Defective apartments: State to fund repairs for as many as 100,000 Celtic Tiger-era homes under Cabinet plans

Cost to the exchequer is estimated to be between €1.5 billion and €2.5 billion

A Construction Defects Alliance protest outside Leinster House in December to mark five years since the completion of the Oireachtas Housing Committee’s Safe as Houses report on defective apartments. Photograph: Dara Mac Dónaill/The Irish Times

Up to 100,000 owners of defective apartments or duplexes are to get financial support from the State for the full cost of repairing their properties under plans approved by Cabinet.

The cost to the exchequer of repairs to between 62,500 and 100,000 properties built before and during the Celtic Tiger era is estimated to be between €1.5 billion and €2.5 billion.

People who have already had their properties repaired will also be able to seek the full cost of the work as the support will be retrospective.

Minister for Housing Darragh O’Brien said the scheme should be up and running either late this year or early next year once the legislation and regulations are in place.

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Some interim remediation payments may be made this year in cases where there are serious safety concerns with buildings that need to be urgently addressed.

Mr O’Brien also said that the Government has “approved the principle” of allowing costs already incurred to fix defective apartments to be covered by the scheme.

He said: “We’re saying very clearly to people that those who have already paid and are paying for the remediation... that costs will be borne by the State.”

He said the details of this will be worked out as the legislation is drafted but that this was “a very important decision” and it is a “fully funded scheme”.

Asked if this means they will get 100 per cent of the costs he replied: “Yes it does. I said fully funded.”

The Government puts the average cost of repairs at €25,000 per apartment.

Mr O’Brien said: “In some instances it’s more - we know of cases where it’s substantial” but he added: “there is no cap on this.”

On whether the construction companies that built the defective apartments will be pursued to help fund the cost of the scheme Mr O’Brien said: “We are looking at all legal avenues available... to be able to seek recourse for those who are responsible.”

He cautioned: “That’s not going to be easy” and gave the example of limited companies “going to the wall and being reestablished” while adding: “We’re looking at all of that”.

He said the principle of the construction sector contributing to costs has been established with the Concrete Block Levy introduced in the last Budget.

Mr O’Brien said a new the independent Building Standards Regulatory Authority is being set up this year “which I think is a very important step forward as well to ensure this doesn’t happen again”.

The Constructions Defects Alliance (CDA) strongly welcomed the Cabinet approval for the plans.

Its spokesman, Pat Montague, said the alliance was particularly pleased at the political decision to ensure that people who have paid or are paying towards remediation costs will be included in the scheme.

He also welcomed the decision to provide immediate support on a series of interim fire-safety measures as requested by the CDA and the Apartment Owners’ Network.

Mr Montague said the Government decision is “an important one for the tens of thousands of people living in apartments affected by fire safety defects.”

He added: “It’s clear that a remediation support scheme is now going to be put in place and a political decision has been made to include people who have already paid or are paying towards remediation costs.

“These decisions are significant although the detail of how they will operate in practice has yet to be worked out.”

Taoiseach Leo Varadkar said the scheme would be a huge relief to tens of thousands of people around the country as he revealed that he was personally affected by defects.

“As I am talking about this matter, I should declare a potential interest,” he told the Dáil. I own an apartment in Castleknock. It is the only property I own but it is in a building with defects. While I will not be claiming from the scheme personally, the owner’s management company might, and I could be an indirect beneficiary in that regard.”

Labour leader Ivana Bacik said she been inundated with “dreadful personal stories from individuals whose homes are not safe” and in many cases have paid thousands of euro to remedy the defects and who are in “dire financial straits as a result”.

“It is vital that this scheme also marks a definitive end to the arm’s-length approach to dodgy developers and builders,” she added.

“We need to hear from the Government its plans to tighten up the planning regulations so those responsible for putting households at risk will not be put in the position where they can do so again, and that owners management companies will be reformed to give residents surety that the same builders will not be in charge of repair works.”

Mr Varadkar added the scheme would be 100 per cent redress, that there will be retrospection and the Government will be establishing a new independent building regulator to “try to make sure this does not happen again”.

“That said, there will be checks and balances and it will not just be the case of people or management companies putting in a claim,” he said.

“It will have to be certified work, legitimately done, and all the rest of it, so there will be checks and balances in the scheme. I think this news will come as an enormous relief to tens of thousands of people and families around the country.”

Cormac McQuinn

Cormac McQuinn

Cormac McQuinn is a Political Correspondent at The Irish Times

Sarah Burns

Sarah Burns

Sarah Burns is a reporter for The Irish Times