Barry Cowen (Offaly, Fianna Fail) | Oireachtas source

I welcome the opportunity to speak on this Bill which attempts to bring forward compulsory purchase orders, CPOs, for unzoned land for social housing construction, to change the rules determining compensation for local authority CPOs, to introduce rent certainty provisions and to bring forward the vacant site levy by two years.

The Bill proposes to introduce the recommendations of the Kenny report from 1973 and seeks to allow local authorities to issue a CPO to purchase land for 125% of its current value. This is defined as the value of non-development land prior to it being zoned for residential use. This is a bad idea because there is already a great deal of development land zoned for residential use. The area of such lands amounts to 17,434 hectares, which is enough for 414,000 dwellings. There is serviceable land zoned for a potential 116,000 units in Dublin alone. Local authorities already own huge parcels of serviced and unserviced land. The availability and cost of land is not a barrier to social housing construction in most areas. There is no reason local authorities should waste money buying parcels of non-residentially zoned land when there are already large parcels of such land zoned for residential use. In addition, CPOs are a costly way to buy land for social housing due to their legal complexity. This is not what is recommended by the Kenny report in 1978. It is about how to reclaim some of the dividend that accrues to landowners as a result of intended or actual State investment in services and-or rezoning. This has and is being been done through development levies, which were not seen as technically feasible in 1973 and were thought by the authors of the report to be too cumbersome to assess and collect. This Bill, by contrast, attempts to make it cheaper for local authorities to build social housing units on agricultural zoned unserviced land. This makes no sense and would be a costly, needless waste of public money. The Bill displays a startling misunderstanding of planning and the local authority home building process.

With regard to changing the method by which compensation is determined on CPOs for local authorities, the Bill proposes to abolish existing methods for determining compensation for CPO by local authority projects, implementing the idea from the Kenny report 1973 whereby all CPOs would be paid 125% predevelopment value. Currently, the assessment of compensation payable by an acquiring authority is based on 17 rules laid out by statute and by the relevant case law, including the value of land acquired, diminution in value of retained lands, if any; costs resulting from acquisition; disturbance; loss of profits or goodwill; loss or depreciation of stock in trade etc. The aim of a compulsory purchase order should be to leave the affected party, in so far as possible, in the same position as before the property or land was acquired. It follows therefore, that the affected parties should be duly compensated for their loss or disturbance. There is no logical reason why this assessment system, which covers the multitude of circumstances in which CPOs take place, should be replaced by a simplistic rule specifying 125% of the prezoned current value. This would be unimplementable and, without doubt, would breach individuals’ rights to fair compensation.

On rent certainty provisions, while stronger rent certainty measures are required, any model must be well thought out and display awareness of the significant disruptions that rent regulations can inflict on the market. Fianna Fáil is on record for over a year now calling for stronger rent certainty measures. Last week, during the course of debate on the Sinn Féin Private Members' business on rent regulations, Fianna Fáil introduced an amendment that would oblige the Minister to introduce new rent certainty measures to the Oireachtas within one month by way of amendment on Committee and Remaining Stages of the Planning and Development (Housing) and Residential Tenancies Bill 2016 which takes place next week or by way of recommendations that could bring about rent certainty. In the absence of Government doing so, we expect that provisions in that regard will be contained in the rental strategy. Failing either of those options being taken by Government, Fianna Fáil will bring forth legislation to implement the rent certainty measures that we believe are necessary. Such rent certainty measures must be subsequent to the consideration of the most appropriate model for rent certainty regulations that is both constitutional and minimises negative affects on rental unit supply.

On the proposal to bring forward the vacant site levy, the 3% vacant site levy is due to take effect in 2019. The Labour Party in government was responsible for setting 2019 as the year in which the levy would commence being charged on vacant residential sites in high demand urban areas. It is now proposing that owners of vacant sites be subject to this levy from 2017. To be subject to the levy, properties will have to be on the vacant site register for one year. That is the law. As such it is not legally possible to introduce it in 2017. This would be a retrospective application of the law, which is not possible or legally enforceable. They are the four main recommendations of this Bill. I have responded to each of those recommendations and highlighted the reasons Fianna Fáil does not believe they are applicable or necessary. We do not believe they would help to resolve the crisis and have set out the reasons why that is the case.

I commend Deputy Jan O'Sullivan on her effort in bringing forward legislation which she believes would be advantageous in addressing the crisis we are in. Unfortunately, I do not believe what is contained in this Bill will have the effect she desires. I have, therefore, as referred to by Deputy O'Sullivan, tabled a counter-proposal to the Second Reading of this Bill. As I said earlier, I look forward to dealing next week with Committee and Remaining Stages of the Planning and Development (Housing) and Residential Tenancies Bill 2016. I hope the Government will take that opportunity to recognise the will that exists across all sides of the House to bring forward a reputable, appropriate and efficient recent certainty model that can help.

It needs to be in place for a sunset period to interfere with what is an abnormal market in order to bring about some sense of normality in the sector.

I know the Minister will receive the help and assistance that is required from those all sides of the House to ensure cross-party support for a model that is appropriate and based on rent certainty regulations. That model should be cognisant of the constitutional aspects. The latter have been lost in some of the debates that have taken place in recent weeks despite people's best intentions and Members all being on the same side in their desire to have a mechanism that would help.

I put the House on notice that I shall be moving an amendment.

See this speech in context