Dáil Éireann - Volume 466 - 13 June, 1996

Ceisteanna—Questions. Oral Answers. - Rural Resettlement Programme.

1. Mr. N. Ahern asked the Minister for the Environment his views on and commitment to the rural resettlement programme; and his views on the creation of a revolving fund for the purchase of houses and a surrender grant scheme for those leaving major urban areas and surrendering a local authority flat or house. [12377/96]

75. Mr. N. Treacy asked the Minister for the Environment if he will ensure that adequate funds are made available for the rural resettlement programme; and the contribution that this Government has made to this programme; and if he will make a statement on the matter. [5125/96]

Minister of State at the Department of the Environment (Ms McManus): I propose to take Questions Nos. 1 and 75 together.

The housing aims of Rural Resettlement Ireland have my full support. Since 1992, my Department has approved grants totalling £215,000 towards the administrative and general [2138] expenses of RRI in respect of its housing related activities, including £60,000 this year. RRI has also been granted approved body status for the purposes of the voluntary housing capital assistance and rental subsidy schemes.

Households moving under the RRI programme may be eligible for local authority house purchase loans or shared ownership, and the deposit requirement under the latter scheme has been eased in these cases. In addition, the mortgage allowance and improvement works-in-lieu schemes can be used to assist families wishing to resettle in a rural area. The mortgage allowance scheme is already available to persons surrendering a local authority dwelling and I have no proposals for an additional `surrender' grant.

As there are considerable reservations about the viability and practical operation of a revolving fund, I have no proposals for the introduction of such a fund for the purchase of houses by RRI. However, agreement, in principle, has recently been reached with the Bank of Ireland, the Housing Finance Agency and RRI on a new pilot house purchase loan scheme which will be introduced shortly.

Mr. N. Ahern: While acknowledging that the Department approved grants totalling £215,000 towards the administrative and general expenses of Rural Resettlement Ireland, I am sure the Minister of State will accept that the organisation had to fund the balance of more than £100,000. Some of its members travelled to America to raise that funding. I am somewhat disappointed with the Minister's reply. My question referred to the operation of a revolving fund and a surrender grant scheme, neither of which the Minister of State agreed to implement. Will she reconsider her decision? The surrender grant scheme would benefit not only the rural resettlement programme but would help create vacancies in urban areas, particularly in Dublin. Is the Minister of State aware that Dublin Corporation, and I am sure other local [2139] authorities, spend up to £60,000 buying houses on the open market? Does she believe a surrender grant scheme would assist the rural resettlement organisation and local authorities to create badly needed house vacancies?

Ms McManus: A special arrangement, involving a £1,000 deposit, has been entered into for the shared ownership scheme and the rural resettlement programme which will enable people make the move. In the past surrender grant schemes caused great upheaval in local authority estates. The current policy is to encompass acquisition with new build and this is working satisfactorily. Genuine difficulties would arise in operating a revolving fund scheme. While I appreciate the Deputy is committed to the principle of rural resettlement, to get involved in property acquisition one requires certain skills, resources and income. Some families making the move might not be able to afford the cost of acquisition and house improvement. Many considerations, such as capital acquisition tax and the tax status of Rural Resettlement Ireland, have not been fully examined. However, a new pilot house purchase loan scheme has been successfully negotiated between the Bank of Ireland, the Housing Finance Agency and Rural Resettlement Ireland. If this scheme is satisfactory it should be expanded. It is a novel arrangement between the organisations concerned and I compliment Rural Resettlement Ireland for embarking on the project. I hope to announce the scheme shortly because people have been waiting for some time for a loan scheme to come into operation. The Deputy should acknowledge that improvement which will assist people who embark on this welcome programme.

Mr. N. Ahern: I welcome the new house purchase loan scheme but I am sure the Minister will accept that Rural Resettlement Ireland will have to produce £6,000 or £7,000 for each [2140] house. While the 1980's surrender grant scheme was not very popular — we are all aware of its shortcomings — I am talking about a targeted scheme which could provide the seed funding for the rural resettlement group when the new scheme gets off the ground. One can always suggest reasons for not doing something, but I have put forward positive proposals for proceeding with a surrender grant scheme. Will the Minister of State reconsider my question prior to making her announcement about the new house purchase loan scheme? Members of Rural Resettlement Ireland cannot visit America every few weeks to raise £6,000. A surrender grant scheme would complement the new scheme which is to be announced shortly. What Department has responsibility for the problem of depopulation in rural areas?

Ms McManus: That is an important question. Rural resettlement involves much more than the question of housing, many other rural renewal factors must be taken into account. The Department of the Taoiseach has a major role to play in regard to the broader question of rural resettlement. Much of the responsibility in that regard is outside the brief of the Minister for the Environment.

The Deputy must recognise that two significant changes — one of which has already been made and the other is about to be made — have been proposed for providing loans for house purchases. The loan scheme was devised in consultation with Rural Resettlement Ireland.

Mr. N. Ahern: From where does the £6,000 come?

Ms McManus: This scheme was spearheaded as a response to the demands of Rural Resettlement Ireland. Obviously, a number of factors must be considered. Rural Resettlement Ireland has operated successfully to date and we have assisted them to a considerable extent. In 1992 it received only £10,000 in grant aid whereas in 1996 it received £60,000.

[2141] Therefore, grant aid for administrative purposes has increased significantly. This important loan scheme involves Rural Resettlement Ireland and, to a greater extent, the Housing Finance Agency and the banks. It is an important step forward and one we should all welcome. I acknowledge the Deputy's welcome for the scheme, which is the way forward.

An Ceann Comhairle: We have dwelt overlong on this question. Members will observe that almost half the time available for dealing with priority questions has been exhausted on this one question and that is not good enough.