Eoin Ó Broin (Dublin Mid West, Sinn Fein)
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138. To ask the Minister for Finance the status of work with the credit unions and the approved housing bodies on the establishment of a special purpose vehicle to facilitate the delivery of social housing. [36300/18]

Joan Burton (Dublin West, Labour)
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187. To ask the Minister for Finance the work his Department has carried out with the Department of Housing, Planning and Local Government and the Central Bank regarding the establishment of a funding vehicle for credit unions to invest in social housing provision as committed to by the government under Rebuilding Ireland; if his attention has been drawn to the fact that such a funding vehicle will have to be regulated by the Central Bank and that the Department of Housing, Planning and Local Government may require assistance if ensuring such a funding vehicle for social housing is compatible with CBI regulations; and if he will make a statement on the matter. [36960/18]

Paschal Donohoe (Dublin Central, Fine Gael)
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I propose to take Questions Nos. 138 and 187 together.

As the Deputy is aware, the Programme for a Partnership Government recognises the potential role that credit unions can play in housing finance.

To that end, officials from my Department and the Department of Housing, Planning and Local Government have met with the credit union representative bodies on a number of occasions to examine how credit unions can assist in the area of social housing. 

Following engagement with the credit union sector on proposals for credit unions to provide funding for the provision of social housing, the Central Bank undertook a review of the investment framework for credit unions in 2017. On foot of this review, revised Regulations with the addition of investment in Tier 3 Approved Housing Bodies (AHBs) as a permitted investment class for credit unions commenced on 1 March 2018. Since this date, credit unions are permitted to provide funding to Tier 3 AHBs for the provision of social housing.  

This new investment framework for credit unions clarifies the scope and the manner in which credit unions can support the development of social housing. The Regulations require that investments by credit unions in Tier 3 AHBs must be made through a regulated investment vehicle. The maximum permitted investment amount per credit union is 50% of a credit unions regulatory reserves where a credit union has total assets of at least €100 million and 25% of a credit unions regulatory reserves for all other credit unions. These limits may facilitate a combined sector investment in Tier 3 AHBs of close to €700 million.

In line with the commitments in the Rebuilding Ireland Action Plan for Housing and Homelessness, the Department of Housing, Planning and Local Government established an Innovation Fund to assist AHBs to develop structures, policies and new funding mechanisms. One of the projects being funded, which is being undertaken by the Irish Council for Social Housing (ICSH), is the development of a Special Purpose Vehicle to facilitate investment into the AHB sector by investors, including the Credit Union movement. The project was approved in May last year and is being undertaken by the ICSH in three phases. The first two phases have been completed and work on the third phase is ongoing. 

With respect to any funding mechanisms specific to the Credit Union sector for investing in social housing, ultimately this will have to be put in place in the first instance by the credit unions themselves, with the support of their members, and with the approval of the Central Bank. In this regard it would not be appropriate for me to comment on the status of any regulated investment vehicle which the credit union sector is or could be developing to invest in Tier 3 AHBs.