Councils failed to spend €51 million provided for housing , C&AG says

Local authorities failed to spend €51 million provided to build social housing in 2015, a report from the Comptroller and Auditor General has found.

The Public Accounts Committee met on Thursday to discuss the report into the spending by the Department of Housing, Planning, Community and Local Government .

The report also found that local authorities failed to develop the vast majority of sites under a scheme where the department funded interest repayments for land bought for social and affordable housing , known as the Land Aggregation Scheme.

Comptroller and Auditor General Seamus McCarthy told TDs and Senators that local authorities had made “no progress” in developing residential housing sites on 84 percent of land acquired under the State scheme, known as Land Aggregation Scheme.

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In a further commentary Mr McCarthy said expenditure under voluntary and co-operative housing fund was €7.8m less than provided.

In response Mr John McCarthy secretary general of the Department of Housing and Planning said the Department’s total spending on housing in 2015 , amounted to almost €646 million.

In addition local authorities spent €119million from local property tax funds, bringing the gross spend on housing programmes to €765m.

“In total, the housing needs of some 13,375 households were met under our housing programmes in 2015” he said.

Public Accounts Committee chairman Sean Fleming said the underperformance in housing spending was particularly "disappointing" in "the context of the current national housing emergency".

EU fines

The secretary general also told the committee that the total value of assets and funding transferred to Irish Water in 2015 was €1.137billion.

He said he "could not say" Ireland would avoid substantial EU fines as a result of a case the EU Commission was taking against Ireland, for delays in implementing the EU Water legislation.

Fines levied against Belguim in recent years amounted to a €10million initial fine and a daily, ongoing fine of €5,000 per day, John McCarthy told Waterford Sinn Fein TD David Cullinane . Portugal had been fined €3 million with a daily charge of €8,000 while Greece had been fined €10 million with a daily charge of €20,000.

He said Ireland had faced environmental fines twice in the past, in relation to the implementation of environmental impact assessments and in relation to septic tanks. But he said the ultimate fines were in the order of “low single digits of millions” as the State had been close to compliance at the time of the fines.

Local property tax

The committee was also told by Fianna Fail TD Shane Cassells that the Government’s withdrawal of the local government support grant, once the funding was replaced by local property taxes, was “a sleight of hand”. He said the move had allowed the Government to transfer funding onto the population through new taxes.

Mr Cassells said this was money that was much needed by local authorities and could have been used for facilities for the community.

Social Democrat TD Catherine Murphy was told by the secretary general that local authorities could keep 80 percent of their local property tax receipts. The remaining 20 percent goes to an “equalisation fund” to top up local authorities where the property tax fund is low, he explained.

However he also said local authorities also had an option to reduce the rate of local property taxes in their area. He told Ms Murphy that just two local authorities who got money from the equalisation fund had reduced their own rates of local property tax. These councils were Louth and Longford county councils, he said.