Society decays as builders and landowners grow fat

Bertie Ahern has a tendency occasionally of musing out loud about big ideas during Parliamentary Party meetings though, usually…

Bertie Ahern has a tendency occasionally of musing out loud about big ideas during Parliamentary Party meetings though, usually, he manages to leave his audience none the wiser about his real intentions.

The other day, the Taoiseach contemplated the possibility that the State could be able to order compulsory purchases of land for housing, at below the Lotto-like gains currently enjoyed by landowners.

Such a move would require a constitutional referendum. It would be fought tooth and nail by the very same powerful builders who happily populate Fianna Fáil's Galway Races tent.

And it would be opposed by farmers, who earn nearly €1 billion annually from selling sites throughout rural Ireland, an income stream that has attracted little notice up to now.

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So far, nobody has any idea whether Mr Ahern has the slightest intention of travelling down such a route, though few of those who heard him in the parliamentary party believe they will ever see it.

If he does not intend to follow through, he should. Protected by a Constitution that puts property ownership above almost everything else, individual rights have long since hurt society as a whole.

Currently, landowners earn millions simply because accidents of geography and often-questionable planning decisions have placed their lands inside the orbit of encroaching towns.

Why is it taken as an unassailable fact that an acre can be sold for €4,000 for farming, but if one wants to put a brick on it the value rockets up to €100,000? It might flow from the Constitution, but is it a law of nature?

Why should developers be allowed to hold land banks for years waiting for the day when they can most capitalise? Why should they not face pressure to build on it, or lose it?

Why is a windfall tax not imposed?

In Killarney recently, the Great Southern Hotel group pocketed €4.6 million from the sale of just 4.6 acres near its flagship Great Southern Hotel in the growing tourist town.

The local Urban District Council, which has a housing waiting list of 400, had bid for the ideally situated land, but a property developer beat it hands down, and fair and square.

The competition for land will worsen. The National Spatial Strategy estimates the numbers of households will jump to 1.889 million by 2020 - and to 2.083 million with improved economic growth - up from 1.123 million in 1996.

In the Dáil and Seanad this week, TDs and senators teased through changes to Noel Dempsey's Planning and Development Act, 2000, by his successor in Environment, Martin Cullen.

The central element of the original legislation ordered that 20 per cent of all privately-developed housing sites should be filled with social and affordable housing. The rule bombed.

Builders did not want to build such estates. Most local authorities, with the honourable exception of Fingal County Council, failed to approach the matter with any level of ingenuity.

And, it must be said, the buying public did not fancy the idea of spending 25 years struggling with a mortgage, while the guy next door gets the same house for a relative song.

Like much else done by Mr Dempsey during his time in Environment, the legislation was innovative, difficult and hard to implement. Mr Cullen has consigned much of it to the dustbin. Developers will now be able to build social housing away from private developments, organise land swaps with local authorities, or pay a levy of up to 1 per cent on each of their houses.

Green Party TD, Ciarán Cuffe, spoke for many yesterday when he accused the Minister of giving in to builders who had filled Fianna Fáil's coffers before the last general election.

Regardless of what the Construction Industry Federation says, builders did drag their feet. They did delay developments, even if they have some grounds for complaints about planners.

Undoubtedly, too, Mr Cullen faces problems. The system is log-jammed. And he had to act if the housing crisis is not to deteriorate further. Without change, nearly 45,000 planning permissions would have expired at year's end.

However, it is nonsense to argue, as he does, that the original intention behind the 20 per cent rule survives. Mr Dempsey's effort was as much about social engineering, as it was about house numbers.

Builders will grumble, but they will pay the levy to ensure that they have fully-private estates to sell for exorbitant prices. If they build social and affordable houses elsewhere, they will do so on lesser quality sites.

Mr Dempsey aimed to create a mix of housing types and social classes, rather than continue to build large local authority housing, some of which will spend their first few decades as little more than ghettos.

In today's Ireland, land is gold. In the years to come, it will become even more valuable.

Society as a whole will lose out, builders and landowners will continue to grow fat.