State 'would prefer to own homes rather than subsidising rentals' but it would cost 'billions' 

All of the department’s efforts were geared towards 'removing barriers' preventing local authorities and approved housing bodies from delivering homes, Public Accounts Committee told. File picture: Larry Cummins

The head of the Department of Housing has said the State would prefer to own homes rather than subsidising rentals, but that doing so would cost “many, many billions”.

Graham Doyle, secretary general of the department, refused to be drawn on whether he considered the Hap and Ras rental subsidies as representing poor value for money. Instead, he told members of the Public Accounts Committee on Thursday that “we would much prefer to own new homes”.

The rental subsidy schemes have been criticised in some quarters because while they are used to bolster social housing numbers, the State gets no return on the investment as the payments are made to landlords.

“Of course we’d much rather that new units were owned by the State,” Mr Doyle said, adding, however, that such a financial commitment could amount to €8,000 a year per property, which he described as “a huge exchequer investment” if paid up front.

Politicians repeatedly asked Mr Doyle about a pattern at his department which has seen its housing budget repeatedly underspent to the tune of hundreds of millions over the past four years. In response, he told the committee: “We’re trying very hard to spend the money”.

He said all of the department’s efforts were geared towards “removing barriers” preventing local authorities and approved housing bodies from delivering homes.

In terms of the €246m unspent by the department last year, Mr Doyle said in “very simple terms” the underspend could be equated with the shortfall in social housing construction, where 7,433 units were built against a target of 9,000 — a shortfall of 1,567 units.

He said a difficulty in matching budget underspend and monitoring how well housing supply was progressing stemmed from the fact “a huge amount of delivery happens in the last quarter” of each year, something he described as a “perennial challenge”.

Mr Doyle said the department had hoped to push construction delivery across the full year for 2022, but issues in terms of “construction inflation, tendering, and risk and uncertainty” had made the backloaded delivery effect “worse than ever”. As a result, nearly 6,000 social housing units were delivered in the final three months of last year.

Regarding the cost-rental Tenant in Situ scheme, which is designed to keep a tenant in place by having the State purchase a home from a selling landlord, Mr Doyle denied the scheme was set to run out of funds for this year as early as August or September.

“We’ve already flagged that,” he said, adding the department would “seek to extend” the funding in order to preserve the scheme.

Separately, Mr Doyle was quizzed regarding his salary as secretary-general of the department. This follows reports from earlier this year that he was involved in a dispute over a potential pay hike with the Government and a legal action might ensue — a suggestion Mr Doyle unequivocally denied.

Clarifying that he is currently paid €241,000 a year, Mr Doyle said the issue in question is “a personal HR matter” and the details “are not something I’m able to comment on”.