Mick Wallace (Wexford, Independent) | Oireachtas source

It is almost a year since home building finance Ireland was first announced. The Minister for Finance, Deputy Paschal Donohoe, told us that it would deliver 6,000 homes with funding of €750 million. It has not delivered any houses yet. At the time, the Minister of State might remember, I thought that maybe this might be a worthwhile exercise because I thought the funding would be given to the builders. I find the Government's failure to deal properly with the housing crisis and the dysfunctional nature of how housing is supplied in this country soul-destroying at this stage. We have had a problem for a long time. It did not start under the Government. It started a long time ago, but it is continuing under the two Governments there have been since I was elected to the House. They have failed to deal with it properly.

This proposal is about lending money to people to build. The Government's Land Development Agency will seek to have buildings provided on State lands, with the figures of 10%, 30% and 60% for social, affordable and private housing, respectively. Considering that private developers and landbankers are sitting on so much land as they watch its value rise, why is the Government giving in to them and providing them with State land on which to build private housing? I am all for building private housing. However, the State is not the one that should be building it. I am okay with the Government giving money to builders to build houses on condition that it would be affordable.

What is affordable? Last week the Minister for Housing, Planning and Local Government, Deputy Eoghan Murphy, spoke about an affordable price being between €325,000 and €350,000. That is not affordable for most people today. The price will not stand still either. There is a big difference between the builder and the developer, but the Government keeps mixing them up, as did the previous one. The developer is looking for a profit of between €60,000 and €80,000 per unit. The builder is not. The Minister of State and I know plenty of builders who, if they made a profit of €10,000 on every unit they built, they would be happy bunnies. However, that is the not the case with developers. The Government talks about engaging developers, but it is not going to small builders who can work for a fair price. Instead, it is going to the big boys, just as NAMA did.

The principle on which NAMA has been working for the past four years is not much different from this proposal or that for the Land Development Agency. NAMA has given money to its favourite chosen ones to build on its land. For example, it funded a development at Maryborough Hill in Cork, where the price of four-bedroom houses starts at €470,000. Why would a State body give money to a developer to provide housing at a cost of €470,000? I cannot understand it. NAMA funded the Piper's Hill development in County Kildare and got Sean Mulryan to build it. The price of a three-bedroom house starts at €345,000. NAMA funded the Coill Dubh development in Malahide where in 2016 four-bedroom houses were going for €465,000. There are other schemes, several of which I have mentioned before, where the position is the same. There is no rationale for this and it is actually inflating the price. The Government is throwing diesel on the fire by allowing the likes of NAMA to fund developments where developers can end up charging a price that is unaffordable for most people. It does not stack up.

The Government has an immense amount of land on which to build. It claims, however, that local authorities are not fit for purpose when it comes to housebuilding. I cannot understand why it does not make them fit for purpose. They cannot build the housing, meaning that they will hire builders, not developers, to do so. Why does the Government not opt for that model? If the expertise is not available in the local authorities, why will it not provide it in and have it run on a county basis? The local authorities could then hire builders in their areas to build schemes and provide houses at a certain price. They could pick one builder out of ten at a fair price. It is not rocket science.

Since 2011, the position has got worse. The Government is not dealing with the issue in the right way. I am frustrated because I know how the industry operates and where the bodies are buried. The Government is just throwing diesel on the fire, which does not make any sense. I wish it would stop listening to the wrong people. It is listening to people who have a vested interest in housing being very expensive. I can guarantee that within three years from now the price of property will fall again. We have not dealt with the fundamental problems of the last recession and are not handling this matter properly. We are moving in the wrong direction and walking into trouble. We are not going to be supplying affordable housing in the next couple of years, which is crazy. Somebody needs to get a grip and stop listening to the vested interests who want property to be very expensive.

In July I brought forward a Bill which proposed a 25% tax on land banks. That is where the expensive supply of housing starts. Fine Gael obviously represents a better-off clientele than other parties. I can assure the Minister of State that 99% of Fine Gael supporters would benefit from cheaper housing if the Government dealt with this problem. The kids of the wealthy cannot get mortgages and cannot afford most of the houses which have been built. It is nuts.

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