Dáil debates

Wednesday, 3 November 2010

Mental Health Services

Social and Affordable Housing

9:00 pm

Photo of Michael MoynihanMichael Moynihan (Cork North West, Fianna Fail)
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I thank the Ceann Comhairle for the opportunity to raise this issue on the Adjournment. I apologise for my voice, as I might not be able to get my message across.

The Freemount Housing Association in north County Cork successfully applied some time ago for funding for the development of social housing units, but a balance was due at the end. I thank the Minister of State, Deputy Finneran, for his considerable help in negotiating the last tranche of funding for the association in recent years. It is almost 12 months since he approved the last amount of funding, so I am pleased he is present to take this debate. He has been involved in many projects in north County Cork during the past year.

We have landed ourselves in a legal dilemma where the transfer of funding from the Department and Cork County Council to the housing association to pay off the debts accruing on the development of the social housing project is concerned. This is causing significant difficulties, as the voluntary housing association wants to clear its account and pay off outstanding bills, which is difficult to do when finances are tight and the times are tough economically. Through the good offices of the Minister of State, the Department has allocated money to Cork County Council to complete the transaction. However, the handing over of the last cheque by the council to the association is in a legal quagmire that involves the Department, the Attorney General's office, the Chief State Solicitor's office and the council. This matter has been ongoing for six or eight months. Will the Minister of State use his influence in Dáil Éireann and beyond to try to ensure that the funding can be provided? The voluntary housing association in Freemount has taken on board this fantastic project, but not without unexpected difficulties.

The last tranche of funding was agreed on 19 or 20 November 2009. Unfortunately, between the Chief State Solicitor's office, the Attorney General's office, the council and the Department, the last instalment is stuck in a logjam. A legal question arose because all of the association's tenants needed to be approved council tenants for the last tranche of funding to be provided.

Will the Minister of State do everything possible to ensure that Cork County Council releases the last tranche of funding to the Freemount Housing Association? I cannot stress enough the amount of work and commitment that has been involved. Like every voluntary organisation, it only comprises one or two people but they need to get the account cleared and pay their outstanding commitments. It is a fright that the money required, despite having been allocated by the Minister of State, is in a legal quagmire between the council and the housing association. The association needs that money to discharge its duties. Will the Minister of State do everything he can to ensure the money is paid to the association?

Photo of Michael FinneranMichael Finneran (Roscommon-South Leitrim, Fianna Fail)
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I thank the Deputy for raising this issue. I addressed this matter in the House last June when I outlined the details of my Department's capital funding schemes, which provide up to 100% of the cost of voluntary and co-operative housing projects. Since March 2007, funding under the capital assistance scheme for the provision of voluntary housing covers up to 100% of the capital cost where all prospective tenancies are taken from the local authority housing waiting list. Grant assistance is also available towards site costs and funding towards the cost of communal facilities is provided, through my Department, from national lottery funding.

The Freemount Community Development Association Limited project is composed of 11 units of accommodation for older people at Freemount, County Cork, and was approved for funding of €1,046,466 in November 2002. Following receipt of a submission from Cork County Council advising that all of the tenants would be drawn from the housing waiting list, my Department increased the grant to €1,913,315 in March 2010. In addition, funding of €82,500 was provided toward the cost of associated communal facilities for the project.

A total of €1,817,649, amounting to 95% of the approved amount, has been recouped so far to Cork County Council on foot of payment claims for this project, leaving a balance of €95,666 yet to be claimed. Under the terms of the scheme, expenditure of up to 97.5% of the approved funding may be claimed on a project prior to completion of the accommodation. The balance is paid on the completion of the project and after a mortgage charge has been created on the dwellings. Approved housing bodies are required to enter into a legal agreement with the local authority, creating a mortgage charge on the dwellings provided under the schemes. This is to ensure that the accommodation is used in accordance with the terms of the funding schemes. Pending the completion of the mortgage deed agreement between the local authority and the housing body, an agreement may be made whereby the local authority can accept a letter of guarantee from the housing body, agreeing to sign the mortgage deed on completion of the scheme.

In 2002, my Department circulated a sample mortgage deed for use by local authorities in creating mortgage charges on dwellings. As a result of changes arising from the enactment of the Conveyancing Act of 2009, my Department is liaising with the Chief State Solicitor's Office and awaiting legal advice in regard to any amendments considered necessary to bring the sample mortgage deed into line with the requirements of the Act.

My Department will liaise with Cork County Council with regard to drawing down the outstanding funding on foot of a letter of guarantee, pending the circulation of a revised sample deed.