Arthur Morgan (Louth, Sinn Fein)

I am sure we will hear more of this closer to the election.

I welcome the opportunity to speak on this issue and I support the general thrust of the Labour Party motion. The increasing prevalence of management companies as an alternative to local authorities taking charge of housing developments is causing significant difficulties to householders. The Government is failing to tackle this problem.

On a number of occasions my party has raised the need to regulate the operations of management companies, particularly in the case of apartment complexes where, unlike housing developments, they are likely to remain a feature long into the future because of the issue of communal space. I hope the Minister will heed recommendations of the Law Reform Commission when it concludes its consideration of legislation in respect of multi-unit structures.

The legislation has become outdated and has not kept pace with changes in the patterns of housing developments or increased deviousness of greedy developers. This issue has been brought to my attention by a number of Sinn Féin councillors and public representatives in Dublin. In particular, Felix Gallagher of Fingal County Council has raised the matter of Tyrellstown, Dublin 15. I attempted to raise this matter in the House for Councillor Gallagher and asked the Minister for the Environment, Heritage and Local Government to investigate the collapse of the estate management company, O'Donovan Property Management Limited.

Residents who paid a cumulative total of €60,000 to O'Donovan Property Management Limited are facing demands for payment in advance from a new management company, Smith Property Management, for work that was meant to be completed by O'Donovan Property Management Limited. This has escalated to the point where a number of residents are facing potential legal action. This case illustrates the difficulties that can arise in the absence of legislation to regulate the operations of management companies.

I refer to section 180 of the Planning and Development Act 2000. Last night, the Minister for the Environment, Heritage and Local Government stated: "Under section 180 of the Planning and Development Act, local authorities are obliged to take in charge the public services of housing estates, once completed to a satisfactory standard, where requested to do so by a majority of the residents of the housing development, or by the developer". Is the Minister satisfied this section is performing as it was intended to do? From instances brought to my attention I must conclude it is not being enforced or it is deficient.

There is evidence developers are evading provisions of section 180 by delaying the completion of works as a tactic to maintain control of developments through their management companies. Some developers will complete the majority of work to have the local authority return bonds they have given. They will delay completing work where the smallest bonds have been given. Has the Minister considered introducing amendments to this legislation to insert timeframes within which developers are obliged to complete work necessary to bring development to the status where it can be taken in charge?

There is nothing in the Minister's contribution, or the Government amendment, to suggest they intend to address the problems increasingly affecting homeowners in new housing developments across the State.

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