Ann Phelan (Carlow-Kilkenny, Labour) | Oireachtas source

I am in contact with many of the housing agencies and the difficulties have not been brought to my attention. The Deputy raises a very important issue. The Housing Finance Agency is a public limited company and in that context the Minister for the Environment, Community and Local Government has no function in the lending decisions and practices of that agency.

The main function of the Housing Finance Agency is to advance funds to local authorities to be used by them for any purpose authorised under the Housing Acts and to borrow or raise funds for these purposes. All of the issued share capital of the agency is beneficially owned by the Minister for Finance. The agency operates as a company and is therefore subject to usual accounting disciplines. The legislation under which it was set up enjoins it to at least break even in its operations and it operates without Government subvention.

Until recently, significant levels of capital funding were available to approved housing bodies through capital funding schemes, namely the capital assistance scheme the Deputy mentioned, and the capital loan and subsidy scheme. However, in recent years the approved housing body sector has had to shift from capital-funded programmes of construction and acquisition to more revenue-funded options and this has been a challenging process for the sector. The use of standard leasing agreements and loan finance from both commercial lending institutions and the Housing Finance Agency has allowed the sector to cope with this shift.

The Housing Finance Agency, in accordance with section 17 of the Housing (Miscellaneous Provisions) Act 2002 is empowered to, and does, provide lending facilities directly to approved housing bodies. Approved housing bodies can apply directly to the Housing Finance Agency for loan finance to buy or build new units to be leased for social housing purposes with lease payments used by the approved housing body to remunerate their borrowings from the Housing Finance Agency.

Each approved housing body wishing to draw funds directly must be deemed a qualifying body on foot of an assessment by the Housing Finance Agency. This is to ensure that the approved housing body is capable of managing all aspects of a social housing scheme from design and construction stage all the way through to rent collection and maintenance over the life of a project. Particular attention is paid in the assessment to financial and governance arrangements. Once an approved housing body has made it through the pre-qualification assessment, applications for lending are made to the Housing Finance Agency on a project-by-project basis and are assessed by the Housing Finance Agency's credit committee.

To date, 11 approved housing bodies have achieved certified borrower status with the Housing Finance Agency. It is anticipated that the remainder of 2015 will see continued growth in the level of lending in this area.

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