Information obtained by Fianna Fáil’s Spokesperson on Housing, Darragh O’Brien TD, courtesy of a parliamentary question, reveals that a special investment fund to allow credit unions invest in social housing is not in place. The measure was to have been enacted by the government some months ago.
The Fingal TD says: “It’s been four years since the Irish Credit Union movement first expressed their interest in investing in social housing. As far back as May 2017, the Department of Housing funded an Irish Council for Social Housing project for a Special Purpose Vehicle (SPV). It was over a year later when the Central Bank introduced regulatory changes that allowed up to €750 million to be invested in large social housing bodies.
O’Brien claims that despite an indication from Minister of State Damien English TD last year that the vehicle would be ready by October 2018, no money has been invested which could have potentially built “3,750 much-needed social homes”.
“We have neither seen nor heard of the details regarding the types of units that will be prioritised when building works eventually get going, let alone how it’s intended the vehicle will link into the overall Rebuilding Ireland strategy,” he adds.
O’Brien has accused the Government of a “hands-off attitude”, adding “it doesn’t give a hoot about the ordinary working families desperately in need of support to find a home”.
“The fact is, Fine Gael are not remotely serious about attracting outsider finance or making the most of credit union money to help build badly needed social housing and we have to ask ourselves why that is.”
Responding to these claims, a Department of Housing spokesperson says: “The Programme for a Partnership Government recognised the potential role that credit unions can play in housing finance and supported the efforts of the Registrar of Credit Unions at the Central Bank to gradually lift current lending restrictions as appropriate, including for housing.
“Credit Union bodies have set out proposed means by which funding could be provided by credit unions to approved housing bodies for the development of social housing. This follows on from the amendments introduced by the Central Bank to the regulatory regime within which credit unions operate.”
The Department says that it, along with the Department of Finance, have met with the Irish League of Credit Unions (ILCU) and the Credit Union Development Association (CUDA) to examine how their sector can assist in the area of financing social housing delivery.
“Throughout the discussions with the Credit Unions’ representative bodies, the Department has emphasised that while it can provide technical assistance regarding the mechanisms for funding social housing, which it has provided, it is a matter for the credit unions themselves to set up special purpose vehicles to enable them to invest in the sector.
“For this reason, the Department referred the Credit Unions’ representative bodies to the Irish Council for Social Housing with a view to both sectors sharing, as far as practical, the benefits of their respective work in this area, including the work being undertaken by the ICSH on the development of special purpose vehicles for social housing financing purposes, supported by grant funding from the Department.
The spokesperson concludes: “It is a matter for both parties to progress these engagements, which the Department hope can lead to a workable, mutually acceptable approach to moving forward on this issue.”
Meanwhile, Fianna Fáil TD for Sligo-Leitrim Marc MacSharry has called on the Government to give local authorities the freedom to build houses and cut down on the red tape associated with applications to fund housing schemes in each county.
He explains: “The local authorities, effectively, can give permission to a person building 1,000 houses, yet, if that same local authority wanted to build 10 houses in their own name they have to go through an administrative nightmare before a shovel is in the ground. Many examples give an average of three to six years from concept to turn key.”
MacSharry poses the question: “When will the Government realise that we have to strip out all this unnecessary duplication? If they are capable of giving planning to me, they are capable of planning for themselves. Let us get on with building rather than supporting the perpetual administrative merry-go-around which county councils must currently endure.”
MacSharry believes that Housing Minister Eoghan Murphy must also address the increasing crisis of vulture funds buying up entire developments. The Sligo-Leitrim TD believe that these properties, which were once identified by first time buyers, are being removed from the market.
Securing homes for all
Fianna Fáil’s current housing policy is encapsulated in the strapline: ‘Securing homes for all’. The party’s strategy for dealing with the housing crisis is based on three interlinked pillars.
Firstly, it says it will open up clear paths to home ownership for low income households, expanding social housing provision. As a matter of priority, Fianna Fáil says it will increase the transfer of housing from NAMA, as well as introduce measures to allow families on waiting lists to move into vacant homes, defraying the costs of refurbishment from future rent.
Secondly, its ‘New Deal for Renters’ is a series of steps that will revamp the quality and quantity of dwellings and bolster tenant rights. According to the party, these measures will strengthen the rental sector, helping to stabilise the housing market and significantly enhance quality of life for 300,000 renters across the country.
Finally, Fianna Fáil will take “decisive measures” to help revitalise private sector construction and house building. It says it will direct part of the €7 billion Strategic Investment Fund to invest in private housing, ease restrictions on planning permissions and reduce development levies to start getting units built where they are needed.
In essence, the party is committed to facilitating and enabling homeownership. Fianna Fáil’s plan to help make housing more affordable includes the establishment of a National Redevelopment Agency. The body will focus on constructing new units on existing state lands which has the capacity to deliver over 42,000 units.
A proposed €500 million per annum Affordable Purchase Scheme site subsidy will provide €50,000 per unit to reduce the price of each home to between €160,000 and €210,000. In addition, a Special Purchase Vehicle will provide finance to local authorities for overall investment.
Darragh O’Brien TD believes that excessive red tape is currently holding back the amount of time it takes to get house building projects off the ground. Under Department of Public Expenditure and Reform (DPER) rules, public projects costing more than €20 million must first undergo a detailed Cost Benefit Analysis (CBA), which can take months to complete.
Information also received by O’Brien, courtesy of a Parliamentary Question (PQ), shows that DPER does not keep statistics on the length of time each Cost Benefit Analysis takes. However, recent freedom of information reports from Dublin City Council have shown serious concerns around housing project delays caused by completing CBA’s.
“We are in the middle of a national housing crisis but last year local authorities missed their targets for building social housing units. It’s clear from concerns stated by officials in local government that government red tape is one factor in slowing down bricks and mortar being put in the ground,” he says.
“I am shocked the Department does not bother to collect data on how long getting through this red tape takes each project. The Department sets the rules but in failure of joined up thinking, fails to see what impact they actually have.
“It’s clear that the Department is ignoring the pressing need and scale of the housing crisis and sticking to rigid rules. Value for money and efficiency should go hand in hand but the Department is focused on box ticking, not building.”
Calling for the Department to review its spending code rules, he adds: “The Department needs to fully and quickly review its spending code rules and allow more large-scale housing projects to undergo development without jumping through onerous bureaucratic hoops that do not reflect the reality on the ground.
“The newly established Investment Projects and Programmes Office (IPPO) should be tasked with cutting down delays and ensuring that delivery time is a critical factor in evaluating housing projects.”