Gormley criticised over €300m cut in social housing

OPPOSITION TDs have criticised the handling by Minister for the Environment John Gormley of the revised estimates for his department’s spending which include a €300 million cut in funds for social and affordable housing.

The Department of Finance last week published its revised Book of Estimates for 2009, detailing the public spending cuts and increases outlined in the April Budget.

Overall, the Department of the Environment has sustained a net decrease of 16 per cent or just under €500 million. However, housing for the poor and low-waged and funding for local authorities has taken the largest hit.

Funding for social housing construction and regeneration is being cut by 16 per cent or €250 million, affordable housing and other housing support schemes is being cut by €44 million or 33 per cent.

The Local Government Fund, which makes up a large proportion of funding for local authorities, is being cut by 24 per cent, or just under €132 million.

Speaking at an Oireachtas environment committee meeting yesterday, Mr Gormley said local government was facing significant financial challenges. However, he said the reductions in the Local Government Fund would be “made good” by the fact that local authorities were allowed to retain pension levies collected locally and that they would be benefiting from the new charge on second homes.

Fine Gael’s Phil Hogan said Mr Gormley was choosing to impose very significant cuts to social and affordable housing at a time of increasing need.

“Local authorities housing lists are increasing out of all proportion. This [funding] is a long way short of where we expected it to be,” he said.

Mr Hogan also complained that Opposition parties had not been given sufficient time to analyse the estimates before Mr Gormley appeared before the committee.

“You have shown enormous disrespect for this committee . . . there should have been more notice than the weekend.”

Labour’s Ciarán Lynch said Mr Gormley was not addressing the fact that people were no longer buying affordable houses. It was predicted that there would be 4,000 vacant affordable homes by the end of the year.

“The Minister has done everything bar the obvious – drop the price.”

Mr Gormley said Fine Gael had proposed a €500 million cut to social and affordable housing which would have had a much greater negative impact. He added that no discourtesy had been intended to the committee.