Fine Gael and Fianna Fail discuss housing crisis plans

Fianna Fáil has demanded the Government build up to 4,000 new homes on State-owned land in the next 12 months as part of an ambitious €200m affordable housing scheme.

The party has called for the investment to be a cornerstone of next month’s budget in talks between Finance Minister Paschal Donohoe and his Fianna Fáil counterpart, Michael McGrath.

Mr McGrath and party colleague Barry Cowen met with Mr Donohoe yesterday for the second time and talks over €800m in new spending for 2019 were described as “constructive”.

The parties are to meet again next week when detailed talks are set to begin.

Fianna Fáil housing spokesman Darragh O’Brien said the plan would involve a multi-year commitment to build new affordable homes on State land, possibly cutting house prices by €50,000.

Speaking to the Irish Examiner at the start of Fianna Fáil’s two-day pre-Dáil think-in, Mr O’Brien said that while there are 2,000 hectares of State-owned land in local authorities across the country, most of it is not being used.

While the average price of a house is €380,000 in Dublin and €250,000 in the rest of country, Mr O’Brien said using the currently empty State-owned land could reduce these figures by €50,000.

This is because the average cost of land to build a house on would not need to be included in any new homes built as part of the new scheme.

What we’re talking about is starting the affordable housing scheme again. It has been done before, and it can be done again,” he said.

“There is a real need for affordable homes for people across the country, because to repay a mortgage for an average house in Dublin at the moment you would have to be earning €90,000, which is out of reach for loads of people.

“So this is about introducing a subsidy of €50,000 for homes that will be built on State-owned land, and it’s something we want to see started in this budget and then expanded on in future years.”

The Irish Examiner also understands that public sector pay issues, particularly lower pay for new entrants, was raised by Fianna Fáil, as was the proposal from Government to again raise the entry point at which people pay the higher rate of tax.

One source described the meeting as primarily an exercise in “touching gloves” and setting out the main demands ahead of more intense and specific discussions.

The talks were primarily on general terms for the most part. But we will have to get into the detail very soon as there is only three plus weeks to the budget,” said one source familiar with the talks.

From the Government side, sources close to Mr Donohoe said the meeting between the parties was positive and constructive.

“The meeting built on the initial meeting last week with Fianna Fáil, which was constructive and where Minister Donohoe set out the broad parameters of the budget,” said a source.