Ciarán Lynch (Cork South Central, Labour)

I welcome the long-awaited Second Stage Dáil debate on the Housing (Miscellaneous Provisions) Bill. The Bill provides Members with an opportunity to develop an expanded programme for social housing, new measures to deal with the problem of homelessness, stronger protection for tenants in rented accommodation, measures to combat anti-social behaviour in housing estates, as well as legislation to regulate the activities of management companies or to give an indication in that direction.

There are more people than ever on social housing lists, an unprecedented number of families face the threat of having their homes repossessed and the level of homelessness is a high as ever. Recently published data show the social housing waiting list has increased in the past three years from 43,700 to nearly 60,000. These truly shocking figures show the extent to which Fianna Fáil has squandered the boom, leaving tens of thousands of people high and dry without adequate housing. An expanded social housing programme would not only provide families with badly needed accommodation but would help to kick-start the construction sector.

No Member of this House needs to be reminded of the unacceptable level of homelessness. Every evening as we leave this House, we see the people huddled in porches and alleyways around Kildare Street and Merrion Square. It is shocking that, on average, 5,000 people are experiencing homelessness at any one time. What is even more shocking is that 487 of them are under the age of 18.

This Bill comes before the House against the background of the increase in the numbers on the social housing list from 43,700 to almost 60,000 and the continuing problem of homelessness. There must be an effective inspection regime for housing standards in the private rental sector. Residents in both apartments and housing estates face ongoing difficulties as a result of the unregulated operation of management companies and the failure of the Government to honour the commitment in the programme for Government to expand the delivery of social and affordable housing options to meet the needs of almost 90,000 households.

In the course of this debate, I will put forward a series of amendments on behalf of the Labour Party. Among these, I will propose that steps be taken to ensure, where possible, that existing unsold housing units are secured for the purpose of social housing. The Labour Party proposes that we make rent supplement more employment-friendly by bringing means assessment into line with differential rent schemes, enhance families' access to rental accommodation schemes, and adequately resource and fully implement The Way Home, the Government's strategy to address adult homelessness. We must amend the Residential Tenancies Act 2004 to provide for the creation of a national inspection regime in respect of housing standards in the rental sector, along with the provision of definitive and efficient timeframes within which disputes should be resolved. At present, such disputes can take 18 months or more to be concluded. We must also reform the law on multi-unit developments, including apartment developments; strengthen the powers of local authorities to deal with anti-social behaviour; and broaden the terms of the tenant purchase scheme allowing local authority tenants the right to buy their apartments.

A housing crisis can be defined in different ways. In one sense, there has been a housing crisis in this State for the past ten years. It is a question of priorities and policies. Do we see houses as commodities or homes? Do we want to build developments or do we want to create and sustain communities? Do we want developer-led government or government-led development? When this Government came to power, the average house price was approximately three times the income of a working family, spread over a 20-year mortgage. Just before the housing pyramid collapsed, the cost of an average house had increased to 12 times the average income, with a mortgage of more than 30 years the norm.

In the period 1997 to 2007, residential mortgage debt increased by an extraordinary 522%. Many people made money from home buyers as the market rose. Many will continue to make money as these mortgages are paid off in the coming decades. Hard-working families and couples have been fleeced in the past decade. A system was in place, facilitated by the Government, which saw massive loans being given to developers to purchase properties at over-inflated prices, with a transference of the financial cost and, more specifically, the financial liability, down the line to first-time buyers. Hence, we had a massive percentage increase in the cost of buying a home when measured against income and almost a doubling in the scheduling of mortgage repayments from 20 years to 35 years. That has been the significant aspect of the Government's social housing policy in the past ten years.

How did this happen? The answer is simple. Those who had a duty of care, including the Government, regulators and banking institutions, all neglected that duty with the result that this country's future was invested in a property bubble. An example of this mind set was best captured in April 2006 when then Taoiseach, Deputy Bertie Ahern, referred to the "health" of the housing market and sneered at economists who predicted a collapse. With his chest puffed out on the "Six One News", he proudly proclaimed that people who listened to the "lulas" would miss the boat and would have to pay more for their houses. This was frightening talk then and it is even more frightening with the benefit of hindsight. It was the mantra of the dodgy salesman encouraging people to buy a dodgy product at an over-inflated price.

It did not matter to the former Taoiseach or his Government that the cost of buying a home was running beyond the grasp of working people. It did not matter that families were being locked into mortgages that would take their entire working lives to clear. Nor was the Government concerned, in those sunny days, that people would be in danger of losing their homes, when the rainy day inevitably came, because of the reckless practices it allowed to continue.

This Bill affords us an opportunity, once and for all, to banish the mind set that the primary purpose of housing development is profit for speculators. If the Bill is to succeed, it must be based on the principle that housing development, whether private or public, is about long-term security, that is, meeting the needs of society in providing people with homes of a quality standard, at an affordable price. The consistent theme in recent years has been the focus of the Fianna Fáil developer-led Government on sorting out the developers and getting new developments built. Such issues as schools, transportation, green spaces and common areas would be sorted out at some time in the future.

Figures I have obtained, and to which I have referred repeatedly in this House, show that less than one in ten homes in the private rental sector are inspected to ascertain their compliance with standards. Figures produced by the Minister for the Environment, Heritage and Local Government, show that only 12,000, or just over 6%, out of 188,000 registered private rented dwellings were inspected in 2007. The figures for 2008 are not much better. Of the 12,000 inspected in 2007, 2,379 were found to be substandard. However, legal action ensued in only 25 cases, or a fraction of 1% of the total number.

Earlier this year the Minister of State, Deputy Finneran, issued guidelines and referred to a dedicated stream of money for local authorities to carry out inspections. However, neither the determination nor the powers to ensure inspections are carried out and standards enforced have been put in place. Despite promises of legislation, vulnerable private tenants are left without adequate protection because guidelines and standards only matter if proper enforcement is organised.

Like social housing, the private rental sector fulfils an important function, providing necessary housing for hundreds of thousands of people. Without question, the majority of landlords are compliant. In many cases, were it not for the private rental market many people could not find housing because of the absence of a clear strategic social housing programme over the past number of years. However it is unacceptable that, despite the legislation governing private residential tenancies and the promise of more legislation this year, adequate enforcement of standards does not take place. This is something the Minister of State is examining and I emphasise the urgency of the matter.

There is blatant avoidance of registration by landlords in the private rental sector by choosing to opt into licensee agreements. This is openly advertised on the IPA website and it is an encouragement to undermine the legislation. I suggest the Minister of State corrects this anomaly immediately and substantially increases the fines for landlord actively avoiding registration because of this loophole. A national inspection regime is required to ensure standards in private rented accommodation and social housing are enforced. This would guarantee the establishment of effective and efficient timeframes in which disputes could be resolved. Local authorities could determine an acceptable period in which urgent repairs should be carried out.

Every Member of this House, particularly those who have served on local authorities, is aware of two difficulties in social housing. One is the turnaround period after a property comes back into the possession of a local authority and before it is reallocated. It is not unusual for this delay to run to years. It is incumbent on the Minister of State to penalise local authorities that facilitate such delays when the work can be done. When a house becomes available in a local authority housing estate, which had been purchased through the tenant purchase scheme, the house is in immaculate condition on the day it is purchased and a tenant could move in on the same afternoon. For some reason, it takes months or years to turn these properties around and one can question the quality of work done in some of the houses. They seem to be allocated in poorer condition than when they came back to the local authority.

The second matter related to urgent and necessary household repairs. Local authorities should be issued with more than guidelines, perhaps a directive, so that if an elderly person or someone with a disability has a major housing repair requirement, this person is not waiting up to 12 months. There should be a specific timeframe in which to deal with this work. If something similar to the National Treatment Purchase Fund is required, whereby the local authority must look outside its capacity to carry out this improvement, so be it. Just like any landlord, local authorities have landlord obligations to their tenants. If we do not accept low standards in the private rental sector, why should we accept low standards in the public housing sector?

The problems relating to management companies are well understood and have been analysed by the Office of the Director of Corporate Enforcement. These companies, many of which were set up by developers, need to be regulated in the interests of the residents not the developers. In the absence of overdue legislation this problem has grown particularly acute where people are being held to ransom by these companies with no come-back and no Government support. Despite successive promises, there has been no regulator and no legislation brought forward by the Government. Homeowners have been abandoned by the Government and they find themselves on their own when a management company or agent provides a bad service.

The fact that these companies are currently in a legal no-man's land is causing endless trouble for affected residents. For several years, the Government has talked about the need for legislation in this area but we are continually fobbed off with policy reviews and committee meetings. Much talk has come from Government about this issue. What is needed is less conversation from this Government and more action.

This Bill is long-awaited and I envisage it will be significantly different by the time we get to Report State. I hope the Bill will remedy some priority issues if it cannot remedy most difficulties. It is very disappointing that when first published the Bill made no reference to homelessness. In later drafts homelessness was mentioned. I hope this was the result of an oversight by the Minister and the Department rather than an indication that homelessness is not a priority for them.

The response in the Bill to anti-social behaviour raises many questions. It appears to provide an additional load of bureaucratic nonsense for local authorities while giving them no additional powers. All this will do is further increase the frustration that currently exists when residents make a complaint and find their situation is no better, if not worse, at the end of a long and futile merry-go-round. We need legislative changes in penalising people who engage in anti-social behaviour, not broadening the scope of bureaucratic activity for local authority officers.

The Bill stands indicted for showing that the mentality of the Galway tent is still alive and well when it comes to the promotion of tenant purchase. The significant changes in this area are targeted towards shifting property to what is described as new build. This is code for empty housing estates built in areas without proper facilities or resources, which are now abandoned and may be filled due to ongoing lobbying of the Government by the Construction Industry Federation. This means there will be no incentive to regenerate existing communities through incentivising tenants to purchase their existing homes. With the exception of the established tenant purchase scheme, we are now seeing a movement of incentivisation of tenant purchase exclusively to the new build. When this is decoded, it refers to empty houses.

The Bill could well create a repeat of the circumstances of the 1980s, which led to an exodus of earning residents from local authority estates. To this day we are still picking up the pieces and paying the price of that mistake both in societal and financial costs.

In its current format, the Bill continues to leave tenants of local authority flats, who for years have been left in the lurch, without the right to buy their own home. The Minister has spoken about the requirement of a legislative framework for this to happen and this has been before the Attorney General. It has been indicated that on Committee Stage, amendments will be introduced. It is critical that the Minister, in his response to the debate, gives a clear commitment that such amendments will be included on Committee Stage.

People have been waiting for ten or 15 years or even longer to have the right to buy the home in which they live. That right is afforded to every other local authority tenant living in a house but not those prohibited from it because they live in a flat. Over that period, people have grown older and because mortgage schedules must be completed within one's working life, if somebody is 50 when trying to buy the flat, he or she only has 16 years to purchase it. If this anomaly is corrected, an opportunity which could have been put in place a number of years ago will unfortunately not be available to those people.

The Minister has talked about new builds and intends to introduce a purchase scheme confined to new builds, where people assessed for social housing can get a loan up to €285,000 from a local authority once they have been refused a mortgage by two lending institutions. This is ironically called the home choice purchase scheme. Everybody knows, particularly in recent months, that there are two reasons for refusing a mortgage. One is that the evidence indicates the prospective mortgagee will not be able to pay back a loan, and the second is that a property could be overvalued.

What purpose does this scheme serve other than to provide a sub-prime lending service and set a false floor price for new houses in a declining but still overvalued property market? There is a duty of care issue in this which I have put to the Minister, and I would like him to expand upon it. Given that there are performance and bonus payments to local authority officials, will this scheme be tied to bonuses?

A prospective house buyer may go to two banks and be refused because the banks, on good grounds, turn down the application after considering wages and seeing that the loan amount cannot be repaid or that a property is overvalued. If that person goes to a local authority and acquires a loan, will the person signing off on that loan receive a bonus at the end of the year because he or she has completed so many transactions within a schedule? If that is the case, serious questions must be asked. The Minister should send out a directive to those who put performance bonuses in place to prohibit such activity. The scheme should be banned in its entirety but if the Minister proceeds, it is critical that a bonus is not in place for local authority officials in facilitating the scheme.

This country is no longer as wealthy as it used to be but it is wealthy enough to be ashamed of its record on homelessness. With housing vacancy rates in Ireland at 15%, it is unacceptable that 5,000 people were homeless in Ireland last winter. We need a strategy to enable homeless people to make the successful transition from temporary emergency shelter to long-term accommodation. There is a specific role for the voluntary housing sector in collaboration with local authorities and the Minister's Department to move on the issue.

This can only be done with the proper rehabilitation processes in place, which would require a cross-departmental and inter-agency report involving the Department of Education and Science, the VECs, health agencies and the Department of Social and Family Affairs. There is a significant opportunity to act on this and the Government must take immediate action, starting with the implementation of a national strategy on homelessness, if we are to eventually see the end of the scandalous situation of 55% of people in emergency accommodation being stuck there for three or more years. There is something radically wrong if we are only dealing with shelter accommodation at the crisis end of the homelessness issue rather than moving people into long-term sustainable housing approaches.

I have some recent figures relating to the past three years in Dublin. In 2006, 1,615 presentations were made with regard to homelessness. An additional 280 presentations were already in the system, meaning the total was almost 2,000 people in the Dublin region being categorised, in some way or other, as being homeless. In 2007, there were just over 1,000 new people coming into the registration process. In 2008, a further 1,100 came in.

I welcome the fact that the Department has eventually moved on this but we need a definition of homelessness. I will table an amendment for the Minister's consideration when we get to this aspect of the Bill. If we need one thing on this matter, we certainly need a definition of homelessness if we are to resolve the problem.

The affordable homes issue also came up in the course of this debate and there is a difficulty out there. I will cite one example. A couple came to see me recently who were involved in the affordable homes scheme with Cork County Council. They were given a mortgage in principle for €250,000 by the council, as their earnings showed they could borrow that amount. They were told by the council that they would be granted a house in a scheme that had just been completed with a purchase price of €216,000, well within their mortgage in principle.

The couple went about the business of buying the property only to discover that when the lending institution examined the property, its value was €196,000, some €20,000 below what the council was selling it for. This will be a recurring difficulty and I stress to the Minister the need to ensure there is an examination of how the affordable housing product was put on the market. The prices were decided two years ago in a declining market, which has changed radically. We may well have a case where people will vote with their feet and the affordable housing programme, as it is currently, will come to a standstill, particularly with the introduction of the incremental purchase scheme. When that is introduced, it will be a far more favourable option to the existing affordable housing scheme.

Even in today's falling housing market, couples find that the cost of buying a home can still exceed their ability to pay and house prices are still over inflated. People are on a social housing list, given the unemployment figures received in this House yesterday, are increasingly finding that the list has grown longer and their place on it may be further down. For too long under this Government housing development and housing policy have been driven by the needs of everyone except home developers. I hope this Bill will show a clear change in direction in that respect. We need change badly, and it is time the House made those changes.

Under this Bill we have the choice to build communities and not housing developments. We can look beyond the bricks and mortar and insist that in future housing is built to sustain communities. We can insist on a housing programme that will enable purchasers to buy homes and not to trade in commodities.

Since I was elected to this House, I have asked when this Bill will come before it. I welcome the fact that we are now dealing with it. I acknowledge that since it was introduced in the Seanad significant changes have occurred in the economy and certain measures will have to be introduced in the Bill. However, there are fundamental aspects of it, regardless of whether the economy is buoyant or in a downturn, namely, good standards and long-term planning are critical to any housing programme. I acknowledge that the Minister of State will bring forward a series of amendments on Committee Stage. I look forward to examining those and will support those that will greatly improve the provision of housing in this State. The Labour Party will also bring forward amendments, to which I hope the Minister of State will give due consideration.

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