Willie Penrose (Longford-Westmeath, Labour) | Oireachtas source

I am glad to have the opportunity to address this Bill in the Dáil today on behalf of my colleague, Deputy Jan O'Sullivan, who is unavoidably absent. I have to say at the outset that, as a former Minister of State for housing, I was well acquainted with the late Simon Brooke. He was the driving force behind the Clúid Housing Association and he made a stalwart contribution towards trying to achieve solutions to significant issues as an approved housing body. I offer my sympathies and that of the Labour Party to Simon Brooke's family and the staff of the Clúid Housing Association throughout the country.

As somebody who came from a local authority house, and was very proud of it, I always knew that our party was very committed to the construction of local authority housing. I only have to go back to the time of former Members Jim Tully, Liam Kavanagh, Emmet Stagg and Liz McManus. When I came into this House in March 2011, there was not a shilling available. I remember the few shillings we had for the local authority small schemes. That was threatened to be taken away. If there was a shilling in a pot, I would have been delighted to devote it to local authority housing because I know the value of getting a local authority house. I was always proud to say where I came from, to pay rent and not run up arrears. I was always delighted to pay. My parents struggled to pay but they always paid. I am very proud of that fact, and it is important.

What I saw when I came into this House was that, unfortunately, the previous Government had moved into the sphere of dependence upon the private sector in all aspects of housing provision. It privatised the provision of housing. To reverse a policy that was going well was foolhardy in the extreme. The height of the Celtic tiger period, when huge resources were being generated, was an opportune time to make sure the local authorities continued along the same vein and provided local authority houses. Someone was blinded by the mirage of Celtic tiger growth. A lesson all of us can take away from that is never to go down that road again.

We will support anything that improves the provision of housing. We will support this Bill in principle but as Deputy Ó Broin said, a number of issues will have to be addressed on Committee Stage. I have no doubt Deputy O' Brien will be up for that to achieve his purported objective.

I salute people who bring forward Bills in this House to address very important issues. It is a worthy effort at this stage to address the need of first-time buyers but there is a number of issues that need to be addressed in the Bill to make it fit for purpose. It should be noted that, while the Bill would allow for lands to be designated, it does not address the principle issue of affordability, which is the key point, for first-time buyers. This is anathema to me. I know the private sector has to have some role but I am opposed to depending on the private market to resolve a problem. The State must be the primary driver. The private sector is like the hungry pig at the trough. The snout is always in if there is something in it for him. As I said this morning when I spoke about the beef processors, of whom I have a lot of experience, they only worry about bottom lines, the margins and who they can squeeze to achieve, maintain and increase margins. They do not care who is injured in the process. That is the reason we have to refocus on this area. I know we are coming from a place where no houses were built. I am not totally agnostic in respect of this issue.

The Bill gives the local council the power to designate land for the purpose of developing housing to be set aside for first-time buyers by amending Part V of the Planning and Development Act and would seek a certain amount of between 0% and 30% to be earmarked for this purpose. There are concerns about the way that would be applied. The level would be informed by the assessment to build or to rent requirements of the local authority areas, which would mean rental requirements would be calculated separate from other housing requirements.

Rental developments will proceed only if they are in line with the housing strategy requirements. While it is a proposed solution, I am sure I am not the only one who believes it is a complicated way to seek to address the problem of affordable homes. The Bill defines eligible individuals as those who have not previously bought a home. As a barrister, I have identified one small flaw, it would not exclude those who have inherited or have been gifted a property. In that regard, the definition of a first-time buyer, as described, would need to be expanded or some other definition devised.

We have heard many times from Fianna Fáil about the affordable housing proposals it secured in government with Fine Gael but we have not seen any evidence of those yet.

I will welcome them whenever they do emerge.

One of the biggest problems faced by young people who want to buy their own home is the record level of rent they must pay. People are paying substantially more in rent every month than they might on a mortgage. Meanwhile, they are unable to save for a deposit. I have experience of the Rebuilding Ireland programme because I was filling out a couple of forms for Westmeath County Council. One of the partners in a certain couple whose case I dealt with was made bankrupt a few years ago. The couple are back on their feet but the black print, that is, the small type, excludes them. They would be paying less on a mortgage than on rent but they are encountering difficulty because one of the partners was bankrupt three or four years ago. Thankfully, he availed of my legislation, on the one-year bankruptcy period, to get out of his circumstances. The banks were so greedy they wanted to press everybody. The individual in question is again being punished, this time by the State. We have to consider cases like that. We have to take the opportunity. Why not take a chance on our own citizens? We have done that for the vulture funds, with their tax-free-haven status. Why not take a chance on a citizen who is paying income tax and rent?

Rents have continued to increase well ahead of the growth in wages. This means people who cannot afford to buy are being squeezed, and squeezed further. It is welcome that Fianna Fáil recently did an about-turn on rents and has converted to the side of those of us who want a rent freeze. That is what should be put in place. Let us test the Constitution in this regard.

For the record, it was Fianna Fáil that allowed Fine Gael put in place the disastrous rent pressure zone model, which has 4% annual increases for tenants. This is far ahead of the rate of inflation. Unfortunately, the damage has been done to the incomes of people in the rental market. Rents are now at a record high and will continue to grow unless we intervene.

It is crystal clear that the market created the housing crisis. There is no way it can solve it, nor should we even contemplate it solving it. The State must step in and reassert its role in the provision of housing. If we want to provide affordable housing for first-time buyers, young people, renters and those who need it, we can do so if there is collective political will. The Labour Party wants this to happen. It is why we published last year our comprehensive strategy, Affordable Housing for All, produced by my colleague Deputy Jan O'Sullivan.

Our aim is to deliver 80,000 units over five years, at a cost of €16 billion, with the source of the money identified – it is not phantom money but real – to deal with the most significant social problem of our time. These would be homes built on public land. To achieve this, we propose the creation of a housing development bank that would incorporate the expertise and resources of the National Asset Management Agency, NAMA, the Housing Agency and the Housing Finance Agency and would also incorporate the Land Development Agency, which the Government has set up but which is going nowhere. There is no reason the Government cannot mandate the Land Development Agency on this day to ensure any housing built on its lands will be affordable and reserved for first-time buyers. Under Labour's plan, the combined remit of the bodies would be to act as a State-owned commercial housing developer with a remit to produce social housing and affordable public housing on publicly owned land. This is radically different from the current policy of providing a large proportion of State-owned land to the private sector to build for profit and what the market would allow, with even so-called affordable homes linked to the market rate, rather to what a household can afford.

We are all aware that, under the Ó Cualann model, homes in the Dublin area were built and can be built for less than €200,000 per unit. There is no shortage of ideas or solutions to the housing crisis. What has been lacking is political will on the part of the Government. That the Government relies on developers to provide solutions to the greatest social problem of our time is mind-boggling. We have to ensure a social democratic model of housing provision will become the bulwark in addressing the problem of social housing. By giving local authorities a pivotal role, we can start addressing it. It will take time but with the political will in this House, it can be achieved.

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