Coveney under pressure over anaemic housing budget

Posted: October 16, 2016 in Budget 2017, Coveney, Housing

Twice this week Minister for Housing Simon Coveney lost his cool. The source of his irritation was an inability to understand why his anaemic housing budget was not being greeted with universal praise.

At his Budget day press conference the normally composed Cork TD was visibly irritated when journalists questioned the wisdom of his so called help to buy scheme.

The following day he displayed an uncharacteristic discomfort during his budget debate contribution. He railed against the opposition for failing to understand just how transformational his housing measures really were.

Minister Coveney has spent much of the last five months telling people that he is in listening mode. But it appears that his invitation to dialogue is more style than substance.

There is a growing gap between the Housing Ministers words and the actions of his government.

I have no doubt that Simon clearly understands the seriousness of our housing crisis. Unfortunately Budget 2017 lacks the necessary investment or policy change to even begin the process of addressing the causes of the crisis.

Minister Coveney has made much of the 50% increase in the housing budget. Proof that Government is prioritising housing he says.

Yet when set again the 90% reduction in housing spend since 2008 the increase is actually very modest. Capital spending on housing is still less than half of what is was at the start of the recession.

Some of the individual measures in the budget have merit. The repair and lease initiative, the buy and renew initiative and the Housing Agency fund to purchase vacant properties are all good ideas. But without the necessary investment their impact will be extremely limited.

Between them these schemes will deliver around 800 homes in 2017. Given that there are 189,000 vacant houses across the state it is not surprising that people are unimpressed.

The litmus test of any Government’s determination to tackle housing need is its level of investment in social housing. Next year Government capital investment in housing will increase by a paltry €150m.

According to figures from the Department of Housing the total addition to the social housing stock in 2017 will be 4450 units. But this is only 435 more than what Government expects to deliver this year.

Little wonder that homeless families and those left languishing on housing lists for more than a decade are not out dancing in the streets.

The Dáil Housing and Homeless Committee report published earlier this year said that to meet housing need social housing stock would have to increase by an average of 10,000 units a year for at least five years.

In his defence the Minister will claim that in 2017 Government will provide 21,000 social housing solutions for families in need. Solutions is a nice euphemism for private housing subsidised by the state.

Eighty percent of these so called solutions are exactly that – 16,600 private properties leased by the state. The majority of these leases will be for two years providing no security of tenure for tenants. This directly contradicts Government housing policy on creating sustainable communities.

This over-reliance on the private sector to meet social housing need is one of the primary causes of the housing crisis. It didn’t work in the 1990s or the 2000s. At a time of even greater pressure on the private rental market and with little construction in the pipeline it certainty wont work now.

During his budget debate speech Minister Coveney berated some of us for what he described as our exclusive focus on the provision of social housing. Did we not understand the need to deal with the crisis in the private housing market.

The failure of understanding is clearly the Ministers. Increased social housing not only meets the needs of those on Council waiting lists but reduces the pressure on the private rental and purchase markets.

Budget 2017 contains nothing for renters or struggling first time buyers.

Only hours before his budget debate contribution Minister Coveney’s party colleagues in the Seanad, with the support of Fianna Fáil, voted down Sinn Féin’s Rent Certainty Bill. The Bill, which if enacted would save renting families up to €2000 per year, was opposed by Coveney and his partner in crime Barry Cowen, when I tabled it in the Dáil in June.

Not content with fuelling rent price inflation Minister Coveney wants to push up the price of first time buyer homes as well. His mis-named Help to Buy Scheme has been roundly criticised by housing policy experts. It should have been called a help the banks and builders scheme because they will be its only beneficiaries. Unfortunately, as with the boom, struggling home buyers will be saddles with greater levels of debt.

In one of the days many ironies Fianna Fáil criticised the Governments help to buy scheme despite proposing something very similar during the general election campaign.

Underinvestment in social housing, over-reliance on the private sector, failure to regulate the rental sector and fuelling a new property bubble do not amount to a transformational housing budget.

They represent the same tried, tested and failed policies of previous Fine Gael and Fianna Fáil governments. Creating a stable and fair housing system will require a change of policy direction and a substantial increase in investment. Unfortunately it appears that only a change of Government will deliver that.

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