Good morning everyone.
I want to thank the Committee for inviting me here to-day to address you and I look forward to our discussion.
I will introduce the Department officials accompanying me:
- Bairbre Nic Aongusa - Assistant Secretary
- Maria Graham – Assistant Secretary,
- Niall Cussen – Principal Planning Advisor,
- Barry Quinlan – Principal Officer and,
Firstly, I would like to commend the Committee on its’ work to date. In a very short space of time the Committee has consulted with a vast number of key stakeholders and experts in the areas of housing and homelessness. I look forward to the Committees Report in due course.
Housing is an absolute priority for this Government and I was appointed as Minister with specific responsibility for Housing, Planning and Local Government to focus intensively on the challenge of tackling the housing crisis. I have recently been joined by Minister of State for Housing and Urban Renewal Damian English T.D. and we have been tasked with preparing an ‘Action Plan for Housing’ within the Government’s first 100 days, working with our Government colleagues and key stakeholders .
Importantly, the Action Plan will build on the considerable work already carried out or underway and will draw on the important work carried out by this Committee. The plan will include actions to expedite and boost supply of all types of housing, including social housing, in the immediate, medium and longer-terms. While it is important to boost housing supply for everyone, the Action Plan will focus in particular on those feeling most difficulty in accessing the housing and rental market at the moment.
Minister English and I have initiated some early intensive engagement with people who have been working in the housing and homelessness areas for many years, to discuss the broad approach to the housing action plan and to develop a common understanding of the housing situation in our country at present. I am firmly of the view that the position can only be described as an emergency situation in our key urban centres particularly in Dublin and Cork.
It is impossible not to be really affected by the experiences of families and children in long-term emergency accommodation and it has really strengthened my resolve to deal with our housing challenges, a resolve absolutely shared by everyone at the Cabinet table.
To-day presents an excellent and timely opportunity for an informed discussion on the diagnosis of the key challenges, particularly in housing supply, and the actions required to be taken urgently.
In terms of my approach, I want to prepare a Plan that the members of the Oireachtas and key housing stakeholders can subscribe to. I absolutely believe that if we all work together in the way that tackling emergency conditions demand, we can and will turn around the situation focusing on actions we can take in the short and medium term.
The Diagnosis:
Housing lasts for generations and takes a long time to put in place, which is why, our current difficulties go back to how our construction and housebuilding sectors collapsed during the downturn and have really struggled to come back. The way the residential sector operated, with the banking and lending sectors, in the past led to our problems and we cannot ever go back to that.
Once the economy collapsed Ireland simply stopped building houses, private and social housing, for the best part of the last decade, apart from finishing out some schemes and one-off houses. This lack of supply of housing in the right locations is the critical factor underpinning the current crisis. Just over 12,600 housing units were completed last year, almost half of which were individual or “one off houses”. We need to be building somewhere in the region of 25,000 units per annum to meet the need and we need to ensure that these are in the right locations and of the right type to meet our evolving household formation and demographic patterns.
Furthermore, many of the active sites in the Dublin area are delivering housing at prices which are not affordable for the majority of first time buyers.
If ordinary people are spending more and more of their income on rents and mortgages, that leaves less for the many other demands of life and this affects the real economy and peoples’ quality of life. It also puts many working families in more precarious financial positions and at risk of homelessness.
If we allow the current supply trends to continue and don’t take some key decisions quickly, it could take another 10 years for the market to right itself and for supply to meet our needs. Such a scenario and the related impact on people’s real incomes and lives is socially and economically unacceptable.
Put simply the housing situation is affecting every sector of Irish society and putting at risk our hard-won gains in terms of employment, recovery of competitiveness and the attractiveness of Ireland as a place to live and work.
The Solutions:
So what are we going to do?
Its’ important to recognise that we are not starting from scratch. I am on record acknowledging the work of my predecessor Alan Kelly T.D. particularly, in the area of social housing and homelessness and I take the opportunity to do so again to-day. A lot has been done, particularly, in putting in place the €3.8Bn social housing strategy, the actions on homelessness, rent certainty and private housing viability.
Just to recap on some of the key actions already taken:
• Part V has been reformed to make delivery of social houses possible and wider developments viable,
• Development contributions have been retrospectively lowered and a rebate Scheme for housing at more affordable prices in Dublin and Cork put in place,
• A Vacant Site Levy was introduced,
• New rent measures were put in place,
• Apartment Guidelines were re-issued to ensure that much needed supply could be viable,
• NAMA has outlined its’ programme to fund development of 20,000 new homes, and,
• A €500m “Activate Capital” NTMA development finance package was put in place.
I put these measures on the record to outline and recognise the building blocks that have been put in place. The Government, the whole of Government, recognises that further actions are required to increase housing construction to create a functioning housing market.
Many think that a total focus on public housing programmes will solve the situation. While I agree that we need to do more on the social housing side and quickly, I don’t think anyone in our country believes that only social housing needs to be built.
We must also focus on the other parts of housing, including doing all we can to keep people in the homes they have and ensuring that the rental and private housing construction markets function properly and deal with the backlog of a decade of undersupply so that people do not get squeezed into homelessness and social housing waiting lists.
The Government knows we have to get housing right and it is for that reason that I personally sought out this portfolio. I am working very closely with Cabinet colleagues under a special Cabinet Committee chaired by an Taoiseach that meets weekly. What we are focusing on so far is how to:
· more quickly tackle the issue of those living in emergency accommodation by expanding and expediting solutions; The programme of rapid-delivery housing provision is being implemented to mitigate the acute issues associated with homelessness. It is my ambition to accelerate and expand the rapid delivery programme.
· accelerating the delivery of the social housing strategy; Under the Social Housing Strategy 2020, targets have been set for each local authority out to 2017. Importantly, local authorities and approved housing bodies have a strong pipeline of construction, turnkey and acquisition projects, which will deliver some 3,900 homes, with approved budget costs of some €680 million. Again, it is my ambition that the delivery of these homes will be accelerated and that the targets will be exceeded.
· Increasing the overall output of private housing to meet the 25,000 which is acknowledged as the likely annual supply need;
o to achieve this we are examining any further potential barriers, in terms of serviced land, funding and financing and delivery mechanisms,
· ensure that most of the additional houses and apartments are affordable and meet the needs of all sectors of society, including students, older persons and the increasing proportion of 1-2 person households; and
· replace the boom-bust cycle of construction and housing supply through better management of the land supply and development process.
How will we do this?
To do this I am preparing a delivery and supply focussed Housing Action Plan. Importantly, the plan is being developed with colleagues on the Cabinet Committee and will draw on the Report of this Committee which I understand is due in mid-June.
I know when my predecessor attended this Committee he said that he favoured a Minister for Housing but only with a broader range of powers in areas of Finance; Expenditure; Social Protection etc. The Cabinet Committee includes my colleagues the Ministers for Finance; Public Expenditure and Social Protection and is chaired by an Taoiseach so the plan is being jointly informed and developed through the weekly Cabinet Committee and Senior Official Group meetings.
Immediate Supply Boost:
The absolute focus of the initial actions in the Plan will be to boost supply and I have asked local authorities and NAMA for concrete proposals to boost supply in the short term, on land they control or influence, for all types of housing – both social housing and housing for the wider private market.
The Taoiseach and I met with local authority Chief Executives on 12 May 2016, in order to discuss, amongst other things, the housing situation and in particular boosting supply and the future delivery and implementation of the targets set for the local authorities under the Social Housing Strategy 2020.
The meeting provided an opportunity for a very useful exchange of views and I reaffirmed the Government’s, my own, and my Department’s commitment to supporting local authorities’ efforts to deliver on the ambitious delivery targets that have been set.
Acknowledging the efforts that have been made by local authorities, working in conjunction with approved housing bodies, to deliver on the Social Housing Strategy since its publication in November 2014, I outlined my ambition that the delivery of homes under each of the social housing programmes should be accelerated. In that regard, I have asked all local authority Chief Executives for their ideas and proposals to expedite delivery of social housing.
Generally, in making proposals I’ve asked both NAMA and local authorities to consider how best to work with builders and the construction sector.
More Funding:
For its part the Government has committed to making funding available for social housing and for infrastructure to facilitate the development of all types of housing. We are also committed to examining all aspects of the “viability equation” particularly input costs, to help ensure that housing is intrinsically affordable, to bring on stream, whether for buyers or providers.
We are looking at all aspects of the house delivery process, from land availability to financing, planning to procurement, to ensure that an appropriate balance is struck in increasing supply on the one hand but avoiding another property boom on the other.
I want to see proper planning, not just building houses but creating places that people will be proud to call their homes. I want to see strategic thinking and action, infrastructure and amenities going in before or as places are developed.
We have learned the lessons from our recent property and debt fuelled economic crash.
Given the gravity of the situation we are thinking radically and are prepared to do whatever it takes to mend the housing system in Ireland. Once the Government takes action it will be very important that the delivery agents and the construction sector respond and I will seek assurances that if we deliver, they will too.
Conclusion:
We are hard at work on drafting the Action Plan at the moment and my approach is to consult broadly. I have met a large number of key stakeholders already and my door is always open to anyone with good suggestions on how to boost supply. The Action Plan will be published over the summer, within the first 100 days of this Government and its implementation will already have begun at that stage.
The Report of this Committee will form a key input and I think the way we are developing the Action plan is a real sign to the people of Ireland that this 32nd Dáil is capable of putting party politics aside to put the key social and economic interests of the people first.
By the end of this year, I expect that the first signs of a ramp-up in supply will start to become evident, taking hold into the early part of next year and onwards from there.
For now, I want to assure this Committee that for my part and that of the Government’s, housing is our number 1 priority and must be, and will be, comprehensively tackled. I look forward to the Committees Report and I will ensure that it informs the Action Plan for Housing.