Ciarán Lynch (Cork South Central, Labour)
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Question 7: To ask the Minister for the Environment, Heritage and Local Government if he intends that, under the Housing (Miscellaneous Provisions) Bill 2008, local authorities should form management companies or employ management companies in order to charge rents or make other charges in regard to dwellings that it owns. [36392/08]

Michael Finneran (Roscommon-South Leitrim, Fianna Fail)
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The provisions of the Housing (Miscellaneous Provisions) Bill 2008 are designed to provide a more transparent framework for the delivery of a diverse range of social housing options. The Bill clarifies the role of housing authorities in regard to the management of housing which they own or lease under the rental accommodation scheme or other arrangements. This includes the power to determine rent and other charges in respect of such dwellings. The Bill also provides for the making of a rent scheme to set out the manner in which rents will be determined.

It does not introduce any new requirements in respect of the formation or employment of management companies. Section 30 of the Bill provides that some or all of a housing authority's management functions may be delegated to a designated body. Such delegation is confined to a body including residents and these powers already exist under section 9 of the Housing (Miscellaneous Provisions) Act 1992.

The question of the formation of management companies must be addressed in the context of developing proposals on the tenant purchase of apartments. I hope to bring forward proposals in this regard during the passage of the Bill through the Oireachtas.

Ciarán Lynch (Cork South Central, Labour)
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I am uncertain as to what the Minister of State has just stated, because the legislation, which I have to hand, states that local authorities will be getting into the business of establishing management companies. To push out the question further, will such management companies engage with matters such as the rental accommodation scheme? I can envisage a scenario in which local authorities would operate management companies were the sale of flats scheme to be rolled out as there would be a need for them in such circumstances.

However my question is simple. The legislation states the Government will facilitate a scenario in which local authorities will get into the business of running management companies. If my interpretation is correct, this is more likely to take place in the rental accommodation sector. This will create three outcomes. The first is an additional——

Brendan Howlin (Wexford, Labour)
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Does the Deputy have a question?

Ciarán Lynch (Cork South Central, Labour)
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I shall frame three questions. Will this create an additional charge for tenants under the rental accommodation scheme? How will the legislative framework for this measure be pitched? Will it be included in the Housing (Miscellaneous Provisions) Bill although regulation is still awaited in respect of the private management sector? Third, although councils will be obliged to get into management, they will be unable to manage half an apartment block. What will this mean for social integration and social housing? If my understanding is correct, the only way this will operate is that one will have entire apartment blocks of rental accommodation scheme tenants. That would constitute ghettoisation, not social integration.

Michael Finneran (Roscommon-South Leitrim, Fianna Fail)
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As for the last point, Government policy is to have integrated and sustainable communities. Consequently, I assure the House there is no question of either my Department or the front-line Department reverting to the old position of having local authority estates. Housing developments must be sustainable communities and this remains the policy of the Department.

As for the new Housing (Miscellaneous Provisions) Bill, it provides a more developed legislative basis for the rental accommodation scheme, RAS. It provides for the general terms and conditions that should be included in local authority agreements with accommodation providers, as well as the terms to be provided in the tenancy agreement between the accommodation provider and the RAS tenant. The Bill also provides for termination of these agreements and the payment of a rent contribution by the tenant to the housing authority. The payment of this contribution by the tenant is an obligation of the tenancy agreement. The Bill updates the powers of local authorities to specify rents, clarifying these cover both the rents of dwellings of their own and those which they lease, including arrangements made under the rental accommodation scheme.

Moreover, when the Bill comes before the Dáil, I intend to incorporate a provision within it for a scheme for the purchase of apartments or flats. This request has been on the table for a long time and we await some clearance from the Attorney General's office in this regard. If this happens and hopefully it will, obviously it will give rise to a mix of public and private apartments and flats. At that point, some form of arrangement will be required between the public and private sectors as regards the management for public areas, roofing and so on.

Terence Flanagan (Dublin North East, Fine Gael)
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I thank the Minister of State for his response. I have asked the Tánaiste and Minister for Enterprise, Trade and Employment about the delay in respect of the property services (regulatory authority) Bill many times, as well as raising the matter on the Order of Business. What is the position regarding the cross-departmental committee that was set up by the Taoiseach? Is the Minister of State in a position to provide Members with a progress report in this regard? The legislation must be put in place as soon as possible. This has gone beyond a joke because of the great number of apartment complexes nationwide. While I recognise this is a complex area, the Tánaiste stated that it would be necessary to bring either a single Bill or an omnibus Bill through the Oireachtas to regulate such property management companies. Meanwhile, although a regulator is in place, Members are not being provided with full information as to what work is going on in the background. The Minister of State may be in a position to provide more information in this regard.

Michael Finneran (Roscommon-South Leitrim, Fianna Fail)
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My Department has no responsibility in that area. It pertains to the Companies Acts and is a matter for the Department of Enterprise, Trade and Employment. However, as the Deputy noted, a debate is taking place on this matter. I understand the Department of Justice, Equality and Law Reform will bring forward its proposals on this issue. However, it is not a specific matter for my Department.

Terence Flanagan (Dublin North East, Fine Gael)
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While it is a cross-departmental issue, the delay is a matter of concern.

Joanna Tuffy (Dublin Mid West, Labour)
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I have concerns about the provisions as outlined by the Minister of State because they will play into the hands of many, if not all, of the county managers. My impression is that county managers wish to offload their responsibilities in respect of housing in so far as is possible. They are attempting to off-load as much responsibility as possible onto voluntary housing agencies and this appears to be another method for so doing. A mechanism will exist whereby management of housing can be dealt with by a management company, thereby absolving the councils of responsibility. Many voluntary housing agencies do good work and I do not condemn them, although I have a bigger problem with management companies. However, an issue arises in this regard pertaining to accountability.

The best type of social housing is that which is directly built, provided, allocated and managed by county councils. While I agree with the point about the need for integrated development, we have many successful council housing estates. In the past the proportionate provision of council housing estates was much higher. While only approximately 5% of what is built at present is council housing, the figure used to be up to 30%. I am thinking of locations that have turned out excellently in Crumlin, Drimnagh, Lucan and so on. These were old council estates that were directly managed and provided by the council that were occupied by working people, many of whom went on to buy their houses.

I am worried about these proposals. The management of South Dublin County Council——

Brendan Howlin (Wexford, Labour)
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We are well over time. I call an tAire Stáit.

Joanna Tuffy (Dublin Mid West, Labour)
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——wants to off-load its responsibility and it should not be allowed to so do.

Michael Finneran (Roscommon-South Leitrim, Fianna Fail)
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First, I wish to reassure the Deputy on this matter. At present, local authorities have certain powers under the 1992 Act, which they use in at least three ways that I can think of. First, they use them when an estate gets together and decides to set up its own co-operative management. This takes place in some, but not all, local authorities and works well. In an estate of 20 or 30 houses, the householders may decide to set up a co-operative among themselves in respect of maintenance and so on. Second, local authorities get involved in many other activities that are not necessarily their responsibility. For example, they set up joint management companies in respect of leisure or tourism facilities. Third, they also do so in respect of voluntary housing. As the Deputy is aware, although my Department pays for it through the local authorities, in some cases the latter also have management responsibilities.

These powers already exist and I will not extend them or provide other opportunities in this regard. However, were we to proceed with the sale of flats, as I do not doubt we will, I would be obliged to make accommodation in the Housing (Miscellaneous Provisions) Bill itself. For example, in a unit of 30 dwellings in which ten are purchased and 20 stay public, we will be obliged to enter into new arrangements. I will be obliged in the Bill to give the power to local authorities to set up some form of management arrangement for such a scenario. I intend to do so during the passage of the Bill. However, the Deputy will have plenty of opportunities to discuss this matter during the debate.

Ciarán Lynch (Cork South Central, Labour)
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I wish to ask a brief supplementary question.

Brendan Howlin (Wexford, Labour)
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We are nearly four minutes over time on this question.

Ciarán Lynch (Cork South Central, Labour)
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It simply is to clarify that point.

Brendan Howlin (Wexford, Labour)
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The Deputy should be very brief.

Ciarán Lynch (Cork South Central, Labour)
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Section 30 of the Bill states the Minister will empower local authorities to make charges for dwellings they do not own but which may be subject to a contract of a lease. I understand this pertains to the rental accommodation scheme. A management company or housing authority may pass on management and service charges to tenants. This looks as though it will constitute an additional charge for people.

The conundrum in this regard is that the legislative framework to require the sale of flats requires this provision. Consequently, the Government has no inhibition in this regard. Although the Minister of State has outlined the legislative framework to allow the sale of council flats to take place in this provision, he has not spotted that is the required legislative framework.

Jack Wall (Kildare South, Labour)
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We must move on.

Ciarán Lynch (Cork South Central, Labour)
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The Government will now be creating massive——

Jack Wall (Kildare South, Labour)
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The Deputy should ask a question.

Ciarán Lynch (Cork South Central, Labour)
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Will this end up as an additional charge on tenants under the rental accommodation scheme? Will the legislation have to be incorporated into the private sector provisions outlined by Deputy Terence Flanagan? How will it lend itself to a social housing integration process if we end up in a situation whereby local authorities take charge of entire private estates?

Michael Finneran (Roscommon-South Leitrim, Fianna Fail)
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We should not assume that local authorities will take charge of entire private estates.

Ciarán Lynch (Cork South Central, Labour)
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I am not assuming; it is in the legislation.

Jack Wall (Kildare South, Labour)
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We must move on. We are already five minutes over our time.

Michael Finneran (Roscommon-South Leitrim, Fianna Fail)
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As I noted earlier, section 30 of the Bill provides that some or all of a housing authority's management functions may be delegated to a designated body. Such delegation is confined to a body including residents and these powers already exist under section 9 of the Housing (Miscellaneous Provisions) Act 1992. I am not adding to those functions in this instance but I will have to make changes when I deal with the sale of flats.