Michael McGrath (Cork South Central, Fianna Fail) | Oireachtas source

I thank the Deputy for the question. The total level of capital expenditure, along with the sectoral allocations for areas such as housing, is currently under consideration as part of the ongoing review of the national development plan. That process has yet to be completed and I do not want to pre-empt any decisions that will be made in the coming weeks on foot of that review being finalised. The overall level of capital expenditure in 2021 stands at €10.1 billion, or almost €11 billion when capital carryover from last year is included. This allocation is almost €5.5 billion, or 119%, higher than the amount allocated in 2017. In other words, capital allocations have already more than doubled under the national development plan. This is an all-time high in the history of the Irish State, with a commitment to maintaining and further increasing this over the lifetime of this Government. This is in spite of the major challenges facing the Exchequer due to the impacts of Covid-19 and Brexit. It is also worth noting that the total allocation for the housing programme has increased by 230% between 2016 and 2021, increasing from €943 million to €3.1 billion. Of this, almost €2 billion in capital was committed to the delivery of housing in 2021. The overall capital allocation for the Department of Housing, Local Government and Heritage in the current year is €2.8 billion, an increase of €500 million from last year.

The Deputy can be in no doubt as to the level of priority that this Government affords the issue of housing and that has been reflected in all of the decisions we have made to date in our first year in office when it comes to the allocation of resources. The priority that is being afforded to housing is, of course, actively considered at this time in the context of the new Housing for All strategy that the Minister, Deputy Darragh O'Brien, is finalising, and certainly in the context of the review of the national development plan.

Additional information not given on the floor of the House:

Subject to the impact of Covid, this year the funding will support the delivery of 12,750 new social homes, including 9,500 new build homes. This is the largest social housing build programme in the history of the State.

Increasing the supply of social and affordable homes is a central commitment in the programme for government. However, these commitments must also be met in the context of competing demands on expenditure.

The ESRI report addresses the undersupply of residential housing in the Irish economy, acknowledging the effects of construction restriction due to Covid-19 lockdown measures in early 2021 and referring to the existing housing affordability challenges in Ireland. We have noted that the paper puts forward a funding option for consideration. It is also important to note that pre-pandemic, Ireland’s level of public debt per capitawas one of the highest in the developed world and this has increased as a result of our response to the crisis.

The national development plan, NDP, review will assess the balance of resourcing between sectors such as housing, health, education and transport, in the light of the programme for Government. The overall capital allocations over future years for housing and these other areas will be set out, once decided by the Government, as part of phase 2 of the NDP review. In addition, phase 1 of the NDP review examined the question of what the appropriate level of capital expenditure should be. As part of that, a macroeconomic analysis considered a number of factors including: the overall fiscal position; the demand for investment; the supply side capacity constraints in the public sector and construction sector; and international comparisons. All of those factors will need to be considered and balanced against each other as part of the NDP review when setting the planned level of public capital investment for the period 2021 to 2030.

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