Willie Penrose T.D., Minister for Planning and Housing, published two documents through the Department of Environment, Community and Local Government today relating to unfinished estates.

The first is ‘Resolving Ireland’s Unfinished Housing Developments: Report of the Advisory Group on Unfinished Housing Developments‘, which sets out the various issues relating to unfinished estates and makes various recommendations with respect to addressing these issues.  It extends the Advisory Board’s draft report published back in February.

The second is the Department’s response: ‘Resolving Unfinished Housing Developments: Response to the Advisory Group on Unfinished Housing Developments‘.  This sets out four strategic aims for the next twelve months (developing a coordinated partnership approach to unfinished estates; tackling issues of public safety; putting in place stronger legislation/policy frameworks to tackle issues; building confidence in the housing market) and a number of action points for the Department and related agencies.

There are two other associated documents that have yet to be published – the manual on how to tackle in practical terms the issues related to unfinished estates (which will be an updated version of the draft manual published in Dec 2010) and the code of practice.  These are due shortly and will give more specific information for developers, local authorities and other stakeholders.

The Department’s response piece is, in my view, the more important document because it commits the DECLG to 20 actions set out in relation to five themes.  The most important of these are the development of Site Resolution Plans (SRPs) that will involve a partnership approach to estate completion, whereby all stakeholders (developers, banks, local authorities, residents, estate management companies, Health and Safety Authority, etc) will meet to negotiate a plan of action on an estate by estate basis.  The action points in summary are:

Coordination and Partnership

1.    A National Co-ordination Team on Unfinished Housing Developments, under the chair of the Minister, will drive the implementation process, with a particular focus on resolving sites.

2.    City and County Councils will each establish Unfinished Housing Development Teams to co-ordinate actions at a local level and to provide regular reports to the National Co-ordination Team.

3.    A Code of Practice on issues such as public safety, the site resolution plan process, information exchange and identification of development solutions will be finalised by the National Co-ordination Team to ensure buy-in by developers, site owners, funders, local authorities and residents.

4.    In cases where the relevant loans / securities fall within their remit, NAMA will work with local authorities, developers and/or receivers and the Department in facilitating early resolution of public safety issues and in co-operating with the other stakeholders in agreeing and implementing Site Resolution Plans, where feasible and appropriate.

5.    The Minister will engage with other financial institutions (both domestic and non-domestic banks) to ensure a full understanding of their statutory responsibilities and to secure their co-operation and engagement with local authorities and developers in addressing public safety issues and in agreeing and implementing Site Resolution Plans.

6.    An Information Pack for local residents in unfinished housing developments will be prepared and published by the Housing and Sustainable Communities Agency.

7.    Guidance will be issued to City and County Development Boards on encouraging and facilitating community involvement in resolving unfinished housing developments.

8.    A best practice Guidance Manual on Managing and Resolving Unfinished Housing Developments on unfinished housing developments will provide practical guidance for local authorities and other stakeholders on how to manage unfinished housing developments

Public Safety

9.    Local authorities will complete their own initial categorisation of unfinished housing sites in line with the four categories identified in the Advisory Group’s Report and will monitor the developments in their areas, updating regularly the National Co-ordination Team on the status of housing developments in their area.

10.    The Department will expedite the approval of applications for funding support from the €5 million public safety initiative funding with the first allocations to be made in June 2011.

11.    Local authorities and the Health and Safety Authority will continue to liaise and engage in monitoring incomplete sites and any resolution activities being undertaken either by the developer or local authority.

12.    The Department will provide ongoing technical assistance to local authorities on the categorisation of developments, on the formulation of an initial site response using the funding at 10) above, on the preparation of Site Resolution Plans, as well as planning and building control queries.

Site Resolution Plans

13.    City and County Unfinished Housing Development Teams will identify priority sites that should be the subject of Site Resolution Plans and will work with site owners, developers, funders and residents in their efforts to develop such plans, reporting to the National Co-ordination Team, with a view to ensuring that 300 Site Resolution Plans are in place by end 2011.

14.    City and County Unfinished Housing Development Teams will develop best practice approaches to the re-use of vacant housing in each of their areas by the end of 2011.

Legislative and Policy Framework

15.    The Department will immediately review existing legislation as identified by the Advisory Group and develop any necessary amendments to the legislation to ensure that there are adequate powers available to address the efficient resolution of unfinished housing developments

16.    The Department will review taking-in-charge standards for public infrastructure within housing developments such as roads, public lighting and piped services with a view to making recommendations on how best to develop national standards.

17.    The Report of the Advisory Group will be referred to the Building Standards Compliance Group for its analysis and response.

Housing Market and Planning Supports

18.    The Department will re-state previous planning guidance to planning authorities on specific policy aspects regarding better phasing of development, the provision of bonds / securities and other DECLG policies as regards sequential and phased development to inform the resolution of unfinished housing.

19.    The Department, working alongside local authorities and voluntary housing bodies, will engage actively with developers and site owners, including NAMA, in seeking to ensure positive uses for vacant complete and near complete housing and in line with the achievement of sustainable communities and balanced tenure of housing developments.

20.    The Housing and Sustainable Communities Agency will undertake an examination of the potential role for self-build and equity partnership type models to enable residents and new investors to assist in resolving unfinished components of housing developments.

What is good is that the DECLG have now appraised the situation and set out a set of action points.  It is particularly good to see a National Coordination Team being put in place and that legislation is going to be reviewed with a view to putting SRPs on a statuary basis and make amendments to existing legislation to aid their implementation.  I do, however, still have a number of concerns.

First, the speed of response.  We are four years into the housing crash and the development of the unfinished estates phenomenon.  It has taken 15 odd months to get from the announcement of a survey to a report and yet a lot of these action points are still at the reviewing and assessment/formulating solutions stage.  In the meantime, lots of people are living with a whole series of issues, many of them concerning health and safety.  The latter has been an supposedly urgent action point for quite some time.  It is true that some local authorities and developers/receivers have already moved to address some of these issues, but it is only now that the first €1.5m of funding is being released to LAs to tackle issues on the worst 230 identified estates.  The aim is to have 300 SRPs in place by the end of the year.  That is 10.5% of all estates (2,846) or on average 9 per local authority.  It’s not clear also whether that is 300 SRPs drawn up or actually in the process of being implemented.  We need to get to the implementation phase across all estates sooner rather than later.

Second, finance.  Finishing off estates and addressing their various issues is going to cost money.  There are 1,655 estates with works outstanding.  At present, there seems to be four possible sources of funding: developer bonds; the DECLG through its €5m public safety fund; NAMA and its development fund; developers/banks who own the estate or possible new investors.  There seem to be massive issues in drawing bonds down and if they can be accessed they are often insufficient to complete outstanding works.  The DECLG €5m split across 1,655 estates is €3200 per estate, which will hardly scratch the surface; NAMA will only invest in estates that are commercially viable and for which they hold the loan book; developers are bust and banks illiquid.  It really isn’t clear to me where the finance is going to come from for either developers or local authorities (where developers are absent) to finish off estates without central government funds being made available (and no such fund was announced today beyond the €5m).  One suggested solution is to recoup the costs from future sales, but again this would only work if an estate is commercial viable, investors come in, and market conditions improve in the short to medium term.  I would like to know a lot more about plans with respect to financing and I’m sure stakeholders would as well.

Third, I am still concerned that the model for SRPs is one of partnership and has the feel of voluntarism about it.  SRPs seek to encourage and not compel developers and stakeholders.  The two documents today are full of phrases like ‘encouraged to work’ and ‘should undertake’ rather than be ‘compelled to work’ and ‘will undertake.’  Without the new full manual it is difficult to fully comment on this, but it also still seems as if there is no conflict resolution mechanisms or clearly delineated objectives, milestones and timeframes for SRPs.  The danger is that negotiations become divisive and fractious and implementation effectively gets kicked down the road.  The role of the National Coordination Team is also not clear.  It seems to have some monitoring function, but its not clear if it’ll be hands on in terms of overseeing, assessing and directing progress and what it’ll do if SRPs are failing.

The next stage is clearly the publication of manual and the code of practice.  Hopefully they will turn up soon.  Today’s report and the DECLG’s response is a step in the right direction, but whether the action points and strategy being pursued will deliver, or deliver significant improvements for residents any time soon, is still an open question.

Rob  Kitchin

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