Dáil debates

Tuesday, 10 May 2022

Affordable Housing: Motion [Private Members]

 

8:00 pm

Photo of Gerald NashGerald Nash (Louth, Labour) | Oireachtas source

I agree with Deputy Clarke's assessment and analysis. Unfortunately, it is an all-too-common description that she has outlined to the House. I do not always find myself in full agreement with every sentence of every Sinn Féin motion or Bill that is presented to the House. We have our differences, and that is the cut and thrust of politics and is to be expected. However, I find myself agreeing with every sentence in the motion before us. I do so without any hesitation.

In any progressive society and successful economy worth the name the aspiration to one day own one's own home should be within the reach of most, if not all, working people. I know the Minister agrees with that sentiment and that ambition. However, we have been saying for a considerable number of years that nowhere is the social contract more broken than in respect of housing supply. When we talk about housing supply, we know the trick is to get the diversity of that supply right. That means a mix of public homes, affordable homes and private homes built to last through the life cycle in a community and reflecting the rich diversity in every community. Regrettably, the approach taken by the last Government and continued by this one, with some small changes, is all wrong. Whether it relates to public housing, cost rental or the building of affordable homes, the excessive reliance on private developers to deliver the stock we need is the Achilles heel of this Government's housing project.

As the motion notes, both Housing for All and the Government's proposals for affordable housing more generally lack ambition with regard to the provision of the required amount of housing annually. I agree with that assessment. This is even more stark when one looks at the specific proposals for the provision of affordable purchase homes and cost rental.

At the time of the launch of Housing for All, commentators such as the ESRI suggested that up to 50,000 homes a year may need to be delivered on an annual basis to meet the requirements of our growing population. Since then, as the Minister has said, the challenge has become even deeper with the crisis in Ukraine and the responsibilities the State has in welcoming refugees fleeing their war-torn country.

The State needs to have greater ambition with respect to the provision of housing and how much is required every year. This is even more so with respect to the delivery of affordable housing and all it entails. Up to 2030 there will be 18,000 cost rental units. This is an average of only 2,000 apartments and homes that will be delivered through this stream each year. The commitment to 10,000 social homes a year is simply not enough given the demands that we face. We all know this. As I stated earlier in my contribution, the Government continues to rely excessively on the private sector for the delivery of housing generally and the supply of affordable housing more specifically. We believe the State should provide a minimum of 20,000 homes a year. This requires a much more direct and hands-on role in the housing system than the Minister is prepared to take.

I am very concerned by the Government's repeated focus on the incentivisation of investors in the private sector, especially in the build-to-rent sector. This will simply not deliver sustainable communities or secure housing. This is back in focus in light of recent reports that the Minister is considering providing incentives of more than €100,000 to developers to build apartments. We have to stop doling out cash to incentivise development rather than recognising that to resolve the housing crisis what is required is direct State delivery at a much higher level and a more intensive rate. In addition, we must give local authorities the funding they need to build homes. Data show that expenditure has decreased by 53% from last year. We need answers as to why the State is not properly funding direct build projects and instead is proposing yet another set of grants for developers. The delivery of homes rather than profits must be the priority. We are at odds with the Minister over how best it should be done.

The motion is about the affordability of homes. The question of what constitutes affordability is another question that divides the House. The Government needs to put a clear definition of affordability on a statutory footing. My colleague Senator Moynihan has been saying this for a long time. This definition should approach affordability from the perspective of an ordinary person seeking a roof over their heads rather than simply a market discount. The motion rightly points to affordability at O'Devaney Gardens where the full price is considered to be €400,000. This is four times the salary of a Deputy. I say this for context and illustrative purposes. Affordability must be defined by the income of one individual rather than predicated on the idea that everyone buying a home is doing so in a traditional family unit, if I can describe it as such, or a couple. Family and household formation, as we all know, is very diverse these days. It comes in many forms and this is as it should be. More than 400,000 people in Ireland live alone. Single people should not be locked out of the market simply because of their family status and how they decide to live their lives.

Housing for All still does not deliver enough State-led social and affordable housing. The Labour Party wants this increased to 20,000 homes per year to address existing need and unmet demand. We believe, as we said last October in the costed proposals of our alternative budget, we should build a further 2,000 social homes in 2022 in addition to the targeted 10,000 under all delivery streams funded for next year under the national development plan. The Government also proposes a further 2,100 affordable homes this year.

We believe a fund should be established to provide increased levels of affordable housing over five years, starting with €5 billion from the Ireland Strategic Investment Fund and €500 million of annual seed capital. This would make good social and economic sense. It would make economic sense from an investment point of view for the taxpayer over the longer term. It would make our economy more successful. I say this because when we speak to the American Chamber of Commerce, IBEC and other employer bodies, they tell us that from a competitiveness perspective they are no longer concerned about issues such as labour costs and other issues they have routinely raised with politicians over the years. What they are speaking about now in terms of our competitiveness challenge is the lack of affordable homes for the skilled workers on whom our economic success and competitiveness in terms of foreign direct investment will depend. This is a massive challenge. Even if we have Government Members whose the ideology is that there is no function for the State - they believe it should be decided by the market and only the market should provide homes, with some additional units provided by local authorities - if they are interested in the development of the economy they should say we really need to crack this for our future economic success. It needs to be looked at through an economic lens also.

Many colleagues have mentioned the experience in their constituencies of the provision and supply of affordable and private homes to buy. House prices in my constituency of Louth rose by 8% in the first few months of 2022. This is on top of the 12% rise we saw a year ago. The average price of a home in my county is €257,000. This is more than 100% above the lowest point in the previous recession, which is in recent memory as we all know. We are still living with the consequences of it and the dysfunctionality of the housing market and the housing supply system more generally. When we look at these figures, it is much more pronounced in my home area of Drogheda given the proximity to Dublin. The averages in Louth do not tell the entire story.

Yesterday we had a shocking story in the Irish Independent. The figures speak for themselves. Only a tiny number of affordable purchase homes will be built between now and 2026 under the Government's targets. In Louth only 45 homes will be built on average every year. It is one of the fastest growing parts of the country. As we know, many people are leaving the capital to live in areas such as Drogheda, Laytown and Bettystown, which are within half an hour or three quarters of an hour by public transport or car to the city centre. This is a derisory level of investment given the scale of the challenge.

The Minister will especially understand this point. He should take the advice of senior officials in the Department of Public Expenditure and Reform and the Central Bank and scrap the ridiculous help-to-buy scheme. It is a subsidy for developers. That is all it is. It is driving house prices up. It is a deadweight investment. It is bad public policy. The money allocated to it from the shared equity scheme should be diverted directly to those who would build the affordable homes we need.

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