THE GOVERNMENT HAS been roundly criticised for standing over a €700 million capital underspend in its housing budget for the year to date.
People Before Profit’s Richard Boyd Barrett told the Dáil today that four of Dublin’s local authorities failed to built any new council houses in the first six months of the year.
During Leaders’ Questions, he asked Public Expenditure Minister Michael McGrath what the Government was going to do to ramp up construction by local authorities.
If houses are not built, he questioned whether the Government would move to buy up multi-unit apartment complexes to make up the shortfall.
“It is absolutely beyond belief that at the end of this year you will have underspent the housing budgets by €700 million and you claim that this is a success from the Housing For All plan,” said Boyd Barrett.
Defending the housing budget, McGrath said new public stock is not just delivered by local authorities but also housing bodies and the Land Development Agency (LDA).
“Local authorities currently have 2,000 homes under construction on various sites and in excess of 3,700 others in the pipeline for delivery at this point in time,” said McGrath.
He highlighted that last week the housing minister provided €100 million to local authorities to help clear legacy debt which will assist in accelerating the delivery of social homes on the sites.
Housing targets
He said it is not backed up by facts to say that the housing targets are inaccurate.
The targets in the Housing for All plan were based on an independent assessment carried out the the ESRI, but since then preliminary data has been released from the census.
McGrath said Government intends to review the underpinning research when the full census data becomes available from the CSO next year.
However, he said the preliminary census results for 2022 shows that housing demand is “broadly aligned with that projected by the ESRI”.
When the full census results are released a reassessment of what the revised projection will be carried out, said the minister.
Scrapping Help-to-Buy
Sinn Féin’s Eoin Ó Broin also hit out at the Government over their underspend, stating that the chronic level of bureaucracy imposed on local authorities has prevented houses getting built quickly.
When asked about his party’s housing policies and its pledge to deliver 100,000 social and affordable homes if in Government, Ó Broin said he would scrap two of the Government’s housing plans if in power.
The Help-to-Buy Scheme and the First Home Shared Equity Scheme would be “phased out as quickly as possible”.
The Help-to-Buy scheme is now a maximum payment of €30,000 for first-time buyers looking to purchase a newly built house.
A total of 16,000 first-time buyers have availed of the scheme in the past 12 months.
However, a Oireachtas Parliamentary Budget Office (PBO) report found that third of recipients of scheme did not need it to meet the 10% deposit requirement to buy their first home and this may have helped to fuel property price inflation.
Ó Broin said that €200 million has been spent on the Help-to-Buy, stating that the money could have been used to build 900 social homes.
“It is a abject waste of public money, it also pushes up house prices,” he said, adding that it his preference for the two schemes would be “to go as quickly as possible” if Sinn Féin were in Government.
“The money needs to be directed into the delivery of genuinely affordable homes,” he added.
McGrath defended the Government’s First Home Shared Equity scheme, which he said has received almost 1,000 applications so far, with 200 contracts being executed.
“Do we need more, of course we need more,” he said, adding that the Government needs the system to deliver.
Vacant property tax
During Leaders’ Questions today, the vacant property tax of 0.3% was also criticised as “laughable”, with Social Democrats co-leader Roisin Shortall stating that a punitive tax was needed to bring houses back into use.
“Two out of three nurses are planning on emigrating, 61% of our primary schools are understaffed, and it’s all down to the cost of housing,” she said.
Sinn Fein leader Mary Lou McDonald also raised the issue of young people emigrating due to unaffordable house and rent prices.
“Your policies are driving an entire generation of our young people from here to Perth, to Sydney, to Toronto and beyond,” McDonald said.
“You come in here week after week telling fairy tales, make-believe, imagining that your approach is working when it is plainly failing.”
McGrath defended the Government’s vacant home tax as “a very significant intervention”.
“It’s the first time that such a tax has been imposed.
“Of course, you can argue about the rate, you can argue about the scope, but we utilised the information that has been gathered by the Revenue Commissioners by way of the returns made in respect of local property tax to construct a new tax and a new intervention with a view to ensuring that as many of those properties as possible come back into use.”
McGrath said that he believes the tax “will play a part” in encouraging vacant property owners to make them available.
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