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Minister for Housing Darragh O’Brien has said that he has been on the record since he was in opposition as being against leasing of homes for social housing.
Mr O’Brien was responding to reports that financier Dermot Desmond had contacted him to recommend the phasing out of leasing for social housing.
The Minister told RTÉ Radio’s Today with Claire Byrne show that Mr Desmond had communicated with him months ago and that they had met virtually to discuss the matter.
“I am a critic of wholescale long-term leasing. I want to see new homes being built that the State owns. We are phasing out long-term leasing.”
Mr O’Brien said the meeting with Mr Desmond consisted of the financier “putting forward his view” which was one that he agreed with, which was that leasing was not good value for money.
However, there were a number of existing schemes such as mortgage to rent, which lets people switch from owning their home to renting it as a social housing tenant and the lease and repair scheme, both of which required leasing, but he still felt that building new homes was the better solution.
“I didn’t need Desmond to explain that to me.
“I’m on the record, from when I was in opposition as being a critic of leasing.”
Mr O’Brien said the Taoiseach had also been a critic of leasing since he was in Opposition.
The Housing For All plan was to deliver social and affordable housing for all, he said. More social housing was going to be built. The projections for the next year were very positive, he said.
“I’m focused on doing my job delivering thousands of jobs, then people can decide.”
Letters
In private letters sent last December and February, Mr Desmond criticised Government policy on housing and the over-reliance on international institutions and the private rental sector for social housing at a time when the cost of borrowing to the State was so low.
He said international investment funds are “having a laugh” at the Government over its housing strategy and its social housing policy is a “shocking mismanagement of public funds”.
The businessman told the Minister for Housing that the State’s treasury agency was borrowing at an average of 0.02 per cent when the State is paying 5 per cent on average to international institutions to fund publicly owned housing.
“In such a low interest environment, the current policy of buying and leasing social housing from private developers and investment funds is a criminal waste of public money,” he told Mr O’Brien in a letter dated December 15th, 2020.
“The international funds are having a laugh at the Irish Government and making a lot of money in the process.”
The Government was losing almost €250 million a year on an assumption that at least €5 billion of State money was being invested in new and government-led housing initiatives.
In a letter to Taoiseach Micheál Martin in February, Mr Desmond criticised social housing policy, describing the Part V legislation where developers provided at the time 10 per cent but since increased to 20 per cent of any project for social housing as “one of the worst pieces of legislation ever passed and clearly not fit for purpose”.
Price tags of between €600,000 and €960,000 for apartments for social housing was “by any standard a failure in policy and a criminal waste of public funds,” he said.