Spending on housing significantly behind target again despite crisis

Government spending on housing is significantly behind target again this year with State-backed agencies such as the Land Development Agency (LDA) said to be spending only a fraction of their budgetary allocations.

Under its Housing for All strategy, the Government earmarked €4 billion for spending on social and affordable housing this year.

However, according to data provided by Minister for Housing Darragh O’Brien in response to a parliamentary question from Sinn Féin’s Eoin Ó Broin, capital spending on housing – up to the end of September – was €1.9 billion.

This comprised €1.08 billion on social housing (new builds and acquisitions) by local authorities and approved housing bodies (AHBs); €682 million in loans to AHBs through the State’s Housing Finance Agency; €161 million on capital expenditure through the LDA; and €24 million on affordability measures such as the First Home scheme.

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The department noted that the LDA’s budget “for projects completed and/or under construction” as at the end of September was €674 million.

A department spokesman, said the headline figure, contained in response to the parliamentary question, did not include all the other housing programmes funded so far this year, which brought total exchequer expenditure on housing – as of October 20th – to €2.5 billion. However, this figure appeared to include elements of current as well as capital spending.

“The largest draws on capital are always in the last few weeks of the year and we are already seeing this coming through in claims,” the spokesman said. “We expect to have a full spend across the housing programme this year,” he added.

But Mr Ó Broin said he was concerned “that once again Darragh O’Brien and his department are significantly behind on their capital spend on social and affordable housing this year”.

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“While there is always an increase in expenditure in the final quarter of the year, it is hard to see the full €4 billion being spent by December, on the basis of the figures provided by the department. It is also clear that the LDA is only spending a fraction of its capital allocation,” he said.

“The Government has over-complicated social and affordable housing delivery, introduced too many poorly designed schemes, and as a result targets that were inadequate to begin with are not being met,” Mr Ó Broin said.

The latest controversy over housing spending came as new figures show house completions – for the first nine months of this year – rose to 22,443, 9 per cent up on the same period last year. The latest data suggests the sector is likely to exceed last year’s total of just under 30,000. Minister O’Brien welcomed the figures, saying “supply is central to dealing with all the key challenges in housing”.