Brian Hayes (Fine Gael)

It took four years for the Bill to be brought to the House. The report, in turn, emerged from one of the three Bacon reports on housing in the late 1990s. It has been a slow process. I regret that it has taken so long to establish the private residential tenancies board. I welcome the fact that progress is finally being made.

Some speakers have suggested that many illegal and corrupt landlords are intent on making life hell for their tenants, but I do not buy into that argument. It is clear that a minority of people is bringing down the entire private rented sector. I am aware, however, that a significant number of people is buying property and renting it to others for reasons relating to pensions. A friend, who is a similar age to me, has two houses because he does not have a pension scheme. We have seen an explosion in the number of people buying houses and becoming landlords because many people do not have pensions. We should not come down heavily on such people.

Everyone had a defined pension scheme and an occupational pension scheme 20 years ago, but many people do not have such schemes anymore. They need to purchase second and third houses to fund their pensions. We should bear in mind that we are not talking about a massive wealthy class of people. Many of the people in question are in the market to make money for their retirement in 20 or 40 years time. They often make good landlords. I do not buy into the notion that the absentee landlord is the majority example. We all know there are terrible examples of landlords in the private rental sector, but we need to make distinctions.

The Government's acceptance of the first Bacon report was the worst thing to happen in the private rental sector. The effect of that decision was to remove the tax deductibility on mortgages in the sector. The Minister of State knows that rents shot up within a year and the Government had to do a U-turn. We need to ensure there is flexibility in the sector. Currently, one of the best ways to get value for money in the Dublin property market is to rent. We must encourage people to stay in the market and to be professional and committed to this as a business interest because the more people who come into it, the more rent costs are driven down. It is better value now to rent a property in Dublin than it was 12 months ago because there are more properties available to rent. We should not lose sight of that.

Approximately 10% of our total housing stock — the Minister of State may correct me if I am wrong — is in the private rented sector, approximately 10% is in the social sector through local authority housing departments, and 80% of houses are owner occupied. There must be a more rapid expansion of the private rented sector to provide options for people who want to save for a number of years to buy their own house, but they want some assurance in that regard.

The problem in the housing market, particularly in the private rented sector, is that leases have been available only on a year to year basis and not on a medium or long-term basis. One had to negotiate the lease for 12 months and re-negotiate it at the end of that period. In other western European countries, particularly Holland and Belgium, most people rent on a three or five year basis. That is reassuring for landlords because they know the rent they will get for that period, and they can factor inflation into that and so on. That is a more favourable system compared with the one here. If I rent in the business sector it is on a ten year basis. Why can we not have the same medium to long-term renting in the private sector? I welcome the provision for this in the Bill and that an arbitration procedure will be put in place in the new board which will sort out the cowboys and the messers on the tenant side. A significant number of tenants are messers, and that must be recognised in the course of this debate.

It must be remembered that not everyone wants to buy a house. It can be more tax efficient in the long term for someone to have less of their total disposable income caught up in paying a monthly mortgage. We must encourage this sector to be flexible and long-term in its thinking and to have mechanisms in place to deal with problems and conflict. I welcome the fact that we can now have longer-term leases in the private rented sector.

Another major problem is the lack of accountability on the part of landlords who are not registered. It is important that local authorities take their task seriously in that regard. In South Dublin County Council someone who is doing three other jobs is also charged with the responsibility of ensuring that the list is in place for the private rented sector. That is ridiculous for a county with perhaps 225,000 houses. The local authorities must get real on this issue. Each housing department should have a special section dealing with the private rented sector, compliance and registration. I ask the Minister if, in his discussions with the Dublin housing authorities, he would tell them to take their responsibilities more seriously than they have done to date in terms of coming down heavy on unregistered landlords. We all know that the reason landlords are not registered is because they are not paying their tax. In that regard we must ensure that landlords register.

In a community where 20% or 30% of the total housing stock is in the private rented sector, the people who bought houses and are committed to that area are peeved at the condition in which some landlords leave their houses and the way tenants behave, sometimes on a daily basis. We must assure those communities that they have a right to make a complaint to an authority about a house and that landlords should take some action in respect of that. The only way that can be done is to have a proper registration process. I am in favour of registration, regardless of the cost; the cost is secondary to the registration. It is important that people know who owns these houses and that the landlords take their obligations seriously.

I was listening to the Minister on the monitor in my office and I was interested to hear him talk about section 197, an amendment to the Housing (Miscellaneous Provisions) Bill 1997 introduced by the then Minister with responsibility for housing, Deputy McManus. I made the argument, and I am sure the Minister's constituency is similar to my own, that there is a major need in Dublin to enforce exclusion orders. As the Minister knows well, before 1997 landlords could not get rid of tenants who were causing havoc in the private rented sector. Decent people in local authority housing stock buying their houses, doing the best for their children and trying to make good of an area had to deal with problem tenants whom the council refused to acknowledge in terms of the hassle they were causing in a community.

I had not realised this was part of the Bill, and perhaps the Minister can explain it further, but section 197 seems to suggest that not only will local authority tenants come under this section, which refers to the original Act, but that anyone involved in a shared ownership, tenant purchase or affordable housing scheme will also come under it. I welcome that because we could shift people in our council housing stock but we could not shift those to whom we had given substantial grant aid in order to buy their own house.