Jan O'Sullivan (Limerick City, Labour)
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7. To ask the Minister for Housing, Planning, and Local Government the progress that has been made on ensuring that a funding vehicle for credit unions to invest in social housing provision as committed to under Rebuilding Ireland is compatible with Central Bank of Ireland regulations in view of the fact that such a vehicle will have to be regulated by the Central Bank; if an assurance can be given that such a vehicle will be established that will facilitate credit union finance being made available to approved housing bodies; and if he will make a statement on the matter. [39066/18]

Eoin Ó Broin (Dublin Mid West, Sinn Fein)
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24. To ask the Minister for Housing, Planning, and Local Government the status of the work on assisting credit unions to provide lending for the purposes of building social housing; and the reason, almost a year after the approval of such lending, no progress has been made to date on this matter. [39017/18]

Joan Burton (Dublin West, Labour)
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Does the Minister have plans for a funding vehicle for credit unions to invest in social housing provision through, for instance, approved housing bodies in the context of the Central Bank having indicated it will allow credit unions to invest in such social housing provided the Department creates a suitable funding vehicle?

Damien English (Meath West, Fine Gael)
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I propose to take Questions Nos. 7 and 24 together.

Following engagement with the credit union sector on proposals for credit unions to provide funding for the provision of social housing, the Central Bank undertook a review of the relevant investment framework in 2017. On foot of this review, the revised regulations commenced on 1 March 2018. The revised regulations included the addition of investment in “regulated investment vehicles where the underlying investments of the regulated investment vehicle are investments in Tier 3 Approved Housing Bodies” as a permitted investment class for credit unions. As such, since 1 March 2018, credit unions are permitted to provide funding, through a regulated investment vehicle, to tier 3 approved housing bodies for the provision of social housing.

In respect of the development of specific special purpose vehicles, SPVs, by the credit unions to enable them to make investments in the sector, it is a matter for the credit unions themselves to make the necessary arrangements to facilitate this. We had this discussion earlier. It is something we want to encourage and to see happen, and there is a process in place to make it happen. My Department informed the credit union representative bodies that it was funding a project being undertaken by the Irish Council for Social Housing to examine the establishment of SPVs to facilitate investment in the sector. The Department put the bodies in contact with the Irish Council for Social Housing with a view to those bodies examining further how they could invest in the sector. There are two different credit union bodies and we want to make sure both get equal and fair treatment. They have been asked to engage with the Irish Council for Social Housing around this SPV.

I outlined to the House earlier that there are three phases to that work, two of which are complete, and the last part will, hopefully, be completed in October but certainly in the weeks ahead. That should facilitate more investment. Again, to be clear, one approved housing body has set up a special purpose vehicle and can take money, and one of the credit union bodies is also ready to make investments.

Joan Burton (Dublin West, Labour)
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Is the Minister of State suggesting credit unions are now able to invest in the provision of social housing through approved housing bodies? How many credit unions are now able to do that? I am sure the Department monitors this. It is a really good social development and it would be a very good provision for co-operative-type of housing developments, like the Ó Cualann development, to be funded through the credit union model. How many credit unions have actually succeeded in doing this so far?

Damien English (Meath West, Fine Gael)
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I agree with Deputy Burton it is a very good development. It is something the whole House wanted to happen and we tried to ensure it happened. My understanding is that no credit union has invested money yet.

Joan Burton (Dublin West, Labour)
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Zero.

Damien English (Meath West, Fine Gael)
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That is the question I was asked and I am giving the Deputy the answer. Since 1 March they are allowed to do this and they have spent the year working on the process to do it. One of the credit union bodies, the Credit Union Development Association, is ready, able and available to invest money through approved housing bodies if it wants, and it has been engaged with that sector. That process is there and that is as far as we can bring it, to be honest. The sector overall is working with the Irish Council for Social Housing to develop another SPV and there will probably be a range of vehicles to facilitate different types of investment. That work should be completed in October. We are not in a position, and we are not allowed, to design that SPV for them but we are trying to encourage the process to make it happen because we would like it to happen. It will come down to approved housing bodies deciding who they want to take their money from. That is where it is at.

Eoin Ó Broin (Dublin Mid West, Sinn Fein)
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I completely understand it is not the Department's responsibility to create the SPVs, whether for the approved housing bodies to borrow or the credit unions to lend. However, what we are hearing from both of those sectors is they do not feel they are getting enough assistance from the Department of Finance, with its expertise in this area, and possibly from the Minister of State's Department to help them set up either one vehicle or two separate vehicles, that is, one to lend and one to borrow. I urge the Minister of State to use his good offices, along with the Department of Finance, to bring together the various players and to try to assist them in doing what we all agree on, namely, the setting up of the vehicle or vehicles to get the lending flowing.

Damien English (Meath West, Fine Gael)
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Again, I think that is unfair criticism from the sector, in that we have engaged with them as much as we possibly can. We cannot design it for them. They are private entities. I want to be very clear on this. Our job is housing. We are not in the business of setting up special purpose vehicles. We have been trying to engage with the process and certainly through our offices, both of us, as Ministers, and our officials have met them on many occasions to try to engage with them, encourage them and put them together. One of the credit union movements is ready; it is through all of the process and has money available. I cannot be any clearer than that. The other credit union movement is engaged with a process which should be completed in October and that will enable it also. My understanding is that one approved housing body has its own SPV. People need to understand what is going on here. We brought this as far as we could possibly bring it. I would be unhappy that it took so long from the Central Bank point of view but we are not in charge of that section. It is my understanding that we cannot do any more for them at this stage.

Joan Burton (Dublin West, Labour)
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Has the Cabinet sub-committee on this issue met? Has the Government brought together the Department of Finance, the Department of Housing, Planning and Local Government and the credit unions? To be honest, the credit unions are being treated like "pass the parcel". They are going to the Central Bank, which has given the okay after a lot of consideration, and they are going to the Department of Finance but it is telling them to go to the Department of Housing, Planning and Local Government. All of those offices are held by Fine Gael Ministers. Can these guys not sit down over a caffè latte or something like that and actually agree to iron it out? This is an area where they could untangle the bureaucracy in which they are buried in order that people who need housing could get it, in particular through the co-operative model. It is sad. There is €13 billion to €14 billion in credit unions at the moment, a proportion of which could be very safely invested in providing much-needed homes for people. The credit unions are a community movement. They want to do it. Can Fine Gael and the Government not facilitate this?

Pat Gallagher (Donegal, Fianna Fail)
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I understand Deputy Ó Broin does not require a supplementary question, which is helpful.

Damien English (Meath West, Fine Gael)
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I think my colleague on my right prefers a mocha frappuccino, although they are not very common down in my area. I prefer the mocha to be straightforward. To be clear, we have sat down with them. I would point out that when we took up the brief of housing, as Fine Gael Ministers, one of the first issues was to make sure the money that credit unions have was made available, and while they would not have €13 billion or €14 billion to invest in housing, they certainly have an amount of money. Our Departments did come together and facilitated a lot of meetings and processes.

We do not control the Central Bank. The Central Bank is not run by any Fine Gael Minister. The Central Bank has completed its work. The process is complete in terms of the work that can be done by the Departments of Finance and Housing, Planning and Local Government and by the Central Bank. It is up to the entities themselves to develop Special Purpose Vehicles, SPVs, and to work with the Approved Housing Bodies, AHBs, on that. Some have been successful and are through the process and money is available to be spent today. I am trying to be very clear about that. That part is complete. The AHBs have to decide who to borrow money from and how much they will pay for that money. That is their decision. We cannot make them do it. We have encouraged them to bring forward projects. There is a pipeline of projects across many sites. Currently, there are over 1,000 sites and development projects coming forward and a large percentage of them are through AHBs. There are options there in terms of this investment happening. The Fine Gael Ministers have sat down and done their work on this and that work is complete.