John Gerard Hanafin (Fianna Fail)

Fine Gael's concern was answered in the Minister of State's contribution, which stated:

The Department has received a strong commitment to pursue the voluntary phasing out of stage payments from the Construction Industry Federation's branch in Cork, which is the main centre where such payments now occur. In a letter addressed to the Department, it has indicated that its members have made a strong recommendation to the Irish Home Builders Association, IHBA, at national level to the effect that it should immediately enter into discussions with the Department with a view to voluntarily phasing out stage payments within a relatively short timeframe. I understand that this recommendation has been endorsed by the national body of the IHBA and the necessary follow-up arrangements will be put in place without delay.

The Government's record on housing is exemplary. House prices have risen considerably and some have attempted to use this as a stick with which to beat the Government. It is a product of our economic success. This Government is committed to ensuring that house prices are affordable. In fact, people may be paying significantly less for mortgages as a percentage of net income than in the 1980s.

Another element that must be considered is supply. The land banks accredited with planning permission should be the subject of a "use it or lose it" timeframe. The market has not retrenched in any way but is not as buoyant as before. This was expected because prices could not increase by 15% per annum into the distant future. No tree grows to the sky. The rate of growth may decrease. If there is a threat in the future and affordability is in question, we should place an onus on builders to use available banks or lose the zoning status.

The Government's record is exemplary. The total number of houses completed in 2005 is 80,957 units, an increase of 5.2% on 2004 and more than double the amount in 1997. Ireland now produces houses at a rate of 20 per 1,000 residents, the highest rate within the EU and five times the rate of the UK. Almost one third of Irish homes have been built since 1997. We are now building almost three times the number of houses built ten years ago, three times the EU average and six times the UK average.

Our focus is on delivering infrastructure such as the extension of the service land initiatives and the more efficient use of housing land. A new housing policy framework, Building Sustainable Communities, was launched in 2005. The framework envisaged a substantial increase in investment, allowing for 50,000 householders to be assisted over the coming three years. There will also be a programme of reforms to improve the quality of the social housing environment. A more detailed document will be published in 2006.

While the rate of house price increases is problematic it has moderated considerably since the late 1990s, when price increases peaked at 40% per annum in 1998. According to the ESRI and Permanent TSB house price index, the year on year growth rate to March was 12.1%. Measures announced in budget 2005 helped first-time buyers to purchase their homes by abolishing stamp duty on second hand homes costing up to €317,000 and by reducing rates on homes of up to €625,000 for first-time buyers. First-time buyers save €11,500 on a house costing €308,000.

This Government has a good and strong record in ensuring there is affordable housing and ensuring that houses are built. The total capital spending on social and affordable housing output in 2005, including non-Exchequer finance, amounted to €2 billion and assisted in meeting the housing needs of over 13,000 households. This compares with 8,500 households in 1998. The extra capital funding in budget 2006 will allow for some 23,000 new social homes to be commenced between 2006 and 2008 and 15,000 affordable homes to be delivered. In total, 50,000 households will benefit over the coming three years from an Exchequer capital investment package of close to €4 billion.

Since 1997, more than 42,000 new social houses have been built either in the local authority or the voluntary co-operative sector and over €7 billion in funding has been provided under a range of social and affordable housing programmes. At the end of 2005 that investment met the needs of some 100,000 households. A total of €1.3 billion is being invested by the Government in housing in 2006. It is anticipated that the needs of over 13,000 households will be met in 2006, including some 5,500 completions under the main local authority programme. A total of 1,850 units will be completed by the voluntary and co-operative sector and there will be a continued focus on the regeneration and delivery of some 3,000 units of affordable housing.

Investment in housing under multi-annual plans for 2006 to 2010 will be close to €7 billion. A new agency has been established, the Affordable Homes Partnership, to co-ordinate and give impetus to the delivery of affordable housing in the greater Dublin area, where affordability pressures are greatest. Over 70 sites have been identified so far on State or local authority owned lands. It is estimated that in 2005 up to 1,350 units were provided under the initiative and up to 2,000 will be provided in 2006.

While many statistics have been quoted, the figures I have mentioned represent homes for people that were built and provided by this Government on an unprecedented scale. We will continue to work to ensure that people can have affordable homes and that they will have the jobs to afford their homes.