The setting of new housing targets by the Government is almost certain to run out of road before the election, falling victim to a combination of time and politics.
Despite a commitment from the Taoiseach, resistance to setting targets from within Fianna Fáil means the clock is on the verge of running out – sparking a backlash from the construction industry. The episode, however, says a lot about the dying days of the Coalition – and what is to come in the election campaign.
One senior Government figure said there is now a zero per cent chance the new targets will be agreed before the election. Tánaiste Micheál Martin this week downplayed the significance of agreed targets, arguing that the ESRI and others have published “ballpark” estimates of housing need.
However, builders are not convinced. Far from being an abstract piece of political theatre, the publication of targets, they say, has consequences in the real world. It sets in train a cascading series of events around zoning, local authorities’ development plans and even central government assessing what policy interventions are needed to make sure targets are delivered.
“This isn’t the elephant in the room, it’s the f***ing herd of elephants in the room,” says one large homebuilder, speaking privately. They added that while politicians may want to campaign on different housing platforms during an election, “in the meantime, it’s really difficult, everything grinds to a halt”.
A second industry source concurs: “The whole system is in a state of stasis because it doesn’t know what it’s doing”. Home builder Michael O’Flynn, who sat on the Housing Commission, said it was “beyond comprehension” that new housing targets had not been announced.
“Proper targets are absolutely essential for appropriate zoning and infrastructure planning. Instead we are getting delays and additional costs are being put on the sector, which is making things worse,” he said.
One large home builder worried privately that rather than a building boom coming down the tracks, without rapid enactment of new targets and a revised planning framework, ‘in the medium term housing output will fall off a cliff’
Housing, inevitably, will be a central election battleground. The Government had set an initial target of 33,450 homes for this year but there is consensus current targets are dramatically lower than is needed for population growth. The Central Statistics Office reported 21,634 new homes being delivered to the end of September.
The Green Party’s manifesto is expected to contain a target of 53,000 a year, based on the ESRI estimate.
Sinn Féin has already rounded on the Government over its failure to set targets, accusing it of “running scared”. Fianna Fáil, meanwhile, is steadfast in its view that it can win the contest over credibility on housing during the election on a foundation of progress made to date and its manifesto commitments.
“There will be an independent debate on housing as much as anything, that’s the realpolitik,” a Fianna Fáil minister said.
The party has pushed messages about its record on housing out on its social media channels this week. However, asking voters to back it again based on its record when so many are still suffering from the acute impact of the housing crisis may be a dubious proposition. One senior Fine Gael source summarised the Fianna Fáil position as wanting to say it has fixed housing, but added: “Let’s be honest, if that’s the tactic, it will fall flat to people who don’t have their own house.”
There is a frustration within Fine Gael over the refusal of their Coalition partners to set targets, which comes against a backdrop where they perceive Martin to be tetchy and irritated by Taoiseach Simon Harris. The same figure said the whole issue over setting of targets has been “an inordinate waste of time”.
“We could have signed off last week and the system could have been ready whenever a new government is formed.”
Senior Fianna Fáil sources contend the housing market is infinitely more complex than simply setting targets, arguing that signing up to new targets in the dying days of the Coalition just didn’t make sense.
All of this politicking is part of a wider dance between the Coalition partners, trying to figure out how they can credibly criticise each other after governing together for five years, while also not damaging relations fundamentally – given their basic goal is to reform some version of the current Government. They must also try to control their own backbenchers and line ministers – which is likely to prove impossible across the board as Government TDs square off and draw on old tribal animosities with seats at stake.
While there is undoubtedly an element of politics at play, Ministers also privately point to the fact that a review of the National Planning Framework (NPF) has not been completed. This complex piece of work effectively sets the top tier of planning policy – currently based on population growth seen during the census period 2011-2016, which was much lower than current growth, meaning a new NPF is needed.
Without an updated NPF – which must be voted on by the Dáil – new housing targets would be something of a paper tiger – a political commitment without any teeth. “You can have a target but without a planning framework to underpin it, it’s not much of a target,” said one Cabinet member. The industry had been hoping for the NPF by the end of the month, but with nothing scheduled for discussion by the Dáil this week, that looks forlorn.
Conor O’Connell, director of housing and planning with the Construction Industry Federation, says a new NPF is “critical” and that both it and housing targets are needed by the end of the year, calling for interim measures to address shortages of land already zoned and serviced with utilities in areas of high demand. “The sooner this process begins the better for future housing supply,” he said.
The Government has this week pointed to housing commencement statistics that suggest a glut of new builds has entered into the process – although these figures are probably inflated by the fact that commencement notices had to be filed by the end of April in order to take advantage of development levy waivers, which were subsequently extended in any event. One large home builder worried privately that rather than a building boom coming down the tracks, without rapid enactment of new targets and a revised planning framework, “in the medium term housing output will fall off a cliff”.
Housing experts also have an abiding frustration over the political system’s acceptance of the true underlying demand for new housing. Ronan Lyons, associate professor in economics at TCD and a member of the Housing Commission, says estimates should take into account a structural deficit in housing – homes that have not been built for people who need them, leaving them stranded. As the demographic profile of the country changes, housing needs change too, with new needs for those trapped in the parental home – or those ageing in outsize unsuitable homes. This stands in contrast to setting targets based on anticipated new demand entering the market each year, Lyons says.
“The politicians focus a lot on the nurse and guard getting married and wanting to have kids, and that’s what they’re looking at when they think of housing demand,” he says. Including those trapped, effectively, in the parental home, would mean higher targets. “They have to get real about that, and the Housing Commission did its best to put numbers on it, but it doesn’t seem to have landed with the Government.”
Last week, Ministers discussed a range of six scenarios for hitting an average of 50,000 homes a year – “some more realistic than others,” a Fianna Fáil source confided. The overall goal, one person involved in talks said, is to add about 4,500 a year to the current pace of construction, getting to more than 60,000 a year by 2030.
This Government has taken its shot on housing, regardless of targets. Now, the battle between and among Coalition parties, and the Opposition, moves centre stage in the election campaign.
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