The Coalition is set to use its capital spending plan, to be announced later this summer, to invest in projects which would free up more land for private housing development and reduce building costs.
The plan is expected to contain at least one large infrastructural project, such as a Luas link from the city centre to the airport or other north Dublin transport options, and smaller, local projects.
Sources said one of its aims will be to try to make more land suitable for private housing development to help with the housing crisis, especially around Dublin. Development contributions – levies paid to local authorities by builders to help fund infrastructure – may also be reduced further to bring down the overall cost of construction. While individual rates are a matter for local authorities, the maximum allowable rates can be cut by legislation.
Fine Gael and Labour have identified housing as one of the key issues to be tackled before the election through efforts to increase supply.
General election
Sources have said that while the general election will come before large-scale house building is complete, signs of life in the construction industry may yield a political dividend.
The Government earlier this year announced its intention to build 1,700 social housing units by 2017. However, there is also concern about the lack of supply in the private housing market and it is understood the capital plan will fund investments in projects – such as sewage systems, roads and transport links – which will allow more land to be suitable for development.
Minister for Public Expenditure Brendan Howlin initially said the capital plan would be announced in June, but it is likely to be pushed back until July.
While sources said the draft capital plan contains little for housing at present, Taoiseach Enda Kenny and Tánaiste Joan Burton have called a meeting of the Economic Management Council, the four-member committee that also includes Mr Howlin and Minister for Finance Michael Noonan, to discuss the issue later this week. It is understood Mr Kenny and Ms Burton favour additional funding, planning and infrastructure measures to reduce the cost of building houses.
Local authorities
One source said: “What does a developer need to make sites viable? You’d be looking at roads, sewerage, power, transport links, that type of thing.”
Another source said local authorities, the Department of the Environment, Nama and developers would know what sites and areas would become available for private development if roads or sewage systems were built.
Mr Howlin has met with various Government departments in recent weeks to assess their priorities and it is expected final pitches will be made by Ministers before the plan is given the official sign-off.
