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DYSFUNCTION IN THE housing sector has become the defining crisis of our age. Despite endless promises from government ministers, the housing situation is steadily deteriorating.
Consider some of the facts. There are currently 7,472 people classified as homeless, 2,563 of whom are children. This is a record level of homelessness in the state. More than 75,000 families remain in mortgage arrears, 55,000 of whom have not paid anything for more than 90 days. In the public system things are no better. Around 130,000 families are stuck on local authority waiting lists, some for more than decade.
This has added to the current explosion in rental costs, with prices rising by around 13% year on year.
Corporate giveaway
One reason for this crisis, is the historical drive to commodify housing. Since the 1970s successive Irish governments have run down the social and affordable housing stock in a deliberate move to facilitate the private sector.
To put some figures on this, more than 500,000 houses were built during the early 2000s, with only 46,000 designated social and affordable. To make matters worse, the State has sold off nearly 200,000 public units, whilst Fine Gael have built virtually no local authority housing since they came into office. This chronic undersupply is one part of the problem.
The other part is the corporate give away. When it was formed, the National Assets Management Agency (NAMA) was touted as the solution to potential fire sales in the property sector. NAMA was supposed to take distressed assets off the balance sheets of the banks and hold them until the market recovered.
This never happened. Instead, Fine Gael instructed NAMA to engage in the fire sale it was meant to avoid. Up to 90% of the property in NAMA went to Vulture Funds who, in turn, used section 110 legislation to pay virtually nothing in taxes.
According to a recent report in the Sunday Business Post, vulture funds pay around €1 in taxes for every €1 million they hold in Irish assets. Between them International Funds and local developers have hundreds of billions of property assets and zoned land. The best way to get some of this land into use would be to penalise those sitting on their assets. Instead, FG wants to give 700 new public sites to the private sector.
Never let a good crisis go to waste
The Mayor of Chicago, Rahm Emanuel, once said that the elites should never let a good crisis go to waste. Simon Coveney clearly agrees, using a crises caused by private speculators to further enrich the private sector. There are at least three good reasons why handing parcels of public land to private developers should be opposed.
The most obvious one is the chronic lack of local authority housing. Instead of owning 100% of the resulting housing stock, the government have agreed a 30/70 spilt, with developers selling the larger share at market value. This will leave longer waiting lists than would otherwise be possible.
The second reason has to do with cost. The cost differential between public and private is roughly €100,000, with councils able to deliver houses for €200,000 versus €300,000 for the private sector. This will make private houses unaffordable for the majority of the working population and those on the waiting list.
The final reason centres on alternatives. Councils could use direct capital expenditure or housing finance agency loans to develop their own mixed tenure estates. People Before Profit recently submitted such a plan to South Dublin County Council, showing that real alternatives are, indeed, possible. For ideological reasons they are not being implemented, however.
Sinn Féin and Labour Support
In a recent opinion piece, Sinn Féin’s, Eoin Ó Broin, likened Coveney’s policy to selling off the family silver. Pity then, that Sinn Féin and the Labour Party are voting for these Public Private Partnerships in local councils.
On April 10, South Dublin County Council voted to sell off 87.37 acres of public land in Kilcarbery the Grange. The site is capable of supporting 892 housing units, but at least 550 will now go to the private sector. Sinn Féin and the Labour Party voted for the initiative.
In Dublin City Council similar initiatives have been voted through in O’Devaney Gardens, Oscar Traynor Road and St Michaels Estate. In each of these developments PPP’s will ensure that at least 50% of the houses will be lost to the private sector.
As the largest group on Dublin City Council, Sinn Féin played a significant role in ensuring that these plans came to fruition, despite alternative proposals being submitted by People Before Profit councillors and other left-wing representatives. The Labour Party has also consistently supported Sinn Féin in this regard, voting in favour of these proposals at every stage.
Simon Coveney is currently engaged in a land grab of epic proportions, but it wouldn’t be possible without support of Sinn Féin and the Labour Party.
Dr Brian O’Boyle is an economic advisor to People Before Profit. He is the co-author of Austerity Ireland the Failure of Irish Capitalism (Pluto Press).
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The stats are shocking. We had unprecedented opportunity for prosperity in this country over the last two decades and the amateur politicians we’ve elected have well and truly butchered it with their incompetence.
@Adrian: thats what you get when you elect failed teachers and small town solicitors…
@Adrian: do businesses generaly pay tax on assests? Im thinking no. Thought it was profit and tax on capital gains
@Adrian..dont for 1 second think they are ‘amateur’. They all knew what they were doing, or not doing
@Shawn O’Ceallaghan:
That is what I thought when I read it as well.
@Gus Sheridan: And what’s in it for me politicians .
@Shawn O’Ceallaghan: As an economist, Dr. O’Boyle knows full well that companies pay taxes on profits, not on the value of their assets.
A haulage company does not pay corporation tax on the value of its trucks, but on the profits generated by the business.
Dr. O’Boyle knows that, but he conveniently ignores it in his ant-globalisation, anti-establishment, cause-du-jour rant.
@David Murphey: Let’s look at the basics David, if you or I go to buy a House, Site, Commercial Property even a dog box on it’s own site we must pay Stamp Duty based on the value of the property.
Many of the Vultures are able to claim they bought the loans not the property thereby skipping the Stamp Duty.
Our Great and Wise Finance Minister even helped them along further by giving them a break on Capitol Gains Tax for when they sell the property to someone (anyone) who will put it to productive use.
Meanwhile any income from the property is buried amid a Charity Scam making it virtually Tax Free.
How many times is this country meant to bend over to suit the Vultures?
That’s fine geal for you, Leo wants to shut down democratically elected parties, but not lucrative loopholes that are aimed at the top 1%
@Dáithí Ó Raghallaigh: can you point me specifically to anywhere Leo said he wants to shut down a democratically elected party? Unless you fear that debate would decimate SF, because that is all he said.
@Dáithí Ó Raghallaigh: can you point me specifically to anywhere Leo said he wants to shut down a democratically elected party? Unless you fear that debate would decimate SF, because that is all he said.
@Michael Doyle: OK, so you just made it up.
@Michael Doyle: Sf would wipe the floor with Leo the waffler in a debate, even if it were on RTE and chaired by Leo loving Miriam.
@Just Me: ok, apart from the ‘my brother can beat up your brother ‘ comment, do you have anything to say that is relevant to the topic?
The statement was made that Leo wanted to shut down a democratically elected party. From what I can see, he only said he wanted to challenge them.
Please stay on topic.
@Michael Doyle: Leo says Sinn Féin is “the greatest threat to our democracy” yesterdays headlines…from a party that saw a majority of voters opt for no water charges candidates in the last election, but would rather ignore them ..
This is Kenny and Noonans legacy yet we have to listen to how great they are and all they have done for the country. The real truth is kept hidden.
@james o reilly: And Leo is clapping his hand as this week he is not chasing fraud anymore, but Sinn Féin !
@cortisola: what ever works he is up for it
@james o reilly:
How did the Celtic Tiger die , murdered by Kenny and Noonan ?
They swam in the mire to rise to power, are afloat but are being pulled down slowly.
Their strength is ebbing, no life line is being offered and few lessons have been taught or learned, by all side.
It begs to be asked what the hell happened to all the money that poured in during the Celtic Tiger years ? First problem and the country almost goes belly up, maybe because it had become too fat !
On of the main problems was that no one controlled the price of houses, which were crazy and that no way reflected the real value. Money flowed in from the taxes on sales and of course no one then thought it would end, but it did ..
There is in fact no shortage of houses within the 26 counties. many are lying empty or being sold at under cost prices, meaning basically there are enough houses for everyone. The big and main problem is only in Dublin, where everything is centered, while “rural area’s” are slowly allowed to die.
Rather than building more houses, putting ” the builders and contractors” on the road again to cause havoc, the past is a good example, the problem should be view at, from another angel.
.My humble suggestion would be, that use should be made of the empty houses scattered all over the 25 counties. Other cities and town should be promoted by out Trade board, so as to get big companies to invest in them and not lose potential investors to other countries,put off by the cost and lack of housing in Dublin. This could be an answer to the housing crisis and to netting more investors.
.
The fact is, that too many people on one end will cause the Island to sink and this time it could well go under, due to lack of foresight and strategic planning.
With family homes taken at unprecedented scale and those very families presenting at garda stations for a roof, this is totally unacceptable. Seany laughs, Apple laughs, we still suffer under austerity to keep the fatties status quo. The FG leader is more important to media as enda bags a massive pay day again at our expense. We will then take out FG and put in FF for the cycle to continue. Wake up Ireland…
@Willy Malone: Be carefull the journal do not tolerate any criticism of who owns them Fianna Gael. I did and was banned.
@Willy Malone: the truth of it we have two new things the plastic Tory government created : the new homeless ( once ordinary working people )
And the working poor ( once ordinary working people) .
How’s that for FG innovations
Make no mistake, if leo gets his hands locked into the top job you will see another ten years of exactly the same when it comes to business. He will change nothing in the cooperate structure of the country
@ChuckE: I think he is not on the fraud chasing anymore. This week he fights the greatest threat to our democracy – Sinn Féin.
@cortisola: Sinn Fein will triumph and Gael will be consigned to the bin in the nest election or when Michael Martin decides to ditch them. Fianna Gael have NO mandate. Fianna Fail controlls them and can ditch them out of government tomorrow. Gael are despised up and down this country and as soon as we have the power to decide they will be hit so hard it will decimate Gael for decades. Enjoy it while Fianna Fail keeps ye in power as their pet poodle..
Dont see any signs on buses or PR campaigns from Largesse Leo on this one though!?!?
Thankfully there is no housing crisis in Ireland, prices are dirt cheap and rents are rock bottom. Only the vukture funds are losing money and so have no tax to pay.
That’s an alternative set of false facts.
Yet 2,000 social houses were refused last year
Don’t be fooled by these people. Going homeless to jump the q then pick which area they want their new house which they want basically rent free and maintenance and their washing machine repairs to be picked up by the tax payer
Most of it is a con. And people here just lap it up.
Most people in this country are no the fiddle. Scamming anything they can get. Highest disability in Europe. Yet 40,000 people investigated 2 years ago, half were found to be fit for work
1 in 2 on some welfare
But sure let’s build houses for anyone who screams I want I want I want
Joke of a system.
@James Nellie: You talk about fiddles and scamming, yet Fitzpatrick walks free from the hugely instrumental part he played in the collapse of the country’s economy?
@Dave Doyle: whataboutery. The usual response when you have no response.
@James Nellie: Say’s the FG lying propaganda minister, James Nellie. When are you going to provide proof Re your makedy up SF immigration policy. Forgot, you can’t, you only deal in lies and spoof bit like your party.
@Just Me: You are asking someone to ‘proof RE’. (sic)
You do see the irony, don’t you?
@James Nellie: Thats the propaganda Gael want us to believe. It won’t work. Thousands all over Ireland are suffering over Gael. They will make them pay for it.
@Dave Doyle: Not to mention the Fianna Gael cronyism in their thousands in the civil service keeping the jobs in the family. Corrupt to the core.
@Michael Doyle: What a stupid non word.
For more of this vital FF/FG
this is misleading fodder by AAA, give the details on tax as % profit not assets held. Was the profit on these assets the same value as the asset? No didnt think so…
@Graham O Fiach: No unfortunately the whole of Ireland can see the truth of this article exposing the traitorous Fianna Gael.
The Minimum Standards in Housing Legislation had a lot to do with the homeless crisis removing a lot of units from the Dublin rental market. It was well intentioned as a strategy but as could have been predicted forced many landlords to sell and get out of the market.
Glad to see that the journal are upfront in declaring the authors bias this time, to provide background to this irrational rubbish.
@Michael Doyle: vulture funds are having a miserable time in Ireland as they book huge losses as rents in Dublin plummet and capital values crash down below acquisition cost. We need to make charitable donations to them so as to bail them out.
Or maybe not!
@Michael Doyle: I’d order they put the author’s bio at the start to help choose not to read rubbish by AAA PBP
@Michael Doyle: So your bias would be FFFG ?
@eastsmer #IRExit: My bias would be towards facts and rational debate. The above article is such rubbish, it is clear to anyone with a modicum of intelligence that it is not even worth analysing.
I could critique this, but the flaws would require several pages to list out.
@Michael Doyle: This is the voice of the People. We all agree with this article. To slander it is to slander the Irish people who can see exactly whats happening. Fianna Gael are traitors to the people.
@Nointerest actually he represents about 4% o the electorate (down to 1 in the last opinion poll).
How can it be slander to see through his infantile rubbish?
Would they not have to pay stamp duty and property tax?
@Stephen Devlin: 1 euro on a hundred thousand. Is this Fianna Gael fariness. No wonder the country is in the toilet for its people.
Kill the vultures, sickening stuff
@Rondon: pluck the Vultures
Another faux outage article from the Journal: No one pays tax on Assets, tax is paid in profits
*on
@Boganity: assets produce substantial capital gains and revenue profits especially so when the assets are acquired at a fire sale price.
@Boganity: I am paying tax on assets. My house which I bought and am paying for, including stamp duty and the so called local property tax.
Another asset would be my car which I paid VRT on and I have to pay ‘motor tax’ on it.
Property tax, car tax. Duh.
@Boganity: My house is an asset I pay tax on it. My car is an asset I paid VRT on it. Every item I buy to increase the value of my house, I pay tax in the form of VAT,
But what does Leo think
The only shock here is that’s it’s as much as 1 euro per million…. I can’t see how fianna fail failed to see the benefits of offering them grants and free legal advice to cover startup costs through the IDA. Very unlike an irish government to miss such a photo opportunity! !!
@dave Doyle.
Yes I agree. As I said from the top down most people are on the fiddle. Doesn’t matter how big or small. We blame the goverment yet most people have no problem getting jobs done for cash, paying no vat on the jobs. Faking sick certs, sick days, nixers while honest people are priced out of jobs. The list goes on
Whole country is one big scam and the people are no better than the goverment.
@James Nellie: “Most people are on the fiddle” Well certainly the “What’s in it for me” party are.
@James Nellie: But according to the government everyone are totally innocent except social welfare. Social welfare is responsible for all the problems of the western world according to Varadkar.
In a Republic, for there to be 12 families to have, literally, nowhere to go is absolute madness. It is also a symptom of where we are as a country. So as Varadker and Coveney parade the country campaigning to be next Taoiseach, remember that no matter which of them get in, things will stay as they are. Plus ca change etc. The Republic is dead, long live the Republic.
Are AAA PBP advocating higher education, responsible financial family planning, disincentivising long term unemployment, anti-drugs?
They prefer to ignore the key causes of homelessness and blame other people.
@alphanautica: Fianna Gael are totally ignoring all of those points.
@Nointerest Here: How do Fianna Gael incentive employment? They remove welfare. It is the greatest evil policy this century. Make people poor and call it an incentive. Natzi’s.
This was the last move over years we lost our freedoms to buying them but then gain others which made over us over look the major ones we lost. The world has plenty for all to have a equal share but then capitalism would not work for a few.
The people behind this move how they got here i don’t know. But only for our governments sold their soles for what can only be greed we will never be the same again as it now gone to far
capitalism is part is good as certain things would not happen if we stayed primitive and it has helped us not get ill and die for simple things which means we don’t lose loved ones but then we loose them to jobs.
I was a member of this site for 4 years and was never blocked from it until I criticised a Fianna Gael troll. Now I have to log in with a facebook account. This proves to me that the Journal is firmly a Fianna Gael propaganda news commentary. I think it is absolutely unacceptable to block someone simply for calling a troll a troll. They can come on here and spew poisonous venom and call the most vulnerable people in Ireland all kinds of horrible names and get away with it. I am going to write to whoever or whatever editor is responsible for this. Its a sad when 4 years of an account is deleted over night for the same criticism I have always done here,. What changed. It wasn’t me I had the same views and expressed them in the same way. I never targeted anyone yet I have been forced form this site. Journal you can shove your account up your H*ol I’ll simply open another one.
@Nointerest Here: I have noticed posts that I have made defending against FG trolls, even though they got a high percentage of agreement , suddenly deleted as if they were never posted. This site has changed and not for the better. When blue Hugh was here at least you were allowed criticism , not now. This new format discriminates against posters who are anti FG by hiding their posts under a title, see x more posts, knowing that most people just skip that and read on.and if as I said the post attracts thumbs ups, it’s deleted.
People before profit? Nah, next article.
@KerryBlueMike: Really I just printed his article to spread the word. Its about time people knew the truth about the traitorous Fianna Gael.
What we have here is a failure to communicate. Always with the negative waves Moriarty!!!!
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