Dáil debates

Thursday, 2 October 2008

Adjournment Debate

Tenant Purchase Schemes.

3:00 pm

Photo of Lucinda CreightonLucinda Creighton (Dublin South East, Fine Gael)
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I want to raise the failure of the Government to introduce the tenant purchase scheme for flat owners in local authority areas throughout the country. As I understand it, the current tenant purchase scheme operates under regulations derived from section 26 of the Housing (Miscellaneous Provisions) Act 1992, which specifically excludes flats and self-contained units in flat complexes from the scheme. It is interesting to note that legislation to apply to flat owners has been promised since the early 1990s but some 16 years later that legislation has not been introduced to enable the residents of local authority flats to purchase the units in which they live and may have lived for many years.

This is fundamentally important to the future of Irish society — I do not mean this in any broad brush sense. It is crucial in terms of social innovation and social inclusion that people are afforded the opportunity to set their hopes and standards higher and ultimately to exercise the right to purchase their home in the same way as the tenants of council houses have been enabled to do so. It is a hugely important issue in terms of offering hope and opportunity to people who are resident in council flats throughout the country. In my constituency of Dublin South-East, this is major issue and is high on the agenda for many of the residents in council flat complexes.

To illustrate the feasibility of this, in researching and finding out more about how tenant purchase schemes operate and have operated, it is clear that a successful scheme operated in Cork City Council in the late 1980s and early 1990s before the new regulations came into force. That was a pretty successful scheme whereby tenants of council flats in the Cork City Council area were unable to purchase the flats they were living in during that period. The scheme was dropped on the basis that legislation was to be introduced by the Government in the early 1990s to cover not just tenants of council houses but also tenants of council flats. That never happened. The scheme was discontinued and no scheme was introduced to replace it. The Government is on record for more than a decade expressing its commitment to affording people the opportunity to purchase flats from local authorities. The Government policy paper in February 2007, entitled Delivering Homes, Sustaining Communities, contained a commitment to a tenant purchase scheme for current residents of council flats. Page 47 of that document stated that legislation to underpin a new scheme of tenant purchase was being drafted and that it would allow for the purchase of flats. In the same document the Government also promised an incremental purchase scheme that would apply to those allocated social housing at the time of that allocation.

In addition, the programme for Government of this Fianna Fáil, Green Party, Progressive Democrats and Independent alliance contains a promise to "expand the paths to home ownership to assist the maximum number of people in gaining a stake in their own home." I urge the Minister to honour those commitments in the Housing (Miscellaneous Provisions) Bill.

Photo of Michael KittMichael Kitt (Galway East, Fianna Fail)
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I am taking this matter on behalf of my colleague, the Minister for the Environment, Heritage and Local Government. I thank the Deputy for giving me the opportunity to outline to the House the steps being taken towards extending the opportunity for home ownership to tenants of local authority apartments.

The Government announced its intention to introduce a scheme for the sale of local authority apartments under certain conditions in the Housing Policy Framework — Building Sustainable Communities, published in December 2005. This commitment was reiterated in Delivering Homes, Sustaining Communities, the Government statement on housing policy published in February 2007. Furthermore, the agreed programme for Government published in June 2007 indicated that the Government would "expand the paths to home ownership to assist the maximum number of people in gaining a stake in their own home."

Previous efforts to introduce tenant purchase for local authority apartments were thwarted by the difficulties associated with the scheme. Work is continuing on a model for the sale of apartments to tenants which addresses those difficulties. The model is based on the long-standing arrangements in the private sector for the ownership and management of multi-unit residential developments. Of course, the transition from a rented social housing complex to a mixed tenure of privately-owned and social-rented accommodation adds an extra dimension to the legal and practical problems that can arise.

Any model leading to a viable scheme for the tenant purchase of apartments must address the following issues: the need to establish fair, equitable and proportionate arrangements to give tenant purchasers and the local authority a voice in the management of the apartment complex; the role of a management company, representative of all apartment owners, including the local authority, in managing and maintaining the common areas and services in the complex; the need for tenant purchasers to contribute, through service charges, towards the ongoing maintenance of common areas and services; arrangements for sharing the costs of insurance covering the entire complex; and the need to create a reserve fund to pay for major improvement works required in the future.

It was not possible to resolve the complex issues involved in time for the publication of the Housing (Miscellaneous Provisions) Bill 2008 in July. Second Stage reading of the Bill has now begun. We are, however, determined to pursue an initiative in this area as quickly as possible but we must also get it right. Our aim is to establish a robust legislative framework that would stand the test of time for all stakeholders, namely, apartment buyers, apartment tenants who choose not to buy, and local authorities.