The Irish Council for Social Housing (ICSH), the national approved housing body (AHB) federation with more than 270 AHB members, has said that Budget 2025 must deliver more social and affordable homes and, critically, support the sector to maintain existing social housing to an appropriate standard and on a sustainable basis.
ICSH CEO, Donal McManus, has said that the AHB sector has been adding 10% to its housing stock annually over the past number of years, with almost 6,000 social and cost rental homes delivered in 2023. More than a third (11,939) of all housing delivered in 2023 (32,695) was social and cost rental housing. “To ensure our members can continue record housing delivery, the ICSH believe that a number of issues around the funding and the maintenance of ageing housing stock, must be resolved, and we support the recent Housing Commission report recommendation for a sustainable financing model for social housing by setting social housing rents at cost recovery rates to ensure there is sufficient income to manage and maintain dwellings.”
Safeguarding Our Stock and Sector Futureproofing
About 40% of AHB owned and managed housing is currently funded through rents that have not kept pace with the related increase in costs. The ICSH estimates that at least one-third (more than 20,000 homes) owned and managed by the sector were built pre. 2010 and under funding models that neither ensure long-term viability for those properties nor provide the AHB with the ability to continue to provide for an adequate sinking fund. The report “Building on Success – A Financial Roadmap for the AHB Sector” produced by Campbell Tickell for the ICSH Finance Working Group revealed annual shortfalls in rent of €2,046 (differential rent) and €903 (economic rent) per property for CLSS and CAS funded stock. The sector is keen to ensure that these properties will be used for social and affordable housing in perpetuity. To address current revenue shortfalls, the ICSH proposes that the properties are put on a long-term stable financial footing through a revenue contract based on a cost recovery model.
The ICSH believe that Capital Assistance Scheme (CAS) funding should continue to be prioritised to support the essential additional housing needs of vulnerable groups (including older people, disabled people, homeless households, women and children experiencing domestic violence, care leavers and international protection applicants) but also recommends an increased capital funding allocation to specifically aid the refurbishment of units that no longer meet modern requirements. The ICSH also calls for Budget 2025 to provide an annual retrofitting capital funding allocation (along the lines of the local authority Energy Efficiency Retrofit Programme funding stream) to enable up to 1000 older AHB homes to be retrofitted annually using up to a 90% grant aid funding model.
Donal McManus added. “When it comes to social and affordable housing, we must remember that we’re still playing catch-up here. 50% of new housing from the 1930s-1950s was social housing, which steadily dropped over successive decades, reaching 20-25% in the 1980s. The AHB sector is a key player in a statewide social and affordable housing recovery that is responding to a non-performing housing market for a number of key households that have continuing issues with affordability and access to good quality and secure homes. We have approximately 65,000 social and cost rental homes collectively in the sector and we want Budget 2025 to support the expansion of the successful CALF (social housing) and CREL (cost rental) funding streams, expand and reform the CAS (care & support) funding stream, but also to protect and maintain our older housing stock, just like a private homeowner would.”
The ICSH is calling on the Government to implement the following measures in Budget 2025:
Increase AHB Funding
- Capital Advance Leasing Facility (CALF). The ICSH supports raising the CALF allocation to €420m considering the 2024 CALF review and a significant upward revision of Housing for All targets. This funding needs to be available for all suitable new social housing delivery including supported housing.
- Capital Assistance Scheme (CAS). Prioritise CAS funding to support housing for older and disabled people and other vulnerable groups with an increased allocation to €200m for 2025. Enhance the CAS application process to speed up delivery of housing for tenants most in need and widen eligible projects to include refurbishment.
- Cost Rental Equity Loan (CREL). The ICSH advocates a significant increase in CREL to €160m to grow the delivery of cost rental as a new, but essential, housing tenure.
- Land Acquisition Fund. Allocate €140m to prioritise the acquisition and servicing of state and private land for social and cost rental housing development.
- Communal and Community Facilities. Introduce capital and revenue funding for communal and community facilities, essential elements of both supported housing and new communities being delivered through CAS, CALF and CREL funding. The absence of targeted funding for these facilities hinders AHBs’ ability to build sustainable communities.
Safeguarding Stock and Sector Futureproofing
- CAS/CLSS/Out of Mortgage Units. Address shortfall in rent revenues for older units and put properties on a stable financial footing through modified availability agreements (cost recover model) to maintain their use for social housing in perpetuity.
- CLSS/CAS Funded Units. Increase the capital funding allocation to specifically aid the refurbishment/renewing of older CAS/CLSS funded AHB stock allowing the AHB sector to strategically plan for large-scale refurbishments.
- Unsold Affordable Homes (USAs). Place USAs into AHB ownership with dedicated funding, enhancing capacity for more housing development and providing tenure clarity to households.
- Retrofitting. Establish a newly adapted and targeted capital funding allocation of €30 million to enable 1000 older AHB homes to be retrofitted annually to a B2 building energy rating standard, using up to a 90% grant aid funding model.
- The AHB Collaboration Fund initiative has proved successful in advancing the consolidation of the sector, an important consideration in future proofing sustainability. In recognition of this, the ICSH recommend a budget of €320,000 for 2025. This will support continued reorganisation of the AHB sector to enhance delivery and the long-term management of homes.
Notes
- The ICSH Pre-Budget 2025 Submission is available to download here.
- The Irish Council for Social Housing (ICSH) is the national federation for non-profit housing associations, representing more than 270 member organisations that provide social housing. The sector manages over 65,000 homes for families on a low income, older people, disabled people and households experiencing homelessness in over 600 communities throughout Ireland.
