by Frank Schnittger
Wed Apr 12th, 2023 at 11:05:32 AM EST
Government will pay a heavy price for housing failures
As a recent poll showed, Fine Gael lost the room when it ended the eviction ban. In fact, it lost the whole house. It bet the mortgage on private landlords re-entering the market if the eviction ban was lifted.
In reality, private landlords can't exit the market quickly enough when the opportunity comes. There is more money to be made in short-term lets through Airbnb or selling into the swollen property market.
The Government has a fundamental responsibility to provide the public with basic social welfare, healthcare and housing services. Instead, it has abandoned its responsibilities in favour of the private market. That market is fundamentally about maximising returns on investment.
The more scarcity, the better, as prices then rise even more. The market is not there to provide for those who cannot afford to pay those prices. The greater the homelessness, the greater the desperation of those seeking accommodation at any price.
PricewaterhouseCoopers has just drafted a private briefing note for clients advising them to sell their assets prior to the advent of Sinn Féin in Government. The current Government has just made that advice all the more urgent for private landlords.
No amount of hand-wringing will change the reality of what Fine Gael has unleashed upon the people who relied on them most. There is no substitute for actually building more houses. The housing market has been in crisis for many years and yet this Government has been incapable of responding to that crisis.
The interests of existing property owners have been prioritised over the homeless. This is in stark contrast to the national mobilisation achieved in response to the pandemic, when the interests of those most at risk were prioritised over those least likely to suffer severe consequences.
There will be a heavy political price to pay for all of this. The public expects the Government to act for the greater good of the greater number, and it has been let down.
The time for excuses for lack of leadership and delivery on the public housing issue is long gone. The Government must now deliver, or else.
The lack of an emergency plan and national housing agency to free up building land, expedite planning permissions, and increase the capacity of the building industry through public contracts and recruitment and training supports is striking.
Instead, it has been business as usual for the government, which has therefore ended an eviction ban introduced as part of the pandemic emergency response. It could not have been more tone deaf in its timing or announcement, with measures allegedly aimed at alleviating its worst effects not ready and ill thought through.
And this is in spite of 12,000 people being homeless and 80,000 Ukrainian refugees who largely have to make do with hotel accommodation - accommodation that is now also needed for the tourist season. Housing costs are now cited as one of the main factors disincentivising further foreign direct investment in Ireland.
Fine Gael, as the party most associated with neo-liberal free market ideology has suffered most in recent polls and is at a record low of 15% (down 8%) in the most recent poll on the last poll by the same pollster, (a fact remarkably not reported in the Irish Times).
The main issue is not cash - the Department of Housing has €1 Billion in unspent funds allocated to housing. Venture funds have been buying up whole housing estates and apartment complexes off the plans in order to dominate the lucrative rental market.
The main problem is lack of capacity in the building industry which the government has failed to address, believing such issues will be addressed by the "market". But an industry which could build (badly) up to 90,000 residential units per annum in the Celtic Tiger years up to 2006 will struggle to build 30,000 units this year. The industry has never recovered from the financial crash, and the many (mainly Eastern European) workers made redundant then have never returned or been replaced.
The government has also failed to issue sufficient tenders for public, social and affordable housing, again, preferring to allow private developers take the lead. County Councils have also been guilty of building hardly any council houses to house those on their housing lists, despite being allocated funds to do so.
If Ireland could build huge numbers of council houses in the 1950’s when absolutely poverty stricken, why can it not do so now? The main reason seems to be middle class resentment that some should be allocated housing at low rents, while those in the higher earning brackets have to pay exorbitant market prices. However, those prices are only so high because of a lack of building in the first place.
The same phenomenon can also be observed in the UK and other European countries. Governments which could build huge numbers of social houses in the post war years when national debts were sky high seem utterly incapable of doing so now, when economies are many times richer. Policies which were mainstream then are decried as far left lunacy now.
Ireland has become number one in the rugby playing world by developing a "no excuses" leadership culture. Our current government seems to be better at making excuses than actually delivering on policy and building more homes. Their failure to do so is an object lesson in how to destroy an otherwise generally good government record in one easy lesson...
Sinn Fein will therefore win the next election, and not because of any great outcry for a united Ireland any time soon.