Ruth Coppinger (Dublin West, Anti-Austerity Alliance)
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4. To ask the Minister for Environment, Community and Local Government if he can resolve the housing crisis while adhering to the European Union's fiscal rules; and if he will make a statement on the matter. [18709/16]

Ruth Coppinger (Dublin West, Anti-Austerity Alliance)
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The housing committee, the Minister for Finance and the Taoiseach himself have all expressed real concerns about the EU fiscal rules impinging on our ability to resolve our housing crisis. The structural rules, the structural balance rule, the expenditure benchmark and the debt rule have now become clear barriers to our investing in public, social and affordable housing, and I want to know what the Minister will do about this.

Simon Coveney (Cork South Central, Fine Gael)
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The European fiscal rules, which are designed to ensure that countries in the EU maintain sound public finances, are not an insurmountable obstacle to providing the investment required for social housing over the coming years. If they were not there, we would not have to look at other vehicles and ways of funding; we would be able to do it in a much more direct way. The Government, however, has been able to provide significant levels of funding for social housing provision since 2014 and is committed to ensuring that funding for the provision of social housing continues to be prioritised. We have already prioritised in the capital programme almost €3 billion in that regard within the fiscal rules.

There are a number of inbuilt flexibility mechanisms within the fiscal rules to incentivise investment in projects that have lasting growth Impacts. In Ireland's case, there is flexibility around what is called the expenditure benchmark treatment of capital formation, where such expenditure is treated more leniently than other expenditure. This is to help incentivise investment in projects that have long-term positive growth impacts, including new building such as schools, hospitals and social housing.

The programme for a partnership Government provides for a comprehensive range of policy measures to address issues with housing supply, including in respect of social housing. The Government has committed, as part of that programme, as the Deputy knows, to publish an action plan for housing in about three weeks' time, certainly before the end of next month. Our challenge, therefore, and what we have been doing, is to consider creating vehicles that can provide significant funding for social housing. We already have some of those models. Consider what NAMA has been doing in respect of what is called a National Asset Residential Property Services, NARPS, funding model, whereby it essentially builds or purchases and then effectively leases over a long-term period to an approved housing body, which is essentially significant investment into social housing that is off-balance sheet. We are looking to expand on that now, using the financing power of the Ireland Strategic Investment Fund, ISIF, to do a lot more of that.

Ruth Coppinger (Dublin West, Anti-Austerity Alliance)
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On 13 June, the Taoiseach wrote to Jean-Claude Juncker about the impact of the EU rules on public investment. He said there was a significant threat to the ability to fund major projects in housing, transport and water. Despite this, the Government is not seeking any derogation from those rules. Why not? Why is the new Minister with responsibility for housing going to the European Commission and saying a housing committee, which met for nine weeks and interviewed many witnesses has said social housing is hampered in particular by the application of domestic and EU fiscal rules and that the financing of social housing by the State is restrained by the EU fiscal rules? The Minister for Finance, Deputy Noonan, said money is not the issue, but our ability to spend it. We have €5.4 billion in ISIF that we are not able to spend on social and affordable housing. The Minister should be going to Europe demanding either a derogation from the rules or saying we will breach the rules to house our homeless.

Simon Coveney (Cork South Central, Fine Gael)
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The correspondence to which the Deputy referred, which was sent from the Taoiseach's office, was regarding EUROSTAT definitions around what is off-balance sheet and what is on-balance sheet, which is confusing. It is very difficult to get certainty about what is on and what is off-balance sheet. In the UK, much of the social housing build programme which the UK Government thought was off-balance sheet was subsequently reclassified by EUROSTAT as on-balance sheet. The UK had put a vehicle in place which it was convinced had solved a funding problem. This is not a satisfactory situation. We cannot get clarification from EUROSTAT or the Central Statistics Office, CSO, before a new funding vehicle is signed off on as to whether it is on or off-balance sheet. We can get an indication, but not certainty, and it is a frustration for the Government. We are trying to work within it.

Ruth Coppinger (Dublin West, Anti-Austerity Alliance)
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The Minister has just answered my question and explained why we produced a minority report and digressed from the Committee on Housing and Homelessness. Off-balance sheet funding is a mirage and nobody has been able to explain how it will work. Although it is the only alternative that has been suggested, nobody could come before the committee and explain it. The Minister has admitted it is confusing and that EUROSTAT keeps changing the rules. It is making it more difficult by the month to get things off-balance sheet. RTE's "Prime Time" did an investigation and identified that no new model that would be capable of providing and financing social housing on an off-balance sheet basis has emerged. Given this never-ending quest, one would think off-balance sheet funding would be cheaper or easier. However, it is not. If we have to build houses on an off-balance sheet basis, it will be much more expensive and take much longer than if we could spend a fund we have saved up, namely, ISIF, formerly known as the National Pensions Reserve Fund. It should be very simple for us to spend it.

Simon Coveney (Cork South Central, Fine Gael)
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Off-balance sheet funding is not necessarily more expensive and does not necessarily take longer. We are working to try to put new vehicles and models in place that we are satisfied will allow for significant investment that is off-balance sheet. We are working through it. I still maintain that it is frustrating trying to get clarity before signing off on a vehicle from EUROSTAT, about which the Taoiseach was corresponding. Many countries face the issue regarding investing in social infrastructure and infrastructure for transport, education and so on. If we are going to have an EU that can invest in the future, particularly while funding is low cost, we need more clarity on the issue.