Joan Collins (Dublin South Central, Independents 4 Change)
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80. To ask the Minister for Housing, Planning, and Local Government the period for which the waiver of development levies (details supplied) will apply; if he will provide an exact outline of how all local authority funds and developments connected to levies will be guaranteed by the Government; and if he will make a statement on the matter. [20781/23]

Cian O'Callaghan (Dublin Bay North, Social Democrats)
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104. To ask the Minister for Housing, Planning, and Local Government the measures that will be put in place to ensure the waiving of development levies results in more affordable homes for people rather than an increased profit margin for developers; and if he will make a statement on the matter. [23446/23]

Michael Moynihan (Cork North West, Fianna Fail)
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109. To ask the Minister for Housing, Planning, and Local Government his proposals for development levies; and if he will make a statement on the matter. [23069/23]

Joan Collins (Dublin South Central, Independents 4 Change)
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On 25 April, the Taoiseach stated the Government would waive development levies for one year. The day before that, however, he stated in a press briefing that the waiver would apply for a couple of years. For what period will the waiver apply? How will all local authority funds and developments connected to levies be guaranteed by the Government? I ask the Minister to make a statement on the matter. Dublin City Council has a €2.4 billion capital budget, of which 9.3% is covered by levies. It makes up a significant part of the budget.

Darragh O'Brien (Dublin Fingal, Fianna Fail)
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I propose to take Questions Nos. 80, 104 and 109 together.

Section 48(2)(b) of the Planning and Development Act 2000 provides that a development contribution scheme applied by a planning authority in respect of its functional area may make provision for payment of different contributions in respect of different classes or descriptions of development. The level of contribution and the types of development to which development contributions should apply, including any exemptions from charging in specific circumstances if that is deemed appropriate, are determined, therefore, at local authority level, in accordance with the powers vested in elected members in respect of the adoption of local authority development contribution schemes.

As the Deputy noted, on 25 April 2023 the Government approved additional measures under the Housing for All plan to incentivise the activation of increased housing supply and assist the achievement of the housing delivery targets set in Housing for All, while also addressing cost and viability issues faced by the construction sector. These measures included the introduction of temporary time-limited arrangements for the waiving of local authority section 48 development contributions and the refunding of Uisce Éireann water and wastewater connection charges. It should be noted that the Uisce Éireann water and wastewater connection charges referenced in the new Government support package will still have to be paid upfront by developers in the normal manner, with the moneys being subsequently refunded by Uisce Éireann on notification of the commencement of works. In effect, the Uisce Éireann piece is a rebate rather than a waiver.

The new schemes apply for one year to all permitted residential developments that commence on site between 25 April 2023, the date on which we approved the decision, and 24 April 2024. These developments must be completed no later than 31 December 2025. This end date is to facilitate large schemes to be speedily brought forward and progressed, while also incentivising their completion as quickly as possible within a reasonable timeframe and delivering additional urgent housing supply.

We are currently working on the detailed arrangements relating to the operation and administration of the waiver and refund schemes. These arrangements have already been communicated to local authorities and Uisce Éireann. I am cognisant that the development contribution waiver scheme does not impact on the ability of local authorities to fund the ongoing provision of necessary infrastructure to support development by local authorities to prevent delays to development works. It will be necessary, therefore, to put efficient administrative arrangements in place to ensure local authorities are promptly compensated by the Department for development contributions. In effect, we are refunding the moneys. The development contributions that are waived will be paid fully back to the local authorities. The local authorities will invoice the Department on a monthly in-arrears basis in respect of development contributions payable that are applicable under the waiver further to receipt of the commencement notices from the developers.

Furthermore, a number of financial safeguards are in place to prevent profiteering by the sector, thus ensuring the measures will benefit purchasers by boosting supply. Developers are already subject to compliance with specific regional price caps in the context of the first home scheme and a cap generally applicable under the help-to-buy scheme. In addition, the Department applies unit cost recommendations on proposed social and affordable housing developments to ensure value for money. These requirements will remain in place as a price control mechanism.

No local authority will be out of pocket. They will be paid monthly in arrears. It is an activation measure. We have already received a number of schemes, small and large, that were on the cusp of viability and are now able to start. The average saving is approximately €12,700 but, for apartments, it is up to €20,000. It is for schemes where we all want additional supply, or say we do. This is an opportunity to get that additional supply through a short-term time-bound measure. The local authorities will be recompensed fully for the waiver of development levies.

Joan Collins (Dublin South Central, Independents 4 Change)
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I thank the Minister. There was a certain amount of clarity in his reply. I am seeking a commitment from him that the waiver will be for one year only and will not be extended. That is a matter of trust and I do not know how much trust we have in the context of many of these deals. At the committee, the Minister stated that just under €20,000 per unit is expected to be passed on but he later made the point that he could not say that all of these levies and connection charges will be passed on. There was a sort of doublespeak there and I am seeking clarity on that important point. If the scheme is being set up to bring down the sale price of homes, we need to be certain the saving will be passed on. I am seeking clarity on that point. What measures are in place to ensure developers pass on the saving of up to €20,000 per house on development levies that are not going to the councils?

Cian O'Callaghan (Dublin Bay North, Social Democrats)
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Since the Minister took office, almost €1 billion allocated to the housing budget has not been spent. This was money that could, and should, have been used to build social and affordable homes. The measures that he announced recently, involving the spending of €1 billion, included more subsidies and handing over of public money to private developers, including the waiving of development levies. Subsidies to developers have increased and their profits have soared. Since the Minister took office, the profits of the largest developers in Ireland have quadrupled. At the same time, house prices have reached record levels. Why has the Minister not acted to ensure that the waiving of development levies is passed on to people and housing becomes more affordable?

Darragh O'Brien (Dublin Fingal, Fianna Fail)
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The waiving of development levies and the refund of Uisce Éireann connection charges apply to all, including the single one-off homes of families who have saved and want to build their own homes as well as small developments. I will provide an example. We were contacted by a 44-home scheme in a rural village that was not going to start but will now do so because of these cost-saving measures. This is an activation measure. We built nearly 30,000 new homes last year and we want to build more. Deputies will understand that this Government will continue to do everything it can to ensure that happens. We are reducing the upfront cost of construction, which is approximately €308.5 million. It is not insignificant. We will be able to track progress, as commencement notices will have to be submitted by each local authority every month in order to receive refunds of those payments.

Last year, our capital expenditure on housing was €3.5 billion, which is the most we have ever spent. There was an underspend over the previous two years. We know why that was. We cannot wish away an almost five-month shutdown of residential construction owing to the Covid pandemic. That had an effect. Some might also want to wish away the impact on the supply chain of the war in Ukraine, but it had an effect last April, May and June in particular. The cost of funding has increased, affecting delivery.

We have other measures in place. For example, the cost-rental viability measure makes a subvention of up to €150,000 available across the board to AHBs and any cost-rental-designated developments. It will allow us to increase the delivery of cost-rental homes. We have approved more than 1,000 tenancies already.

Since we want more homes for our people – everyone in the Chamber says he or she does – we must take measures to ensure that happens. The waiver is a practical measure to achieve that on a time-bound, one-year basis. I have outlined the scheme's criteria to Deputy Joan Collins.

Joan Collins (Dublin South Central, Independents 4 Change)
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The Minister has still not explained how the approximately €20,000 per unit will be delivered to people on the ground. Some €308.5 million, which is taxpayers' money, is being invested in this. What is in place to ensure that developers pass it on to home buyers? That is the crucial question. There is no point in activating a measure like this if it does not deliver on the ground.

Cian O'Callaghan (Dublin Bay North, Social Democrats)
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That is the crucial question. In the years since the Minister took office, public subsidies to developers have increased, as have their profits. Here is another measure that we do not know will be passed on to people buying homes. There is no transparency around developers' profits. The largest developers are publicly listed, so we can see how their profits have increased in recent years, but there is no transparency around the other companies availing of these subsidies and the development levy waiver. Will the Minister introduce measures so that developers availing of public subsidies like this waiver must have transparency around their profits and publish their profits so that we can see whether there is a link between the increased subsidies and their increased profits? Will the Minister investigate this link to see whether there is an issue? What measures is he going to take to ensure that public subsidies actually make housing more affordable as opposed to just increasing profits for developers?

Fergus O'Dowd (Louth, Fine Gael)
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The Government's policies are working. The Minister referred to the first home and help-to-buy schemes. He visited Drogheda recently, but he may not be aware that, under those schemes, houses are being advertised for sale today at a mortgage rate of just under €1,000 per month, making them more affordable than renting there. We need more of the same. The schemes are working because Government policies are working and spending is happening. That is welcome.

Darragh O'Brien (Dublin Fingal, Fianna Fail)
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Fundamentally, this is an activation measure to increase supply. I thank Deputy O'Dowd for his kind comments. This measure is taking effect on the ground. Consider the measures the Government has introduced to support first-time buyers in buying at affordable rates. The help-to-buy grant gives them back €30,000 of their own taxes. I cannot imagine why anyone would be opposed to such a refund of tax that has been paid by hard workers-----

Eoin Ó Broin (Dublin Mid West, Sinn Fein)
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It is because it pushes up house prices. The Minister knows the answer.

Darragh O'Brien (Dublin Fingal, Fianna Fail)
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Actually, it does not. The equity under the first home scheme is not a second mortgage, which is what others claimed. Under it, we are providing approximately €69,000 in equity. Combined, these come to nearly €100,000. People who have been renting or living at home have a real way now to buy their homes at an affordable rate, with mortgages of €1,000 or €1,100 per month. That is happening. Some may wish it was not happening. The main Opposition party inexplicably wants to scrap both schemes. Last year saw the largest number of first-time buyers since 2007, with them purchasing one in every two new homes. The issue in that space is supply.

This time-bound measure, which will be kept under review, will get development schemes that were on the cusp of viability moving so that people will have more choice and can get out of the rental trap or their folks' box rooms. I expect a large portion, if not all, of the levy reduction to be passed on. We are earnestly requesting that this be done.

Cian O'Callaghan (Dublin Bay North, Social Democrats)
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If there was transparency around profits, we would know.

Darragh O'Brien (Dublin Fingal, Fianna Fail)
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We have already seen new schemes starting because of this measure. The commencement figures for quarter 2, which will be published this afternoon, are the highest in ten years. The commencement and completion figures for quarter 1 were the highest since we started collating these records. Everything is not perfect, but momentum is building, and we will take measures like this if they provide affordable homes for our people.

Joan Collins (Dublin South Central, Independents 4 Change)
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What mechanism has the Government put in place to ensure that developers pass it on?

Eoin Ó Broin (Dublin Mid West, Sinn Fein)
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None.

Cian O'Callaghan (Dublin Bay North, Social Democrats)
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And no transparency around their profits.

Darragh O'Brien (Dublin Fingal, Fianna Fail)
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The Deputies do not want houses at all. They want to take away every support from first-time buyers.

Joan Collins (Dublin South Central, Independents 4 Change)
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No. We want to be sure that this support is passed on.

Kieran O'Donnell (Limerick City, Fine Gael)
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We want houses to get commenced.

Darragh O'Brien (Dublin Fingal, Fianna Fail)
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The Deputies will take people's tax back off them and abolish the first home scheme.