LDA in line for up to €2.5bn extra funding under plans approved by Cabinet

The Land Development Agency (LDA) is in line for up to €2.5 billion in extra funding under plans approved by Government on Wednesday.

While the decision doubles the capitalisation for the agency tasked with building thousands of homes on State owned land, the funding is short of the €6 billion mooted when Minister for Housing Darragh O’Brien pushed to deploy part of the State’s corporation tax windfall for social and affordable housing.

Earlier this month, Government sources said the LDA never needed that entire sum in a single swoop but the financial package on offer would be enough to fund the early years of its business plan for 2024 to 2028.

It is understood that the €2.5 billion sum approved by Cabinet on Wednesday was determined following engagement between the LDA and the Government’s NewERA agency on its needs for 2024 and 2025.

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The additional sum is to bring available funding for the LDA to approximately €5 billion up to 2025 with the goal of ensuring the delivery of its business plan in the short to medium term.

A Department of Housing statement said the long-term sustainable funding of the LDA will also be considered as it delivers its programme of work up to 2028.

After the Cabinet decision Minister for Housing Darragh O’Brien said: “Under the LDA’s Business Plan 2024-2028, the agency will provide 12,900, primarily affordable cost rental, homes over the lifetime of the plan. This is a significant contribution to our overall objectives within Housing for All.”

He said the Government is “determined that the LDA is fully funded to play its full part in delivering much needed affordable and social homes”.

He noted that the LDA last week announced that it had started on the development of almost 220 homes at the former Devoy Barracks in Naas, Co Kildare and that this week it confirmed it has completed the purchase of lands in Clongriffin in north Dublin with the potential to deliver a total of over 2,300 affordable and social units.

Mr O’Brien said Wednesday’s decision “will give the agency the reassurance it needs to maintain this momentum.”

The Government decided to commit a further €1.25 billion from the Ireland Strategic Investment Fund for share equity in the LDA as needed and also agreed to secure additional funding sources for a further €1.25 billion for the agency.

The Cabinet also approved an increase in the borrowing limit of the Housing Finance Agency (HFA) from €10 billion to €12 billion.

The HFA provides funding to support Approved Housing Bodies and local government in delivering social and affordable homes.

Meanwhile, Minister for Health Stephen Donnelly provided colleagues with an update on the €800 million National Maternity Hospital (NMH) project which has been hit by delays in recent years.

He briefed Cabinet on the procurement process for main construction works for the NMH and the beginning of essential enabling works at the St Vincent’s University Hospital (SVUH) campus at Elm Park.

Mr Donnelly said afterwards that the enabling works will deliver new boilers and upgrades to electrical systems on the campus, as well as new buildings to accommodate a neurology ward, medical records, and a staff canteen.

He added: “To save time and, ultimately money, we are doing these works at the same time as the public procurement process for the main works contractors who will deliver the new hospital.”

The first stage of procurement process for the main construction works began in September 2023.

The procurement process could take 18 months, whilst the enabling works, beginning this week, are expected to be completed in the first half of 2025.

Once a successful tenderer has been identified, the final business case for the project will be updated with the results of the tender process and brought back to Government for approval to proceed to award the main works contracts.

Minister for Higher Education Simon Harris welcomed Government agreement for the publication of the Research and Innovation Bill 2023. The legislation provides for the amalgamation of the Irish Research Council and Science Foundation Ireland, and the establishment of a new research and innovation funding agency, Taighde Éireann – Research Ireland.

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