Victor Boyhan (Independent)
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I welcome the Minister of State to the House.

Mary Seery Kearney (Fine Gael)
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I welcome the Minister of State. As he is aware, we have problems across the country with apartment defects. More than 100,000 apartments are affected by defects and the Government announced a remediation scheme some time ago. While it has been slow in commencing, a portal was opened last December for submissions for interim funding as we await the Bill for the overall remediation scheme. The interim funding piece is for cases such as a block like Park West, which is being represented by Sam and Odette Doran of the Not Our Fault campaign, where they have made sure that all the surveys have been carried out and everything is done. They are engaging with the fire officer and are doing a fantastic job, and hopefully they will be the first to draw down from that scheme. Because they are so far advanced, they provide support services and advice to other owner-management companies and that has thrown up a major problem with the Multi-Unit Developments Act 2011.

It was agreed as a priority that the Multi-Unit Developments Act 2011 needed serious reform. It was very good legislation at the time but the lived experience has rendered outdated an awful lot of its provisions. This interim scheme has shown that you have management agents charging fees for the administration of the remediation scheme and therefore less money is going back to owners who are affected by it. A situation can arise where only some have paid for the survey and only some should be getting back money and the question is how do you administer that. Owner-management companies are in the main run by volunteers. Other issues that arise are owner-management companies or management agents planning to hold on to the moneys from the remediation scheme and perhaps using it to upgrade to today's standards instead of the requirements within the scheme.

Some have paid out money in good faith and are expecting to receive that money back from the Government. If the Government decide to only pay it to the owner-management company, if that owner-management company is dominated by institutional landlords or even approved housing bodies, because they have a vote for every unit rather than just one entity one vote, they can often outvote the owner-occupiers within schemes. The need for a regulator is very clear and that regulator, it is proposed, would need to come in under the multi-unit development reform amendment Bill that is due. Although all of this is all Department of housing discussion, the legislation for it and enforcement of it is within the remit of the Department of Justice. Hence, it has taken me a somewhat circuitous route to find myself in front of the Minister of State here.

What is needed is a regulator that will be a source of information and resources, that will be a point of appeal for owner-managers and can be an arbitrator where there are disputes. They can perhaps be a conduit, along with the Housing Agency who are administering this scheme. Let us say you have 30 owners in a scheme who have paid in, that money could be paid to a solicitor for the owner-management company through this regulator that would then ensure that that solicitor, in the same way as we have with conveyancing, undertakes to distribute those moneys to the owners who have paid in good faith with the residual amount then going to the management company. That can be done through an undertaking from a solicitor.Look at Park West where they have really led the way. They do not have those problems because they happen to have Sam Doran there who is very experienced. Not every development has that.

Victor Boyhan (Independent)
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I thank the Senator and call Minister of State, Deputy Martin Heydon.

Martin Heydon (Kildare South, Fine Gael)
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I am going to start by thanking Senator Seery Kearney for raising what is a really important issue. I will respond on behalf of our colleague, Minister for Justice, Deputy McEntee, who unfortunately cannot be here today. Last December, the Minister for Housing, Local Government and Heritage, Darragh O'Brien, announced the opening of the interim remediation scheme as the Senator outlined, for fire safety defects in eligible apartments and duplexes. The scheme provides for the funding of emergency fire safety defect works, in order to provide an acceptable level of fire safety in buildings, pending the completion of the full remedial works.

Apartments and duplexes built between 1991 and 2013 with eligible defects qualify for the scheme. The scheme, which has been administered by the housing agency on a nationwide basis, is open to applications via the housing agency's website. Given the current legal obligations and ownership of common areas, owner management companies, OMCs, will receive funding to carry out the necessary remediation works. Only applications from authorised representatives of OMCs will be considered and funding will not be directly allocated to any individual homeowner. Although only applications from authorised representatives of OMCs will be considered, I am advised that the process is designed in a way that OMCs will complete the application through the assistance of competent professionals such as engineers, architects and quantity surveyors, as well as local authority fire service personnel.

As of the end of last month, May 2024, 154 applications have been validated by the housing agency across 27 local authority areas, representing a total of 15,743 residential units. The Department of Housing, Local Government and Heritage has also been advancing the steps to put the remediation scheme on a statutory footing, as a matter of priority. Full remedial works, which will include all necessary fire safety measures as well as those relating to water ingress and structural damage, will be funded under the statutory scheme.

As regards the establishment of an interim non-statutory regulator for OMCs as has been raised here, I am told that it is important to point out that the owner management companies are already subject to company law provisions including their own memorandum of association. They are also subject to oversight by the company registration office and the Office of the Director of Corporate Enforcement. Furthermore, the Multi-Unit Developments Act 2011, or the MUDs Act as it is known, also acknowledges the risk of disputes arising in the enforcement of rights and the performance of obligations imposed by its provisions on OMCs. Section 24 of the MUDs Act makes provision for the resolution of such disputes. A non-statutory regulator would have no lawful authority over any entity and so establishing such a regulator would be of no practical effect. Given the challenges arising in the context of the interim scheme and the proposed statutory scheme, Deputy McEntee and Deputy O'Brien have agreed to establish an interdepartmental group to consider what further regulatory measures are required for OMCs.

Mary Seery Kearney (Fine Gael)
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The Minister is just the messenger but that is a wholly inadequate answe that does not reflect the lived experience. These are voluntary people on an OMC, people who live in apartments they have been told have defects and some of them got bills for €64,000. There are owner management companies that are in bed with the suppliers and getting backhanders. All sorts of stuff is going on. They have inflated tendering processes and inadequate procurement processes. They are charging levies to owners and applying interest to those levies and who is benefiting from that? In many cases the original builder, who developed the development with all of these issues in hand, has a controlling interest in the owner management company. The idea that the MUDs Act is deemed to be appropriate is way off the lived experience of people around the country. That is a wholly inadequate answer and I will finish on this: The fact is we are looking for a statutory regulator, not a non-statutory regulator. Everything that has happened was foreseeable and was warned by people like Sam and Odette Doran, so there is no excuse for the delay.

Victor Boyhan (Independent)
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I thank the Senator. The Minister has one minute to respond.

Martin Heydon (Kildare South, Fine Gael)
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I will bring the very important points the Senator raised back to the Ministers. I do note from the wording of her motion, it was an interim OMC regulator. Maybe that was perceived as non-statutory. I take the very serious points the Senator raised on board. The Department of Housing, Local Government and Heritage has also been advancing the steps to put the remediation scheme on a statutory footing as a matter of priority.The full remedial works, which will include all necessary fire safety measures, as well as those related to water ingress and structural damage, will be funded under the statutory scheme. Given the complexity of the issues, including the significant amount of Exchequer funding that the Government has committed to assist affected homeowners, sufficient time is required to ensure the scheme is fit for purpose, provides value for taxpayers’ money and contains appropriate oversight and governance measures, which I am sure the Senator will agree are important. However, in respect of refunds for outlay made by homeowners before the interim scheme came into operation, the Government approved the principle of allowing remediation costs incurred or levied to be covered under the forthcoming statutory remediation scheme, once such costs fall within the scope and defined parameters of the scheme.

It is expected the general scheme of the proposed Bill will be submitted to the Government before the summer recess. Subject to the legislative process, the statutory scheme will be in place shortly thereafter. As I noted earlier, it has been agreed to establish an interdepartmental group to consider what further regulatory measures are required for the OMCs. I will bring the specific points raised by the Senator back to both Ministers.