Seanad Éireann - Volume 196 - 01 July, 2009

Housing (Miscellaneous Provisions) Bill 2008 [ Seanad Bill amended by the Dáil ] : Report and Final Stages.

  An Leas-Chathaoirleach: This is a Seanad Bill which has been amended by the Dáil. In accordance with Standing Order 103, it is deemed to have passed its First, Second and Third Stages in the Seanad and is placed on the Order Paper for Report Stage. On the question “That the Bill be received for final consideration”, the Minister may explain the purpose of the amendments made by the Dáil. This is looked upon as the report of the Dáil amendments [592]to the Seanad. For the convenience of Senators, I have arranged for the printing and circulation of the amendments. The Minister will deal separately with the subject matter of each related group of amendments. I have also circulated the proposed groupings in the House. A Senator may contribute once on each grouping. I remind Senators that the only matters that may be discussed are the amendments made by the Dáil.

Question proposed: “That the Bill be received for final consideration.”

  An Leas-Chathaoirleach: I call on the Minister to speak on the subject matter of the amendments in group 1.

  Deputy Michael Finneran: I am pleased to be back in the Upper House to report on a range of amendments made by the Dáil to the Bill. The Bill was first discussed in this House on 1 October 2008 and completed all Stages on 10 December last. Since then, as Senators will be aware, it has been debated in the Dáil, amended and, I believe, improved significantly. The list before the House today contains 157 amendments which have been made to the Bill as passed by Seanad Éireann. In view of that significant number, Senators will appreciate it would not be practical to discuss each amendment individually. In my report to the House, I will therefore deal with the amendments under a number of broad groupings. Of course, if any Senator would like to be briefed on a particular amendment, I will be happy to do so.

There are a number of groupings. With regard to the homelessness action plans, group 1 relates to amendments Nos. 1, 10, 15, 17, 22, 23, 47 to 53, inclusive, and 147 to 152, inclusive.

The issue of homelessness and the placing of homelessness action plans on a statutory basis was the subject of considerable debate during the Bill’s passage through the Seanad. I am pleased to be reporting back to the House today with these amendments. As Senators are aware, The Way Home: A Strategy to Address Adult Homelessness in Ireland, which I published in August 2008, set out the key objectives of our homelessness policy, which are to eliminate long-term occupation of emergency accommodation and the need to sleep rough. The strategy also contains a commitment to put homelessness action plans on a statutory basis and the amendments made to the Bill in the Dáil, and first signalled in this House during the Second Stage and Committee Stage debates, deliver on that undertaking.

Amendments Nos. 47 to 53, inclusive, contain the substantive provision and insert a new Chapter 6 with seven sections in Part 2 of the Bill, which deals with the functions of local authorities. The provisions establish a structural process involving homelessness consultative forums, management groups and the making of and adoption of homelessness action plans by elected councils. The plans will specify the actions to be undertaken by various stakeholders to meet broad objectives, including the prevention and reduction of homelessness and the promotion of an effective co-ordination between the various bodies involved in the provision of homeless services. The consultative forum will bring together the key players in the provision of homeless services, statutory and non-statutory. Its function mirrors at a local level the cross-departmental team and the National Homeless Consultative Committee which provide the platform for consultation nationally. It will play a key role in the homeless action plan structure as a forum for discussion and debate on homelessness and it will provide input for the preparation of a homeless action plan and views and reports on the subsequent operation of the plan. The management group will complement the work of the consultative forum but with a separate function, including a remit to make recommendations to housing authorities, the HSE and other relevant bodies in respect of homeless services, the preparation of the homeless action plan and recommendations regarding funding for homeless services.

[593]  Senator Dan Boyle: I thank the Minister of State for the amendments accepted to date in both Houses relating to homelessness, especially the arguments advanced by the Make Room campaign. The fact that so many amendments have been taken on board demonstrates how well the policy has been formed and practised and how the issue has proceeded. In any given set of proposals from NGOs not everything will be accepted. However, the fact that so many amendments were accepted and the spirit in which they were accepted speaks well for the quality of the policy and the commitment to improve it, especially at a time when the danger of homelessness and the necessity of meeting the needs of the homeless has never been so great.

  Senator Paudie Coffey: On the introduction of the Bill in the House there was a serious engagement on the homelessness issue. The Minister of State will recall that many amendments were tabled by this side of the House. We engaged to a large extent with the NGOs and the Make Room campaign, which is very concerned about homelessness and how the State proposes to address this serious issue. I welcome the amendments and anything we can do in a positive sense to try to address these unfortunate people who find themselves homeless is to be welcomed. I acknowledge the role of the NGOs and those working at the coalface for engaging in the parliamentary process, for introducing information and for proposing amendments to Senators. The Dáil has helped to inform the legislation and to improve it as well. The Minister of State and his officials have engaged with them and listened to them as well. I welcome this aspect and I broadly welcome the amendments.

  Senator Camillus Glynn: I compliment everyone concerned. In some ways this echoes the words of Padraic Colum’s poem The Old Woman of the Roads, “O, to have a little house! To own the hearth and stool and all!”. Since taking over the portfolio of housing, the Minister of State, Deputy Finneran, has been very proactive in the whole area of housing and homelessness. The Bill affords Members of both Houses an opportunity to make a real input and to address this very serious social ill. I look forward to hearing the views of colleagues as the debate progresses.

  Senator Frances Fitzgerald: I agree with colleagues about the importance of this issue and the need to strengthen responsibilities in the area of homelessness. However, it is in the implementation, monitoring and evaluation of such policies and the budgets allocated that we will really see the difference. Will the Minister comment on this point and on the proposed monitoring and implementation of the policy? He has made a good start with the legislation. What strengths are in place to ensure these important matters are followed through? That will be a key issue.

Many of us believed the homeless strategy and the increased budgets to tackle homelessness over the years would bring about an end to it. Unfortunately, given the economic downturn and the pressure on families this will be a very real issue throughout the country, not only in urban areas. The way in which local authorities respond and how they are directed by Government will be critical in the years to come.

  Deputy Michael Finneran: I thank Senators for their comments. It can be seen from the Bill as amended that the views of Senators and their contributions were well analysed by my Department and the officials. While not everything has been included, I am pleased that the intentions and wishes of Senators have been considered and there has been an acceptance of the wishes of Members.

The matter of the budget is vital and I was very conscious of this when I launched the strategy in August 2008. This is one of the few areas of Government expenditure that received an increase under the 2009 budget. The allocation of money for the homeless in 2009 is €62 [594]million, an increase of 5% on the 2008 figure. This is topped up with approximately €30 million from the HSE for the care programme for the homeless which is an important part of the homeless area.

I refer to the main areas of work. An extraordinary amount of consultation has taken place and I place on record the contribution of the agencies involved and the Make Room campaign, which I thank for its very forthcoming and clear statement, in which it welcomed the content of the new chapter of amendments published by me and included in the Bill. My Department officials and I held discussions with the Make Room campaign on this issue and the campaign is pleased the amendments are reflective of that dialogue.

The dialogue was necessarily extensive because as Senator Fitzgerald remarked the implementation of the plan is vital from here on. It cannot be achieved by one person or group. There must be a collective contribution involving people working together to implement the plan and to meet the aims of the strategy, which are very clear and simple. The aims include the target that people will not be left in emergency accommodation for longer than six months and that the need to sleep rough will be excluded. These aims are to be in place within two years. We are committed to that and I assure the House that work is already in progress on these issues. People are actively working towards these ends. We did not wait for the legislation to pass fully through the Houses and we are already in the process of implementation. Large numbers of people have been identified who are moving from temporary accommodation. As I have stated previously, there have been people in temporary accommodation and bed and breakfast accommodation for seven and eight years, which I find totally inappropriate. I vowed this would not continue. People are entitled to remake their lives, to enter new relationships and to have a second start. They cannot do so if they must be out on the sidewalk at 9.30 a.m. or 10 a.m. The programme is extensive and there is a responsibility on the local authority and all the different agencies involved. It is working co-operatively and it will not always run smoothly but if people keep focused it will eventually deliver the desired result which is the strategy announced last August. I thank Senators from all sides of the House for their interest in this important area which is now being given its entitled legislation. There was debate in the House about whether there should be a legislative framework and I gave an undertaking in the House that I would give a legislative backing to sections of the implementation plan and this is in the Bill.

  An Cathaoirleach: Group 2 amendments deal with incremental purchase which is the subject matter of amendments Nos. 2, 29 and 54 to 86, inclusive.

  Deputy Michael Finneran: Amendments Nos. 2, 29 and 54 to 86, inclusive, deal with the incremental purchase scheme. The main provisions for the incremental purchase scheme arrangements were contained in the Bill as initiated and passed by Seanad Éireann. The amendments made by the Dáil provide for a further number of clarifications and improvements to those provisions. I have also taken the opportunity to align the incremental purchase provisions in Part 3 with the new arrangements for the tenant purchase of apartments which will also operate on the incremental purchase model.

Among the main changes to the incremental purchase arrangements as passed by the Seanad are a clarification on how the amount of money a purchaser will pay to an authority for a dwelling is calculated based on the purchase price provided for under amendments Nos. 59 and 60. Amendment No. 61 is necessary to ensure housing authorities can refuse to sell a dwelling under Part 3 where the applicant household is or has been in arrears of rent. The second part of this amendment, paragraph (p), however, allows for some flexibility in applying paragraph (a) to the applicant household as it allows authorities to approve a purchase application from [595]an applicant in rent arrears who has entered into a repayment agreement with a housing authority under section 34. A simplification of the provisions governing the actual sale of a dwelling is provided under amendment No. 63 in Part 3.

A simplified method is provided under amendment No. 72 for purchasers to get a current statement from the authority or approved body as to how many additional incremental releases for the purchaser have thus accumulated. Purchasers can request this statement at any time from the authority or the body as it is a statement as opposed to a deed of discharge. There is no cost to the purchaser for requesting this statement.

Amendment No. 75 provides for the insertion of a new section in Part 3. This provides that a housing authority or an approved body may suspend the release of the charge share for any year where a purchaser breaches the terms and conditions of the charging order. In such circumstances, the charge held by the housing authority or approved body will not be discharged during the charge period. At the end of the charge period, the purchaser will be liable to repay to the housing authority or the approved body an amount equal to the percentage share in the dwelling held by the housing authority or the approved body based on the market value on the date of expiration of the charge period. I do not envisage this provision being invoked regularly. It is simply being inserted to ensure that where a purchaser does not comply with the terms and conditions of the charging order, the housing authority or the approved body concerned, has the power to take the appropriate action. Where a purchaser fails to repay this amount within two months of receipt of the notification from the housing authority or approved body, it is open to the housing authority or the approved body to recover the debt outstanding as a simple contract debt in court as is already provided for with regard to moneys owed where a purchaser resells a dwelling within the charge period and fails to make the repayment to the housing authority or an approved body.

  Senator Paudie Coffey: I acknowledge again that this is another mechanism to allow people move onto the housing ladder from whatever accommodation they are in. It is a genuine attempt by the Minister of State to make another provision in legislation to allow such people to have a house of their own.

I ask for one clarification from the Minister of State. Views differ among local authorities. Where a local authority tenant dies and other family members are living in the house, there is an issue of succession to the tenancy of that house. Some local authorities are of the view that the house keys must be handed over and the house handed back within a month. The policy is that because the family members were not part of the formal rental agreement, it now becomes available to the wider housing list. There is a social issue to be considered as some family members may have lived in that house for 20 or 30 years and surely they should have some succession entitlement to continue the rental of that house. This point is not specifically related to incremental purchase but it relates to local authority housing. The Minister of State may direct me in this matter. There is a concern about the situation regarding the family of an elderly person who have lived in a house for many years. I await the Minister of State’s views on this matter.

  Senator Paddy Burke: I support Senator Coffey in this regard. It is an issue that has been well debated in many local authorities. I compliment the Minister of State on bringing this complex legislation through the House with great efficiency and with great attention to the debate in the House. He has introduced a degree of flexibility into the housing sector to allow people to move from sector to sector within local authority housing, whether they are homeless or are local authority tenants or have bought their own home.

[596]Senator Coffey is referring to a degree of consistency. Some local authorities have interpreted this differently from others, as have some legal advisers to local authorities. There are differing opinions within the same local authority, whether they be town councils or county councils. He makes the point very well that in some cases people may be living in local authority houses for 30 or 40 years. The person who is the original tenant believes he or she can leave the house to the siblings or other members of the family. In some cases, there may be nobody living in the house but the people who were born, bred and reared in the house and brought up in that community feel they should be the people to get the house. This is where the notion of consistency comes into it because in some cases, local authorities have allowed the family members to keep the house or sell the house in other cases and there has been inconsistency. Some councils have taken hard-line decisions which have created difficulties and hardship. Will the Minister of State outline the position under this Bill? I hope there would be a degree of flexibility and consistency.

  Deputy Michael Finneran: The incremental purchase scheme allows for the first time people allocated a house to enter a purchase scheme on the day they were allocated it. This has not been available to date and this is an innovation contained in this legislation. I have been of the opinion for many years that this opportunity should be given to tenants. It gives the person ownership of the house from the day they go into it and they take responsibility for maintenance and insurance. This will be introduced on a pilot basis but I hope it will become the norm in a very short period.

Regarding the matter of houses being passed on to other members of the family, I wish to be clear that these are matters for each housing authority and I do not wish to be seen to interfere with that. I would be concerned also if there was not uniformity on the matter. If there was not uniformity and inconsistencies arose, as mentioned by Senators, it might be the subject of a circular from me or even further legislation but it is an area on which I would like to see uniformity across the housing authorities. It is not specifically dealt with in the legislation but the matter has been raised and we will take note of it and have it examined in the context of a circular, a meeting with housing officers, which happens on a regular basis in any event, or by way of legislation. If there is a need for legislation in the future, I will have no hesitation in dealing with the matter by including it in a further Bill because I am sure there will be other housing Bills coming through.

  An Cathaoirleach: Group 3 is on tenant purchase of apartments. I call the Minister to outline the subject matter of amendments Nos. 3, 13 and 14, 18 and 19, 87 to 114, inclusive, 142 and 157.

  Deputy Michael Finneran: Amendments Nos. 3, 13, 14, 18, 19, 87 to 114, inclusive, 142 and 157 deal with the tenant purchase of apartments. I am delighted to report back to the Seanad on these significant amendments to facilitate the introduction for the first time of a scheme of tenant purchase for local authority apartments. The proposed scheme will deliver on the commitment outlined in the Government’s housing policy statement and remove the glaring anomaly in the existing tenant purchase scheme that households allocated a local authority house have the right to buy but those allocated a local authority apartment to date have had no such opportunity.

The tenant purchase model agreed by the Dáil is based on a long-standing arrangement in the private sector for the ownership and management of multi-unit residential developments and the substantive provisions in this area are contained in amendments Nos. 87 to 114, inclusive. For the benefit of Senators, I will outline in general terms how these provisions will work in practice.

[597]Under the proposed scheme housing authorities will be required to conduct a tenant plebiscite in individual apartment complexes proposed for designation by the housing authority for tenant purchase. Where the plebiscite shows that a minimum number of tenants are in favour of designation and that a minimum number of tenants are willing to serve as directors of a management company if they proceed to buy their apartments, the housing authority may designate the complex.

The authority will transfer ownership of each designated complex to a new management company established for the purpose, which will immediately lease all apartments back to the authority while retaining ownership of the common areas and services. The authority will continue to let the apartments to the existing tenants who, subject to meeting the prescribed minimum tenancy requirement, will have the option of buying them from the authority under the incremental purchase arrangements. Sales will proceed provided that the first sale takes place within a specified period after designation and that a minimum proportion of all the apartments in the complex are to be sold.

The housing authority will continue to be the landlord to tenants in the apartments that remain unsold in the complex. The tenants of local authority apartments will be able to purchase their homes for a proportion of the market value with a charge being placed on the property in favour of the authority or the body concerned for the portion of the equity not paid for, declining over time until the charge is eliminated. The charge share will reduce in equal annual equities releases over 20 to 30 years of occupancy of the property unless the housing authority invokes provisions allowing for the suspension of the releases in cases where the purchaser breaches the terms of the lease. This means that the equity stake not purchased at the outset, in effect the discount, will be given free of charge to the purchaser provided the terms of the scheme are complied with fully.

If the tenant purchaser wishes to resell the apartment during the charge period, the authority has first refusal in buying it back. If the authority declines to buy back the apartment, the tenant purchaser may sell it on the market in which case he or she must pay the authority the value of any outstanding charge on the property.

This is, of necessity, a complex business. The arrangements I have outlined are not straightforward but I believe they are the right ones. I am prepared to endure a little complexity if it ensures that the interests of the State, the housing authorities and, above all, the tenants who wish to buy and the tenants who wish to remain tenants are protected.

The remaining amendments in this grouping are all related directly to the new provisions and provide for the miscellaneous technical amendments to improve the clarity and understanding of this part of the Bill. I am sure Senators on all sides of the House will welcome this provision. I thank Members for their interest in this issue.

  Senator Paudie Coffey: This issue was highlighted for the Minister when the Bill was before the Seanad. I recall at the time he could not give a commitment because of the complexities involved but undertook to address the concerns of Members of this House with regard to the equality issues raised concerning tenant purchase of apartments. I welcome the fact that the Minister has done what he said he would do. I acknowledge managing apartment complexes is a complex area in that there is purchase of some and not others, the common areas and so on, but the Minister has done his best to grapple with that difficult matter and the amendments before us will allow tenants a sense of equality. They are no different from those who are renting a local authority house in that they too can buy an apartment in the same way they could buy the local authority house in which they were living. I acknowledge the progress that has been made in this regard. It will be welcomed, mainly in the authorities in the larger cities [598]where many of these apartment complexes are located. I thank the Minister for his efforts in that regard.

I do not wish to be negative but on the area of housing associations, which was debated here and in the other House, if we are talking about total equality the tenants of housing associations is an issue we should keep under review. We might examine in a future Bill the possibility of those tenants having some opportunity to purchase association houses which have been provided for by the State. There is an argument that must be acknowledged, and it is made in many local authority chambers throughout the country, that while tenants of those houses are glad to have them and the estates are run very well by the housing associations — I compliment the housing associations on their engagement in the social housing area — we should revisit this area in the future to further the argument of equality and the right of a person to purchase the house they have rented for many years. However, I acknowledge the progress the Minister has made with regard to apartments.

  Senator Camillus Glynn: This is an innovative measure and the Minister deserves great credit for it. As everybody in local government knows, apartment complexes have produced many difficulties and this measure will invest in former tenants of apartments home ownership pride, which is very significant. I accept this area is complex and that it has been difficult but notwithstanding that, the Minister has taken the bull by the horns and come up with an innovative proposal.

I have been in public life for 30 years and in my experience this is one of the most innovative measures in terms of home provision. It is a marvellous development and I compliment the Minister on it. No words of mine could give him enough credit for it because this is an area that has been difficult in terms of management.

While on social trips to visit my relations in Great Britain, I took the time to visit apartment complexes and they present many problems, but the Minister has overcome the problem here and I compliment him and his officials on that. It will stand as a monument to him in his capacity as the Minister responsible for housing. It is a tremendous step forward in terms of home ownership.

  Senator Dan Boyle: When the Bill was initiated in this House, I raised the matter with the Minister and found him willing to introduce these amendments. I am glad they have been accepted in the other House. This issue has been a long-running sore since legal difficulties arose when the scheme was first introduced in the 1980s. The mechanism chosen will alleviate most of the concerns which have arisen since.

It is my understanding that, subject to the regulations which will follow this legislation, the discount being offered will vary from the standard 30%, or 3% over a ten year period, to 60%. I ask that the full 60% discount, or as close to it as possible, be offered to those who in the 1980s, having been involved in a housing purchase scheme found the offer withdrawn by local authorities particularly in Cork and Dublin. A court action followed in Dublin. Attention must be given to people who, now more than 20 years older, will find it difficult to secure banking finance for the increased purchase price. Attention must also be given to the increased asset value of the properties. It is important that the maximum discount is offered to people who find themselves in this position.

  Senator Paddy Burke: This is an example of the flexibility which the Minister of State has shown. I congratulate him on this initiative and I welcome it. The Multi-Unit Developments Bill, which will regulate apartment management companies, was recently published. Once a local authority apartment is purchased, the complex is no longer a local authority complex. [599] Would such a complex come under the new management companies Bill and would the local authority pay management fees to a management company?

  Deputy Michael Finneran: I have made provision in the legislation for voluntary bodies to make sales under the incremental purchase scheme. I cannot force them to do so but I have made provision in the legislation for it. Members are aware of the review being carried out of the voluntary housing side of the social housing programme. The report of that review will be available later this year. I will then be in a better position to speak on this matter. There is provision in this Bill for voluntary bodies to sell houses to their tenants. This is the first time this has been made possible. Voluntary bodies may find it appropriate to sell because they may need to develop a fund base in the future. I hope they will travel that road, now that we have provided the facility to do so.

With regard to management companies, I earlier referred to the holding of plebiscites, after which people must be prepared to serve as directors of the management company. In many of the designated complexes, a large number of people may decide to continue as local authority tenants. They must also be catered for. Local authorities will not renege on their responsibilities to their tenants even when a management company is in place. This is provided for in the legislation. Where there is a genuine interest in selling, a sufficient number of people who decide to buy and people prepared to become directors — I am sure people will want to be directors of their own housing development to look after common areas, structural work and so on — things will fall into place. However, local authorities will continue to be responsible for its own tenants.

  An Cathaoirleach: Group 4 includes amendments Nos. 4, 5, 11, 16, 20, 21, 24, 25, 28, 30 to 33, inclusive, 37 to 40, inclusive, 44 to 46, inclusive, 134 to 138, inclusive, and 143 which is similar.

  Deputy Michael Finneran: This large grouping is comprised of stylistic and drafting amendments to delete or insert commas, improve and clarify the meaning of a text, provide more accurate referencing and delete unnecessary content. The amendments are recommended by the Parliamentary Counsel. I recommend them to the House.

  An Cathaoirleach: Group 5 includes amendments Nos. 6 to 8, inclusive, 26 and 27, 34 to 36, inclusive, 41 to 43, inclusive, 139, 144 to 146, inclusive, 153 and 156.

  Deputy Michael Finneran: A number of amendments agreed in the Dáil can be categorised under the miscellaneous heading. Within this group there are some substantive changes, to which I will refer briefly. There was a considerable debate on subsection 25(5) during the Bill’s passage through the Seanad. The intention of section 25 is to underline the seriousness of actions such as non-payment of rent or breach of tenancy agreements by specifying them as matters which disqualify households from eligibility for social housing support in the context of section 20 assessment procedures. In particular, concern was expressed at the non-discretionary nature of the provision and also at the broadness of the breach of tenancy condition, that is, that any breach of an agreement, regardless of its seriousness, could result in a household not being eligible for social housing support.

There was also discussion on the interaction of section 25 with section 34, which sets out arrangements for the operation of a hardship clause where money is due to a housing authority. The tenor of the argument was to point out the contrast between the discretion allowed for in section 34 and the lack thereof in section 25. In response to the debate in the Seanad I indicated that my Department would examine the matter in consultation with the Parliamentary Counsel. Having done so, I moved amendment No. 26 on Committee Stage in the Dáil to moderate the [600]measures somewhat by substituting a new subsection (5). The new provision refers to the issue of rent arrears only and does not now refer to the breach of tenancy. In addition, while the amendment maintains the mandatory feature of the disqualification of social housing support, it is tempered by linking the provision to the measures contained in section 34.

The net effect of the amendment is to provide an applicant for social housing support with the opportunity to avoid the sanction of disqualification from eligibility if he or she enters into an agreement with the housing authority for the payment of outstanding money due. I think this is a fair reassessment of the provision and I thank the Senators, particularly Senators Bacik and Norris, who raised the matter with some vigour on Committee Stage.

10 o’clock

  Senator Paudie Coffey: I acknowledge that the Minister of State took on board the views expressed in the Seanad. Strong views were expressed during the debate on Committee Stage with regard to these miscellaneous measures. Some Senators felt the breach of tenancy agreements and rent arrears, while they did happen, were dealt with too harshly by the legislation. I acknowledge there is a softening of sanction, provided agreements are entered into by the tenant and the local authority which protect the interests of the local authority and the State. I welcome that and acknowledge that the Minister listened to the views expressed in the House. These amendments reflect that.

  Deputy Michael Finneran: The reassessment has resulted in a fair balance. Obviously, people must meet their responsibilities but there are hardship cases. The county manager is entitled to waive whole or part of rent arrears in certain circumstances. The housing authorities have used that entitlement on compassionate grounds in certain areas in the past and I am sure that will continue. It is provided for in law.

  An Cathaoirleach: Group 6, amendments Nos. 9, 12, 115 to 133, inclusive, 140 and 141, 154 and 155, relate to affordable dwelling purchase arrangements.

  Deputy Michael Finneran: These amendments provide for the introduction of significant changes in the way affordable housing is made available for sale under various affordable housing schemes. They provide for a shift to the equity sharing arrangement and away from the current procedures which involve a time-limited clawback in return for a discounted house. The provisions, which were signalled in the budget of 2009 and are covered under amendments Nos. 115 to 133, inclusive, provide the legislative powers necessary for this equity sharing arrangement, together with enabling powers for an open market component to replace the current shared ownership scheme in due course.

Under the new arrangements the purchase transaction will be largely unchanged from the purchaser’s perspective. However, instead of the units being sold at a discounted price, as they are currently, with the value of the discount being subject to a clawback that reduces over time, the housing authority will take a stake in the affordable unit sold. The purchaser will have the option of either buying out the outstanding stake in steps or, alternatively, at the end of a fixed period of 35 years. The various affordable housing schemes will continue to operate unchanged as the means of supplying affordable units but third purchasers will have the single affordable housing purchase mechanism available to them. The stake held by the housing authority will be equivalent to the percentage below the market value at which the property is sold to the affordable purchaser. Generally, affordable housing units are sold at 20% to 25% below the market value so I anticipate that the housing authority’s share will be pitched at around this level.

[601]The new arrangements mean that affordable housing products can be tailored more closely to an individual’s ability to pay. Undoubtedly, the new arrangements are not as financially advantageous to households as the existing arrangements have proven over the years. However, our basic objective in the provision of affordable housing is to support home ownership for households unable to purchase in the market without some degree of assistance from the State. It is not about creating wealth. The various affordable housing schemes in place provide a welcome means of bridging the affordable gap for households ready to take the step into home ownership but who require a modest level of support. I believe the new arrangements will not only enhance supply but also offer better value for the State and provide a more equitable means of supporting the valid home ownership aspirations of the prospective purchasers.

A small number of consequential amendments have also been agreed, which provide for a number of minor changes to provisions relating to affordable housing under the Housing Acts 1992 and 2002 and Part V of the Planning and Development Act, as well as deletions of proposed changes to the provisions of the 1992 and 2002 Acts for which the Bill provides. These are now needed given the wider changes proposed under the substantive amendments. The changes follow certain recommendations made in the report, Increasing Affordable Housing Supply, which was prepared by consultants for the Affordable Homes Partnership and subsequently published for public consultation following Government approval. The report also identified measures that would assist in responding to the ambitious targets for affordable housing in Towards 2016. During the consultation process, the shift towards an equity sharing arrangement, as now proposed, was supported by all the social partners.

  Senator Paudie Coffey: There was wide debate on affordable housing when this Bill was before the Seanad. The changing market conditions show the need for changes in legislation to allow local authorities to sell affordable housing units in a more flexible manner than was previously permitted under legislation. It was necessary to address that and this Bill goes a long way towards implementing that flexibility in the market which will allow people who aspire to home ownership to get on the property ladder and own their own house. With market conditions in flux at present it is difficult to determine what is an affordable house. Three years ago we fully understood what an affordable house was and how it could benefit people who wished to own a house. However, with the fall in the market value of all houses, flexibility is required to reflect the current reality. Local authorities need flexibility to give people the opportunity to buy such units.

Will the Minister clarify the number of affordable housing units held by local authorities at present? A substantial number of the units held by local authorities throughout the country are unsold. There are still housing lists in the local authorities. Where affordable housing units are not and cannot be sold even though they have been on the market for some time, has the Minister issued guidelines to the local authorities to advise them that they can recategorise these units so they can, for example, introduce them into the incremental purchase scheme or offer them as social housing to people on the housing lists? That further flexibility is now required. Perhaps the Minister will deal with it through a circular or guidelines to local authorities and housing directors.

That would be a welcome development to address the current market conditions and the requirements of people on housing lists or those who might wish to buy houses. The authorities could free them from the affordable sector and make it more flexible for people to move into those accommodations. The Minister is aware that there are hundreds, if not thousands, of these units in the ownership of local authorities as a result of the Part V arrangements. To some degree local authorities have been victims of their own success in this regard given that they acquired many units under Part V. Now, however, the units are idle and vacant. The [602]flexibility in the legislation must be extended to allow those units to be inhabited and to accommodate families. I await the Minister’s views in this regard. I believe this must be done and local authorities must understand clearly that they have such flexibility, if that is the case.

  Deputy Michael Finneran: The number of houses the local authorities have on their books is estimated to be approximately 3,700. In some cases local authorities are finding it difficult but I am informed that they are possibly in a position to sell 1,000. To ensure this important infrastructure is available to the people who need it, that is, those on housing lists, I have issued guidelines to local authorities. These relate to the sale of dwellings on the open market at the market price — to accommodate that I recently increased the local authority loan limit to €220,000; the sale of dwellings to local authority tenants under the incremental purchase scheme; the use of appropriate local authority properties to house persons currently obtaining rent supplement under a RAS type scheme for a temporary period; and use of temporary social housing supports under leasing arrangements. The final position is where funds are available and where appropriate housing authorities may consider taking the units into their permanent housing stock to be allocated as social housing.

We have given a large degree of flexibility to the housing authorities in this regard. There has been comment on this in the media and I insisted on taking part in a programme on RTE radio some weeks ago because there was some very negative presentation regarding the position of affordable houses. I felt it necessary to take part and present the correct factual situation, as did a member of Dublin City Council. These houses are an important infrastructure of the State albeit they are in the local authority system. Some 3,700 houses have been built and are in the possession of our local authorities. At another time we might say we were delighted to provide that number of houses. We now have them in addition to those in the other schemes and they will be put into use for the best purposes, albeit perhaps not that for which they were originally intended.

We must monitor and engage continually with the local authorities who have these houses. Not all do. There is a close connection between us and the authorities which is continual so we will be able to see how the scheme progresses. We believe this matter will be resolved in the best interests of people on our housing lists.

There is a minor cross-reference error in the Bill to a provision in the Planning and Development Act 2000 which will be corrected ahead of the Bill’s enactment by way of the clerk’s correction.

I thank Members for their contributions during the course of the Bill, in its earlier passage through the House and again today, and for their report on amendments made in the Dáil. Members of this House have raised important matters in respect of the Bill and all are reflected in the final document. Key provisions in respect of the tenant purchase of apartments and homeless action plans will have a statutory basis when the Bill is enacted.

The primary aim of the Bill remains, namely, to give legislative effect to the reforms set out in delivering homes and sustaining communities. That document set out a vision to guide the transformation of the housing sector over the medium term by delivering more and better quality housing responses and by doing so in a more strategic way that focused on the building of sustainable communities. I believe the Bill is a key element in the practical implementation of that agenda. I look forward to its enactment and moving on to the crucial implementation phase.

[603]Again, I thank Senators. I brought the Bill to this House initially and had it read for a second time in this Chamber and am glad I did so because I spent almost 14 years in the Seanad. The contribution of Members was very constructive and thoughtful. I am glad to see Members of the House believe we have responded in so far as we could to the concerns they raised on Second and Committee Stages. The Bill was changed on Committee Stage in the Dáil.

  An Cathaoirleach: I draw the attention of Senators to a drafting error in the Bill. In section 94(3) of the Bill as passed by Dáil Éireann, as contained in amendment No. 131 on the green list, there is a reference to section 96(13) of the Planning and Development Act 2000. This should be referenced to section 96(12) of the Planning and Development Act 2000. Accordingly, as provided for in Standing Orders, I will instruct the Clerk of the Seanad to make a formal correction in the text of the Bill.

Question put and agreed to.

Question proposed: “That the Bill do now pass.”

  Senator Paudie Coffey: If it is appropriate, I wish to comment on the passing of the Bill. I thank the Minister of State for commencing the Bill in the Seanad Chamber where there was a great deal of discourse and debate regarding all the provisions it contained. There was much engagement by all sides in the Bill. The legislation tackles serious areas in our local authority areas that needed urgent attention, such as anti-social behaviour, improving how local authorities engage with housing applicants, how they function and the entire area of housing under their responsibility. Homelessness was mentioned as a significant area that required attention and I believe there is good provision within the Bill. Housing assistance programmes were intended to allow people get on the property ladder and give them the opportunity to own a place of their own. All that is left, now that the Bill is going to pass, is to ask the Minister of State and his Department officials to ensure local authorities are communicated with well concerning the contents of this Bill so that it can be implemented in as full and proper a fashion as possible in the relevant administrative areas.

I thank the Minister of State for listening to the debate and taking on board the views of all Members. I thank his officials for their time and effort. The Bill is comprehensive and complex and will have a major impact on our social housing policy and on how our local authorities implement that policy locally. We in the Fine Gael Party broadly welcome this Bill and hope to see the fruits of that improvement in trying to house people who badly need accommodation.

  Senator Camillus Glynn: As Government spokesperson on the environment, heritage and local government, I thank the Minister of State on behalf of the Government side of the House. The job has been very well done. It is a flagship Bill and I have no doubt it will serve communities throughout the country well in the future.

The passage of the Bill through this House initially was one of the better events that have happened in the House since I became a Member. It received strong scrutiny and set the stage for what ultimately took place tonight. Society in general will be better served by the passing of this Bill.

Question put and agreed to.

  An Cathaoirleach: When is it proposed to sit again?

  Senator Camillus Glynn: Ag 10.30 a.m. amárach.