There has long been a debate about precisely how many houses Ireland needs to build to deal with a rising population. The Government’s Housing for All plan targets 33,000 new homes per annum, while some analysts put the number significantly higher. Either way, there is no argument that current supply is inadequate, with at most 28,000 new units due to be completed this year and a worrying fall-off in housing starts and in planning permissions being sought for apartment construction.
The political stakes for the Government here are high. It has been seen to deliver on its budget targets, growth has been strong and the economy got through Covid-19 in much better shape than might have been expected. But in terms of delivering in specific departmental areas, the record is more mixed. And the problems in housing will be a central battleground in the run-up to the next general election.
A new article from the Economic and Social Research Institute (ESRI) provides some important insights on the barriers faced in accelerating housing provision. One of the most important is a shortage of skilled workers, with the report finding that much of the increase in employment in the sector in recent years has been in the commercial sector, building new office and retail developments.
A slowdown in this sector may allow for some skilled employees to move to building new homes. But more may need to be done. For example, the ESRI report suggests that promises to deliver on an upgraded apprenticeship programme need to be delivered on. It also suggests that some building skills be put on the State’s critical skills occupation list, which would make it easier for people from outside the EU to move to Ireland to work. The “chicken and egg” nature of the problem is illustrated by the fact that they would also need somewhere to live.
The report also identifies other blockages – for example in funding, in unpredictable and sometimes costly land supply and in the rising cost of building. The delays in the planning process, meanwhile, have long been pointed to as a key issue and proposals are expected shortly here to go before Cabinet, based on an analysis by the Attorney General.
The Government has initiatives in many of these areas, but the rise in interest rates and building costs is increasing the scale of the challenges it faces. The risk now is of a fall-off in housing supply next year rather than an increase.
There is a need for ministers to develop a clear programme to address all the various challenges which stretch across many Government departments and agencies. And to move to implementation of these relentlessly, recognising the very significant public interest in doing so and accepting the reality that this will take some years to solve.