Many of the posts on this blog have been critiques of the planning system, the construction sector/developers, the banking sector, and government policy or lack of.  A critique of the blog is that it doesn’t do enough to put forward solutions and a positive path forward, especially given widespread unemployment amongst former construction workers and development residing at the bottom of a deep slump rather than being a productive part of the economy.

In this context, a key challenge for Ireland is to re-grow the construction sector back to a normal, sustainable level as a productive part of the economy and to get construction workers back to work without exacerbating existing issues and problems with respect to property.  This is no easy task, but here is my suggested road map.

First, any attempt to resurrect construction activity in Ireland has to take place within a strategic approach to planning and property that strongly guides any development takes place.  The adoption of core strategies and revisions to the Planning Act are a step in the right direction, but are specific tactics, not strategic visions.

To this end, the government needs to put in place a strategic planning and development framework that combines spatial planning (what used to be the National Spatial Strategy, NSS) and sectoral planning (what used to be the National Development Plan, NDP).  The present NDP expires end of 2013; the NSS is hollow and in review.  The proposed Medium-Term Economic Strategy (MTES) 2014 to 2020 will focus on macroeconomic strategy and policy actions for achieving sustainable economic and employment growth, not planning and development.  The MTES needs to be complemented with a new NDP to run 2014-2020 to guide investment, underpinned by a NSS that will ensure coordination across sectors and locales.  In other words, it should consist of joined-up thinking.  The danger is that without a strategic approach, the development that does occur will be ad hoc, poorly linked, weakly leveraged and will slow recovery.

Both the new NDP and NSS need to be based on an evidence-informed analysis of the present state of property (housing, office, industrial, agricultural, etc), planning/zoning, and models of projected demand based on demographics, economic growth, labour market demand, etc.  This requires decent property data (we have some limited housing data; no independent commercial sector data) that have temporal and spatial resolution.

This strategic framework needs to be prepared to be selective.  Rather than trying to encourage growth everywhere, it should aim to grow selectively to create agglomerations and critical mass.  Agglomeration is important for growing jobs and the economy.  Employ a smart consolidation approach elsewhere (focus on quality of life and sustainability, rather than growth).  Limit further one-off housing: it is unsustainable in service terms (utility and service provision) and environmentally (water pollution, commuting, etc) and contra to popular belief evidence suggests weakens rural communities.

Part of the strategic framework should focus specifically on housing and produce a comprehensive housing strategy.  As well as planning for the future, this strategy needs to address all the issues affecting housing at present:

  • vacancy and oversupply in most of the country and pockets of undersupply in specific locales
  • large numbers of unfinished estates and poor build quality (issues of pyrite, etc.) that need to be retrofitted
  • huge numbers on the social housing waiting list, stalled regeneration schemes, collapsed PPPs
  • extensive mortgage arrears and negative equity
  • the lack of mortgage credit and a large proportion of cash buyers
  • the lack of finance for development and the lack of active developers
  • Supply of land.  Land has to be made available sensibly: land bank through NAMA, Site Value Tax/Kenny Report to get derelict/brownfield sites back into productive use, bring on strategic greenfield sites, and limit future land speculation.

Development needs to follow best practice planning principles and should be integrated in nature.  Residential development cannot be simply houses but also needs to be utilities, schools, creches, public transport, etc.  Piecemeal planning undermines formation of sustainable communities.  When housing construction occurs, all the other elements also need to occur at the same time (not several years later).

Second, the creation and delivery of any strategic plan needs to be properly resourced in terms of staffing and finance.

Proper planning requires administrative units capable of delivering: the Department of Environment is severely understaffed with respect to planning; regional planning authorities are shells; local planning authorities are emasculated; NAMA should be part of this coalition.

Development requires finance — there is a need to source investment capital given the Irish banks are not lending.  NAMA should fill the void where possible.  If there is true demand the market does not need stimulating and tax incentives/subsidies should be avoided.  The construction/development sector needs access to finance through loans not incentives.  Do not sacrifice measures such as Part V Social and Affordable Housing provisions of the Planning Act (we need social and affordable housing).

Third, we need new entrants into the sector to replace failed enterprises.

Encourage new developers through loans/grants — many of the older ones are bust, tied up in legal cases, or cannot access investment capital.  We need new entrepreneurs to enter the market who have fresh ideas and energy and do not have any of the bad habits and institutional memory of the old set.

Encourage new, large rental companies into the market and professionalize the rental sector.  The rental sector is under-regulated and is dominated by amateur landlords (70% own 1 or 2 properties).  Encourage cooperative and association housing and make finance available to them for new projects.

Specific ideas to re-grow the construction sector back to a normal, sustainable level and to get construction workers back to work

Invest in capital projects that will stimulate the economy beyond construction jobs (i.e. will provide the conditions that will attract inward investment and indigenous growth)  — public transport, utilities (electricity grid, water system, broadband), public infrastructure (e.g. school building — 1 in 3 schools still have prefabs and the number of children is growing; hospitals; universities, etc), selective road building, etc.

Proactively address the housing issues detailed above.  (1) complete viable unfinished estates and deconstruct the others; (2) address build quality and pyrite-infected homes; (3) restart regeneration projects and revive PPPs with new partners; (4) refurbish existing social housing.

Enable private housing in very select locations where there is a demonstrated demand/projected demand based on hard evidence.

Enable office development in very select locations where there is a demonstrated demand/projected demand based on hard evidence (remember >20% of office space in Dublin is vacant; in some parts >40%; similarly lots of empty retail/industrial space in Dublin and throughout the country).

Curtail speculative development of all kinds where there is no demonstrated need/demand. Under no circumstances create additional supply in areas where there is already oversupply as it will flat-line any recovery and extend related problems.

I am open to suggestions and debate with respect to this road map.  We need these kinds of conversations.  What I do not think is sensible is to have no strategy and plan and to simply try and muddle through and hope that inaction and the present lack of policies and direction will somehow solve our various issues.  They won’t; they are more likely to cause additional problems.

Rob Kitchin

Yesterday, Minister Jan O’Sullivan appeared before the Oireachtas Joint Committee on the Environment, Culture and the Gaeltacht to outline her Department’s proposals to legislate for the introduction of a Planning Regulator in 2013. The introduction of an Independent Planning Regulator was a key recommendation of the Mahon Tribunal Report published last year. The Tribunal recommended that the Minister for the Environment’s planning policy enforcement powers be transferred to an Independent Planning Regulator who should also be charged with carrying out investigations into systemic problems in the planning system as well as educational and research functions.

The introduction of an independent Planning Regulator, which the Minister has publicly committed to, does not entail a simple ‘bolt-on’ addition to the planning system. It will profoundly alter and transform the entire way in which planning policy has to-date been implemented in Ireland. It is clear from the text of the Minister’s speech that in framing their policy proposals for the forthcoming legislation, the Department is grappling with the many complexities and difficulties at the heart of the problem – that is, that planning is fundamentally a political activity which does not lend itself neatly to simple bureaucratic regulation. In guiding the discussion at the JOC, the Minister posed a series of questions as follows:

  • Should the Minister’s powers be fully transferred to an independent regulator or should the final forward planning decisions remain political in nature (i.e. to be taken by the Minister / Government / Oireachtas) with a regulator providing an independent advisory / supervisory role?
  • If power is to be fully transferred, how can we ensure accountability by an independent regulator?
  • What would be the limits of the regulator’s powers vis-à-vis the planning process and elected members? Is the regulator’s decision final?
  • Should the role of a regulator be confined only to situations where a dispute arises over a plan?
  • What is the most suitable institutional arrangement for delivery on the recommendation (e.g. new authority or some type of recast of existing framework)?
  • If a new authority is to be established how would it interface with the existing institutional framework (planning authorities, regional authorities, An Bord Pleanála)?
  • If existing structures are to be used, what entity could take on the function and how can the new function be taken on without eroding capacity to discharge existing roles or without being detrimental or damaging to well established and publicly accepted independent role’? For example, if the plan-making regulatory function is to reside in an existing body such as An Bord Pleanála, might that affect the other functions of the board creating an inherent tension between making the Board making decisions on forward planning, development plans and local area plans as well as individual planning cases?
  • Is there not a case for the Regulator to be the person who conducts the fundamental assessment of the performance of the planning system, including an assessment of the effectiveness of the Minister, local authorities and so on rather than becoming a super-non accountable national planning body?

Firstly, it is worth commenting on what the Minister did not say in her speech to the JOC, but which is absolutely critical in framing this debate. It is essential that, as also recommended in the Mahon Tribunal Report, both the National Spatial Strategy and National Development Plan be placed on an explicit statutory footing (as is the case in Scotland, for example). The forthcoming legislation should specify that both the NSS and NDP be reviewed in parallel and be subject to Oireachtas approval. The legislation should place a mandatory obligation on government to jointly review both the NSS and NDP at a minimum each and every eight years; outline precisely what is required to be included in both plans (including delivery and implementation); the procedure by which they are to jointly be reviewed; and provide for transparent public involvement in the process i.e. a staged process similar to that required of local authorities in adopting development plans. The placing of the NSS/NDP on a statutory footing will require both plans to be subject to Strategic Environmental Assessment and Habitats Directive Assessment, – including an analysis of alternative future scenarios – and allow for a public and political debate which is desperately needed.

The placing of the NSS/NDP on a statutory footing will ensure that that national planning policy remains a political activity. However, the regulation and oversight of the system should be independent. There has been considerable reform and improvement of the planning system in recent years with the introduction of multi-level and multi-agency oversight. As a result, the scope for local authorities and/or regional planning authorities to deviate from national policy has been considerably reduced. However, the current system whereby the Department reviews, comments and potentially ‘calls – in’ local authority development plans through Section 31 of the Act needs to be replaced with a system of independent oversight. Planning in Ireland is mired in a public perception of corruption, cronyism and political interference and only an independent regulatory authority will suffice in undoing this perception. In doing this, the Department can get on with the important business of plan-making.

Accountability can be ensured by designing the system so as to be fully transparent through, for example, the full application of the Access to Information on the Environment Directive, requirement for the Planning Regulator to attend at Joint Oireachtas Committees as necessary, an open and transparent appointment process for a fixed term, full publication of all reports within mandatory time limits, and strong legal deterrents against lobbying, etc. The decision of the Planning Regulator should be final. This does not imply that the role of the Planning Regulator is designed so as to be inflexible. As is currently the case between, for example, the Department, the National Transport Authority, the Regional Planning Authorities and local authorities, the regulatory system can be designed so as to allow formal interaction with the Planning Regulator to reach consensual solutions where possible. It is accepted that there could be rare occasions whereby the Planning Regulator fails to act or acts inappropriately and a fail-safe mechanism is required. In such situations the Minister must remain ultimately accountable and the power should rest with the Minister to override the decision of the Regulator. Again, the legislation could be crafted such that, in such rare circumstances, a draft order be required to be laid out before each house of the Oireachtas and could only be proceeded with following a resolution approving of the draft has been passed by each house.

It is not appropriate that the proposed Planning Regulator be merged with An Bord Pleanála. In the same way as the Minister is precluded from commenting on any specific planning application and An Bord Pleanála has no role in the forward planning system, there should be a strict separation of powers. The role of the Planning Regulator should be confined to ensuring that national planning policy is correctly implemented and overseeing complaints against planning authorities. This should include complaints on allegations of corruption, improper procedures or systemic problems and undertaking periodic audits of the planning functions of local authorities – but not extending to a role in reviewing a decision on any specific planning application. For example, the Local Government Ombudsman currently has the powers to examine complaints about how local authority staff carry out their everyday executive and administrative activities in relation to the planning system. These include complaints about delays or failing to take action in relation to, for example, planning enforcement matters. These oversight powers should be transferred to the Planning Regulator.

The introduction of the Planning Regulator does not necessitate the creation of another expensive QUANGO. Throughout the ‘Celtic tiger’ period local authorities employed significant numbers of planners and other professionals to deal with the huge volume of planning applications. With the dramatic fall-off in new development proposals and the proposed reforms of local and regional governance structures, there is considerable scope for suitable professional staff to be seconded from elsewhere in the public service. There is also a plethora of agencies with some responsibilities in oversight, such as the Regional Planning Authorities, the National Transport Authority, the Local Government Ombudsman and the Office of Environmental Enforcement. An innovative and rationalised approach to oversight could yield significant savings and the establishment of a more coherent system. For example, the Planning Regulator could be housed as a sub-unit of the Local Government Ombudsman to ensure administrative synergies are maximised.

Finally, a further important recommendation of the Mahon Tribunal Report, also not referred to in the Minister’s speech, was that the Planning Regulator should be mandated to undertake educational and research functions. There is no doubt that heretofore planning education and public/political awareness of the important role of land-use planning in society has been abjectly lacking in Ireland. The abolition of An Foras Forbartha (similar to the Design Council in the UK) in 1988, the abolition of local rates and political cronyism and ineptitude all contributed to this end. The evidence-base for planning has improved dramatically with the development of tools such as MyPlan and AIRO. However, I am not convinced that a regulatory authority is best positioned to undertake planning education and research. It should be the role of the Department, unburdened by oversight responsibilities and with a new and focused national planning mandate, to lead in this important task drawing on the existing capacities within universities and other private and public bodies. For example, could the Housing Agency be reformulated as the ‘Housing & Planning Agency’ to provide a 21st Century An Foras Forbartha?

2013 has the potential to be a landmark year. In the aftermath of the economic collapse, exactly fifty years after the introduction of the first planning acts in 1963, twenty-five years after the short-sighted abolition of An Foras Forbarhta and ten-years after the publication of the NSS, we have a once in a generation opportunity to reform the planning system, rethink the role of national planning for our long-term prosperity and to foster a new consensus in the public and political consciousness as to the value of planning in building a nation for the common good. We shouldn’t waste it.

Gavin Daly