Michael Kitt (Galway East, Fianna Fail)
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Could we have some order, please? We are moving on. If Members want to have conversations, could they have them outside the Chamber, please? I understand that the Minister of State, Deputy Coffey, was in possession.

Barry Cowen (Laois-Offaly, Fianna Fail)
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Kick it over the bar.

Paudie Coffey (Waterford, Fine Gael)
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I wish to speak to amendments Nos. 34 to 43, inclusive, which propose to amend sections 33 and 34, which in turn amend section 96 of the principal Act.

I do not propose to accept amendment No. 34, which would have the effect of deleting section 33 and replacing it with a provision that would delete section 96 of the Planning and Development Act 2000 on the power of local authorities to enter into Part V agreements with developers to secure social and affordable housing. For me as Minister of State to accept this amendment would effectively be to remove the concept entirely of Part V and eliminate the contribution that this mechanism can make to meeting the social housing needs of our citizens. Therefore, I do not understand how, on the one hand, Deputies can table an amendment seeking to retain the upper limit of 20%, which was argued for this evening, while on the other hand seeking to remove the Part V mechanism from the Statute Book. Deputies will agree that there is a wide acceptance that Part V has been relatively successful in delivering social integration and more sustainable mixed tenures in communities across the country. Furthermore, there remains a rationale that the betterment value from a grant of planning permission for residential developments should be captured through Part V agreements for the benefit of the community as a whole. As such, we will not accept amendment No. 34.

In the context of a recovering housing market and increased housing construction activity, the Part V mechanism, with the appropriate amendments contained in sections 33 and 34 of the Bill, has the potential to be a significant contributor to future social housing provision. Given the significant and urgent need to increase social housing construction and supply, it makes sense that amendments would be made to Part V to maximise its contribution to achieving the supply targets contained in the Social Housing Strategy 2020.

I cannot accept amendments Nos. 35, 36, 39, 40 and 43, which oppose the proposed amendments to the options for developers in fulfilling their Part V obligations and some consequential technical amendments. The overall objective of section 33 is to amend the options contained in section 96 for the delivery of units within a Part V agreement and to maximise the transfer of completed social housing units. The amendments are necessary to increase the supply of social housing units speedily. Long-term leasing and rental agreements are necessary new Part V options. Removing the cash options and the option of providing sites is also necessary.

Deputy Paul Murphy's amendment No. 35 seeks to introduce new aspects to the considerations that a local authority must have when entering into Part V agreements. The option of transferring sites or parts of sites is to be removed, rendering the first part of the amendment unnecessary. Likewise, the second part of amendment No. 37 is unnecessary. Any transfer envisaged under Part V will be on a permanent basis. For example, the transfer of a housing unit or land will be on the basis of transferring ownership.

Deputy Boyd Barrett's amendment No. 38 raises the matter of the inclusion of profit on costs in the calculation of development work related to units to be transferred. I will not accept this amendment. It is accepted that there have been many difficulties with Part V agreements due to the complexity of the legislation. This has been reflected in the judgments in a number of court actions. The proposed amendment to Part V represents an opportunity to provide some clarity in the operation of the legislation and could save millions of euro by reducing the time spent on negotiations, engagement of professionals such as quantity surveyors, engineers, planners and legal advisers, court proceedings etc.

Section 33(1)(c) substitutes section 96(3)(d) of the principal Act and provides that, where houses are to be transferred as part of an agreement, their price shall be calculated on the basis of the cost of the land and the cost that would have been incurred by a planning authority had it retained an independent builder to undertake the work on its behalf. The price that an independent builder would command in the marketplace would ordinarily include some provision for profits. Section 33(1)(c) should bring clarity to the costs to be considered as a basis for calculating the price of housing units to be transferred under Part V. The amendment takes account of relevant court judgments and the practical difficulties reported in the operation of Part V. The inclusion of "and profit on those costs" is consistent with the existing provision and no change in policy is proposed. Court judgments do not appear to point to any deficiency in this regard.

I wish to speak to the final two amendments in this grouping, Nos. 41 and 42. I do not propose to accept these. On the face of it, the proposed definition of an integrated scheme of retirement housing contained in amendment No. 42 appears open to interpretation on a number of fronts and could be open to court challenge. Amendment No. 41 proposes that section 96 of the principal Act on the Part V social and affordable housing obligations should not apply to such an integrated scheme. As the House knows, the State seeks to provide community living for the elderly where they cannot afford such facilities. Therefore, I see no reason for private developers providing such housing to be exempt from Part V obligations. I should also point out that, if such developments were provided by approved housing bodies, AHBs, they would be exempt under the Bill. Presumably, such private ventures are profitable. Therefore, I do not believe that private developers could not provide social housing units or land to the relevant local authority to house its elderly tenants adjacent to private facilities. It would also be open to the local authority to accept a completed social housing unit for any age group on an alternative site. Under the revised section 96, the developer could acquire a unit for such purposes if the local authority agreed to same in a Part V agreement. The Government is keenly aware of the country's demographics and the challenges afoot, but it is not in the interests of the State to provide this exemption. Therefore, I cannot accept amendments Nos. 41 and 42.

Dessie Ellis (Dublin North West, Sinn Fein)
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The Minister of State's definition of "social housing" differs from mine. Part V was to deliver 20% social and affordable housing, but the Bill will limit that to 10%. "Social housing" is social housing that is given over to local authorities, not leased, yet the Government plans to allow for leasing arrangements. That is crazy. The State will lease a property from a developer for a period of ten or 15 years or whatever it is, after which time the property will return to the developer. As we know from the rental accommodation scheme, RAS, and rent supplement, landlords have moved against people on leases. Tenants can be evicted from properties with nowhere to go.

That is undermining the whole idea of Part V but, as far as I can see, that is what is happening. It is absolutely mad that rather than delivering proper social housing, provision is being made for leasing arrangements. It beggars belief that we are fattening landlords up in this way. NAMA has leased out many properties. Local authorities and other interests have taken properties from NAMA under leases. That is what has built up the portfolio. NAMA has accumulated a big amount of money from all the leasing and other arrangements into which it has entered. In this case, a ministerial order is to be used to remove the affordable end of it, which would have helped many families across the board, particularly those in the least well-off areas of our society, by giving them cheap and affordable housing.

Mick Wallace (Wexford, Independent)
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When we had our first discussion on these amendments before the break for Private Members' business, the Minister of State tried to tell me that the Government is doing what I have been recommending. That is not true, however. The Government is not following my recommendation. Section 33(1)(a) of the Bill proposes to amend section 96 of the 2000 Act "in subsection (2), by inserting "prior to the lodgement of a commencement notice within the meaning of Part II of the Building Control Regulations 1997". After one gets planning permission, one has to wait for a certain period in case objections are made before one reaches the stage at which one can lodge a commencement notice. The Minister of State is still talking about having a debate with the builder or developer after he or she is given planning permission. There is a debate before the commencement notice. If the Government wants a clearcut operation and is genuinely interested in ring-fencing a ghettoproofed system with a guarantee of a social and affordable element on every site, I reckon it should include that written in black and white as a condition of planning before the individual gets planning permission. That would ensure there is no debate afterwards. My argument for ensuring there is no debate afterwards is that certain players are getting deals in such circumstances. Some people are getting deals afterwards and some people are not. Things are being left too open. This section of the Bill talks about "the transfer to the ownership of the planning authority, or to the ownership of persons nominated by the authority in accordance with this Part, of houses on any other land within the functional area of the planning authority". I suggest that the inclusion of terms like "any other land" is where ghettoisation comes from. Rather than insisting on the supply of housing units on the relevant site in line with Part V, the Government is proposing to allow other lands to be provided in lieu of those units. If the Government does not provide for ring-fencing and prevent developers from supplying units elsewhere, we will have ghettoisation forever. It needs to stop what it is doing.

Richard Boyd Barrett (Dún Laoghaire, People Before Profit Alliance)
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Any good that is in this Bill is completely wiped out by these leasing provisions. This marks another fundamental watershed in this Government's gallop away from the principle of the provision of social housing by local authorities and towards outsourcing such provision to the private sector. When private developers build housing under this Bill, nothing at all - not 20% and not 10% - will have to be handed over to local authorities on a permanent basis. They will be able to engage in leasing to get out of their obligations. We will be paying them for years and years to come. It is a form of corporate welfare on a massive scale, as if we have not had enough corporate welfare in this country for the past 20 years. It will cost us an absolute fortune. The sky is literally the limit when one looks at where property prices and rental prices are going at the moment, and they will continue to go in that direction. It is not surprising that Fine Gael would do this, but it is shocking beyond belief that the Labour Party is a party to it. This is the beginning of the end of local authority housing. When we look at the figures for next year and the year after, we see that the number of actual real physical council houses that are going to be built is negligible. It is all rental accommodation scheme leasing and housing assistance payment scheme agreements. This is rotten stuff. It has to be opposed vigorously.

Ruth Coppinger (Dublin West, Socialist Party)
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We have said it all already. I want to take up one issue. The Minister of State has said that this leasing package needs to be introduced to get rid of the cash or the land in lieu elsewhere. I would rather the cash or the land in lieu than the leasing of houses. I think everybody else would share that preference. It has been suggested that this approach has to be taken in order to outlaw the way in which Part V was circumvented previously. When that was happening, at least councils got some cash to build houses on their own lands or elsewhere. They were given land or they were given money. The leasing measure that is being introduced now is unbelievably shocking. As I said earlier, the families concerned will never be able to live in and be part and parcel of an actual community with a good community spirit, as families were able to do many years ago when they got council houses. Families will always have to contend with the threat of being moved on at any time. I will conclude by repeating a question that I do not think the Minister of State answered. Who is going to police the issues that arise among tenants in these leased properties? All the councils used to have estate management sections, but now private landlords will be in charge of these tenants. If the Minister of State intends to continue to stick rigidly to this policy, the least he could do is answer my question.

John Halligan (Waterford, Independent)
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I agree with everything that has been said. I do not understand why we are reducing the 20% requirement under Part V at all. My interpretation of this measure is that it is being introduced to incentivise builders to build. We should be trying to get builders to be part of the community and to play a part in resolving the major housing crisis that confronts this country at present. I genuinely do not think people are aware of what is happening here, or the consequences it will have for many people. The Minister of State used to serve on a council, just as I did. There was always an argument and a discussion on the 20% requirement under Part V, but it appeared to have cross-party support from every member of every council in the country. This is a retrograde step. People at the coal face who are dealing with the 20% requirement under Part V, including many councillors, will be taken aback. I am not sure that too many of them are aware of what is happening here today. They probably have not read the Bill and are not conscious of it. I have to say I am shocked at the Labour Party.

Ruth Coppinger (Dublin West, Socialist Party)
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I am not.

John Halligan (Waterford, Independent)
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I am really taken aback that it would take this route. I did not think it would countenance a reduction of even one percentage point in the 20% requirement. The Minister of State and everybody else knows that allowing builders to lease housing back to councils is not going to work. The builders out there tonight must be rubbing their hands together with glee because this will lead to more profit for them. I am really taken aback by this. I do not see the need for it. When councillors throughout the country from all parties read into this in detail, I think they will be taken aback and shocked.

Jonathan O'Brien (Cork North Central, Sinn Fein)
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When I was listening to the Minister of State's reply to the initial comments on these amendments, it seemed to me that there was a major contradiction in what he was saying. He said that Part V is an integral part of the provision of social housing, even though he is legislating for a reduction in the limit from 20% to 10% and providing for a leasing option, thereby removing the need to provide social housing. We could end up with no social housing being provided, even though the Minister of State has said that his approach is an integral part of increasing the availability of social housing. The leasing issue is an important one. We are going to have developers leasing back properties to local authorities. My reading of it is that these properties will be used for either the housing assistance payment scheme or the rental accommodation scheme.

Councillors tell us about the number of people who visit their constituency clinics seeking to get out of the RAS system. It is a disaster and is not working. There are landlords who are not taking care of the properties. When one complains to the county or city council, it gets in touch with the landlord but the landlord simply says, "That is the way the property is. There is nothing I can do about it."

Now we will have a situation where local authorities are not responsible for providing social housing and will not have the responsibility to maintain the properties in which these tenants will live. That will be left in the hands of the developers and landlords. It is a flawed policy. The Minister of State cannot say that Part V is integral to the increased availability of social housing and then introduce a policy such as this, whereby the council can lease properties instead of providing the social housing. There is a huge contradiction in what the Minister of State is saying.

Noel Coonan (Tipperary North, Fine Gael)
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I thank the Minister of State for his response to amendments Nos. 41 and 42. He referred to the description I outlined of the housing for the elderly, which is integrated housing where medical services and care would be provided, as open to interpretation. Many sections of the Bill are very much open to interpretation, but there is not much left open about describing somebody as 70 years old and over.

We are talking about housing for the elderly and keeping elderly people in their communities for as long as possible. The alternative is to put them into a nursing home or some other type of home at huge cost to the State. This is an opportunity to keep them in the community. It is provided by builders. I heard colleagues on the opposite side of the House say that they would expect it of Fine Gael to do away with the 10% under Part V, but this is a situation where Fine Gael is insisting on it. I can only come to the conclusion that it is the undue heavy influence of the Labour Party Minister, the Minister of State's boss, that is forcing this on him and on the officials. The interpretation is quite clear, and it is something we should be doing. We should use every opportunity to house people in their community. As I said earlier, those people are moving from houses and moving in from the country, so it opens up housing for other, younger people who will be in a better position to live in those conditions. I very much regret that the Minister of State is not accepting the amendments.

I reiterate the point I made earlier. The terminology being used is unfortunate. We are describing people's homes as "affordable" or "social", and we are labelling and classifying various sections of the community. We should move away from that. Everybody's home is their castle and that is how we should refer to housing. It is not right to put people somewhere and to label their homes as social or affordable.

The Minister of State is insisting on 10% of this development for older people and that the authorities would have to put younger people or families into it. It just does not work. I accept the Minister of State's reply but I do not agree with it.

Paudie Coffey (Waterford, Fine Gael)
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To respond to Deputy Coonan, the Bill provides that any developments of up to nine houses are exempt from Part V. If small sheltered housing developments were developed by private developers with up to nine housing units, they would be exempt. If approved housing bodies, which are usually involved in this throughout the country, are building these units they too are exempt if they are building sheltered housing for the elderly. It is only where private developers might be considering developing them, and there would be a profit element involved, that the Government considers it is reasonable that they should contribute 10% of that towards additional social housing as part of the development. That is the position.

Regarding the overall objective of securing more housing units, no avenue or mechanism should be ruled out. That includes leasing and renting. We are quite dependent at present, unfortunately, because we have not been building the required number of houses for local authorities over the last number of years. That is obvious. We must address the shortfall in the meantime. What we are trying to do in this legislation is provide flexibility for local authorities to deliver social housing and to be able to respond to local situations. However, to reassure Deputies and to achieve the balance they are seeking, I will issue a ministerial policy directive to local authorities instructing that where capital funding is available they should enter Part V agreements for the acquisition of social housing units rather than entering into leasing agreements. Furthermore, where leases are being agreed, there should be a specified minimum period. Obviously, the minimum period should be a long period. Currently, the arrangement is a minimum period of ten years and up to 20 years. We cannot rule out any options that are available to increase housing supply for the people who most need it.

Finally, I wish to clarify the situation for Deputy Wallace. He is particularly exercised about Part V and how it is managed. I will be happy to clarify it further later outside the House if he wishes, because I only have a short amount of time to speak now. Essentially, we are front-loading the Part V element. In the past there were problems with disagreements between the developer and the local authority. Difficulties arose and there were many court cases. Due to the various differences, we did not deliver the number of units we wished. We now intend to front-load that into the process. A proposal for Part V should be part of the planning application process. When it is being considered by the planning authority an agreement will be reached and by the time the decision is being determined there will be a condition of planning on the Part V. The legal agreements will follow afterwards. It is an attempt to front-load it and get the agreement the Deputy speaks about at a much earlier stage in the process, to ensure we do not have the differences and problems that we experienced in the past. We can issue further regulations in this respect to tighten it up and pin it down, so people do not get away from the obligations under Part V.

Dessie Ellis (Dublin North West, Sinn Fein)
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I intend to press this amendment. The Minister of State says he will issue a ministerial order regarding the leasing issue. Why will he not do away with the idea of leasing? The leasing is absolutely mad.

Paudie Coffey (Waterford, Fine Gael)
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It would do away with all of the units.

Dessie Ellis (Dublin North West, Sinn Fein)
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We are talking about social housing. Leasing means the units will go back to the developer after a period of time. This will make us a laughing stock. The units go back to the developer and they will avail of this. The local authorities will be left with nothing. In addition, people in leasing arrangements have been moved on under RAS and the rent supplement. The HAP is now being introduced. Landlords have reneged on leasing arrangements. What would be the result if that happened in this case? We would be left in a right mess.

The Minister of State should re-think the idea of leasing, especially with regard to Part V. Part V is very clear. I do not agree with the Minister of State reducing it to 10%, as I have said, but Part V is very clear that it is for delivering social housing. That means housing in which people can say, "This is my house from the local authority. No other person has an influence on it." What the Minister of State is doing is absolutely wrong.