Nama and the housing crisis

 

Sir, – The Taoiseach is committing a cardinal management error by planning to repurpose Nama as its primary vehicle for social and affordable house-building as structure should follow strategy and role definition, rather than precede it.

A new national agency that could absorb relevant Nama resources would start with a clear focus and without any legacy baggage.

It should act as principal and directly engage contractors to build houses on public-owned land in the larger urban centres and, optionally, play a coordinating role in relation to major schemes in other areas.

This approach would result in lower costs and more affordable houses than could be achieved by a restructured Nama, which simply and expensively co-ordinates profit-seeking developers.

It could be part-funded by some of the €5.3 billion surplus cash resting within the Ireland Strategic Investment Fund, alongside external investment and debt structured to surmount likely EU concerns about breaching national debt limits.

Even with funding in place, it will take time to mobilise resources, undertake design work, issue and place tenders. As the Central Bank has indicated, a major building programme could strain resources and this would further delay progress. To address this and respond appropriately to the crisis, the agency should, for major projects, actively seek participation from well-resourced, major overseas construction firms with appropriate safeguards on labour conditions, quality, etc.

Finally, a clear indication from the Government to “the market” that it intends, as is its right, to directly supply large numbers of affordable homes should cause landowners, speculators and landlords engaged in hoarding or gouging to rethink their greedy plans.

And to reinforce this message, it should also signal that it will invoke the second clause of Article 43 of the Constitution in relation to private property where the common good, social justice and national housing emergency demand this. – Yours, etc,

BRIAN FLANAGAN,

Blackrock, Co Dublin.

Sir, – Are we really meant to think that the Government is concerned about rising rents when it guarantees an increase of 4 per cent per annum for landlords in an economy where inflation has remained below 1 per cent for years? – Yours, etc,

EUGENE TANNAM,

Firhouse, Dublin 24.