Terence Flanagan (Dublin North East, Fine Gael)
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Question 5: To ask the Minister for the Environment, Heritage and Local Government if he will outline his new rental scheme in regard to the renting of homes in private estates for applicants on local authority waiting lists with details of the intended private estates to be used in this scheme and projected rental costs; and if he will make a statement on the matter. [4171/09]

Michael Finneran (Roscommon-South Leitrim, Fianna Fail)
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Under the social housing investment programme, local authorities have traditionally met social housing needs mainly through the construction of housing in local authority estates. In recent years, the supply channels have been expanded to include an increased number of acquisitions, in particular under Part V agreements, and through arrangements with private landlords under the rental accommodation scheme. At the same time there has also been an expansion in the volume of accommodation provided by voluntary and co-operative housing bodies.

The new leasing initiative, under which authorities will procure properties on long-term leases of ten to 20 years, is designed to widen further the sources of supply and thereby help create a flexible range of delivery mechanisms for local authorities to meet demand for social housing. The use of leasing arrangements will allow for a substantial increase in the number of households that will have their housing needs met over what would otherwise be possible. It is expected that, through this measure, at least 2,000 additional homes will be procured this year.

Under the initiative it will be a matter for each local authority to determine what properties and locations are suitable for social housing. In putting forward leasing proposals, local authorities will be expected to have regard to the Department's guidelines for social housing, and all proposals must be consistent with the policy of creating sustainable communities. As with all social housing investment, local authorities will have to ensure on a case-by-case basis that value for money is achieved. Overall, however, I am satisfied this approach will facilitate the effective and efficient use of public finances. To this end, I have provided €20 million within this year's housing budget to meet leasing costs.

Terence Flanagan (Dublin North East, Fine Gael)
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Some €20 million of taxpayers' money is to be used for renting 2,000 social housing units. Contracts of between ten and 20 years will be signed in this regard. The cost over a ten-year period will be €200 million and the cost for a 20-year period will be €400 million. This seems like a great deal of money. How will the scheme compare to the equity scheme? If it does not fit in with it, there will be dead money and no value for money. Will the Minister of State explain the background to the scheme and why it is proceeding at this stage? The Government recently introduced the home choice loan scheme. Will the Minister of State comment on how this is working?

Michael Finneran (Roscommon-South Leitrim, Fianna Fail)
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The moneys available to local authorities and the voluntary groups in 2009 for housing programmes is close to €1 billion. The sum for the leasing programme amounts to €20 million. The home choice loan is provided through the local authority system. The equity loan will be dealt with under the Housing (Miscellaneous Provisions) Bill 2008 that will be before the Dáil in a couple of weeks.

The €20 million will deal with over 2,000 people on the housing list and I am happy that this represents good value for money. Everybody knows there are many vacant properties, perhaps 40,000. There are over 56,000 people listed on the local authority waiting lists that were submitted to me. I am responsible for addressing the needs of all those on the list and I have proposed this additional measure because I am satisfied on the question of value for money.

Terence Flanagan (Dublin North East, Fine Gael)
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The people on social housing lists want permanent accommodation, not rented property. Will there be an equity element? We want to ensure the money is used to best effect. Those in local authority houses for ten to 20 years should have an option of ultimately purchasing them. The moneys they pay in rent should contribute towards their purchase.

Where will the 2,000 units be located? Is the scheme a pilot project and will additional units be made available over the years? Will the Minister of State be reviewing the housing strategy in view of the downturn?

Michael Finneran (Roscommon-South Leitrim, Fianna Fail)
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It will not be possible to purchase a house under the scheme as it is a leasing scheme. It will not be any different from taking a local authority house because the landlord will be the local authority or the voluntary body. There is a great similarity and the differential rent will apply. One will not be entitled to purchase. However, as the Deputy will be aware, the Housing (Miscellaneous Provisions) Bill 2008 includes an incremental purchase scheme. Tenants who feel they are in a position to move towards a purchase will be able to do so under this scheme.

Terence Flanagan (Dublin North East, Fine Gael)
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Where will the 2,000 units be located? Is it a pilot project?

Michael Finneran (Roscommon-South Leitrim, Fianna Fail)
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That would be entirely a matter for the local authorities involved. They will have to get suitable properties in the location corresponding to the people on their lists, and they will also have to conform to Government guidelines on sustainable communities, namely, a mix of social and private housing. In some ways that may present an even better opportunity for a mix of housing.

Terence Flanagan (Dublin North East, Fine Gael)
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Will it apply to second-hand homes also?

Michael Finneran (Roscommon-South Leitrim, Fianna Fail)
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No, it applies to first-time lets.

Brendan Howlin (Wexford, Labour)
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The time for Priority Questions has expired.