Major change in State policy

HOUSING waiting lists have increased massively over the past few years as a result of the housing crisis and a change in the State’s approach to providing local authority housing.

The waiting list is an estimated 98,000, up from just 56,000 in 2008. Local authority housing has fallen from 4,986 completions in 2007, to less than 300 last year. While voluntary and non-profit housing bodies are being encouraged to pick up the slack, they built just over 2,000 in 2009, but this fell to little more than 100 last year.

The Irish Council for Social Housing says their sector manages up to 27,000 homes, while local authorities social housing stock is around 130,000 following years of sell-offs and now accounts for 8.7% of social rental accommodation. Government policy is to encourage housing organisations and rely on the private rental sector — the indications are that it now accounts for 20% of dwellings.

Social Justice Ireland says, however, that the sector could make a substantial contribution provided the State ensures sufficient funding, and paths to find funding, but it can’t be relied on to fill the total need. At the same time, private house developments have fallen by close to 90% from 2007 to 2012, when just 7,500 new homes were completed.

The population has been increasing, but home ownership in 2011 was back to where it was 40 years ago at around 70%, from a high of 80% in 1991.

The Government’s Housing Policy Statement of June 2011 commits to the creating of a viable and well regulated private rental sector with quality housing, a move towards long term leasing and a rental accommodation scheme, and bolstering the role of the voluntary and co-op sector.

This was accompanied by a massive cut in capital spending on housing to €576m this year. “There is a reorientation of funding from construction towards leasing initiatives, but no coherent approach to reducing the number of households on waiting lists,” says the SJI report.

Sorcha Edwards, who heads up Housing Europe, which represents social housing bodies in Brussels, said one of the big missing elements in Ireland’s housing policy, despite Government’s promises, is the lack of clear tenants rights.

A new form of financing is leasing, where private landlords are being signed up to agree to accept a regular payment and make their accommodation available to local authorities and local and voluntary coop housing bodies.

In the push to encourage those on low-incomes to buy their own homes, the Shared Ownership Scheme was introduced in 1991, with local authorities splitting the mortgage between annuity and rental. The idea was that, as people increased their incomes, they could afford to move the full amount into the mortgage.

Over the following two decades, around 16,500 loans were taken up but, in a paper delivered by Dáithí Downey of TCD and Stuart Stamp of Dublin City University, it was found that the economic crisis and the complexity of the scheme has left loanees with unsustainable debts, increasing poverty and increased risk of homelessness.

Social housing in Ireland is targeted at the poorest households with priority for certain groups such as those in overcrowded or unfit housing, the homeless, young persons leaving institutional care, and those with difficult medical or disability issues. Rents are related to the tenants’ income with housing allowances provided by the State for those who cannot afford to pay.


> Population: 4.5m

> Social housing of total housing stock: 8.7%

> Population at risk of poverty: 25%:

> General government spending on housing and community amenities as % of GDP, includes water and lighting: 2.1%

State aid rules

State spending on social housing has been all but outlawed by the European Union’s state-aid rules.

These were designed to prevent cartels forming and to encourage competition in business, but they are now being extended into areas that hitherto have been seen as protected because they are social.

They are being imposed to prevent the state subsidising the building of social housing; to ban having developers include social housing in new builds; and to limit the amount of housing that can be provided to a small number of the least well off; and to set the maximum rent that can be paid. The European Court has been asked to rule on two cases recently, one Belgian and one Dutch. 

The court struck down parts of Flemish housing policy last year that obliged developers to provide some social housing. The regional government included some compensatory measures for developers, but did not inform the commission of this. The European Court said it was at odds with the principle of freedom of establishment and capital, that social housing was a public work that had to follow European procurement rules — and that the obligation imposed a disproportionate burden on developers — and so violated state-aid rules. Willem Korthals Altes, a land development expert with Delft University, said the Flemish housing policies were designed to prevent gentrification.

In the Dutch case, private sector landlords complained to the European Commission that social landlords, housing associations, local authorities and charities, were becoming increasingly commercial in their approach and were competing with them, helped by public funds. The mayors of 27 cities, including Dublin, have signed to the commission asking that the definition of social housing and decisions on the type of provision be left to member states and their local authorities.

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