Damien English (Meath West, Fine Gael) | Oireachtas source

Deputy Healy-Rae raised the issue of the protection of rural Ireland and this budget is certainly rural-proofed as I and the Minister, Deputy Humphreys, will outline. We look forward to working with the Deputy on that and would be glad to hear any ideas he might have to help to achieve that.

In the absence of the Taoiseach, I will have to defend him because he is my boss and I had better make sure I do that. I would be surprised if a man who spends a lot of time - weeks and weeks - in Kerry every summer, as Deputy Healy-Rae knows, would laugh at people under pressure from floods. It is not something that would be in his nature. While I was not here and cannot absolutely guarantee it, I would be surprised if that is what he was laughing at. To be fair, that is not something he would do. That does not take away from the issue. There are serious issues of flooding in Kerry and other places, and it is a particular issue for farmers and those with their own businesses. It is something we have to address and money is being provided for flood relief. I doubt that is something the Taoiseach would have laughed at.

With regard to the issues about development and the barriers for developers, the Deputy is right that these are issues of concern. In putting together our plans for rebuilding Ireland and the action plan to tackle homelessness and housing, we engaged with all the stakeholders, including developers of all different sizes who, as the Deputy said, want to get back in the game and want to be able to build houses. We need them to be able to build houses. Therefore, the budget has a 50% increase in the housing budget to try to tackle this issue now and for the years ahead. The commitment of €5.5 billion of taxpayers' money over the next four to five years is to do exactly that - to get houses under construction again, to get developers back in the game and back working and to get small builders back out there building houses, both social and private. In 2017 we will see €1.2 billion of taxpayers' money being spent on housing. Hopefully, that will do what the Deputy suggests and help some of these developers get back in the game and get them going.

I want to deal with two specific issues. First, Deputy Healy-Rae is correct that the cost of money is an issue for developers and builders and it is too high for some of them. Two new funds have been set up through the Department of Finance which are designed to make money available for construction, and hopefully some of them can avail of that. Second, we announced last week and under this budget that the Part V element can now be paid for up front by county councils. Some developers might have a site for ten or 20 houses but they need the cash to get going. We are now allowing that the Part V 10% can be paid for up front, which will give the developer a bit of cash to build the first few houses and get the project moving. We recognise this is an issue.

In the budget and in the housing action plan there are commitments to fund infrastructure on key sites. I am conscious the focus of those key sites will probably be in the Dublin region first, then Cork and the greater Dublin region, but there is also a commitment to fund infrastructure and open up sites. In some cases, there will be a site where 500 or 600 houses could be built but, for the want of a bridge or a new road, the site is not active. We are providing taxpayers' money in a €50 million commitment in 2017 to get that started, and some €200 million overall to fund that infrastructure. There are also other commitments to fund infrastructure on those sites.

Development levies are an issue, of that there is no doubt, and they are an impediment to some people being able to construct again. That is a decision of local authorities but it is certainly something we are engaging with them on as a Department with responsibility for housing and planning. In Cork and Dublin we have already made changes to the levies, which has given positive results. In some cases, if they are told it is €30,000 to €60,000 per unit to open up a site, developers are not going to build those houses because they cannot pass on that cost. The Deputy is on the ball in that regard and these are issues we are addressing.

There is some confusion over the help-to-buy scheme for first-time buyers. It is a supply initiative and it will help one-off houses. Last year we saw some 6,000 one-off houses built in rural Ireland, many of which were possibly built by first-time buyers, although I do not have the figures. They can also avail of this assistance towards getting a house. It is a supply measure. The Deputy asked why it is not for second-hand homes. I saw a teacher from the Deputy's area on the news yesterday saying he was disheartened and disappointed that it was not available for him to buy a house. While I totally understand that, we have to focus taxpayers' money - the people's money - on new supply. The major problem is that there is not enough supply, which is why the incentive is towards supply of new housing. If we made that grant available for second-hand homes, we would not be guaranteed to increase supply.

It should reduce the competition for the second-hand home in question. The gentleman and others I am sure the Deputy represents should be in a position to buy a cheaper second-hand home. First-time buyers should target new developments and houses.

In what way is the measure a supply measure? I am conscious there is some confusion. Many people are of the opinion that the measure will drive up the price of houses. In my view, that of the Minister responsible for housing, Deputy Coveney, and the Minister for Finance, Deputy Noonan, the measure probably would drive up the price if it were designed for second-hand homes, but it is not for them. It is for new supply. I refer to the supply of houses of a kind that are not available at present. In the greater Dublin region, there is no supply of houses worth between €240,000 and €280,000, yet there are first-time buyers who want to buy such houses. Why are they not being provided? Our understanding is that the customer does not exist. Although single people or couples may want to buy houses at the price in question and reckon they can afford a mortgage worth €240,000 or €260,000, they cannot get the money from the bank. They cannot queue up to buy the houses so the developers are not supplying them. Developers are building houses worth €450,000, €480,000 or €500,000 for a different part of the market. We want the starter homes, however. We want houses worth between €260,000 and €360,000. If the scheme works, and I have no doubt it will, it will put first-time buyers in a position to put a deposit together, obtain a mortgage and try to buy a house in the price bracket in question. We expect the developers will respond to that and build houses for this market.

An analysis of the sale of houses at a certain site in Dublin recently shows that approximately 80% of the buyers were in rented accommodation. If first-time buyers are able to avail of the scheme and buy newly supplied houses, it will free up the houses they are leaving for others. I have no doubt that the scheme will work. It will not drive up the price because there is no price at present. The houses in question are not currently available. We are trying to bring them on board. There is a sunset clause. The provision is for only three years, not for the next ten years. We are all reluctant to incentivise something too much. The period is three years so the scheme cannot run away with itself, as it were. It is a question of bringing on board the supply that we badly need.

We have discussed frequently the importance of social housing and getting back in the game of building social housing. I agree with many Members that for a long time, before the crash, we stopped investing in social housing and in teams of people in both my Department and local authorities to build social housing. The previous arrangement is being reactivated and we are putting the teams together such that all local authorities will be in a position, during the lifetime of this plan, to return to delivering 10,000 social housing units per year, as was the case in the past. We are getting back there.

Social housing on its own will not be enough to solve the problem this year, next year and the year after. We need to increase the private supply of housing. We need to depend on private landlords as well. That is why they are addressed in the budget. We must also reactivate our own construction programme for social housing.

We have committed to supplying 47,000 houses. This budget goes a long way towards meeting that commitment. We wish we could do more but we have to be realistic. It will take a little time to get social housing activity back up to where it should be. I agree there should be such activity.

In this House, we have alluded to the fact that the budget for next year will help approximately 21,000 people get into homes through the various assistance measures, including the housing assistance payment, HAP, and the rental accommodation scheme, RAS, and also the construction of new houses and provision of vacant properties. We are doing all this and it will help to provide social housing. Over the next four or five years, the plan will see approximately 130,000 houses coming on stream in general for everybody.

Part of my brief when in the Department of Jobs, Enterprise and Innovation was dealing with companies daily to try to win jobs for all counties. Housing is an issue for their clients. I refer to people who are not on the social housing list but who need an affordable house. It is important, therefore, that when we commit taxpayers' money, we help all parts of the housing market. We need more houses and more supply. That is the bottom line. I have no doubt that our housing action plan, Rebuilding Ireland, with the backing of this budget, on which the Dáil will vote, will address this problem. It will address the problem of infrastructure and bring the cost down.

There are 84 actions. I have touched on only some of them. The help-to-buy scheme is but one of them. They are all designed to tackle homelessness and provide emergency accommodation. They are to increase the supply of housing because we need it for those who need help to get out of emergency accommodation or get off the streets and those who require assistance paying the rent. We also need it for those with jobs in cities and towns but who cannot get a house, be they in Kerry, Cork, Meath or Dublin.

There is a two-pronged approach and both prongs are very important. I am sorry I cannot touch on any more aspects. It is a progressive budget.

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