Thursday 5 December 2019

Martina Devlin: 'What does it say about the State's moral compass when, as a result of official policy, people are becoming homeless faster than houses are built?'

Government is too wedded to outsourcing house building – even though a (homeless) child of five can see that it is dysfunctional public policy. Stock Image: Bloomberg
Government is too wedded to outsourcing house building – even though a (homeless) child of five can see that it is dysfunctional public policy. Stock Image: Bloomberg
Martina Devlin

Martina Devlin

The Micawber Principle is being applied to the Government's housing policy - with predictable results. It takes its ethos from the Dickens creation Mr Micawber, who is carried along on a tide of faith that "something will turn up".

He's synonymous with people who have misplaced confidence that a solution to their problems will drop from the sky at their feet. Which leads me to Government policy on housing. It owes a lot to Micawberism: let's just wait for the private sector to pick up the slack. That's as likely as Martians arriving with a team of crack housebuilders in their spacecraft.

The Government's housing policy is a national disaster area. Over-reliance on the private housebuilding sector to supply homes is not delivering solutions - there are insufficient properties and often they are unaffordable. Nor is depending on the private rental sector the answer - many renters are crippled by their accommodation bills and will never be able to set aside enough for a deposit on a home. In a number of cases, the State pays contributions to these rental costs with income supplements or housing benefits, but this is a sticking-plaster solution. It is dead money which could be used instead to build long-term social housing.

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We keep hearing about how many housing units were delivered this year and how many more will be ready next year. These aren't the figures to focus on - they are numbers salad. It's the figure for homeless people which matters. Ten thousand citizens, including families with children. That's 10,000 human beings homeless in Ireland since the Government's Rebuilding Ireland programme was launched.

And who can forget that shameful photograph last month of a five-year-old boy sitting on the pavement to eat his dinner off a piece of cardboard?

Housing was a key consideration for many voters who went to the polls yesterday in four by-elections and will be a deciding factor in next year's general election. A roof over people's heads has to be a basic requirement. It's not exactly setting the bar at impossibly high levels.

So why is the Government failing, failing and failing again to provide a stable supply of housing?

Housing Minister Eoghan Murphy faces a no-confidence motion from the Social Democrats next week, supported by Sinn Féin. The minister dismisses it as a 'stunt' - an odd interpretation of what others regard as accountability - and Fianna Fáil indicates it won't support the motion, meaning it will fall. The first vote for our four new TDs will be on this most urgent of matters.

The minister is also under pressure from Fianna Fáil, which has introduced legislation to allow councils to allocate up to 30pc of housing to first-time buyers. Despite the confidence-and-supply deal, Fine Gael won't co-operate, contending it would be unlawful. It seems odd that some workaround can't be found in the interests of helping a hard-pressed demographic.

On the one hand, Mr Murphy isn't furnishing solutions at anything near the rate that's needed. On the other hand, policy is the problem rather than the political figure at the helm of housing. Chances are, a new Fine Gael housing minister would make no material difference.

Clearly, we need large-scale State investment in affordable public housing. Even when Ireland had cobwebs in the coffers, Éamon de Valera was building houses because he identified it as a priority. Leo Varadkar should do likewise. His Government is too wedded to outsourcing house building - even though a (homeless) child of five can see it is dysfunctional public policy.

Government policy is that the market will solve housing shortages: supply will meet demand is the received wisdom. But supply and demand are failing miserably to meet because the private sector can't keep pace, meaning the policy isn't working and needs to change. The State must recognise this and step in to bridge the gap.

Spin isn't helping. The situation is at crisis levels but minister after minister trots out to the TV cameras to put a gloss on the housebuilding figures. Leo Varadkar says more have gone up now than in the previous 10 years. Hardly something to take a bow over when his party has been in government for eight of those years.

Capacity within the construction sector - much reduced since the boom time - is bound to be one of the factors contributing to under-supply. Employment in the construction sector stood at 135,000 in the second quarter of 2019 compared with 230,000 at the end of 2007, according to the Central Statistics Office. In other words, a severely contracted market is serving a rising market - hampering the ability of supply to meet demand.

Last year, the ESRI produced a useful report, Social Housing in the Irish Housing Market 2018, which concludes that the State may need to build more houses directly. The report, authored by Eoin Corrigan and Dorothy Watson, says: "As the population increases, all other things being equal, the demand for housing will increase." This is a given. So where are the ambitious building programmes to address that self-evident need?

Since 2002, there has been a marked decline in public housebuilding. A graph in the ESRI report shows that social housing as a percentage of households remained steady at 9-10pc between 2004 and 2016. It's not yet clear how Rebuilding Ireland will change the graph but don't hold your breath.

What's alarming here is that by 2013, Ireland had emerged from the bailout and the recovery was beginning. Social housing as a proportion of overall housing should have been scaled up significantly at this point. It was obvious that other groups in addition to low-income households would need access to it, such as young people blocked from mortgages because of tighter lending rules.

Around Ireland today, boarded-up houses and commercial buildings are visible everywhere. Why not convert them and turn them into homes? Planning laws also need an overhaul, with increased use made of compulsory purchase orders.

And what about land hoarding? Last year, the vacant site levy hiked the tax from 3pc to 7pc of the value of the land, but that's not punitive enough. Raise it to 20pc and let's have that land - we have citizens who are in need.

The influx of vulture funds to the housing sector hasn't helped. Investment funds have been buying residential properties specifically as buy-to-lets. Proportionate to the market they are a tiny segment - but it's hardly a positive development, not least because of our history of absentee landlords.

The bottom line is that people are becoming homeless at a faster pace than houses are being delivered and it's happening as a result of official policy. What does this say about the moral compass of our State? Bear it in mind when the next opportunity to vote comes your way.

 

Irish Independent

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