Mick Wallace (Wexford, Independent) | Oireachtas source

I wish no disrespect to the Minister of State who is present. I have had a few conversations with him about housing and he has earned my respect. This is a very problematic area. The problems are not easily fixed but sadly they have got worse in the six and a half years since I have been here. I do not agree with the Government's approach.

My topic is the need to ring-fence all State land currently available throughout Ireland for social and affordable housing. In certain parts of the country, especially in Dublin and other major cities, there is a lot of land under the control of the State and of the National Asset Management Agency, NAMA. I do not understand why we would, for example, allow NAMA engage developers to build housing, and finance them to sell units that are unaffordable.

I do not understand why the State is not proactive about supplying affordable housing. I am very disappointed that the amount of social housing coming down the line is not enough. We need about 10,000 social housing units per annum for the next ten years. We also need a minimum of 10,000 affordable units per annum for the next ten years. We will not achieve that under the current policy.

We face two big problems, the price of land and developers' profit - that is a developer as distinct from a builder. As the then Minister with responsibility for housing, Deputy Simon Coveney, told us in December 2016, the local authority on State land in Dublin could have built a three bedroom house for €205,000, that might be €230,000 now, while the figure outside of Dublin was €154,000, which might be €170,000 now. The truth is that we will not get units through a major developer who has been funded by NAMA on State land for less than €400,000. It is not happening and it will not happen. Why will the Government not ring fence the land?

I have looked at what happens in Europe. In Germany, local authorities can freeze the value of the land after it decides to specify an area for residential construction. The freezing of land values means that the local authority effectively acquires the land at use value. That is not rocket science. Our site levy which was invented in 2015 is a joke. It is too easy to get out of it. It will not catch anyone with a brain in his or her head. It is no good for the Minister to increase it from 3% to 7% because it will not catch the developer. If I had a land bank I guarantee I would not have to pay a penny in tax because I know exactly what I would have to do to avoid it and so too do the developers. If one has borrowed more than 75% of the money one can avoid most of the tax, which is also the case if one is using the land for anything.

This week I was at a launch of a report by Jesuit Centre for Faith and Justice and I will mention a couple of relevant points made at that event. First was that the housing crisis was a direct result of Government policies and second that Rebuilding Ireland failed to address the financialisation of housing. It said that the market failure must be recognised, the market does not deliver when it should and the prices are too high. The report says that three out of four homeless people will end up in private rented accommodation. We are moving towards the private rental market but we have designed it in such a way with REITs and vulture funds that rent is too expensive here. The average rent for two-bedroom apartment in Dublin is now €1,800, where it is €400 in most cities in Italy or Germany. I ask the Minister of State, please can we have a change of direction and ring fence land so that State land can be used to provide housing - social and affordable - for the people of Ireland?

See this speech in context