Cian O'Callaghan (Dublin Bay North, Social Democrats)
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We have a fundamental choice as to the direction we want to go on housing affordability. We can continue with the current model of private provision, turning homes into financial assets and pushing up prices.

The Government is proposing to introduce more and more subsidies and discounts to the model but it is essentially continuing with the same model that has failed in recent decades.

The alternative model is to try to tackle land costs, land speculation and building costs, and to bring in affordability throughout the housing system, which will benefit everyone. If that is the approach we take, we will not have to get into a debate about cut-off points and income limits because the proposals will take some of the speculation costs out of housing and make it more affordable for everyone. That is the kind of approach I favour.

If the Government is serious about housing, one step it could take tonight to indicate its seriousness is to state it will accept in full Article 31 of the European Social Charter on housing, which is not a radical demand or anything like it. It commits the State to promoting access to housing of an adequate standard, to preventing and reducing homelessness with a view to its elimination and to making the price of housing accessible to those without adequate resources. The ambitions set out in Article 31 are not radical. It is incredible that the Government and the State signed up to the European Social Charter 20 years ago but to this day will not commit in full to Article 31. The Minister should show a bit of ambition and commit the State to Article 31. It would be a good signal of intent and I ask him to do that.

On affordability and the changes that have been happening in recent years, levels of home ownership have fallen, especially for younger people, and the growth in house prices has substantially outstripped the growth in incomes, resulting in intergenerational divides in terms of access to housing, deepening inequality, social exclusion, housing insecurity and homelessness. This is part of an overall trend of commodifying and financialising housing, turning homes into financial instruments and assets for investment. Much of this happened originally with the deregulation of the mortgage market in the 1980s, which led to a flood of cheap credit into housing, as well as when we joined the euro, which exacerbated that problem. There was a lack of regulation and control over the banks at the time, which inflated prices. Land hoarding and speculation has also contributed to house price inflation and unaffordability. More recently, the previous Government accelerated many of these policies, including favourable tax treatment of real estate investment trusts, REITs, encouraging arrangements such as short-term lets, reducing standards and even going as far as privatising the provision of homelessness services and hostels. There are significant negative consequences of that and we need a change of direction.

Internationally, there are good examples of housing affordability. In South Korea, for example, housing is becoming more affordable over time, the opposite to what is happening in Ireland, and that is where the state plays a large role in the provision and development of housing. Affordability in terms of people's incomes is becoming less of a burden over time, which shows that when a state gets involved and is serious about it, it can be very effective. In countries such as Germany, municipalities and local authorities can freeze the existing land use values and acquire land at the existing land value. There is nothing new in that idea; it was proposed in Ireland, as everyone in the House will know, some 47 years ago in the Kenny report. The current Taoiseach stated two years ago that he was examining whether the Kenny report could be implemented but there has been silence on that since.

That is what we should be looking at. One factor that creates housing unaffordability and drives up the price of housing and land is the public investment we make in infrastructure and our zoning process. There is no reason we should be gifting that uplift in land values to private developers. In effect we are using public resources to make landowners rich while, at the same time, making housing unaffordable for people. That is something we need to tackle and, if we are serious about affordability, it is something we should be doing. One of the arguments often raised against that relates to constitutionality. When the 2004 Oireachtas all-party group, which included representatives from the Government parties, examined the Constitution, its recommendation was that the Kenny report would be constitutional to implement. It noted that the Supreme Court had found that Part V provisions were constitutional and that the Kenny report had argued strongly that the legislation should be passed and referred to the Supreme Court in order that it could be tested beyond doubt. That would have an impact on housing affordability.

We need a systemic change rather than just initiatives that seek to subsidise and provide discounts, some of which, unfortunately, are modest. The LIHAF funding has not been entirely successful. Some of the discounts are very small and there is also an issue with the uptake of the LIHAF funding. In my constituency, funding awarded years ago has still not been drawn down and the infrastructure has not been built. We need more systemic reform than simply expanding some of the current schemes.

We have a fundamental choice as to what direction we go in. Are we looking at providing more homes or more commodities? Are we looking to provide places for families to be secure and in which to flourish or are we looking to provide more investment opportunities? Government policy dictates this. Will we be having more build-to-rent schemes or will we be looking for strong, stable and thriving communities? Will we be looking to subsidise affordable housing and land speculation or to implement policies that will make housing affordable across the board? What do we want to build and what kind of society do we want to live in? Do we want to live in a society or simply a market?

This is a political choice. The policies the Government takes will determine in which direction we go in the coming years. While its various initiatives are welcome, I urge it to go much further and consider systemic change and cutting out speculation. There is no reason, if that has been done successfully in other countries such as Germany, the Netherlands and South Korea, that we should not avail of the same policies to make housing affordable, get rid of land speculation and improve the quality of people's lives.