Goal to build 35,000 homes won’t be met without ‘significant changes’ – CIF

The goal to build 35,000 homes per year won’t be achieved within the lifetime of this Government without “significant changes” in the processes to deliver housing, the lobby group for the construction sector said in its pre-budget submission.

In its submission for Budget 2021, the Construction Industry Federation (CIF) took aim at bureaucratic processes which it said add "cost and delay to the delivery of public and private construction".

“It can take construction companies as little as 16 weeks to actually build a house or only a matter of years to construct motorways. Most of the time it takes to move from concept to completion derives from the State and its agencies,” the lobby group noted in its submission.

As a result, the group made a range of suggestions including changes to public procurement practices, measures to support private demand in housing, focus on regional infrastructure and emergency measures within the planning system.

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The CIF called on the Government to secure €15 billion from the EU recovery fund to bolster the national development plan, the introduction of a shared equity scheme for private homes, and the extension of planning expiry dates so that development permissions are not lost due to Covid-19 disruptions.

"The current system, involving multiple bureaucratic, regulatory, and political objectives, adds cost and delay to the delivery of private and public construction," said Construction Industry Federation president Tom Parlon.

“Other major issues include the slow pace of improving connectivity in the regions, the many blockages to improving housing output and affordability, the need for public investment to stimulate private investment and the overwhelming support for Project Ireland 2040,” he added.

Among specific measures the CIF proposed is one to increase Irish Water’s operational budget to €2 billion annually to enable it to accelerate essential water infrastructure. It also called for €3 billion to be spent on regional projects in the coming three years.

Stimulus package

A report prepared by professional services firm EY on behalf of the CIF estimated that for every €1 billion invested in infrastructure, housing and other construction-related activity, there’s an additional €1.85 billion of GDP output. Excluding levies, there’s also €140 million in exchequer revenue and €680 million circulating through the economy in terms of wages and profits.

A stimulus package of €15 billion, therefore, would generate an additional €27 billion in output.

“The Government has a unique opportunity to drive our recovery, solve the housing crisis, build climate change resilience and facilitate our Covid-19 response by increasing investment in infrastructure, housing, and other construction activity,” said Mr Parlon.

“The reality is that the construction industry is the economic sector best-placed to generate the economic activity to erode the debt from dealing with Covid-19.”