Mick Wallace (Wexford, Independent) | Oireachtas source

I disagree with section 12(3)(a), which states that a local authority must only give tenants ten working days of notice before the District Court can hear a possession application. As Focus Ireland has argued, tenants should be given at least 30 working days so they can have a reasonable amount of time to obtain advice and information.

Having read some of the submissions to the Oireachtas environment committee regarding the Bill, it seems a strong theme emerged from organisations working on the front line with homeless people that the option of evicting tenants should only be used as a last resort. Local authorities should be obliged to first engage with problematic tenants to try to resolve issues leading to difficulties rather than going straight to eviction procedures. The Bill needs to deal with the fact that simply evicting people because of rent arrears or anti-social behaviour does nothing to tackle the root causes of these issues, such as poverty and social exclusion. Problems are just moved elsewhere, and in some cases the cost to the State increases, as newly homeless families must be provided with costly emergency homeless accommodation.

Part 3 provides for a new tenant purchase scheme along incremental lines. In Britain, the result of Prime Minister Thatcher's right-to-buy scheme is a chronic shortage of affordable housing and millions of people on the social housing waiting list. Between 1980 and 2010, more than 2 million properties were sold, which is equivalent to approximately half of the country's public housing stock. These council houses were sold at serious discounts of up to 50%, although new public housing was not built to fill the gap. In the London Review of Books, Mr. James Meek recently pointed out that councils were not allowed to spend the money earned to replace homes which were sold, and central government funding for housing was slashed. Of all the spending cuts made by the Thatcher government in its first term of notorious axe-swinging, three quarters came from the housing budget. Mr. Meek argues that many who bought their council houses sold them to private landlords who rented them to people on housing benefit who could not get a council house at double or triple the levels of council rent.

The right-to-buy scheme therefore created an astonishing leak of state money into the rental class. The British Government sold people homes it owned at a major discount and allowed the buyers to keep the profit when they sold the homes to a private landlord at the market price. It then artificially raised market rents by choking supply, making it impossible for councils to replace the sold houses. It also paid artificially high rents to the same private landlords in the form of housing benefit which was many times higher than what would have been paid if the houses remained in council hands. In other words, Britain made the private rental sector fat at the expense of the state in the long term, which does not make sense.

The Minister of State has just about admitted that this State's refusal to build social housing for a long period is the root of our problems with housing. The big elephant in the room is that we have yet to see a Government control the price of development land. The Government has information on who owns this land but it does not seem to care what is the price. There is sometimes regulation but there is no appetite to regulate this area, which is the biggest problem of all.

The issue is the difference between demand and supply. Demand is driven by a number of factors, with a small group of people controlling the supply. That suits these people, as prices are increased. Demand is great because the population is growing, although families are getting smaller. At one time there would have been far more people living in each house but there are now many more separate couples, which adds to demand. As the small group controls the land, it controls the supply, and the Government is the only party that can deal with this problem. One cannot expect the private sector to address the problem as it has a vested interest in not doing so.

Those involved in building private houses in this country are not doing so in an effort to house people but are doing so for profit. That is the way the system works. As they can control the supply of land, they can control the price of housing. Currently, agencies like the banks, some of which we practically own, and NAMA are selling large blocks of units to investors with the result that the investor has never owned as many units in this country. These properties are selling for a fraction of what they are worth. As I have stated before, some of my own portfolio has been sold for less than half of the cost to build such a unit today, even if I had the land for nothing. How logical is that? A portfolio went on the market last week, with approximately 400 units for sale at approximately €50,000 per unit. If an individual seeks to buy the same unit, he or she would have to pay close to €250,000 for it. As an investor can buy so many units in one block, and the institutions like the banks and NAMA are keen to sell the property in large parcels, we are sowing problems for tomorrow by giving a small group complete control of the rental sector.

Is the Government serious about the problems which the construction sector has brought to the table? That sector was knee-deep in both the boom and the economic collapse, so it is important for the State to control the issue. It will not do so until it addresses the problem of how much development land can be sold for. Everybody is familiar with the Kenny report which was published approximately 25 years ago.

At that time the Kenny report referred to allowing development land to be sold - I am quoting from memory - for something like 25% above agricultural land. I could be wrong on that figure. If the Government allowed development land to be sold at double the price for agriculture, that would be fine because it would be measured but it is being sold for telephone numbers above the agricultural price. I bought a fifth of an acre in a working class area in Dublin for €5 million. Agricultural land has not reached that level. It is still around €10,000 an acre. Imagine if that could be controlled. Does the Government have the appetite to rein these people in? These guys are landbanking again.

Not only are investors, most of whom are foreign, buying large blocks of apartments and blocks of houses, but they are also buying land. It is unlikely that they will release that for development in the next 12 months. They will wait for the price to go up. Will the Government tax land that is zoned for development while the investors sit on it? It could be taxed highly because it creates the problem. If the investors have not started digging the ground 12 months after getting permission to build property on it, the Government should tax them to the hilt. That would do a lot to address the problem. I do not expect Fine Gael to have an appetite for it because it is far more interested in facilitating the private sector to get fat than in challenging it. It would mean a great deal if the Government would get its head around the idea that the price of development land has to be controlled. That is within the Government’s remit.

I rang Wexford County Council this morning to ask how it feels about the Bill and I was told that it welcomes some aspects of the housing assistance payment, HAP, going back to the local authority but it will need the proper resources to administer it. It pointed out that the rent supplement for applicants with short-term housing needs will continue to be the responsibility of the Department of Social Protection while applicants with long-term needs are passed to the local authority. It sees this as a duplication of resources which could lead to problems as applicants are passed from one Department to another. The Minister of State might consider that issue.

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