Tuesday, 26 June 2018
I thank the Minister of State, Deputy Mitchell O'Connor, for coming to the House to discuss the issue of third level student accommodation.This issue usually arises at this time of the year as thousands of students finish their leaving certificate and look forward to going on to third level education. They will be looking for accommodation for the end of August and the beginning of September once they get their results. The problem is that there is an increasing number of students and a decreasing amount of accommodation. In addition, the cost of the accommodation available is increasing far above the rate allowed within pressure zones. I will give a specific example of that shortly.
The Government's national student accommodation strategy of July 2017 showed there was excess demand for purpose built student accommodation of over 23,000. That will increase to over 25,000 by July 2019. The figures in that report outline what the problem is and how it is increasing. I met some student leaders in Galway last week. They said that in the middle of their examinations in May the cost of official student accommodation in the National University of Ireland Galway, NUIG, was increased by 18%. That confused me because Galway city is a rent pressure zone, which does not allow rent increases of more than 4% for accommodation. However, I was told that this does not apply to student accommodation. Perhaps the Minister will clarify that. Am I wrong in the assumption that it should apply everywhere? This will lead to students commuting long distances to get over this problem, sleeping on the couches of friends and mental health issues.
I am seeking information on the developments at all universities and third level institutions. Is much extra student accommodation planned? Is much being built at present? If more student accommodation became available it would alleviate pressure on private rented accommodation for the general public. Would the solution be to give some incentives or grants to provide student accommodation on the campuses of our universities or colleges? That would in turn provide an income stream, help the overall development of those third level institutions and, perhaps, take some pressure off the Government to provide extra funding. I am merely passing on the concerns that were raised with me and I hope the Minister can reply to some of the questions I raised.
I have met and spoken with the students' union in Dublin City University, DCU, and NUIG, where there were particular problems during the last term. To answer the Senator's question, student accommodation is being built. At the end of May last, 2,990 student bed spaces had been completed since the launch of the Rebuilding Ireland report. Nationally, there are 7,070 student bed spaces actively being built, and 2,354 will be available in the coming academic year and over 2,800 will be available in the following year. The potential pipeline of accommodation is also encouraging. Some 7,017 bed spaces have been granted planning permission. Therefore, we should meet, if not exceed, the Rebuilding Ireland target of 7,000 purpose built bed spaces by the end of 2019 and 21,000 bed spaces by the end of 2024.
By increasing the available supply of student accommodation we can alleviate some of the pressure on the private rental market, which will in turn help to decrease price. In tandem with the Housing Finance Agency work has been carried out to assist in the provision of finance for higher education institutions.Work has been carried out to assist in the provision of finance for higher education institutions. The Housing Finance Agency has implemented a streamlined application process to assist such institutions to access finance for the construction of purpose-built student accommodation. Provisions have also been made which allow applications for new, purpose-built student accommodation developments to move through the planning process at a faster pace.
Alongside these initiatives, the Union of Students of Ireland and the Departments are working through the interdepartmental working group on student accommodation to promote and facilitate the provision of digs accommodation as an alternative to both purpose-built student accommodation and the general rental market for students. The 2018 campaign was launched on 25 June and will seek to increase the number of homeowners offering accommodation to students during academic term time.
The recent rent increases in privately run, purpose-built student accommodation are a significant cause for concern. I have met my colleague, the Minister of State at the Department of Housing, Planning and Local Government, Deputy Damien English, to discuss this issue and we continue to work together to ensure that students are accommodated in the current housing market. Officials from the Departments of Education and Skills and Housing, Planning and Local Government are working in close co-operation to identify a solution that will provide the longevity sought from any intervention. This is a complex issue which may well necessitate legislation that is robust and does not give rise to unintended consequences. As such, it is necessary to ensure that any potential solution is robust enough to withstand scrutiny from many different perspectives.
I thank the Minister of State for her comprehensive reply. I am glad to hear of the many initiatives that are being taken. The Minister of State referred to the rent increases in privately run, purpose-built student accommodation. Does the 4% limit on rent increases in rent pressure zones, RPZs, apply to such accommodation?
Obviously that is a loophole that must be closed off. I thank the Minister of State for that clarification. She outlined a number of welcome initiatives. It is important that we try to solve the student accommodation problem. Students experience considerable stress in the lead up to their exams and then they stress about results. They experience more stress when trying to find accommodation so anything that lightens their load is to be welcomed.
First, I reiterate that the RPZ restrictions do not apply to student accommodation. Second, we must make sure that any solution proposed is constitutional, robust, does not have any unintended consequences and can withstand scrutiny from different perspectives, including those of owners and students.