Joint Oireachtas Committee on Housing Planning and Local Government – Opening Statement by Minister Eoghan Murphy on Rebuilding Ireland Report

I thank the Chairman and members of the Committee for the opportunity to appear again before the Committee, this time to give you an update on the progress made in terms of the implementation of Rebuilding Ireland in the first Quarter of this year.

I am joined this afternoon by Mr. John McCarthy, Secretary General, and Assistant Secretaries Mary Hurley and Dave Walsh.

To begin with our most pressing concern and in relation to homelessness, the first quarter of this year saw Storm Emma hit our country. Today, I would like to take the opportunity to once again acknowledge the efforts by all in local authorities, NGOs, emergency services and my own Department in keeping our rough sleepers safe and warm during that extreme weather event.

Since Storm Emma, we have put an additional 60 emergency beds in place and we have seen significant progress with the number of rough sleepers on our streets reducing by more than 40% in April.

While this is welcome, more needs to be done and we will further tackle this issue through the accelerated roll-out of the Housing First Programme and by continuing to support the most vulnerable in our society. A Director of Housing First was appointed in February and is currently advancing a National Housing First Implementation Plan, which I expect to receive next month. At the end of the first quarter of this year, 224 new Housing First tenancies had been put in place with 106 of these being put in place during 2017 alone.

On the publication of the January homeless figures, I stated that I had asked the Dublin Region Homeless Executive to investigate increasing numbers, with a view to preparing a detailed report and recommendations. This report is almost finished.

In the course of this work and work in relation to the preparation of homeless figures for March, significant mis-categorisations have been discovered, which have overstated the total number of people that are in emergency accommodation in the State today. A number of local authorities have erroneously categorised individuals and families living in local authority owned or leased housing stock, including in some instances people renting in the private sector but in receipt of social housing supports, as being in emergency accommodation.

To date, at least 600 individuals have been identified as having been categorised as living in emergency accommodation when they are not. Some, but not all, of these individuals have been removed from the total numbers, with the agreement of Local Authorities. Work continues with Local Authorities to gauge the total extent of the issue.

It is quite clear that the current reporting model needs to be reformed as such errors undermine our ability to properly understand the extent and nature of the problem, as well as inform policy decisions around solutions.

Once I receive the DRHE report and also the report due from the Homelessness Inter-Agency Group, I will review them and respond with policy measures and further solutions, as appropriate. As I have indicated already, I will also engage with this Committee in relation to both reports.

Building on the €1.4 billion provided for investment in housing last year, this year’s ambitious programme of delivery will be supported by funding of €1.9 billion, an increase of over 35% on 2017.

In January, we held the second Housing Summit with local authority Chief Executives where we agreed a commitment to drive greater transparency and accountability at individual local authority level on the delivery of the targets under Rebuilding Ireland. On foot of a detailed process of engagement since then between my Department and individual local authorities, I have now advised all 31 authorities of their social housing targets for 2018 and also for the multi-annual period to 2021.

In setting local authority targets for 2018, I have made very clear that these are minimum targets, and that where additional capacity to deliver arises, we will work in partnership with local authorities to drive that accelerated delivery. I have shared these targets with the Committee for their information and they are publicly available on my Department’s website.

Looking at social housing delivery overall in 2018, it is expected that more than 25,000 additional households will have their housing need met. This includes just under 8,000 homes to be built, acquired or leased by local authorities and AHBs, and in excess of 17,000 additional flexible housing solutions through the Housing Assistance Payment and Rental Accommodation Schemes.

I am planning to convene a third Housing Summit next month and will be pressing local authority Chief Executive to ensure they keep their focus on delivering their targets and accelerating their programmes.

When we look at the overall supply of housing, there are really encouraging signs that home building is recovering. All supply indicators are showing positive trends. But all of the indicators are pointing very positively in the right direction:

–  Planning Permissions – 20,800 in 2017 – an increase of 27% on 2016;
–  Commencement notices – 18,100 new houses notified in the 12 months to March 2018 – an increase of 27% year-on-year;
–  CSO Quarterly National Accounts – show residential investment up 33% in 2017.

An Bord Pleanála’s fast track planning system has delivered some substantial new planning permissions and has bedded in very well with both developers and local authorities. To date, of the 19 applications received, there have been 15 decisions made, with 12 approved which will deliver a combined:

–  1,600 houses;
–  1,300 apartments; and
–  3,600 student beds.

Current applications which will be decided in the next 2 months alone involve a further:

–  600 houses;
–  250 apartments; and
–  480 student beds.

Further consultations and applications are continuing to be lodged on a weekly basis. As supply is increasing, we must ensure that the new homes are accessible and affordable to rent and to buy. The new affordable housing measures I signalled earlier this year are being actioned. Specifically:

–  I will commence the legislation for affordable housing purchase in the coming days and I will make regulations shortly thereafter;
–  An announcement on a major cost rental project to be advanced in Dublin City is forthcoming;
–  I am expecting to issue further calls for proposals (with €75 million of Exchequer funding available) for enabling infrastructure (both off-site access and on-site services) to facilitate further housing delivery, with a particular focus on our cities where the affordability challenge is greatest.

Building on the extensive analysis on their housing land-bank by each local authority that informed their social housing targets out to 2021, I will also be concluding my assessment of the affordable housing yield from local authority lands and publishing delivery targets in the coming weeks.

The new Rebuilding Ireland Home Loan, which was launched in February, is also another important tool in terms of facilitating credit worthy first-time buyers to access sustainable mortgage lending to purchase new or second-hand properties in a suitable price range. The low rate of fixed interest associated with the new loan provides first-time buyers with access to mortgage finance that they may not otherwise have been able to afford at a higher interest rate. As you’d expect, there has been a lot of interest in the loan. To date, the Housing Agency has had a total of 660 valid applications referred to it by local authorities for credit assessment. Of these, 479 have been assessed and 46% of those have been recommended for approval. As with previous loans, it is a matter for the relevant local authority credit committee to ultimately determine whether a loan application is approved, having regard to the Agency’s recommendation and any other relevant factors and considerations.

As the Committee will be aware, a significant policy shift towards securing more compact and sustainable urban and rural development was signalled in the National Planning Framework.

A key element of implementing this will involve the establishment of a National Regeneration and Development Agency to assist in ensuring a more effective approach to strategic land management, particularly in terms of publicly owned land.

Detailed arrangements in relation to the functions, powers and mechanisms for the establishment of the Agency are currently being developed by my Department, in conjunction with the Department of Public Expenditure and Reform.

New apartment guidelines have also been introduced which will provide more flexibility to expanding apartment construction, including in facilitating new models like Build to Rent and shared accommodation.

Overall implementation of the NPF will be supported by an investment of €2 billion for urban regeneration and development purposes, focusing on cities and towns with populations in excess of 10,000. The new Urban Regeneration and Development Fund, which will be launched at the end of June, will be a competitive bid-based fund, operated in line with specified criteria, with the aim of achieving more sustainable growth in Ireland’s five cities and other larger urban centres.

In relation to the rental sector, I secured Government approval on 17 April to quickly progress the drafting of a new Bill to amend the Residential Tenancies Acts.

The Bill proposes to make it an offence for landlords to implement rent increases that contravene the law around rent limits (4% per annum) in Rent Pressure Zones (RPZs) and to provide powers to the Residential Tenancies Board to investigate and prosecute landlords who implement such increases, without the need for a complaint to be made. The Bill also provides for much longer notice periods for tenants before they have to move out of their rented accommodation, which adds a greater degree of security and certainty for renters.

In relation to the RTB’s latest Quarterly Rent Index for Q4 2017, there were signs of some moderation in average rental price growth at a national level as well as in Dublin. Nationally, private rents rose by 6.4% across the country, compared with the same 12-month period to Quarter 4 2016. This compares with 8% year-on-year growth recorded to Q3 2017. In Dublin, over the same period, rents were up 5.2%, compared to 8% year-on-year growth in Q3 2017.

Notwithstanding these encouraging signs, the fact that rents are still rising means that we have to continue to do all we can to increase supply of rental accommodation and provide greater security and certainty for both tenants and landlords.

The proposed new powers for the RTB are a crucial first step in expanding its overall role and function as part of a multi-annual change management programme to proactively enforce tenancy law and assume more the role of a regulator within the rental sector.

Finally, we are continuing to work proactively to reduce the number of vacant homes throughout the country, identifying opportunities and procedures for their re-use. Local authorities have either completed or are close to completing Vacant Home Action Plans and designated Vacant Homes Officers have been appointed, actions which will aid the identification of the scale of vacancy in individual local authority areas. In addition, we are continuing to work with local authorities in implementing new initiatives such as the Repair and Leasing Scheme and the Buy and Renew Scheme.

Rebuilding Ireland is working and we are seeing progress across the country as families and individuals move into their new homes. The updated position in relation to all the actions under the 5 Pillars of the Plan is set out in the Q1 2018 update table circulated to members and uploaded onto my Department’s website, providing a useful summary of activity, status and progress.

While much has been achieved, I know only too well that more is needed. I and my Department remain firmly focused on that delivery agenda, working with our wide range of partners, including the local authorities and Approved Housing Bodies.

I again thank the Committee for their invitation and I am happy to respond to any questions that members may have.

Rebuilding Ireland Action Status Report – Q1 2018