nah, Iâm apathetic, youâre just pathetic
Ok vanilla ice.
Deficits largely ballon in times of recession or emergency, like Covid. This is unplanned.
Generally governments will try to get close to balancing ins and outs. This is politically expedient during good times as you have more money to spend on goodies.
You again arenât dealing with the point.
Governments of course make plans. We have had numerous plans in the last 20 years for capital expenditure. These have been rolled over when governments change or the economic picture changed. Plans have been rolled over for example on water charges, based on political realities.
Goodies will then be thrown out when cash is available.
EU fiscal rules are too restrictive on capital investment. We do not tie debt to capital as we should. The IIEA made this point several years ago.
Your initial point was self-evidently nonsense. That was my only observation.
Again not coming back with anything substantive.
Generally they used to. More modern incumbents try to buy elections to the detriment of any long term view. This is amplified by fptp voting systems with a binary outcome imho.
A broken blueprint: The system for supporting low-income renters is defective â but it can be fixed A broken blueprint: The system for supporting low-income renters is defective â but it can be fixed - The Currency : The Currency
A broken blueprint: The system for supporting low-income renters is defective â but it can be fixed
More than half of households that rent are in receipt of State supports, but the system is effectively a lottery. And that lottery is locking people in to and out of a broken system. Ultimately, it is the binary nature of supports that is the problem.
A recent ESRI report by Barra Roantree and co-authors gives a detailed portrait of the rental sector in Ireland, as of the early 2020s. The report, entitled âLow Income Renters and Housing Supportsâ, is the just type of policy analysis that countries like Ireland need to diagnose issues and inform public policy.
It combines information from Censuses back to 1991 with data from the Survey of Income & Living Conditions and other official reports to provide a wealth of information on how renting, whether supported or not, has evolved over the last three decades.
The dramatic rise in the number of households since 1990 is well known â from one million to almost two million currently. What is less well known is how the rental sector has grown since then and the share within that of those who rent with some form of state supports, either through government housing or through income supports.
While the share renting, in all forms, was largely static in the 1990s, below 20 per cent, by 2020 it had reached almost 30 per cent of all households. For context, the first reliable number on split between renters and owners is from the 1946 Census, when 43 per cent were renters. That share fell steadily for four decades, bottoming out in 1991.
The combination of a rising share of renters â at a time of rising population â means that in absolute terms, there has been very sharp growth in the number of households that rent, rather than own, their own home. The number of renting households has increased by 150 per cent in two decades, from 220,000 at the turn of the millennium to 550,000 two decades later.
What is particularly interesting in the report is the authorsâ production of rigorous estimates â for what I believe to be the first time â of the share of households within the rental sector that are in receipt of state supports compared to what they term those renting in âunsupported accommodationâ. They use this term, rather than the more familiar split between private and social renting sectors because of the nature of renter supports in Ireland currently.
Many of those in supported rental accommodation do indeed rent from non-profit landlords, such as their local authority or an Approved Housing Body (AHB), like Cluid Housing or Oaklee. But many more households that rent do so with income supports, rather than direct housing supports. These include Rent Supplement, Rent Allowance, the Rental Accommodation Scheme (RAS) and more recently the Housing Assistance Payment (HAP).
What these support systems have in common is that the lease is with a private landlord, and not a local authority or AHB. As such, they blur the lines between a social rental sector and a private rental sector. While RAS and Rent Supplement had been the main forms of income supports in the early 2010s, HAP has become central to income supports since its introduction. According to figures released last month, over 60,000 households are now in receipt of HAP around the country.
Including those in receipt of such payments in a âsupported accommodationâ sector gives a clearer picture of the rental sector, both now and since the mid-1990s. It also challenges the narrative that state intervention in the rental sector has reached unprecedented levels in recent years â at least, if thinking in shares, rather than levels. Two decades ago, there were almost three times as many homes in the supported rental sector as in the unsupported one (14 per cent to 5 per cent).
The share of all households that are in the supported rental sector has ebbed and flowed in a narrow band around 15 per cent over the last two decades, peaking in 2010, bottoming out in 2015 and â as of 2020 â somewhere between the two and rising slowly. However, the share of households in the unsupported (i.e., entirely private) rental segment has trebled in the same period, from 4 per cent to 13 per cent by the late 2010s. There are, in other words, nearly five times as many (fully) private sector renting households now as twenty years ago. It has been an outsized contributor to the growth in Irelandâs population over the last two decades â accounting for almost 200,000 of the 600,000 or so additional households in that period.
Subsidies and supports
There are two aspects that are worth highlighting. The first seems, at first glance, an obvious finding. There has been a shift away from the direct provision of support, through homes owned by local authorities (LAs) and AHBs, to indirect subsidisation of housing costs in the private rental sector.
But a number of elements here may surprise some commentators. The first is that this shift dates back to the 1990s, not the 2010s. The share of the âsupport rental accommodationâ segment made up by LAs/AHBs fell from close to 80 per cent in the early 1990s to about 60 per cent in the late 2000s. The second is that this transition could easily be overstated. LAs and AHBs were always comfortably in the majority compared to RAS, HAP and similar indirect supports. And that is more so the case now than a decade ago. HAP (and RAS) have certainly pushed out Rent Supplement and Rent Allowance but only 30 per cent of supported renters avail of these indirect supports. Seven out of every ten households in the supported rental sector rents from a local authority or a non-profit housing body.
The second highlight relates to the timing of the growth of the overall rented sector. Taking 2000 and 2020 alone, this conclusion would probably not surprise some. Growth in the rental sector in the early/mid-2000s, facilitated in particular by Section 23 tax reliefs and reflecting both a change in the age structure of the Irish-born population as well as Ireland becoming a destination for, rather than a source of, international migrants. But the timing of the increase is again a challenge to the dominant narrative. Much of the increase in the fully private rental segment has been after 2007, not before.
Source: Michael Doolan, Barra Roantree & Rachel Slaymaker/ESRI. Authorsâ calculations using the Living in Ireland Survey and the Survey on Income and Living Conditions (SILC). Note: Living in market or supported rental accommodation.
As the ESRI data makes clear, this is as much to do with deep-seated and slowly-evolving demographic trends than economic cycles â to the extent that one can distinguish between the two. It shows the share of people, by year of age, living in rented accommodation, by cohort. For people born in the 1960s, as they hit 30 years old, i.e., in the mid-1990s on average, fewer than 20 per cent lived as renters. For people born in the 1970s, when they reached the same milestone, about 30 per cent lived in rented accommodation. And for those born in the 1980s, roughly half lived in rental accommodation when they turned 30. Early trends for those born in the 1990s suggest similar rates to those a decade older.
This reflects a move to longer education and later career starts, marriage and â if relevant â having children. Based on the experience of other countries, this is not something that will pass in a hurry. Rather, it is something that needs to be front and centre in Irelandâs housing policy over coming decades. This is a theme Iâve referenced a bit in these columns â as household size falls (or wants to), we need our mix of new homes to reflect this.
A perfect storm
But rather than stress the same point again, it is the subject of the latter half of the ESRI report that I want to focus on for the remainder of this column. While Section 2 outlines the stylized facts of Irelandâs rented sector over the last three decades, Sections 3 and 4 discuss the design of housing supports for low-income renters and the link between those supports and the financial incentive to work.
They start with a relatively obvious but important finding: both direct and indirect supports significantly improve the affordability of housing for households that receive them. In 2019, median rents were over âŹ500 lower for supported than unsupported renters. On a like-for-like comparison, controlling for observable differences in location, type and quality of homes, the gap was smaller, roughly âŹ300 a month, but still sizeable. Even though supported households have lower incomes, their typical rent-to-income ratio was 15 per cent, compared to 23 per cent for unsupported renters.
But from this, a drawback emerges. The nature of Irish housing supports means that there is excess demand: there are households, either formed or suppressed, who meet the criteria but cannot avail of the supports. As a corollary, there are among supported households some with higher incomes than in the unsupported segment. Such households typically pay a far smaller share of their income in rents than poorer households unable to avail of the supports.
This interacts further with the nature of HAP, which links household income and market rents. In particular, households have to have incomes below set thresholds, while local authorities pay landlords full market rent, with local maxima updated infrequently. This has resulted in something of a perfect storm. For example, in Arklow, more than half of those in the rental sector are in receipt of HAP. While this is an extreme case, it shows that HAP can be a very significant factor in local rental markets. Further, the static nature of income limits and binary nature of supports dulls the incentive to be in (better) paid work.
At the same time, the extraordinary lack of construction of new rental housing for over ten years â at a time of strong growth in population, incomes and the economy â has meant that market rents have doubled. This puts extraordinary pressure on what are effectively âlotteryâ type housing supports.
And herein lies the key point. Irelandâs housing supports are currently all effectively lottery-style supports. The generosity means that far more households want it than can get it and when you get it, it changes your incentive to earn more. Ultimately, it is the binary nature of supports that is the problem.
The case for change
A solution exists, however, that would overcome these drawbacks. Rather than tying housing supports to the market, with arbitrary caps on what you can earn and the market rent you can pay, housing supports should be designed around the cost of provision of new homes. Such cost rent systems have been signposted in Housing for All. But the worry is that, as described, they appear to be just another housing support tied to market rents â in this case, 25 per cent below market rents. True cost rental schemes are based on the cost of provision, not on market rents.
The level of support a particular household gets should be based not on whether they are above or below an arbitrary income level but instead on how their disposable income each month compares to the break-even cost of providing a home.
Suppose a new home had a break-even cost, in monthly terms, of âŹ1,000. Where a household had disposable income â taking into account taxes and transfers â of âŹ2,000 each month, it is clear that this household would not be able to meet the cost rent without support. If one third of household income were set as the maximum burden allowed for housing costs, then this household would be able to spend no more than âŹ670 per month on their housing. This means that the cost-rent subsidy, paid by the taxpayer to the non-profit housing provider, would be âŹ330, bringing the total to âŹ1,000.
Such a system has numerous advantages of the many complicated systems set up currently. First, it is based at its core around equity, both horizontal and vertical. Households with the least income get the most support. Secondly, and related, there are no threshold effects: getting a pay raise or going for a new job may push you âover the limitâ but in a cost rental scheme, that would merely mean paying the cost rent without support, rather than having to leave your home.
This idea of a spectrum, rather than categorical on/off extends, thirdly, to owning or renting itself. Where income increases enough, the household could pay a premium over the cost rent and buy an equity stake in the home, releasing funds for the housing body to provide new social housing elsewhere.
And finally, following on from the earlier ones, and perhaps most importantly for policymakers who need to think in these terms, given a fixed budget of housing supports each year, it gives the greatest bang for buck.
Believe it or not, there have been strides forward in housing policy in the last few years. With housing supply lagging policy by years, not months, this can be easy to miss. But while a significantly increased budget for social housing is welcome, it needs to be spent on something other than systems that effectively pit support and unsupported renters against each other for a fixed amount of rental homes.
Not so sure about that. Certainly back in the day there was less entrenched spending and scope for increasing social programmes.
Ronan Lyons is a great man for driving the usual suspects demented on Twitter. They take great offence to his rigorous fact-based analysis as it doesnât tally with their anecdote-informed performative hand-wringing
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I would be interested to see the split in local authority housing vs housing bodies owning houses. From what I can see the local authority is basically buying houses and giving them to these housing bodies because they couldnât be arsed dealing with it.
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Thatâs exactly it - Tuath own a load of the required social housing in Dublin estates
The housing bodies seem to do a good job.
I have no issue with them at all. They do great work. I donât see why the state is outsourcing it though. Its like pieta house do fantastic work for mental health. But the HSE should be doing that. Then the state ends up funding it anyway, but has no oversight of it
They donât give them to the AHBs, they get them to manage them, alot easier for a housing body to evict an anti social tenant than a local authority.
Housing bodies do build/buy/lease their own stock once a local authority confirms they will support it with tenants.
âŹ39 million estimated cost for 72 Dublin City Council units in 2018 when they owned the land, I wonder what the final price was. 
Theyâre getting a crèche at the end of this at least for their âŹ65m and 158 units. 
https://www.dublinlive.ie/news/dublin-news/dorset-street-flat-complex-given-18178273.amp
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Would there be anything to be said for refurbishing the flats? I know they would need a lot of work, but surely âŹ100k a unit, on 113 houses would go a long way. Thatâs âŹ11.3m. Maybe thatâs wildly optimistic, but âŹ300k a unit is still only âŹ34m. Which would seem very high for a refurb.
They site anti social problems, but I mean the buildings arenât causing the anti social problems. Imagine what say âŹ5m of funding to tackle anti social problems in area in terms of creating somewhere for the kids to go etc could achieve instead.
The Poet sounded fierce cranky when talking about housing
He must have missed his breakfast or something
I doubt heâs missed a meal for years.
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