I was a bit baffled by the news that housing charity Threshold had, in its pre-budget submission, added its voice to those campaigning for government stimulus for new housing construction. As quoted in the Irish Times, Bob Jordan Threshold chief executive suggested that “Up to 30,000 new houses need to be constructed annually to meet the ongoing demand for new homes. However, since the recession, housing construction has virtually ceased, with only 8,500 new units built last year.” The organisation argued that, if left unchecked, the “housing shortage” could become a “full-blown crisis”.
A closer look at their submission reveals that the proposal for the Minister for Finance to consider a stimulus for housing construction is part of a wider and much more targeted set of proposals, which in large part aim to address the current threats faced by tenants in the increasingly precarious private rental sector. Included in these are proposals to provide a financial package for the purchase and construction of social housing and amendments to Residential Tenancies Act. Threshold are keen to point out that the problems of undersupply are restricted to particular, primarily urban, areas. In this context, it is odd if a little unsurprising that the point picked up by the media is the call for new construction.
Another story is today’s papers offers a more apt corollary to the issues that Threshold raise. A report from Oxfam claims that austerity policies across Europe are benefiting the top tier of society while impoverishing many households on the lower end of the economic spectrum. Likening current austerity policies to structural adjustment programmes imposed on poor countries by the IMF since the 1970s, the report (in which Ireland features prominently) warns that:
“The only people benefiting from austerity are the richest 10% who have seen their share of income rise whilst poorest have seen their share fall. The UK, Greece, Ireland, Italy, Portugal, Spain – countries that are most aggressively pursuing austerity measures – will soon rank amongst the most unequal in the world if their leaders don’t change course.”
It is this growth in levels of inequality and the knock on effects this has, rather than simply a lack of construction, which produce the suite of challenges for tenants that are now being flagged by Threshold.