O'Brien on the speeding up of social housing delivery and this issue of whether the Government was going to raise the threshold for local authorities to use the one track or one stage planning process. Deputy Micheál Martin, in his contribution on the budget last October, made it very clear that an agreement had been reached with Fine Gael that the one stage process threshold would be increased to €6 million. He stated:
We secured agreement to reduce the four stages of planning applications from local authorities to the Department to one stage, we also removed the ceiling of €2 million that requires Authorities to apply for even very small developments. The ceiling is now increased three-fold to €6 million.
Members will remember there was a very heated exchange at the last committee meeting where Deputy O'Brien claimed that was agreed and the Minister, Deputy Murphy, took a different view to say it was agreed to examine it, but that was subjected to a consultation with the Department of Public Expenditure and Reform. If I am not mistaken, this is the first time the Minister has publicly stated, or certainly to this committee, that on foot of that advice from the Department of Public Expenditure and Reform, he does not believe it is appropriate to raise the threshold from €2 million to €6 million. Can the Minister just confirm that is correct and that it is not the Government's intention, irrespective of other parties may claim was agreed in last year's budget negotiations, and that the threshold is not going to be increased? Therefore, local authorities, like those in Dublin, for example, which do not do social building projects for €2 million, will not be able to avail of the fast-track one-stage process.
My next question is on homelessness. The latest homeless figures were produced, as the Minister is aware, a couple of weeks ago. In the last 12 months, adult homelessness is up as is child homelessness. The percentage of individuals and families in emergency accommodation and the length of time they are spending in emergency accommodation have increased. Crucially, we are spending more on private emergency accommodation than ever before. We have more individuals, families and children in private emergency accommodation, and it is costing the State, the taxpayer, about €2 million a week for hotels, bed and breakfasts, etc. In Dublin, it is about €1.5 million a week and outside of Dublin, it is €0.5 million. Does the Minister not accept at this stage, given all those facts, and notwithstanding the fact there have been some positive outcomes on prevention, that what he is doing simply is not working and the problem is getting worse? What is he going to do in the coming months that is different and that we do not end up having the same conversation that we have every quarter, when the numbers are going in the wrong direction? I am not arguing that he should not be spending on emergency accommodation but it is about the relentless rise in homelessness.
On affordability, in our first of these meetings at the start of this year, I asked if the Minister would confirm that no affordable homes to rent or buy would be delivered in 2019 under any Department of Housing, Planning and Local Government funded scheme, be it costs-rental or affordable purchase? At that stage, the Minister declined to answer and said he would answer it later on in the year. Given that none has been delivered, will the Minister confirm none will be delivered for the remainder of this year?
The Minister said something interesting during Oral Questions in the Dáil earlier today. He said the delivery date, in terms of when tenants were likely to move into the affordable cost-rental properties in Enniskerry Road in Dún Laoghaire-Rathdown, is 2021. Given that these are the first of the affordable housing projects to be funded by his Department, can he confirm that no affordable properties to rent or to buy under schemes funded by his Department will be delivered at next year?
Related to that, many of us have huge concerns about what the Minister considers to be affordability. Enniskerry Road, as we know, is about €1,200 rent a month. That is not affordable for the vast majority of households that need it. We now have three sets of figures from Dublin City Council on the potential purchase price of the so-called affordable homes in O'Devaney Gardens. There was a report by the manager early last week and additional information was given by the manager to elected members this week and the Minister made comments today. The figures range from the high end of €420,000 for an affordable home to €399,000 for an affordable home. During Oral Questions in the Dáil today, the Minister said most would be delivered below €310,000. Even €310,000, of course, is not affordable because the average loan offered by Dublin City Council in the Rebuilding Ireland home loan is less than €200,000.
My concern is that we are not getting delivery of units and even the units that the Minister is promising us are not going to be affordable. What are the Minister's thoughts on all that? Crucially, given that the affordable housing to rent or buy is for those households above the social housing eligibility threshold, which is €38,000 for a family with several children in Dublin, and up to €75,000, the only way we can meet their needs to rent or buy is if we have rents at €700 to €900, and houses to purchase at less than €250,000. Does the Minister accept those points? Will he respond to what Mr. Brendan Kenny said when he was here the last time? He said that to deliver homes at those prices, he needs an additional intervention from Government, either longer maturities on the loans funding, for example, St. Michael's estate or greater capital investment at the start. How are we going to deliver genuinely affordable rental and purchase homes, not homes at €1,200 or €310,000 up to nearly €500,000, which is currently the case.
To respond to the question on the potential increase of between €2 million and €6 million on the one-stage and the four-stage in the social housing approval process, I cannot confirm anything because I have not had an opportunity to consult the Department of Finance on the need for a derogation and whether such a derogation would be forthcoming. As we made clear as a Government at the time, most projects coming before the Department could come in under the one-stage approval process and did not need to go through the four stages. There was a question as to how necessary a derogation was but we agreed to review and change the threshold if it was seen to be justified. On foot of the review and taking a look at the projects coming through, the speed at which they are being completed, new innovations we are bringing forward to cut the timelines, some of the projects that have come to us from local authorities, which are not proper projects and have to be set back, losing time, and the risk is that might increase, my fear is that it would be reckless to change the threshold, although I have not had a chance to discuss the matter in detail with the Department of Finance because other conversations are ongoing given the time of year. I want to have that conversation with the Department before we come to a conclusion but I was clear with Deputy O'Brien in our previous engagement at the committee as to what my understanding was from those engagements around this time last year.
On the question about homelessness, the Deputy outlined a number of facts about what is happening with the homelessness issue. We cannot and should not pretend we do not have a massive challenge and that it will continue to be a challenge in the future. From the experts in the local authorities, on the front line and in some of the leading non-governmental organisations, we have learned that the problem has stabilised. We continue to have a serious challenge because it is still true there is net immigration and not enough homes are being built. We will continue to have to deal with the challenge but part of the reason I am trying to improve the details and data we have is to enable a national understanding of what is happening. Some 1,400 people exited homelessness in the second quarter of this year, which was a 21% increase on the previous year, while some 2,800 exited in the first half of the year, an increase of more than 20% on the same period last year. Some 532 of the exits into social housing equated to a 52% increase, meaning that more people are entering social housing than are entering the private rented sector from emergency accommodation or homelessness, which shows that new homes we are producing and providing for social housing are helping people who are experience housing insecurity.
Presentations in Dublin have fallen, as has the number of people entering emergency accommodation in Dublin. In the first half of this year, for every two families who presented we found a home for one immediately. Even though there have been continuing presentations of families and individuals in their thousands over the course of the past year, fewer families and children are in emergency accommodation than there were a year ago, which speaks to the considerable work being done by everyone working on the front line with us. It continues to be a significant challenge, however, and we will continue to have to allocate resources to it. Given that more than 2,000 homes begin construction on site every month, as is happening, and given there is a commitment and money to deliver approximately 10,000 new homes to the stock of social housing this year, we will make serious in-roads and continue to help thousands of people either exit emergency accommodation or escape the housing insecurity that has made them present as homeless in the first place.
On affordability, prices have fallen for a while. There was double-digit growth throughout 2018, but that has fallen to low single-digit growth nationally while in areas of Dublin it is falling. To put that in perspective, a total of 88% of first-time buyers buy their home for less than €250,000 outside the greater Dublin area, Cork and Galway. For first-time buyers in those areas, one in two buys a home for less than €320,000. Two people earning the average industrial wage can afford to buy a house and secure a mortgage from a bank, not from a local authority, and buy a home at that price point. In Dublin, a total of 40% buy their home for €320,000 or less, which tells the story of the affordability challenge we face. It is not nationwide but it is quite acute in certain areas. That prices are falling in parts of Dublin is welcome but it is not true to say we have not delivered any affordable homes under affordability schemes.
Measures such as the Ó Cualann model are possible only because they have been taken by Dublin City Council and the other local authorities. Homes with the LIHAF cost reduction are already on sale. In 2020, affordable homes will be completed as per the timelines presented to me by the various stakeholders bringing the projects forward. I believe that the site under construction in Enniskerry Road, a two-bedroom apartment at €1,200, will be affordable, at €600 for each person paying the rent. It was not easy to get there, however. The Housing Agency, the National Development Finance Agency, Tuath Housing, Respond, my Department, the European Investment Bank, and the Housing Finance Agency - a number of actors - were involved to try to get us to a place where we could provide those types of affordable rents. Let us not forget what we are doing in respect of the Rebuilding Ireland home loan, which received a significant increase in funding following the engagements I had with the Minister for Finance, and the help-to-buy scheme, which has helped more than 12,000 people to get a home.
On the report on O'Devaney Gardens, I spoke to Dublin City Council about the matter. Four homes will cost €420,000 but Dublin City Council informed me that it will re-examine the matter and that no homes will cost more than €400,000. Notwithstanding that, the majority of the homes will cost less than €310,000, which, as I noted, is affordable for people earning the average industrial wage. In the case of other Dublin sites, such as in Ballyfermot and Ballymun, using the serviced sites fund there will be homes for less than €200,000. We will use land to continue to increase affordability and bring forward such schemes. The purpose of the Land Development Agency is to bring forward affordable housing but that is not just the mandate of the agency but rather of the whole Government. In any Department or State agency where development is under way for housing, 30% must be secured for affordable housing, which has a deflationary impact on land prices more generally and will help push down prices.
I continue to keep issues under review in respect of affordable building and delivery. We continue to consult people working in the sector and hear their proposals to lock more affordability into what is happening in the housing sector. As I have always stated clearly, the old ways of thinking, namely, that if we build enough social housing homes, it will bring about affordable housing, has not worked in other cities. The Government has to step in to bridge the affordability gap, which is precisely what we are doing with our various initiatives.
On the homelessness figures, I appreciate the level of work being done to reduce the level of homelessness but, regrettably, the numbers continue to increase. While we all accept that 2,825 people either have been prevented from entering homelessness or have exited homelessness, in the past six months some 129 people per week have presented as homeless, or 18 people per day. The figures are still increasing, therefore, and we have not got on top of the matter. The Minister stated 2,825 is a 21% increase. Where do we need to reach for the figures to decrease realistically? There has been a decrease for two months but this month there has again been a further increase. The Minister stated previously, including well over a year ago, that we need to collect better data but when do we stop collecting data and make decisions? What better data do we need to make decisions?
The Minister also mentioned the monthly reporting of homelessness. He suggested there is a better format and that he would prefer the figures to be reported every three months. Nothing is stopping him from publishing a quarterly homelessness report if he can gather additional data. What information will be gathered for a three-month homelessness report as opposed to that gathered for the monthly homelessness report which is currently presented? If it can be done, why is the Minister not doing it? He does not need the approval of the committee to publish a quarterly report.
On rapid building, we all know that "rapid" was probably the wrong word to use. When the scheme was announced, there was a perception the homes might be poor quality, although I believe we have now dismissed that and people accept that rapid-build houses are well-built houses.
We are so far off target on this, however, that it is frightening. Perhaps the Minister can give us an update on the rapid-build programme. Moving through the rapid-build programme, I will move to the delivery of the volumetric rapid-build delivery. Perhaps the Minister can give an update on exactly where that design process is, as it was meant to be here in quarter one but it is not here in quarter two.
One other item that has not been addressed yet is the Home Building Finance Ireland fund of €750 million. This is of interest to me because I have spoken to a lot of smaller developers from outside of Dublin who have found it exceptionally hard to access funding. I see there has been some success in this regard and while I know it is early in the play, can the Minister get us some detailed reports on the type of applications that are being presented, where they are from, why some are getting approved and others are not? That would give us a better understanding of how that scheme is working because it could be positive.
We all share the frustration regarding vacant properties. We have not delivered on the potential of what vacant properties could have done in solving our housing crisis. We asked each local authority to set up a vacant property office. Is it delivering or what else can be done to try to get all these vacant properties back into use? They are visible to all of us but we have failed to get them back into use and it is part of the solution.
I thank the Deputy for those questions. On homelessness, a lot of the inquiries we are seeing are being driven by individuals and the complexities we have there. We are moving to increase the number of additional emergency accommodation places we have for individuals because it is important to do that. What we saw for two months in a row was a decrease in the overall numbers but for three months before that we were seeing the numbers of families and children in homelessness falling. It could be the case that the numbers for August might be up again. Looking back - and I have looked back over previous years - we have traditionally seen high numbers for homelessness in June, July and August. We did not see them in June this year but we saw them in July and it might have carried through into August. I am engaging with the local authorities to get a better understanding of what has happened over the course of August. The increases we are seeing have been met by increases in exits and in preventions, and that is the important thing. We are doing a huge amount of work and if that work was not being done, a lot more people would find themselves in crisis. For example, if we were not using types of supports such as the housing assistance payment, the homeless housing assistance payment, the place finder programme, paying the deposit and the first month's rent, things would be a lot worse. The same goes for the increase in the social housing stock and that is why it is so important that we are doing that.
I have produced the first quarterly report. What I said previously was that we would continue to publish monthly and we would start reporting quarterly to give that greater level of detail in order that we could understand what was happening with presentations, preventions, exits, length of time in emergency accommodation and to where people are exiting. That is why we know there has been a more than 50% increase in the number of exits into social housing homes rather than into the private sector. That is why we know the majority of people currently in emergency accommodation in Dublin are spending less than 12 months in emergency accommodation.
I have been doing a bit of reading and research into efforts to tackle homelessness in other parts of the world and one of the first things any expert will say is that without good data, it will not be possible to get on top of the underlying causes and then bring about the necessary policy responses. That is why we are continuing to build up our data. We have a separate independent research project under way that is tracking a piece of work on families in emergency accommodation that I hope will help better inform our data and the work we are trying to do. The monthly numbers are important but I have always said we need to get behind the numbers to the people and to the problems and that is how we figure out and tailor better solutions. It is also how we can make sure we get to a point where we believe we have stabilised what is happening in homelessness and to get people out of long-term emergency accommodation. We must make sure that as we build social housing homes, as we increase housing more generally and as we see more landlords returning to the rental sector, it results in a continuing decrease in the numbers of people in emergency accommodation. However, we continue to see people presenting, individual adults in particular. That is a cause of concern but we continue to increase the number of preventions and exits, which is also important.
On rapid-build, "rapid" is an unfortunate word to use The fact of the matter is that it is quick, once planning and procurement have been gone through. We try to shortcut those other processes as much as we can. The fast-track planning process has been done in my Department. There are perceptions around quality, which are unfortunate, but they have largely been dealt with. We have a new framework. Some 150 homes are coming off the new framework on two sites in the next couple of weeks and that provides for 1,200 more homes. What we are seeing with local authorities - and it is part of the engagement I have with the CCMA tomorrow - is that where there are parts of the local authority sector with better expertise on rapid, modular, off-site or prefabricated builds, they are coming to the fore and helping other local authorities that do not have that. It is part of the shared services model we have been building more generally in the housing sector as we upskill the local authorities to build more homes.
On Home Building Finance Ireland, while that is not directly under my Department, the note I have here says there have been 30 applications to date with €41 million of funding approved for 228 homes on seven sites. Some 92% of those are outside of Dublin. The Department of Finance will report on what it is doing at regular intervals but I know from my direct engagements with HBFI what it has been able to do in a number of instances. Having been approached, HBFI, by working on the borrower's application, is enabling that person to then go to the existing banks and get finance that way. That was a point that came up in a recent engagement I had with the Irish Home Builders Association. That was probably about six weeks ago. We had HBFI in the room, as well as Irish Water and others, to go through different challenges the sector was experiencing and we got a good update from the representative from HBFI. A report should be published soon on what it has done to date but those are some of the top-line figures from the Department.
On vacant officer teams, from memory, since Rebuilding Ireland commenced, somewhere in the region of 7,000 to 9,000 homes have come out of long-term vacancy and back into the stock of housing. We have vacant home plans for every local authority and I approved funding for vacancy officers for every local authority. Through that work, I have an individual breakdown of what is happening in each local authority area. What I have been saying to colleagues, to Deputies and to Senators - and I have spoken on this a number of times in the Seanad - is that I have spoken on particular local authorities and given that drill-down of information. I have pointed out what the Central Statistics Office, CSO, said, I have pointed out what the geodata said, I have pointed out what our own surveys said, I have listed the inspections that have happened, I have given the up-to-date numbers and I have detailed the compulsory purchase orders, CPOs, that are in train. That is the level of detail I have given and I can provide that to members on request if they want to do it by way of a parliamentary question, in a Topical Issue matter or in a Commencement matter because it is a good way of getting the information out. There has been a revamp to the website. That will be launched tomorrow by the Minister of State, Deputy English. We have had thousands of people provide information on vacancy in their areas. That goes through Mayo County Council as the lead local authority and then goes through the separate local authority areas from there. It will be announcing some interesting numbers on that tomorrow.
I welcome the Minister. I have a few general questions, as well as more specific questions, mostly on pillar 1 but some questions on other pillars as well. I want to confirm some of the numbers because I am new to the committee. From the most recent figures, 10,000 people are homeless and 4,000 of those are children, with roughly 1,000 single-parent families. Are those figures approximately correct?
The Minister was talking about the importance of data, so of the single-parent families, does he know how many are in emergency accommodation because of domestic violence?
How many are there because of eviction from the private rented sector? How many in direct provision centres, including children, have residency status but are unable to leave because of the housing shortage?
The report, No Place like Home, by the Ombudsman for Children and the report of the Children's Rights Alliance, Home Works, highlight the negative impact of living in emergency accommodation on children, not just for the present but for their futures too. A ten year old girl compared the family hub accommodation in she was living to a prison because that had been her experience. It leaves children at risk of developing adverse childhood experiences, something that has been well documented as a phenomenon. The research shows the long-term impact of homelessness on children's health and well-being, including an increased likelihood of homelessness in later life. Is the Department, or any other, carrying out any assessment of the long-term impact on children of living in emergency accommodation? Would the Minister consider placing a time limit on how long a child can spend in emergency accommodation?
The first key action in pillar 1 of Rebuilding Ireland was to ensure that by mid-2017, that is, two years ago, commercial hotels and bed and breakfast accommodation would only be used in limited circumstances to provide emergency accommodation, in recognition of the fact that staying in such accommodation was inappropriate and unsustainable over a long period and particularly detrimental to children. As of 1 June 2019, 80 homeless families were in one-night-only emergency accommodation. Why has the commitment to cease the reliance on commercial hotels and bed and breakfast accommodation not been delivered on? What steps are being taken to ensure no families will be subject to what is a chronically unstable and inappropriate provision? Will the Minister consider a change in the law in order that decision makers will have to consider what is the best for each child and ensure his or her needs are met when deciding where to accommodate families?
Serious concerns were expressed about housing in the budget submission of Cork Chamber of Commerce, which represents 1,200 businesses. The chamber's latest survey of its members reveals issues related to the availability of rental accommodation as being the top threat to growth, second only to Brexit. The report states that while housing provision is a social issue, insufficient housing stock, particularly rental accommodation, remains a primary concern that has a negative impact on the ability of businesses to grow and hire and retain talent. It also contributes to wage inflation, thus impacting on competitiveness. I ask the Minister for his comments on the short, medium-and long-term impact on children of living in emergency accommodation. They number almost 4,000 according to his own figures. I also ask him to comment on the lack of a good rental sector in the context of our future prosperity, as Cork Chamber of Commerce has flagged in successive budget submissions.
There are 1,005 families headed by a single parent in emergency accommodation. We tried to do a piece of research into the reasons people were presenting as homeless and at emergency accommodation centres, but 40% of respondents did not give a reason. We tried to get a proper understanding of what was going on from the answers of the other 60%. Family breakdown accounted for one in three cases, although we did not have a further breakdown of what family breakdown meant, or know how many cases involved domestic violence. One in three came from the private rental sector, although not necessarily following an eviction. In fact, we did not know what the reasons were. This shows the lack of detail included in the data. We have commissioned a more detailed survey which is under way. I hope, we will get a much better understanding from it of the reasons people present as homeless.
I am not responsible for the direct provision system. Different supports are in place for peope coming into the country and seeking asylum. It is not done by local authorities but is led by the Department of Justice and Equality.
I am very well aware of the negative impact on children. One of the first things brought to my attention was the presentation of children suffering from motor skill development issues because of the cramped places in which they were being brought up. I have spoken to people who work in the hubs and have dealt with the issue of homelessness for far longer than I have. I have heard about their fear of intergenerational homelessness and situations where a child is more at risk of becoming homeless than adults. I have also spoken to teachers about the impact of homelessness and living on emergency accommodation on children. The hub programme is in response to the fact that we believe hotels and bed and breakfast accommodation are not an appropriate first response for families. There are 650 families in family hubs where they receive all the care and support they need. Families in hubs spend much less time in emergency accommodation than families in hotels. In Dublin the majority of families spend less than 12 months in emergency accommodation before they are given a home. That is still too long, but the stay is much longer for families in hotels.
They are not homes but a first response. In the first half of this year 467 families left emergency accommodation and moved into homes, an increase of 45% on the number in 2018. While things are very bad and we face a huge challenge, we are increasing the supports and getting more families and children out of emergency accommodation.
On the question about the position in Cork, we need more rental properties in this country. I am awaiting the latest rental sector data for the second quarter from the RTB's rent index. They will be available in the next couple of weeks, but the data for quarter 1 show that there increases in the numbers of landlords and tenancies. That is good because, for a long time, they were decreasing, putting greater pressure on emergency accommodation. With fewer landlords and fewer places to rent, there is greater housing insecurity. Perhaps it is turning back in the other direction and the quarter 2 data will give us more information in that regard. There is a need for more rental properties in Cork, but they will not come from individual landlords in bringing one or two to the market. They will only come in building more apartments. That requires build-to-rent apartments and institutional investment. As I discussed with Deputy Darragh O'Brien, we need to ensure this will continue to happen but not in a way that will unbalance the market. As of now, 10,000 of 350,000 rental properties are with institutional investors. The number is increasing and we are keeping the position under review. I have met representatives from Cork to discuss the challenges in building apartments that people can afford to buy or rent. Based on suggestions they made to me, the Minister for Finance and the Tánaiste who is a representative for Cork, we are reviewing some of the proposals to see if we can help expedite the delivery of apartments. In the latest report we have seen an increase of 150% in the number of planning permissions. The number of planning permissions for apartments now exceeds that for homes by a ratio of 5:1. If this follows through to commencements and completions, it will do a lot of the heavy lifting to help those in the rental sector and those looking to buy their own home.
I congratulate the Chairman on his appointment. He has significant knowledge of the challenges in the housing sector, particularly in the provision of rental accommodation, living as he does in an urban area close to a university and other third level institutions. His experience will be very useful in helping the committee to chart where it wants to go in what remains of the term of this Oireachtas. I also join colleagues in commending his predecessor, Deputy Bailey, on the work she did.
As an aside, I welcome Senator Kelleher to the committee, as I know her commitment to this particular area, equality of access to housing for all, irrespective of their communities and whether people are in a minority. She will play a significant role in the work of this committee.
I welcome the Minister. We have had engagements over a period about how some local authorities have been more compliant with national policy than others. I know that to try to focus minds, a twice-yearly conference has been organised to bring those authorities together and to challenge them to meet their targets and so on. What is the Minister's view on their targets? Are the departmental data indicating that matters have improved in respect of local authorities meeting their targets in the various areas?
There is the question of purchasing properties, including distressed properties or those on the open market, for social housing. I firmly believe that buying more private houses in different estates for social housing is a far better model, as it spreads social housing throughout the community, leading organically to everybody living in a more equal society. I completely understand the need to build large-scale housing developments and we need plenty of social housing in all areas of the country and each street in every town in order to create the type of equal society we all seek.
Over the summer we saw disgraceful behaviour from universities with respect to on-campus accommodation, as the figures charged to young people starting at third level were dramatically increased. There were also increases in the cost of on-campus accommodation for people in second or third year or those doing postgraduate courses. Regulations were about to come into force and this stunt - it can only be described as such - from the universities and third level colleges came a couple of days beforehand. Is there any way the Minister can rectify or address this by having the universities and other third level institutions to do the right thing by bringing this back to what it was? All third level colleges and the surrounding areas should be deemed rent pressure zones. It is one way of dealing with this once and for all.
I had a conversation on the meeting fringes with the Minister about emergency accommodation. I agree with the principle that Tusla should have the power to inspect all emergency accommodation in an unannounced fashion. Is the Minister's thinking in any way similar and would he consider exploring the matter by speaking with Tusla's new executive, Mr. Bernard Gloster? I know he is exceptional as I worked with him when we was with the Health Service Executive in the mid-west.
There is the question of the rent-a-room scheme. When people rent a room in their apartment or house, it works well by and large and such people can take in €12,000 or €13,000 tax-free for a room. Has the Minister data on the take-up of the scheme and is it worth putting more resources into promoting it? There is an ageing population and I know of several people in the city who have availed of it. It has created a social space for them, as well as an income and it is working very well. I have no doubt there are thousands of homes and apartments where single professional people, and perhaps even elderly or retired people, have the capacity to provide accommodation to young professionals. Are there any data on it?
I thank the Senator for his questions. I might jump around with the answers as there were some important questions and I want to ensure I can address them. There has been some misunderstanding about what happened in the universities over the summer. What may be advertised as "rent" is not actually rent until it is agreed. As the new laws came into effect on 15 August, unless the universities increased rent for previous tenants, new tenants coming to accommodation this week, next week or the month after that would have their accommodation captured by rent pressure zones as per the legislation. Those students have the protection of the legislation that was introduced earlier in the year. The universities have been talking about increasing their rents since the third quarter of 2018 and that is one reason we moved to bring the change in legislation and those protections. If the accommodation was rented last year, the rent cannot be increased beyond the 4% level. If there is any concern about that, those students should absolutely access the Residential Tenancies Board, RTB.
The Senator asked about Tusla inspections. Inspections of emergency accommodation happen and when I met the Ombudsman I said that we absolutely want to ensure we can have trust in what is happening in our emergency accommodation. The national quality standards framework is important and we must roll that out to emergency accommodation across the country. We can then look at what might follow. Tusla does not report to me on this matter but I raised this point with the Ombudsman. All the appropriate checks in terms of Garda vetting and training are in place for the providers of emergency accommodation and hubs, and the local authorities and non-governmental organisations are responsible for the hubs they operate. There is also a responsibility on private operators. There is already an inspection system in place and there are already standards being rolled out nationally. We will continue to see what more we can do to ensure people can have confidence in the type of accommodation being offered to families in particular at a time of emergency and crisis.
The cap for the rent-a-room scheme is still €14,000. Last year I helped to fund some student union organisations in getting the word out about this scheme and they presented very compelling data to me on the success of their campaigns, and how this has helped people, particularly in accommodation close to universities. We do not hold data on the scheme as it does not fall under my Department. Acquisitions are helping in areas where there are vacant properties and there is no demand in the private sector. The process is also helping regeneration in a number of areas as well.
In 2018 we saw an eightfold increase in the number of social housing homes being built by local authorities since 2015, the year before the publication of Rebuilding Ireland. People always say this number is coming from a low base but it is not any more. More than 6,000 homes will be built this year and the stock of social housing is to be increased by 10,000 units. It is why I publish the annual targets for each local authority and what numbers are then reached. Everybody knows what they must do and what is achieved. We have held a number of housing summits and they have been very helpful. We have moved from housing summits with chief executives to more focused engagements with housing delivery teams in regions and specific local authorities. In two local authorities, we have introduced the task force concept that we had in Cork; it is now across Galway city and county and it is starting to show results in what it will be able to do this year and next year.
Some local authorities are ramping up more quickly than others, and we have an engagement tomorrow at the County and City Management Association to see how we can get the better performing local authorities to help other local authorities. We also have the new standard internal design document that has been published and the document for both the layout of social housing estates and the internal layout for homes. It will help the local authorities that need such assistance to do better. We can look at the increase in numbers and what is happening, and although it took a couple of years to gear up the local authorities, they are now geared up and delivery is coming. I mentioned this morning that right now, there are more than 6,000 social housing homes on-site and under construction. That number will continue to increase each month.
I was genuinely surprised by two comments made by the Minister in our discussion around affordability.
He should correct me if I misrepresent what he said. He seemed to indicate that he thought rent of €1,200 per month is affordable and to suggest that €310,000 as the purchase price of a house is affordable for a two-income couple on the average wage. In the most comprehensive study of affordability to date, the ESRI states that for renting, affordability would be determined by 30% of net disposable income. On a rent of €1,200, one would need a net monthly income of €4,000. Clearly, it is affordable for such people. However, we are looking for affordable housing for people who are above the threshold for social housing and, according to the Minister's rules, earning less than €50,000 for a single applicant and €75,000 for joint applicants. That rent is not affordable for the Minister's system and rules; amounts of between €700 and €900 are. Likewise, if one is purchasing a home for €310,000, there is a 10% deposit of €31,000, which leaves a loan of €279,000. Under the Central Bank's rules, a gross income of €79,000 is needed. That household is above the threshold of eligibility for affordable housing. It is also above the threshold for eligibility for the Rebuilding Ireland home loan scheme. Even if it were not, the average Rebuilding Ireland home loan across the State is €200,000 or less. Does the Minister know how many loans under the Rebuilding Ireland scheme Dublin City Council has offered since the scheme opened that are close to that price? Only 16 have been drawn down.
Here is the problem. We are trying to get the State to invest in a supply of affordable rental and purchase accommodation for households on incomes between €38,000 and €75,000. None of the stuff the Minister is promising, meagre and all as it is in the context of numbers, is going to meet their needs. Somebody will be able to afford what the Minister is offering; I am not doubting that. Some people will pay for it even though it is not actually affordable according to mainstream ESRI rules. Enniskerry Road and O'Devaney Gardens are the only developments we are seeing prices for and our big fear is that they are way off the Richter scale. What I would like to know, and what those who are desperate for affordable housing would like to hear, is what is coming down the line for the families on €38,000 to €75,000 that will be affordable to them under the existing rules and mainstream understanding of affordability. When will those units be available? For the people we all represent, nothing is becoming available now.
I think we all agree that the affordability gap can only be bridged by means of State-led intervention. It is not going to happen if we leave it to the market. It is not going to happen if we only do it in respect of social housing and hope that might have a knock-on effect. When we look at what is actually coming on line through things like the serviced sites fund or the cost rental scheme, Dublin City Council has already identified two sites where there will be homes for less than €200,000. That is affordable. There is now €129 million for Dublin City Council under the Rebuilding Ireland home loan scheme for 2018 and 2019 to give out that affordable mortgage product.
If we look at two people earning the average industrial wage, let us say it is approximately €40,000, they have a combined income of €80,000. With the Central Bank rules, with help-to-buy, they can get the money together for a home at €310,000. The rent on a two-bed apartment on Enniskerry Road, which we are talking about being affordable, is €1,200 or €600 per person. Those amounts are affordable. However, there is a lot more work that we have to do regarding affordability. It is on both sides of the ledger still. We still have work to do on ensuring that all of those thousands of apartments that have planning permission are built. We still have work to do to make sure that the significant level of funding we have provided to date for affordable homes delivers such homes. It is also recognised that more than 12,000 households have been supported with help-to-buy and that more than 1,000 people have been able to buy homes using the Rebuilding Ireland home loan mortgage, which now has funding to support another 2,000 people up to the end of this year. A huge amount is being done by the Government. While we have to do more, we also have to recognise the complexity when it comes to individual sites such as Enniskerry Road, which require a number of partners and quite a bit of time to get things right. That is why we engaged the European Investment Bank officially in May as a research partner to ensure that, as we do this at scale, things like cost rental will be properly affordable over the lifetime of the building. As we bring affordable homes on-site across the country using the serviced sites fund, which is €310 million, almost half of which has already been allocated, we must ensure that we are seeing homes such as those Dublin City Council is talking about in terms of Ballymun and Ballyfermot and that we are bringing on homes at those prices.
I have seven questions. We might look again at An Bord Pleanála and e-planning. They are way down the list. The Minister might touch on what is happening at the Central Mental Hospital site in Dundrum. I want to flag a major problem with Cherrywood strategic development zone. There is a shortfall of approximately €60 million and there is a dispute between the stakeholders. That dispute needs to be resolved quickly. This is one of our biggest strategic development zones with great potential for homes of all tenure types. The Minister might touch on Thornton Hall and the massive landbank owned by the State. What is being put to use there in terms of housing?
The Minister might tell us about progress in respect of the national strategy for affordability. We also need a national cost-rental policy. On the classification of the approved housing bodies as on-balance sheet by EUROSTAT, given what we know about the national children's hospital project and the major demands on capital spending, I have concerns. We must not lose focus. I know the Minister will not do so. There are demands on capital and I hope they will not impact on Rebuilding Ireland.
On reform for Part V, I am a great advocate of going back to 15%. Ideally it should be 20% but let us start by getting it from 10% to 15%. What is the Minister's view on the Part V increase from 10% to 15%?
I actually counted eight questions there. We have provided for e-planning already through legislation. A pilot project is being rolled out so we are starting to make moves on that. I spoke to the chair of An Bord Pleanála about this approximately three months ago at our last official engagement. I mentioned the importance of the project. On the Central Mental Hospital campus in Dundrum, it is a big site for the Land Development Agency. There might have been a slight delay with the planning permission. I will need to look at the deck again, I cannot find it.
We are doing the work as we decant the health facilities from that site. There will be no delay once the HSE is gone from the site in terms of getting construction under way.
On Cherrywood, I am aware of the points the Senator has raised and the Department is engaged in terms of what solutions might be available. That is a very important development with a lot of potential. It is a kind of new city within a city. On Thornton Hall, I discussed the matter with the Minister for Justice and Equality some time ago in respect of the Land Development Agency. There is a potential use there but it will not necessarily be for housing because it does not have the infrastructure in place for that. The Land Development Agency has a mandate to manage land between the Departments. It may be that somebody else has a use for it and we could take their land for housing in another location. That is something that will be pursued in time.
On the national strategy for affordability, when it comes to affordable homes to be bought, because we have all these different streams such as the serviced sites fund and LIHAF, the process of putting all that together can be a little bit complex. As we finalise the different regulations around it, we will be able to talk about that strategy.
On a cost-rental national policy, we have engaged the European Investment Bank to help us come to that national policy. There are always going to be certain site-specific considerations but we want a national policy so we understand truly what cost rental is and who it is for. On AHB reclassification, I think they are appearing before the committee soon.
It is very important. It is being led by the Department of Finance. We have got the Housing (Regulation of Approved Housing Bodies) Bill 2019 beginning Second Stage next week in the Dáil, which is very important. There is no question about there being money in Rebuilding Ireland for housing bodies to do the work they need to do. I have been quite clear on that all along. We can deal with the classification issue in a way that will not impact on funding coming in to the housing bodies sector to continue to do what we want to do, which is to get to 12,000 social housing homes a year, every year. We are almost at that.
On Part V, it is currently at 10%. With the changes we made around introducing the Land Development Agency, we locked in a requirement for 40% social and affordable across any public land that is being developed for housing. Now is not the time to do that on private sites, in my opinion, but it is something we are keeping under review.
As I said earlier, the trends concerning families and children in emergency accommodation show that there are fewer in emergency accommodation than there were this time last year. We have increased the number of exits and preventions for families so that we find a home immediately for one of every two families presenting. However we are still seeing huge numbers of presentations. They are slightly down in Dublin but it is still too high.
It is way too high and the impact is immeasurable. It is not just the here and now and it is not simply a matter of bringing in regulators to hubs. That might make things better. Introducing regulators to workhouses in the 1840s would have made life a little bit better for people, but what we actually needed was for those workhouses to close down. People should not be in emergency accommodation. Some 80 families are in hotels as of June. People are in hubs. The damage to children is immeasurable and the scale of the trauma those children are facing, now and in their futures, is not properly understood. Therefore I sincerely ask the Minister, his Department and other Departments to understand the impact. If he does not have sufficient data he should commission it. This should not happen to children today. It should never again happen to such a large group of children in our State. I would really like the Minister to give me a sense that he understands. Maybe the numbers are going down, but they are far too high and the damage is far too great. I do not believe the response is adequate to the scale of the trauma those families are experiencing. I would like to be reassured by the Minister's words.
I absolutely understand the damage that is being done to families, children and individuals because of the housing crisis. I do not need any more data to understand that. I have met families in hotels and hubs. Thankfully, I have also met families going into their new homes. The scale of this challenge is incredibly significant. It is not just that not enough homes were built for several years. We also have net immigration because the economy is doing so well, which puts us under even more pressure to ramp up the delivery of new homes. Regarding the scale of our response, by the end of this year 100,000 households will have been supported since the beginning of Rebuilding Ireland because of the work local authorities, my Department, housing bodies and NGOs have done across the country to help people. That includes preventing people from becoming homeless in the first place, supports like the housing assistance payment, HAP, and getting people into social housing. The important thing we have to do is drive the delivery of new homes. The new data shows that the number of families exiting emergency accommodation into homes is up by something like 45% on the same period for last year. That is important. The number of families exiting emergency accommodation into social housing homes is also up by more than 50% on the previous period. That is important too. That tells people that this is a huge challenge but a huge response is under way as well. We are only increasing the response every year as we build more homes to meet that challenge.
Regarding the Minister's invitation to Deputy Coppinger to meet with him about the issue under discussion, we will be happy to meet him to discuss that. We will welcome the compiling of statistics. We will hold the Minister to that. However, we will want to discuss a lot more than that. We will want to discuss the steps the Minister plans to take to ensure that people in such a situation can safely speak out and that people have protections against landlords who would take advantage of this power imbalance. We will want to know if the Minister will support the Anti-Evictions Bill 2018 or other progressive anti-eviction legislation and bring in real rent controls so that tenants are in a less vulnerable situation.
Finally I refer to HAP. To be clear, we raised a specific case in the Dáil today. We have since been contacted by hundreds of people expressing support. Among those hundreds are some who have raised their own issues and told their own stories. There seems to be a trend of people raising issues that have affected them in dealing with HAP landlords. We will check those stories and talk to those people. Some of them are single parents, who are disproportionately affected by the housing crisis. They cannot find anywhere else to rent. They fear being homeless with their kids. They are particularly affected by this power imbalance. I put it to the Minister that the correct position for him to take was not to have a go at myself and my party, which has raised criticisms of HAP in the past, but to express concern if there is any possibility that this might be the situation and to state his intention to put measures in place to deal with it. I am giving him a second opportunity to do so now.
It is very difficult to interact with Deputy Barry because he always mischaracterises and misrepresents the people with whom he engages. I am very sorry for that, because the case he raises is disgusting. There are many power imbalances in Irish society as in every society, but if the particular case he raises, of which I do not know any details, is true it is disgusting. However, Deputy Barry is incorrect to link it with HAP. He does not understand what HAP is. HAP is a payment support that comes through a local authority to help someone into the private rental sector. There are more than 900,000 people in the private rental sector and the vast majority of them have appropriate experiences.
Deputy Barry says he is now going to look into these allegations. He should probably look into them before he raises them. All he seems to do is undermine a system of assistance that is helping tens of thousands of people in housing insecurity into homes. The more Deputy Barry talks down an assistance support like HAP, the more landlords will not want to take it - they cannot refuse it, but they will seek other ways to get around it - and the more individuals in housing insecurity will be afraid of using this support, which is ridiculous.
I answered the Deputy earlier when I spoke about engagement with Deputy Coppinger on this issue. I spoke to him earlier about engaging with the Department of Justice and Equality on how we can compile statistics. I also pointed out that this issue would not solely fall to me and the Department of Housing, Planning and Local Government because it is a criminal matter outside of my brief. To conclude, the Anti-Evictions Bill 2018 the Deputy has introduced would not solve this particular issue and it would not solve the housing crisis either. We have been quite clear on that before. We have had two engagements on this matter in this committee today and I spoke about it in the Chamber earlier on. The Deputy should not seek to mischaracterise how I have responded to this very serious matter. Also, he should not ignore the very valid concerns I have raised about how Deputy Barry is trying to link this to something else when for all intents and purposes he does not know if there is any linkage at all, as he has admitted already.
I have two quick questions. In my interaction with the Minister last time he said that landlords were flowing back into the system. Does he have any numbers on the landlords flowing back into the system? We lost 4,500 or 5,000 tenancies last year, so it is significant if landlords are coming back into the system.
My other point concerns the recent regulation around short-term letting platforms and the recent article in which Dublin City Council said it needed €750,000 to enforce the new short-term letting arrangements. Can the Minister give an update on that? Moreover, has the Minister made any progress with his Cabinet colleague towards introducing regulation of the short-term letting platforms themselves where tourism is concerned? If they were regulated they could provide the information local authorities need and would take the burden of work away from them. In fairness, the Minister's piece of legislation did define short-term letting.
I thank the Deputy for those questions. The most recent numbers that we have are from the Residential Tenancies Board, RTB, rent index for the first quarter of this year. We do not know if it is a trend because we are still awaiting the figures for the second quarter. Some 3,000 new tenancies were created over that period, tenancies that would not exist but for new landlords coming into the sector. Obviously that is a positive in and of itself. We would like to see if that is a trend and get a better understanding of who those landlords are. We need to find out if this is happening because more build-to-rent properties are being built or because large institutional landlords are entering the market and increasing the stock of rental properties.
Regarding short-term letting, a new team is being put in place in Dublin City Council but the existing planning authority is already working on this issue because it is a planning matter.
I believe we have allocated just over €800,000 for those resources. We estimate that between €2 million and €3 million will be required in the next two to three years to beef up resources across local authorities. It is important to recognise that what we have done in terms of the planning laws is the most progressive change compared with any other city in the world when it comes to short-term letting.
There is another piece, which is the regulation of the platforms. That falls outside my Department. Interaction on that is ongoing.
I apologise that I had to leave the meeting for a while to attend another meeting. I want to come back to two issues. On the discretionary cap, I do not accept the position the Minister has outlined. It will make a substantial difference in speeding up the delivery of social homes, which are badly needed. I do not believe it will leave the Department open to any undue risk because, as I said to the Minister previously, the local authorities are responsible and answerable to him, and most, if not all, of them have the requisite experience and expertise. Currently, county architects are sending back plans to the Department of Housing, Planning and Local Government to be checked by juniors and are going back and forth in that respect. We do not need to do that. If we look at housing delivery, and the Minister spoke earlier about the target to have more than 6,000 social homes delivered this year, in the first half of this year the figure is approximately 1,000, so we are 5,000 short. How confident is the Minister in reaching that target.
On the private housing supply-----
-----and the Minister's target is to build more than 6,000. It is a big gap. Is the Minister confident he will meet that target?
Regarding private housing supply, I mentioned earlier the role of build-to-rent, cuckoo funds and the private rented sector, PRS. They are having a massive impact within Dublin. If we take Dublin as an example, according to the property price register there were 211 new homes for sale in Dublin in the last six months of last year. Even with increased construction for this year, that figure has dropped by nearly 500 to 1,733.
From the property price register. What I am saying is that more houses are being built and fewer are for sale. That is happening in many parts of the country and it is because we have a market that is being hoovered up by pension funds and investors who will now be able to set the rent prices in those given areas. That is a serious issue. We need to wake up to the fact that entire communities and parts of our cities - not just Dublin - and our suburbs will be owned by these investor funds. That is not a good place to be in. Some 21% of people who are housed are housed in private rented accommodation. That is up from 9% in 1991. The Minister has spoken about moving towards a continental model of housing. We are there already because we are below the European average on home ownership. That is a serious problem. I do not believe it is a life choice to rent in the private market. It is because of lack of supply.
The Minister must speak to the Department of Public Expenditure and Reform urgently about the discretionary cap. That needs to happen. I do not accept that it cannot happen because it was not conditional.
I thank the Deputy for those questions. To go back to the institutional investors, when I talk about a continental model, I mean a continental model for renters and a continental model in terms of home ownership. What we are seeing in home ownership, in terms of the decreasing rates of home ownership, and I do not believe we are below the EU average-----
Home ownership fell at the same rate from 2006 to 2011 as it did from 2011 to 2016. There is an underlining factor there that shows that even in the boom years, and in previous Governments, home ownership was declining. What we believe is that, culturally in this country, people prefer to own a home, even people who are renting now. We need to make sure there is a process in place to ensure they can own their own home. That is why I say again that State-led intervention in terms of affordability is so important.
I know the Deputy is trying to build a case for legislation he wants to bring forward around institutional investors.
We need to be careful that we do not turn off an important increase in supply that is coming through in terms of the build-to-rent sector. We have to recognise the views of experts, including Assistant Professor Ronan Lyons. In other countries, these institutional investors are known as landlords.
For the rental sector here, we need to make sure that we move away from the volatility we had in the past when people were exposed to the individual life choices of their landlord owning only one property and deciding he or she did not want to be a landlord any more-----
-----whereas institutional investors are making a 40-year play and will abide by the laws because they have got a board, shareholders and everyone else to report to and provide good accommodation and everything else. There is a balance to be struck and we will try to strike that balance as we work through the proposals the Deputy will present next week.
With regard to social housing delivery, we have seen this every year. We will get there in terms of quarter 1 to quarter 2 to quarter 3 to quarter 4. It is just a matter of how to programme in the build each year. It happened in 2017, and I was there for the end of 2017, and it happened throughout the course of 2018. We do not simply let them off for the year and tell them we will see them at the end of the year. I did a review in the middle of the year. We continue to engage, through the housing delivery office, to make sure that different sites are progressing as we expect.
On the point the Deputy raised about the cap of €2 million to €6 million, we have projects, two of which are in Wicklow, being delivered through the four-stage process in fewer than 43 weeks. That is even quicker than what the one-stage process would allow for. What we have seen is local authorities bringing forward programmes where it is €750,000 per social housing home. If that was to happen through the one-stage process, we would only get sight of it at the very end, at which point we would have to say it is not value for money and go back to the drawing board, which would result in even further delays.
My concern, and this was always an issue in terms of the public spending code and a derogation to be got from the Department of Public Expenditure and Reform, is that, on review, and we can sit down and talk about this off-line, so to speak, we might believe this to be a reckless way to approach capital spending through the local authorities and not something either of us will want to pursue. If the Deputy were in my seat, and he might well be in six months' time, would he be happy if he did not believe he had proper oversight of 44% of his capital budget, given that he is the person who will be reporting to the committee on actual delivery by the local authorities every quarter and every year?
I thank the Minister, Deputy Murphy, and his officials for attending today and engaging with the committee. I thank the members for their questions and understanding. I look forward to more fruitful engagement with the Minister in the future. From my perspective, I look forward to chairing a productive, purposeful and positive committee. We are off on the right foot in any event. The meeting is adjourned. The next meeting will be held on Thursday, 26 September, at 9.30 a.m.