Friday 18 October 2019

More than €2bn in State cash given to social housing bodies which have no regulation yet

Legislation for AHBs starts journey through Dáil

Eoin O'Broin. Picture: PA
Eoin O'Broin. Picture: PA

Caroline O'Doherty

More than €2bn in Government funding has been given to unregulated bodies to provide social housing over the past 10 years.

The money went to a variety of co-operatives, associations, charities and other non-profit groups clustered under the description of Approved Housing Bodies (AHB).

But despite the huge sums of money and substantial contribution of AHBs to social housing provision - they provided 40pc of all new social housing in the country last year - they still have no statutory basis for operation.

Draft legislation, the Housing (Regulation of Approved Housing Bodies) Bill was published in late summer and has only just begun its journey through the Dáil.

The extent of State funding to AHBs was revealed to the Oireachtas Housing Committee as members discussed recent changes to the entities' funding status imposed by the EU.

Between 2009 and 2018, they received €1.745bn in funding directly from the Department of Housing or channelled through local authorities. This year to date they have received €260m in capital funding and €210m for current spending.

Under government plans, 12,000 extra social housing units are to be built, bought or leased each year from 2021 to 2027 and AHBs are to provide around a third of them - adding to the 30,000 home they already manage around the country.

Yet it is not clear how many AHBs there actually are. Officials told the meeting that 552 were registered as AHBs but just 260 had signed up a voluntary code of conduct introduced in anticipation of statutory regulation.

Paul Lemass, assistant secretary at the Department of Housing, said it was believed a lot of the remainder were no longer active.

"We are carrying out a de-listing exercise and some have been removed from the register and we expect others will be," he said. He said it would be preferable from a regulatory point of view to have a smaller number of bigger AHBs.

Independent Senator Victor Boyhan agreed. "I'm not in favour of providing plush offices and top chief executives for a load of Approved Housing Bodies," he said.

"We have a lot of people reinventing the wheel, doing the same thing. What are local authorities supposed to be doing? Why are we reinventing the wheel and handing so much of housing delivery to bodies outside the local authorities?"

The need to properly organise the AHB sector has become pressing after Eurostat, the EU's statistical office, ruled that spending and borrowing by AHBs must be counted as state spending and borrowing rather than kept off the Government's balance sheet.

The rationale is that the AHBs are using public money to provide public housing and charging rents that are lower than market value so they can not be treated as private entities. Fourteen of the largest AHBs have already been reclassified as a result.

But that leaves AHBs competing with other essential services and capital projects for the general pot of public funding and they have expressed concern that they will be subject to fluctuating finances that will make it difficult for them to plan ahead and fulfil their part of social housing provision.

Mr Lemass said the department had argued against the reclassification and was working with the AHBs and legal advisers to see if the move could be reversed but he warned that could take time.

Sinn Féin TD Eoin Ó Broin said he was concerned that they didn't have time. "If there is any change in our macro- economic circumstances - and I'm thinking of the ESRI's warning this morning of a recession in the event of a no-deal Brexit - that immediately has implications for the capital expenditure of government and the ability of AHBs to meet their targets," he said.

Irish Independent

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