Ten local authorities have run out of their initial funding for the Government's home loan scheme despite Housing Minister Eoghan Murphy insisting money is available to continue the project.
Mr Murphy made the admission during a meeting with TDs in which he claimed he knew nothing about an internal memo to press officers in January warning of funding problems. He said it was not sent by his officials.
At the Oireachtas housing committee Mr Murphy said the scheme will continue.
His comments came just 24 hours after revelations the €200m scheme has used up its budget despite hundreds of people still to draw down approved loans.
The Housing Minister said he is in discussions with the Department of Finance and Central Bank to increase funds and that the project is not "frozen".
However, asked by Solidarity-People Before Profit TD Mick Barry if Kildare county council has reached its funding limit, Mr Murphy conceded it as well as nine other local authorities will need more funds.
"There are 10 local authorities who have reached their limit, so more money will be re-allocated there," Mr Murphy said.
He said despite the concerns "the scheme has not closed, it has not run out", insisting "people can still apply" and saying he is "very surprised" at the widespread funding criticism.
However, despite the re-assurances, he was heavily criticised by Fianna Fáil housing spokesperson Darragh O'Brien, who told Mr Murphy "please don't treat people like fools", adding "if you were a business you would be insolvent".
Mr Murphy responded by repeating money is available to continue the scheme and that all 1,500 successful applicants would see the support promise honoured.
He said while the total cost stands at €310m, not all loans will be drawn down and that it is expected the "actual draw-down level will be €176m", staying within the initial €200m funding cap.
Asked by Mr O Brien to explain how this could be the case if a January memo to press officers confirmed there are major funding concerns with the project, Mr Murphy added:
In a parliamentary question response to Sinn Féin's housing spokesperson Eoin O Broin, the Department of Housing said of the 575 applications which have been drawn down to date:
Mr Murphy was also criticised for the ongoing homelessness crisis. He told the committee that while problems are continuing, in "the past two months" there has been a trend of more people leaving emergency accommodation than entering it.
However, it was pointed out this is only correct if the number of people prevented from entering emergency accommodation in the first place was included.
Mick Barry said: "The number of people in emergency accommodation is greater now than at any time in the history of the State.
"The minister's statement omitted to mention 9,987 persons are living in emergency accommodation.
"This number touches the coattails of 10,000 people officially homeless."