Minister Murphy's speaking notes at the Irish Council for Social Housing AGM

Published on Monday, 03 Jul 2017
Minister Eoghan Murphy

Check against delivery

Thank you very much for inviting me to speak at today’s AGM.

I am new to this portfolio – but I am not coming new to this issue. No one in politics or indeed anyone with an interest in our communities or our country could be new to this crisis. It’s been with us for some time now.

The housing situation is reaching a crisis point; the level of homelessness in Ireland is an emergency.  You’re on the front lines of these symbiotic challenges. And everyone very much appreciates the work that you do & thank you for doing it.

I look forward to working with you and to solving these problems together in the months and years ahead.

Rebuilding Ireland timeline

Rebuilding Ireland is a plan to 2021. We need plans and we need timelines, and targets and goals. This is how we drive implementation of policy. This is how we get things done. Rebuilding Ireland has already achieved a great deal with more good things to come.

But we won’t be fully out of the woods by 2021. The legacy of this problem – the problems that today’s Ireland faces when it comes to housing and homes – have been growing for far too long.

This is an area of public life that’s been a problem for people (and for the State as a whole) in one way or another for the last 15 years. It’s a shared problem because communities are built around people. You don’t have to be directly affected by homelessness or the lack of affordable rents for young people in your area, say, for it to have an impact on you.

And I don’t need to tell you how bad public policy in this area over the years, or reckless behaviour by certain institutions, has damaged the fabric of society.  Legacy issues damage it still.  This crisis that we face is a genuine threat to our communities, to our social fabric.

Some of the sensible solutions required to meet this challenge, to overcome it, deserve and necessitate a longer time horizon than Irish politics and political and public discourse is used to.

But this new government is determined to think big, and the new government has no choice but to think in decades. That’s why the Minister for Finance is now talking about a ten year capital plan for the country.

That’s why this Government wants to plan a spatial & development strategy out to 2040, now.

It’s also why I think it might be worth reviewing some of our timelines – but not our ambitions – in Rebuilding Ireland. To make sure that in solving this current crisis, this emergency, we do not inadvertently sow the seeds for crises of the future. That in forming an immediate response, which is already well underway – we do not undermine the possibility of a more sustainable future when it comes to meeting our people’s housing needs.

Certain solutions will buy us time, and that is welcome. For example, rent pressure zones buy us time. We will need more solutions like that, as construction ramps up.  But the government is going to have to take a more direct role in supply, and it’s going to have to find true housing security for people in the long term, during that time.   I think that’s something that all of you in the room here can understand.

Rebuilding Ireland Review

I’ve been tasked with reviewing Rebuilding Ireland.  To be clear, this won’t be a wholesale review – we’re not starting from scratch again. The plan is good and is delivering important results.  But it’s good practice to review policy. And there may be scope now for new initiatives. While I have a strong sense already of what I want to do, certain initiatives will have to wait until the budget.

An immediate priority is to find a first response for homeless families that isn’t commercial hotels or B&Bs. And then to make sure that those families who are in hotels can be found an alternative home as quickly as possible.  It’s deeply regrettable that this could not be achieved by the 1 July – but we are making very good progress.

The number of families presenting as homeless in June, while still too high, appears to be down on the numbers presenting in May. We’re going to have to keep on driving this but I think we can meet our target soon.

Social Housing

This new Government and our new Taoiseach talk about building a Republic of Opportunity.

“Opportunity for all” means an inherent obligation on the part of all of us – but most especially the State (the Government) - to direct our resources to help those who need our help the most - especially when we talk about help in providing a home for people and their families.

When I used to speak about the concept of a Republic of Opportunity, I tended to speak about it in the context of education.  An obligation and a need for social housing have always been there. But maybe we weren’t meeting that obligation in the right way. Maybe we lost sight of the true nature of that obligation.

And now it is a greater problem than before and it touches upon more people and more families than it did before. It’s a legacy of the financial crisis that will be hard to shake off.

Every household in Ireland needs access to secure, good quality affordable housing suited to their needs in a sustainable community. A strong Social Housing Sector is an essential requirement if we are to meet this obligation.

We know that more than 90,000 households qualify and are waiting for social housing supports.  The Government is committed to providing a more flexible, progressive and targeted system of Social Housing supports over the next few years in order to meet this need to the greatest extent possible.

Under my review, the Taoiseach has asked me to see if the government needs to directly build more homes.

The Role of Approved Housing Bodies

In my first week as Minister, I had the privilege of visiting two AHB projects - the Iveagh Trust’s Annamore Court in Ballyfermot, and Focus Ireland’s Greenmount in Harold’s Cross.

Both demonstrated a community focus; both were funded using innovative financing, combining funding from my own Department and credit from the Housing Finance Agency.

Currently, we have almost 30,000 homes being provided by housing associations and it is estimated that this sector has the capacity to contribute almost a third of the 47,000 new social housing units that we are currently targeting for delivery by 2021.

The significant funding being provided for new housing delivery will enable AHBs to increase their revenue flows, including from rent, allowing them to enhance their staffing capacity.

New schemes such as the Repair and Lease scheme as well as the Buy and Renew scheme are harnessing the opportunity of vacant stock. AHBs are well placed to play a central role in the delivery of these new schemes.

I recognise that the business plan or strategic direction of every AHB will not be orientated in the same way - the remediation and leasing model may not be suitable for every AHB for example.  This must be about people playing to their strengths. And so that might also mean intensifying the construction of new homes by AHBs where that makes sense.

We will be establishing on a full statutory basis a Regulator for the Approved Housing Bodies (AHB) sector.   The Department is currently finalising the detailed drafting of the Housing (Regulation of Housing Providers) Bill to deliver on these commitments.

Regulation is crucial for the sector, if it is to move its operations from the low-risk environment of virtually 100% Exchequer funding that has prevailed in the past, to one where AHBs have the standards of governance and management capacity to increasingly access private finance.

Regulation will also provide reassurance to investors, tenants, and the Exchequer that the sector is operating in a well-regulated, stable and progressive environment.

Growing Unaffordability

We know that the failure of the rental market to respond to the increased demand for rental accommodation - is a serious underlying problem.

As we increase the supply of homes, to rent or to buy, supply must recognize that private rented accommodation is becoming increasingly unaffordable.

And that this is happening alongside a growing dependence on the rental sector for accommodation, particularly among households on moderate to low incomes.

So we have to achieve increased supply at the lower priced end of the market.  We have to open up affordable rental models to protect people who may become more vulnerable as they approach the latter stages of their working lives, As well as finding solutions for young people and young families.

The Not for Profit sector – Housing Associations

A long-term objective of our strategy is to expand and transform the not-for-profit segment of the rental sector to provide accommodation at costs that are more affordable for those that the private market does not serve.

This will fulfil the commitment contained in the Programme for a Partnership Government to develop a "cost rental" option for low-income families. By providing accommodation at a lower cost, we can help close the growing affordability gap faced by families on moderate incomes, who are currently obliged to rent in the private rental market.

When operating at large enough scale, AHBs can provide a stabilizing effect across the rental market and the broader housing system. By European standards, Ireland’s not-for-profit sector is underdeveloped.  Housing associations in Ireland currently provide accommodation for less than 2% of households.

Across Europe, between 10% (in the UK) and 33% (in the Netherlands) of total housing is provided by the sector.  We need to have the ambition to make the step change necessary to achieve this type of scale.

AHB classification

Now as you know, the classification of Approved Housing Bodies for government-accounting purposes is currently being reviewed.  This review is being undertaken by the CSO at the request of Eurostat, the body that oversees government accounting rules across European Union Member States.

This is a hugely important strategic issue to my Department, and one we are taking very seriously.   We are very much aware that there are concerns amongst AHBs surrounding the potential implications arising for individual AHBs and for the sector as a whole.

We are working closely with the sector, through the office of the AHB Interim Regulator in the Housing Agency, with individual AHBs, as well as through the Irish Council for Social Housing.  It’s crucial that we all work together on this.

Role of the Irish Council for Social Housing

With its membership of over 300 housing associations, and its connections with similar organisations across Europe, the Irish Council for Social Housing is of course as a key partner in developing the sector. I want to thank you for the contribution that you’ve made, particularly in relation to the voluntary regulation of the sector and preparing for the new obligations that will come next year.

But our challenge from now is building the larger and more dynamic not-for-profit sector that is essential if we are to meet the long-term demand for rental accommodation that is affordable for moderate to low income households. This will be a long-term project.  It will require more than just the development or replication of existing AHBs.

Yes, we must develop the capacity of the existing sector through amalgamation and growth, but we also need to look beyond ourselves and our existing system.  We must also be prepared to bring in housing bodies from other countries, to create a range of new types of non-profit and mutual housing associations and support innovative housing initiatives from within public service provision and professional organisations involving key workers.

I very much look forward to working with you in to the future.

We can do this, if we work together.

Thank you