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Budget 2018 – Housing Summary Report

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The Irish Council for Social Housing (ICSH) has responded to this year’s housing budget saying it demonstrates government investment in social housing. However, the ICSH is concerned that diverting significant funds to supporting the private rental sector represents bad value for money. Social housing is an essential public service, and new spending should be used to rebuild the country’s depleted social housing stock. You can read the press release here 

A summary of the main aspects of Budget 2018 for members is outlined below.

Context

Budget 2018 allocates total funding provision of €1.9 billion for housing which is an increase of 46% on the 2017 housing budget. It is anticipated that this will provide for the social housing needs of 25,500 households. A large element – €1.14 billion – is for the delivery of almost 5,900 social homes through a range of construction (5,000) and acquisition (900) programmes. These homes would already be in the pipeline for delivery in 2018.

The balance of the funding will add additional tenancies – and maintain existing ones – through HAP, RAS and long-term leasing.  €149 million of additional funding is being allocated for HAP and this is a concern. Funding to address homelessness and those at risk of homelessness is certainly welcome but we need to question the approach here. Expanding the HAP programme, which relies entirely on the private rental sector, is worrying as there isn’t enough rental stock out there. The ICSH views this as over-reliance on the private rented sector, which has continually failed to deliver for low-income households.

The Government has committed to an extra €500million capital funding to support a new target of 50,000 homes for those on social housing waiting lists up from the 47,000 homes originally in Rebuilding Ireland. 

The following is a breakdown of Social Housing Targets for 2018.
 

Delivery Method

2018 Targets

Build

4,969

Acquisitions

900

Long Term Leasing

2,000

RAS & HAP

17,600

Total

25,469


Current Expenditure 

Funding of €760m has been allocated to support delivery of 19,600 units through:

  • HAP: an allocation of €301 million (€149m more than 2017) for the Housing Assistance Payment, which will enable a further 17,000 households to be accommodated, as well as support the 32,000 existing HAP tenancies.
  • RAS: funding of €134 million will support a further 600 new transfers under the Rental Accommodation Scheme and also the ongoing cost of 19,900 households supported under the scheme.
  • Homelessness: allocation of €116 million (€18m more than 2017) for the increased demand for emergency homeless services. In 2018, more than 3,000 exits from emergency accommodation are expected through the provision of social homes and the Housing Assistance Payment. Arising from the roll-out of the Family Hub programme, which was allocated €45 million in 2017, the additional €18 million for 2018, will support the wrap-around and running costs of the Hubs.
  • Social Housing Current Expenditure Programme (SHCEP): Increased funding of €31m bringing the total to €115m in 2018. Expected total delivery – 4,000 under SHCEP. (Includes LA and AHB).

Capital Expenditure

  • CAS / CALF: No specific details announced on each scheme.
  • Traveller accommodation: Funding of €12 million (€3m more than 2017) will support a range of Traveller specific accommodation schemes and deliver 110 homes in 2018.
  • Mortgage to Rent: €22 million (€5m more than 2017) will support the expansion of the Mortgage to Rent Scheme and will allow for a further 250 transactions under the AHB scheme.
  • Housing Adaptation grants will be increased to €53 million (€5m more than 2017). This will enable up to 11,000 home adaptations to be undertaken.
  • Regeneration: The National Regeneration programme will be supported through funding of €61 million (€5m more than 2017) targeting some of the country’s most disadvantaged communities.
  • Repair and Leasing Initiative: Funding of €32 million has been earmarked in 2018 for the Repair and Leasing Scheme, with the potential to deliver 800 vacant properties for social housing. Under the Buy and Renew and Repair and Lease Schemes, as well as the broader acquisitions programme being managed by the Housing Agency, funding is available to see over 1,000 vacant homes being occupied by social housing recipients.

Other Measures

  • Vacant site levy: This will increase to 7%. The 3% levy becomes a liability this January. If land owners on the register fail to build next year, then on 1 January 2019, their liability from that point on will increase to 7%. If they continue to hoard that land through 2019, then they will end up with an effective liability of 10% over 2018 and 2019 combined.
  • Urban Renewal fund: a multi-annual urban renewal fund is being created, on a competitive bid basis with local authority contributions, to identify projects/initiatives to regenerate and revitalise depopulated urban areas and facilitate more compact and community-focused growth, as highlighted in the draft National Planning Framework. €50m allocated over the four years to 2021 (€10m in 2018), and taking account of an additional minimum 20% contribution from LAs. 
  • Affordability: The Local Infrastructure Housing Activation Fund will be supported by an allocation of €60 million in 2018.  The Fund will provide enabling infrastructure on key sites to open up lands for early development and has the potential to release the delivery of at least 20,000 new homes by 2021.   At least 10% (or 2,000) of these new homes will be social housing (through Part V) with additional social housing to be provided on certain State-owned sites. 
  • LIHAF second phase: A second LIHAF infrastructure fund of €50m to unlock more sites, and at affordable prices.  Through a second tranche, will include targeting funding towards servicing local authorities sites that can be offered at nominal prices to AHBs to provide affordable housing. In addition, €25 million is to be provided (€15m in 2018) to provide infrastructure and services (e.g. roads and paths, water connection, street lighting etc) on local authority-owned sites in Dublin to facilitate the delivery of affordable housing to help households facing the greatest challenge with affordability and to create mixed tenure communities;
  • Finance: Home Building Finance Ireland will provide finance at commercially competitive rates to developers with sites ready to go but who are experiencing difficulty in obtaining funding