Oireachtas Joint and Select Committees

Thursday, 3 June 2021

Committee on Budgetary Oversight

Budget Priorities Exiting Covid-19 Pandemic: Discussion

Photo of Kieran O'DonnellKieran O'Donnell (Limerick City, Fine Gael)
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I have two quick questions in the limited time left. Are we now in the middle of a new industrial revolution?

Dr. Kinsella spoke about housing, anger and the median voter. The ESRI report that will be published tomorrow mentions an extra spend of between €4 billion and €5 billion. The document appears to deal exclusively with social housing provision. It does not appear to deal with affordability, which, from my perspective, is as big an issue with the median voter. If Dr. Kinsella is going with the policy being proposed by the ESRI, capacity constraints are not addressed. Currently, with the supply of labour available, our capacity to build in Ireland is around 15,000 units per annum. It is all very well to talk about spending money, but it must be demonstrated how it will be done. The ESRI report itself mentions spending money, but does not state how the capacity constraints can be addressed and how the affordability aspect can be dealt with. What we are finding on the ground, is that young couples cannot afford to purchase homes because they are not becoming available on the market for them. It is not just a supply issue. It is an internal supply issue within that supply in that there is a reduced supply to first-time buyers.

Before I pose my questions to Dr. Healy, I ask Dr. Kinsella to clarify the following. Are we in the middle of a new industrial revolution? Although I welcome the ERSI report, I cannot see how it addresses the affordability issue. It addresses the issue of spending money in a very macro way. There is no point in throwing money at something unless there is the capacity to deliver it based on that funding. I would like to have seen the ESRI report address those capacity constraints. We need to build many more houses, both social and affordable. While the report addresses social housing and the issue of spending money, it does not address the constraints on building that social housing and the affordability aspect. I ask Dr. Kinsella to comment on that.