Aodhán Ó Ríordáin (Dublin Bay North, Labour) | Oireachtas source

I congratulate the Minister on his appointment. During the general election held a few short months ago housing was the biggest issue arising on the doorsteps. In terms of affordability, it was far too common to come across a number of generations of one family living under the same roof, with people priced out of starting a life, with relationship break-up putting a huge strain on families and with people wondering what life chance they had to live in the area I represent, although this is a national issue as well.

I appreciate the opportunity to speak on the issue of housing this evening. The Labour Party Private Members' time tomorrow evening will focus on housing as well. This evening, we are focused on the issue of affordable housing. The Minister mentioned in his contribution that he proposes to initiate an affordable purchase scheme and he mentioned that he would welcome practical and positive suggestions. In this regard, I refer the Minister to the former rent-to-buy scheme. The Minister will recall that prior to the crash a number of housing schemes were in place during the late 2008 to 2010 period in particular, which afforded people an opportunity to get on the property ladder but these schemes were disbanded when the crash happened. The rent-to-buy scheme was operated by Dublin City Council and Louth County Council. A similar scheme operated in Northern Ireland.

I would like to speak to the scheme operated by Dublin City Council. Under this scheme a person entered into a three-year agreement with the council to rent at an agreed monthly rent of up to 20% less than the market rate in a particular area. If the person decided to purchase the property, 80% of the rent paid over the three years, or a shorter term but up to a maximum of three years, was offset against the purchase price, this price having been agreed before the tenant moved into the accommodation. One of the benefits of the rent-to-buy scheme was that a person had three years to decide if he or she wanted to buy the property, to continue to rent it or to walk away. This gave people an opportunity not to have to rent and save simultaneously. These are the couples and individuals all of us meet who cannot afford to rent and save for a deposit at the same time and so they feel completely locked out. What we need now is a scheme such that people do not have to rent and save at the same time. Such a scheme existed pre-2010. The Labour Party is suggesting that the Minister recommence that scheme, but nationally rather than in any one local authority area.

As I said, a similar scheme is operated in Northern Ireland, known as the rent-to-own scheme. Under this scheme a person signs a tenancy agreement, the rent-to-own co-operative buys the property selected by the rent-to-own applicant and it rents it to the tenant at market rent. The tenant then has an option to buy at the end of three-year fixed term. To qualify, a person must be able to show that he or she can make the repayments and does not have an alternative route into home ownership. The Labour Party proposal is practical and it should be taken on board to address the situation for the locked out generation. It is a proposal we could work on collectively across the House. As I said, schemes of this type were in place prior to the crash. When the crash came, over a short period a huge amount of property became much more affordable to people of a certain income stream if they were still in employment.

These are the types of schemes we need to revert to. The State should be happy to get involved. I do not understand the reluctance of successive Governments to have the hand of the State hugely, if not solely, involved in the provision of housing. The State does not have a profit motive. The issue with housing when it is left to the market is that the market has no conscience and it has a profit motive. If the State is involved it does not have a profit motive and there are standards that we can expect from the State and those who oversee the agencies of the State, be they local authorities or Departments. We would have more faith in councils, local authorities or direct funding from Departments to drive these schemes. Those who could avail of these schemes would have much more faith in them because they would know that in a private rented market situation they would not end up on the rough end of a tenancy agreement if things did not go their way. People can trust the State more than the market economy.

On that basis, tomorrow night we will flesh out other issues the Labour Party has in terms of the housing situation. As I said, when I was canvassing a rent-to-buy scheme was a measure many couples said they could potentially buy into. People should not have to rent and save at the same time. The two can happen simultaneously with tenants being given a three-year timeframe within which to make a decision. This would give people a level of comfort for a set timeframe. It also would not put a huge emotional strain on a relationship or an emotional strain on a family that just wants to move on and live their lives.

See this speech in context