Michael Finneran (Roscommon-South Leitrim, Fianna Fail)

I do not want to switch everything to social housing either. I want to leave a certain type of community. Many of the social problems in our big estates arise from mono-tenure occupation. We are regenerating the older estates in places such as Ballymun, Limerick and Sligo. The policies which existed may have seemed correct in the past but they were not the best policies. A mixed accommodation is better and leads to a sustainable community. In such cases, social problems do not develop to the extent that they did in the past in mono-tenure estates.

I do not know about the banks and financial institutions. I would love to think they are making more credit available, but I am not sure that is exactly the position. A recapitalisation programme was introduced but I know people are still finding it difficult. People telephone and write to me as a result of difficulties they face. An option has been made available to such people in the form of the home choice loan. The take-up in respect of the latter has not been what we might have expected. As already stated, however, it is provided as an option only for people who cannot obtain loans elsewhere. Where banks or other financial institutions seek 20% deposits from customers, we reduce it to 8%. Therefore, the loan will amount to 92% of the overall cost of one's home. Funding is available from the Housing Finance Agency, through the four local authorities that are responsible for making the home choice loan facility available, to support people who wish to go down this route. I thank those local authorities for their assistance in this regard.

Like Senator Quinn, I recall the housing agencies in London and the people who were involved with them. The Senator referred to his involvement some years ago with a committee of the Archdiocese of Dublin that was established by the then archbishop to help get people on the housing ladder. The co-operative system remains in place and the voluntary groups operating throughout the country have been extremely successful in filling the gap that existed in this area. Such groups provide a large percentage of the homes required by elderly people, those with disabilities, etc. My Department provides funding directly to the local authorities in respect of these groups, which then receive 100% grants. These voluntary groups do a great deal in the context of meeting the housing needs of people in the categories to which I refer.

Senator Quinn also referred to the listing process and the fact that people who lost their homes are excluded from purchasing affordable houses. Such people may have lost their homes for particular reasons, but I assure the Senator that I will give consideration to this matter. Senator Quinn also called for a flexible approach to be taken.

Senator Cannon asked that a percentage of housing be allocated as social housing. The Senator's thinking is very much in line with that of the Department. We are flexible in respect of this matter. Senator Cannon referred to a friend of his from Galway who worked in the UK but who is now resident in Ireland. The Department will certainly consider the paper she submitted to the Senator.

Senator Brady stated that there are 4,000 people on the housing lists. I accept that this is a large number. However, it must be remembered that many of those on the lists have already been accommodated under the different schemes. My Department dealt with almost 19,000 households in 2008, either by providing houses or by offering assistance through the rental accommodation scheme, rent supplement or whatever. People are being catered for and 19,000 households is a large number with which to deal in one year. While every scheme does not deliver exactly what we desire, there is no doubt that, by and large, the many housing authorities try to assist people.

I accept that some of the schemes could be tweaked and we are open to suggestions in this regard. I am not particularly wedded to any scheme and I am prepared to consider alternatives. What is the goal of any public representative working with his or her local authority or a Minister working with his or her Department? It is to ensure that people have homes in which to live. That must be our focus.

Senator O'Malley made a number of thought-provoking comments. I accept what she said regarding particular holiday homes being built with certain conditions attached. One or two county managers have already tabled motions or had provisions included in their county development plans to release such houses. It is a matter for local authorities to take action in this regard. If there are 30 holiday homes lying idle in a particular local authority area and if that authority's housing list indicates that 30 people require houses, it is open to the authority to change the scheme, either by means of including a provision in the development plan or tabling a motion to be decided upon by members. I have no difficulty with such houses being released. It has already been done in a couple of cases and I provided advice in respect of it to one county manager. Local authorities are housing authorities and if they want to change schemes, they have the power to do so. Tax implications, etc., may arise in certain circumstances but that is a matter for the individuals involved.

Local authorities entered into agreements at a time when house prices were at a high. My predecessor issued a word of caution in 2007 with regard to prices being unsustainable. My Department was responsible for flagging the fact that developers were involved in inflating house prices to a large extent. Everyone recalls the gazumping that occurred and the fact that €50,000 might be added to the price of a house during the course of a single day. My predecessor stated at the time that this approach was wrong.

I hope I have responded to the issues raised by Senators and also to the strong points they made. As already stated, I am open to suggestions with regard to how progress might be made in respect of the housing lists. For one reason or another, some 55,000 people throughout the country are on those lists. Local authority housing officers and officials of my Department have a major responsibility in respect of these individuals.

The council loan was increased from €185,000 to €225,000 because people were not able to buy affordable houses in Dublin for €185,000. The increase was introduced, therefore, to ensure that, if they wish to do so, people will be able to obtain these loans in order to buy affordable houses. Like the home choice loan, the council loan is merely a facility and there is no pressure on people to use it. However, if they are experiencing difficulties in the open market, they may wish to avail of it. I do not wish, in any way, to place people in a position whereby having taken out a mortgage, they might find themselves in a position of negative equity in the future. I would prefer it if people were dealt with through the social housing programme rather than see them affected in this way.

The Housing (Miscellaneous Provisions) Bill, which was introduced in this House and which is before the Dáil at present, makes provision for an incremental purchase scheme. I have always believe that when a local authority makes a house available to someone, that authority no longer owns that property to any great extent. Such a house might be passed from generation to generation of one family. There is then a tenant purchase scheme under which the people occupying the house might eventually buy it. Why not offer the people involved the opportunity to buy the house when it is first made available to them, particularly if they are in a position to make repayments of a certain amount each month? Under the incremental purchase scheme for which the Bill to which I refer makes provision, a person will be able to state from the outset that he or she can afford to pay a mortgage worth 40% of the value of the house made available to him or her. He or she would, therefore, be the owner of that house from day one. The scheme will allow people to have ownership of their homes and local authorities will obtain a financial return that can be invested in the provision of further housing.

Today's debate is about affordability. There are some 3,700 affordable housing units available at present. Information emanating from local authorities indicates that, through the affordable housing scheme, they will be in a position to off-load half of these to those who are eligible. The local authorities did the deals with regard to these houses. In circumstances where difficulties may have arisen, however, I am open to suggestion in respect of such houses. I will not stand in the way of a local authority that puts forward a proposal which will ensure that these houses will come into public use. If that does not happen, we are prepared, as a last resort, to consider the matter in the context of the open market.