Government to offer cheap houses to low-paid

THOUSANDS of low-paid workers are to be offered cheap houses on State-owned land from next year.

The radical house-building plans form part of the proposed national pay deal, due to be discussed by unions and employers in crucial meetings today.

The initiative is expected to be partly funded by raiding the pension reserves in what would be a major U-turn by the Government, which ruled out such a move in the election campaign.

Workers on low and middle incomes, who cannot afford a mortgage, can buy 10,000 cheap houses under the initiative. Local authorities and State agencies are to be asked to free-up land for houses which may be bought at a knockdown price.

The Government will also examine ways of enhancing compulsory purchase orders to free-up land banks around the country.

Irish Congress of Trade Unions president Joe O’Toole, one of authors of the house-building plan, said young workers on low or middle incomes would finally have the chance to own a home.

“The net effect of this is that it will take the developer out of the process,” said Mr O’Toole. “People who can’t afford a mortgage will be able to by a house at cost-price for the first time.”

The houses will be separate from social housing schemes, directed at people waiting for a corporation or council home. A similar scheme was established in the 1930s when the Government made thousands of cheap houses available.

The house-building plan will technically not cost the Government any money. It will be financed by the National Development Finance Agency, which is expected to source money from the pension reserves to be passed on by the National Housing Agency. The money will be paid back into the pension fund by mortgage-holders.

The pension fund itself is not due to be distributed for another 25 years.

SIPTU president Des Geraghty yesterday confirmed the Government has told unions pension reserves would be used for the housing scheme.

Finance Minister Charlie McCreevy had ruled out such a move during the general election and poured cold water on opposition parties’ plans to use the funds for capital projects.

Labour’s finance spokesperson, Joan Burton, said she was glad the Government appeared to have changed its mind and was prepared to help ease the housing crisis.

Unions, employers, building groups and Taoiseach Bertie Ahern are due to meet to discuss details of the house-building plan within the next 10 days.

In Mexico, where he is on a State-visit, Mr Ahern confirmed he would take a central role in pushing the plans forward.

Crucially, builders have already thrown their weight behind the proposals in private talks with unions and the Government.

ICTU and employers’ group IBEC, meanwhile, meet today to decide whether to recommend the new pay deal to members. Both sides are upbeat about the prospects of acceptance, however there is resistance from public sector unions who would face a six-month pay freeze.