Housing Policy
A discussion document from the Dublin Region of the Workers’ Party
ENVIRO
MENT
G
WORKERS RIGHTS
WOMEN
HOUSING
THE WORKERS PARTY THE WORKERS PARTY
THE Workers’ Party COMMUNITY ECONO
Housing
A discussion document from the Workers’ Party Introduction Housing is central to the functioning of any fair society. The rights to family life, to healthcare, and to education are hollow when inadequate housing means those rights (and others) are inaccessible. Housing policy must provide for the accommodation needs of the population but should aim for more than that; planning should provide transport links, childcare facilities, and stability. It should create sustainable communities. This is not the role that housing has played in the Irish economy up to now. Housing has been about covering over deficiencies in investment and employment, as well as providing easy capital gains to developers, speculators, stockbrokers, bankers, and their accountants. The narrative of “we all partied” has been well and truly rejected. We know that the housing crisis is part of a structural crisis. This document tries to understand the underlying problems of this crisis and to offer some solutions.
Problems in Housing Ireland has a multitude of interrelated housing problems. In 2011, at the time of the last census, 11.5% of properties (excluding holiday homes) were vacant. Yet 90,000 housing units will be needed to meet demand up to 2020, with 60% in Dublin and another 26% in Louth, Meath, Kildare and Wicklow. Ireland once again has the fastest rising house
prices in the EU and house prices are increasing at 30 times the Eurozone average. The rebirth of the housing bubble is a serious concern: at present 16.5% of mortgage holders are in arrears, with 11.8% (90,343) in arrears of over 90 days.
nationwide and €300 in Dublin).
There are currently 90,000 households on the social housing waiting list. A fifth of those have been waiting more than five years. 75% of households who qualified for social housing support are being accommodated in the private rented sector, while 19% are living with friends or family. Social housing is not providing protection to tenants: 26% of public housing tenants suffered severe material deprivation in 2011. A 2014 report by the Irish Human Rights Council said residents of Dolphin House in Dublin were being denied their international right to housing due to housing conditions.
There has also been a rise in homelessness, especially amongst families. Over 400 families lost their homes in the first 10 months of 2014. Homelessness can mean sleeping rough, staying in emergency hostels or shelters, or staying with friends or family. Over one weekend in October 2014, 421 adults and 680 children were living in emergency accommodation in Dublin.
According to Census 2011, 18.5% of households are tenants in the private rented sector. Tenants in this sector experience considerable problems, including illegal deposit retention by landlords (32% of complaints received by the PRTB in 2013 related to deposit retention), conditions (46% of tenants surveyed by the Red C in 2014 were unhappy with the standard of their accommodation), and lack of security of tenure. Lack of security of tenure presents itself in short-term or no leases, loss of accommodation if the landlord goes into receivership, and rent increases (between 2012 and 2014 rents rose by an average of €150
Unsurprisingly, young people are unable to access independent housing. In 2011, half of 20-24 year olds, a quarter of 25-29 year olds, and a tenth of 30-34 year olds lived with their parents.
The problems listed above sit alongside long-term housing issues. Local authorities have not fulfilled their obligations under the Housing (Traveller Accommodation) Act, 1998, to provide Traveller-specific accommodation. 11% of Travellers are officially homeless and many experience multiple deprivations as a result of inadequate housing. Yet between 2007 and 2012, more than €50m was under-spent on Traveller accommodation allocations by local authorities. Right now, there are over 4,000 people living in the Direct Provision system. With whole families sharing a room and bathroom facilities often shared, residents of Direct Provision lack privacy, an independent complaint mechanism, and control over their own lives. Refused permission to work, asylum
seekers must survive on €19.10 per week per adult and €9.60 per child. On average asylum seekers spend three years, with a significant number waiting seven or more years, in a system designed for six-month stays.
Issues It is necessary to recognise the immediate housing problems of people in this country but also to understand the trends which have caused them. Overemphasis on Construction
proportion of households living in social housing dropped from 18% to 7.8%. This was not caused by a lack of need but by a new social and economic climate where a house is a means of financial accumulation rather than accommodation. The new climate has been brought about through the sale of local authority housing, a movement from state financing to Public Private Partnerships (PPPs), and reliance on the private sector to deliver services. 32% of households in the private rented sector in 2014 relied on Rent Supplement, in 2013 the top 20 landlords took in €5m between them from Rent Supplement, and 17 firms receive €17m to run the Direct Provision system. This is the transfer of public money to private hands.
Speculation The increase in house prices has often been blamed on the growth in wages or in building costs. However, even a brief glance at the figures shows that while wages and house construction costs Source: Costas Lapavitsas, Crisis in the Eurozone (2012) rose at broadly similar Construction has been used as a rates, new house prices ballooned means to boost investment and at an unrelated pace. While employment figures. Between schemes for the regeneration of 1995 and 2008 “private dwellings” consistently accounted for more than a third of overall investment, peaking at nearly 42% in 2005. 13% of the workforce (rising to 22.6% of all males) was employed in construction in 2006, compared to an EU average of 7.9%. Already affected by the drive for artificial self-employment, construction workers faced the highest levels of unemployment and emigration after the crash. Privatisation Between 1961 and 2011 the
specific areas or forms of tenure may have had positive aims, they resulted in construction for tax breaks rather than accommodation or economic regeneration, spurring the housing bubble. Corruption The most well-known form of corruption in construction relates to the use of political influence (or the buying of political influence) to control building land. The impact of corruption is not just the profits made by a small group but is felt by the vast majority when house prices are pushed up or dysfunctional housing conglomerations without facilities or links to employment are built instead of communities. The Kenny Report on the use and control of building land was published in 1974. It has never been implemented. Financialisation Each of these four threads feeds into financialisation. Financialisation refers to the increased role that finance has played in the economy since the 1970s. But it also refers to the creeping entanglement of finance in everyday life i.e. it is difficult to find a part of life or death not dependent on finance. For example, where once housing
Source: DECLG & Eurostat
could be publically accessed, for many years now getting a mortgage has been the only way to get a roof over your heard. With this has come indebtedness: mortgage debt rose from 31.6% of household income in Ireland in 1992 to 92.3% in 2003. And it is not going away: the Finance Act 2013 legislated for the introduction of Real Estate Investment Trusts, which further financialises the rental market.
Solutions Efforts must be taken to deal with the immediate crisis of housing. But in doing so we cannot allow for the continuation of privatisation, speculation, corruption and financialisation. In 2014 the Constitutional Convention recommended strengthening social and economic rights in Bunreacht na hÉireann, including a specific right to housing. A referendum on this issue should be held and used as a means of refocusing our understanding of housing. Both immediate and sustained effort must be made to improve the housing situation for Travellers and Asylum Seekers, with the same minimum housing standards introduced across the board. The Direct Provision system must be abolished and replaced with an equitable and prompt system which treats people with dignity. There should be penalties for local authorities who fail to deliver on their Traveller Accommodation Programme, under-spend
budgets, or emphasise the private rented sector when Travellerspecific accommodation is requested. 18 years after the establishment of the Mahon Tribunal, measures are being taken to tackle corruption in Irish political life. However, corruption in the planning process will never be destroyed if measures only focus on punishment for those who are caught. Measures which could be taken to diminish planning corruption and speculation include the introduction of a land tax, abolishing legislation which encourages speculation, and confronting issues around the price and zoning of land. With 16.5% of mortgage holders in arrears, 32% of households in the private rented sector relying on Rent Supplement, and the collapse of all but one of the Dublin city PPP estate regeneration projects, it is clear that the Free Market has failed to provide for housing needs. Instead of relying on the markets, the state must begin a major building programme, which will aim to create sustainable communities through the provision of local amenities, transport links, and childcare and elderly facilities. Increasing the capacity of local authorities can help support these communities. A viable and long-term private rented sector can reduce the pressure on home ownership as well as social housing. The prompt introduction of the long-promised Tenant Deposit
Protection Scheme and the introduction of the need for a Certificate of Compliance with Minimum Standards to legally let accommodation would go some way in alleviating immediate issues in the sector. The issue of security of tenure cannot be ignored. Open-ended tenancies, with stricter provisions, should be introduced. In the case of a landlord going into serious arrears or receivership, it should be clear that the receiver steps into the place of the landlord. Some form of rent control must also be introduced to provide stability for both landlords and tenants. This should be both within and between tenancies. Each of these suggestions are worthwhile in their own right but they have a long-term goal of increasing awareness of the social aspects of housing. In this way, they help to confront financialisation. The establishment of a public bank is another method of doing so. Having a social and collective remit, the public bank could supply credit on condition of repayment at socially-determined rates of interest. The introduction of a tax on financial transactions (generally called a Tobin Tax) could discourage short-term speculative gain. Cooperative housing could be supported through granting a certain proportion of deposits held as part of the Tenant Deposit Protection Scheme to voluntary or cooperative housing schemes. We should also consider a general write-down on mortgage debt.
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