On the eve of Election 2016 Construction asked all the main parties a series of questions about the construction sector and it’s role in the economic recovery. Martin Foran reports on what they had to say.
How important is the construction sector to Ireland’s economy?
For a strong balanced recovery, Ireland needs a strong construction sector. The continuing slow growth of the construction industry is a key risk factor endangering economic recovery and increasing living costs for families.
To take one example, the main reason rents are so high around the country is due to the record low levels of rental unit supply. This supply problem is the result of the historically low construction activity in the housing market, which was created by this government due to their introduction of ill-thought out regulatory changes since 2012, under which the cost of building housing no longer bears any relation to supply and demand in the real economy. These changes have increased the regulatory cost of building a home by €38,000 per unit or a staggering €60,000 for a one off build, before any actual construction gets underway.
While not mean a return to boom-time levels of development, Labour in Government believes that, in comparison with other countries – and taking on board long-term trends for Ireland – an economy of our size is capable of sustaining a construction industry equivalent to around 12% of GNP.
Construction is not just critical to the economy. It also plays a key role in the state of society.
The construction sector is crucial part of Irelands economy employing many skilled and semi skilled workers year round. It is also crucial to have such skills in order to develop adequate housing, commercial and public spaces as well as developing and maintaining quality infrastructure.
People Before Profit
Housing and construction is a very complex and emotional issue and cannot be tackled in isolation. The construction industry has a responsible part to play whether they like it or not. It is way too important to left in the hands of dodgy developers and estate agents and should come under tighter government control.
The construction sector has an important role to play not only in the Irish economy, but Irish society. It will play a vital role in future-proofing Ireland, by building the affordable, comfortable housing our citizens need, by insulating and retrofitting our buildings to save homeowners money, save energy, and reduce Ireland’s emissions. The construction industry will be vital in building the roads, public transport infrastructure, housing, schools and hospitals that Ireland needs to thrive for the next 100 years.
If elected to Government what steps will your party take to ensure future growth in the construction sector?
Fianna Fáil’s policy blueprint ‘The National Housing Road Map‘ sets out a series of policy proposals to stimulate the construction of 150,000 new affordable, quality homes in the private market, help revitalise the construction industry with 80,000 jobs, support elderly people living independently in their own homes and broaden social and affordable housing provision with 45,000 new units.
Labour in Government is already working hard with the CIF to boost employment in the construction sector, particularly through measures introduced in the Tánaiste’s Department of Social Protection. Under the Tánaiste’s leadership, the Department now provides a range of supports to connect employers with skilled workers. And through the JobsPlus subsidy to companies, the Government provides help with wage costs, an invaluable support for companies. We are also piloting social clauses in major public contracts, to ensure that when such a project gets under way, unemployed construction workers living in the locality are hired. The very significant Grangegorman PPP is an example in that regard.
We will prioritize a major new Public Private Partnership driven programme of social and community housing, prioritizing the needs of working couples, which we expect will generate private sector investment of two billion euros per annum.
Sinn Féin have committed to a major investment in social and affordable housing which will require huge input from the construction industry and employ thousands of workers at all levels for a period of 15 years when we plan to build 100,000 social and affordable housing units. Additional plans to invest in health, education and public infrastructure will be a major boost to construction. We also would implement and stronger vacant site levy to discourage speculation and increase viable land for construction projects both public and private.
People Before Profit
The future growth of construction lies in the next government declaring a housing crisis and calling for a housing programme to build directly housing for the nation, which the nation’s builders can be employed in the construction through local authorities and other vested community groups who want to achieve quality housing for future generations across the country.
The Green Party proposes an ambitious state backed building programme, using NAMA to coordinate, and using state owned lands. This would provide a significant boost to the construction industry. The Green Party would also divert the €120 million currently being used to subsidise peat fired power plants to a home retrofitting scheme. This would create 3,000 jobs in the construction sector, retrofitting 5,000 homes per year.
Fine Gael will increase annual housing output to a sustainable level of 25,000 units per annum. We will implement a series of measures over the next term of government to achieve this goal, streamlining the local planning process and introducing measures such as a vacant site levy to prevent the hoarding of land and ‘use it or lose it’ planning permissions. In recognition of the 31 different local authorities’ approaches to apartment standards, new national design standards for apartments have been published to streamline the approach and are designed to increase the supply of new apartment developments.
We will introduce a number of reforms for renters, recognising the changing patterns of the housing market.
We will provide 35,000 new social housing units with a €3.8 billion budget up to 2020. It’s not acceptable to have families living in emergency accommodation in 2016. We will introduce a series of measures to boost affordable housing supply.
More detail will be available in the Fine Gael manifesto.
Over the coming days we will publish the full responses from all political parties.