Noel Ahern (Dublin North West, Fianna Fail)

The review group report indicated that any Government action to outlaw or prohibit the practice would require changes to the law of contract. It concurred with a previous Law Reform Commission conclusion that the only practicable way to protect buyers would be through consumer information and it recommended that the property services regulatory authority address this as a priority.

I understand that the general scheme of the property services Bill will make provision for regulations to take account of the Law Reform Commission report on gazumping. The Irish Home Builders Association has operated a voluntary code of practice since 1999, which is designed to give buyers of new homes protection against gazumping. It is my view that gazumping has not been a significant feature of the housing market for some time and the voluntary code has gone a long way towards dealing with the issue.

The Government is very conscious of issues that have emerged about property management in Ireland. Action to achieve improvements in the area as quickly as possible is being taken by a number of agencies. Action is being taken by my Department on planning aspects and taking in charge of estates. Planning authorities have been advised that management companies should not be conditioned for traditional housing estates and, pending further guidance, should only be conditioned in mixed estates in cases where they would clearly be of benefit to the residents.

Planning authorities have already been reminded of their responsibilities over the taking in charge of traditional housing estates. A working group involving relevant interests has been set up to delineate the extent of the local authority responsibilities for facilities in high density estates. It is intended that the group finish its work before the end of the year and that further guidance issue to planning authorities in early 2007 at the latest.

My Department is also pursuing agreement with the construction industry on measures to prevent management problems involving developers. The issues in question include, for example, incorrect obligations being placed on buyers of houses or apartments and developers retaining control of management companies. Agreed measures would be incorporated in an industry code of practice.

Actions are also being taken in this area by other Departments. The legislation being developed by the Department of Justice, Equality and Law Reform for the new property services regulatory authority will include the regulation of managing agents. The authority will licence, regulate and deal with complaints relating to managing agents, which are commercial firms engaged by management companies to carry out day-to-day management and maintenance. The authority will also have a public information function relating to property management.

In addition, action is being taken by the Department of Enterprise, Trade and Employment on legislation to reform company law, which governs management companies. I draw Deputies' attention to the useful information booklet published by the National Consumer Agency on management companies and charges, and a report containing a range of recommendations on the issue.

The Law Reform Commission is examining legal aspects generally regarding the management of multi-unit structures. A consultation paper is likely to be published before Christmas. Recommendations are likely to deal with both the prevention of future problems and identification of effective legal mechanisms to remedy existing problems, for example, due to defective legal documentation or dissolution of management companies. Following the consultation period, a final report will be prepared by the Law Reform Commission. Its recommendations will be considered by the Departments concerned to see what new measures are necessary. In the meantime the actions I have outlined will help to achieve improvements in this area, without prejudice to the recommendations from the commission.

This Government has been successful since 1997 in increasing investment in housing, expanding the range of housing supports and generally facilitating a vibrant housing market. It has been, perhaps, the most remarkable era for house building since the foundation of the State, a circumstance helped in no small measure by the priority given to housing policy by this Government. In the early 1990s the total number of houses built, both private and social, was approximately 22,000 per year. That has increased to 80,000 last year and 90,000 this year, based on the figures for the first nine months.

We are building on these approaches to ensure housing policy is seen in the appropriate context of building sustainable communities. That is the key issue. We are not just opting for numbers. One could have adopted a policy of just building vast local authority estates on greenfield sites, as was done in previous decades.

See this speech in context