Environment Minister Phil Hogan said he wants county and city councils to start building more local authority housing.
Hogan said councils stopped building homes in the Celtic Tiger years, handing responsibility to private builders.
But he claimed the current waiting lists for council housing are too long, and the government is spending too much on rent assistance and other schemes.
"I am very much in favour of getting local authorities back into the business of direct build of local authority houses again," he said.
"Local authorities have been pushed aside over the last 20 years from doing the work that they were set up to do.
"Which was to generate the economic and social activity in their own communities with help of money from the national taxpayer, but also from the local level."