Emmet Stagg (Kildare North, Labour)
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Question 40: To ask the Minister for the Environment, Heritage and Local Government his plans to introduce a change to the method by which bonds are calculated in view of the unprecedented number of ghost estates. [44397/10]

Seán Sherlock (Cork East, Labour)
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Question 45: To ask the Minister for the Environment, Heritage and Local Government if he has received requests from local authorities for funding to address issues in relation to incomplete estates where adequacy of bonds is of concern; and if he will make a statement on the matter. [44399/10]

Seán Sherlock (Cork East, Labour)
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Question 50: To ask the Minister for the Environment, Heritage and Local Government his plans to introduce legislation to provide the flexibility which would enable bonds to be called down in stages and to be called down in conjunction with enforcement proceedings; and if he will make a statement on the matter. [44398/10]

Ciarán Cuffe (Dún Laoghaire, Green Party)
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I propose to take Questions Nos. 40, 45 and 50 together.

Sections 34(4)(g) and 180(2)(b) of the Planning and Development Act 2000 provide respectively that a planning authority may attach conditions to a planning permission requiring the giving of adequate security for the satisfactory completion of a proposed development and, if a development is not subsequently completed satisfactorily, apply a security given under section 34 for the satisfactory completion of that development.

My Department has consistently advised planning authorities that it is essential that planning permissions for residential developments are subject to conditions under which an acceptable security is provided by way of bond, cash deposit or otherwise so as to secure the satisfactory completion of those developments. This advice was repeated in my Department's Development Management Guidelines of June 2007 and policy guidance on the Taking in Charge of Residential Developments of February 2008 which state that, in the case of residential development, planning conditions must require the giving of sufficient security prior to commencement of development and that planning authorities must ensure that they are in a position to draw down the security in cases where a developer fails satisfactorily to complete a residential development, or phase of a development, within the specified period.

The Guidance states that it is a matter for the planning authority to determine both the level of the security and the type of security (e.g. the lodgment of a bond from a financial institution such as a bank, insurance company or building society, a cash lodgment or a letter of guarantee from the Construction Industry Federation) that will be required for each residential development, but that the amount of the security, and the terms on which it is required to be given, must enable the planning authority, without cost to itself, to complete the necessary services (including roads, footpaths, water mains, sewers, lighting and open space) to a satisfactory standard in the event of default by the developer. The Guidance also states that planning authorities must ensure, when using time-limited bonds, that the bond is of sufficient duration to allow them time to inspect the development after the expiration of permission and still call in the bond if necessary, and recommends that the duration of the planning permission (and any approved extension of that duration) plus 2 years should be minimum duration for a bond.

In addition, the Guidance advises that a security condition must also provide for the recalculation of the amount specified in the condition by reference to the House Building Cost Index (or the Consumer Price Index) if the development to which the permission relates is not commenced within a specified period after the granting of the permission.

In relation to the matter of phasing of development, Circular Letter PD 1/08 states that planning authorities should consider whether it is appropriate to attach a condition regarding the phasing of a residential development in order to ensure that residents do not have to live in uncompleted residential developments for lengthy periods. It pointed out that a phasing condition could include requirements relating to the completion of roads, public lighting, open spaces, etc. which are necessary for, or ancillary to, the completed units in each phase. Such an arrangement would permit the security for satisfactory completion to be related to a particular phase or phases of the development and thus enable completion of sections of the scheme to be advanced while, at the same time, facilitating the developer by obviating the need for a very large security appropriate to the entire development.

The high-level Expert Group on Unfinished Housing Developments is actively developing practical and policy solutions to effectively address unfinished housing developments, including preparation of a guidance manual and Code of Practice and the identification of appropriate legislative reforms to ensure the satisfactory resolution of issues associated with unfinished estates. I expect the Expert Group to report back early in 2011.

I have not received any specific requests from local authorities for funding to address issues in relation to incomplete estates where adequacy of bonds is of concern.