Leo Varadkar (Dublin West, Fine Gael)
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Question 586: To ask the Minister for the Environment, Heritage and Local Government if his Department has produced guidelines for local authorities in setting the level of bonds that must be paid by developers of new residential developments; if he has satisfied himself at the level at which bonds are being set; and if he will make a statement on the matter. [24787/07]

John Gormley (Dublin South East, Green Party)
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Sections 34(4)(g) and 180(2)(b) of the Planning and Development Act 2000 provide that a planning authority may attach a condition to a planning permission requiring the giving of adequate security for the satisfactory completion of a development, and, if the development is not subsequently completed satisfactorily, may apply the security to that satisfactory completion. The determination of an adequate amount to complete any particular development is a matter for the relevant local authority, having regard to the circumstances in its area. However, in the interests of those purchasing a property in a development, it is essential that the bond be adequate, to enable the local authority carry out the work if the developer defaults.

In circular letter PD1/06, issued on 25 January 2006, my Department informed planning authorities that it was necessary for all planning authorities to establish, as a priority, a policy on taking in charge of estates, to be approved by the members of the authority and reviewed at least once a year. This circular further stated that the policy should, among other requirements, provide that:

an acceptable level of security be provided by the developer towards the completion of a development,

the security not be released until the estate is completed to the specified standards, and

the bond obtained from the developer be applied to carry out any outstanding work where needed to ensure the estate is completed.

My Department issued further guidance to planning authorities on this issue in the Development Management Guidelines, published in June 2007 under section 28 of the Planning and Development Act 2000. The Guidelines provide specific recommendations on attaching conditions relating to grants of permission for residential development including that:

a planning condition requiring an acceptable security by way of bond, cash or otherwise is essential so as to secure satisfactory completion of the development,

the amount should be specified and should be index linked,

the amount should enable the planning authority, without cost to itself, to complete the necessary services to a satisfactory standard,

the condition should require lodgement of the security coupled with an agreement enabling the local authority to realise the bond,

the bond should be of sufficient duration to allow inspection of the development and still call in the bond if necessary, and

the bond should be refunded on satisfactory completion of the development.

My Department also established a Working Group, representative of local authorities, architects, planners and consumer interests to consider this issue and other related issues around taking in charge of estates. The Group has now completed its work and the draft guidance has been submitted to me. I expect to be in a position to issue revised guidance on taking in charge shortly.