Update: Housing Crisis – Finance 2nd October, 2014

QUESTION NO:   77
DÁIL QUESTION addressed to the Minister for Finance (Deputy Michael Noonan)
by Deputy Bernard J. Durkan
for WRITTEN ANSWER on 02/10/2014  

 To ask the Minister for Finance the extent to which provision will be made to deal with the housing crisis which is growing rapidly; if a Government bond will be considered to deal with the issue, given that savings will accrue from a housing building or house purchasing programme on two levels, a reduction in the cost of rent support currently in the figure of €500 million per annum and a considerable increase in employment in the construction sector; and if he will make a statement on the matter.
 
REPLY.

The Government recognises that recent price and rent developments in the housing market reflect the interaction of a recovery in the economy and in employment and a shortage of supply of new housing, particularly in Dublin and some other urban areas.

These issues are being addressed under the Construction 2020 Strategy: A Strategy for A Renewed Construction Sector. The Deputy should be aware that my Department is party to a range of actions as part of the Strategy. The Strategy addresses among other issues: housing supply, with a particular focus on planning issues and appropriate and sustainable development financing; transparent and sustainable mortgage lending; the application of the tax code to the construction and property sectors; as well as addressing legacy issues associated with the property bubble. All of these actions are detailed in the Construction 2020 Strategy publication.

As regards the Deputy’s reference to a bond, all monies raised through Government borrowing are paid into the Central Fund and used to fund Government spending as approved by the Oireachtas. It has never been the custom to link borrowing to specific projects as to do so would limit the flexibility of the Government in managing the State’s finances.

The Government is committed to responding to social housing needs through a variety of mechanisms. In terms of the delivery of social housing, the main focus in terms of supports provided by Government will be on meeting the most acute needs. The Social Housing Strategy, committed to under Action 8 of Construction 2020 and now in preparation, will provide the basis for an enhanced approach to social housing provision in Ireland over the next 5 years. The optimum delivery and funding of social housing will be addressed in the Strategy. My colleague, Minister for the Environment, Community and Local Government, Alan Kelly TD, has indicated that the Strategy will be brought to Government in the coming weeks.