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Irish Times
15 minutes ago
- Business
- Irish Times
Ireland needs to ditch empty promises and economic fairy tales and start confronting reality
The next six weeks or so are going to go a long way to defining the Government's term in office. The printers are going to be busy. We are due an updated housing plan, a new strategy on competitiveness and productivity, the Summer Economic Statement and a new medium-term budget strategy along with a revised National Development Plan outlining state investment plans. Then, in the middle of all this, there is the deadline for the US/EU tariff talks on July 9th. The Government needs to use this crucial period to set some kind of coherent economic narrative for its term. So far it has been firing blanks. For example, bits of its housing plan are drip-feeding out in an often-disorganised fashion. Perhaps this is meant to give the impression of busyness, but all it does is confuse people. READ MORE At the heart of all this is credibility. A believable strategy must have some hope of delivery. And here the State – in the widest sense of the Government and the public service – is struggling. It is not just that things are happening late – like the National Children's Hospital. Or that there are signs of waste and carelessness with public money – step forward the Leinster House bike shed. It is that a lot of vital stuff is simply not happening at all. It is a stretch to believe that the Metro will ever get built. Or the giant project to bring water from Shannon across the State. Or the offshore wind infrastructure that is meant to be at the heart of our energy transition , where the Draghi report on EU competitiveness showed Ireland has one of the most long-drawn out consent mechanisms in Europe. In this context, government targets take on an air of fantasy. Less than six months into the Coalition's term, Minister for Housing James Browne told us this week that the target of building 41,000 homes this year is not going to happen. So why should we believe the target for 2026 or the 300,000 plus homes promised during the Coalition's term? The Departments of Finance and of Public Expenditure will publish a budget strategy over the summer, based, we must assume, on tighter control of day-to-day spending. But key spending targets have ended up being roundly ignored in recent years. Central Bank researchers estimated this week that permanent Government spending has risen by 37 per cent since 2021. Had the annual spending limits of 5 per cent set by the previous administration been adhered to, the increase would have been 16 per cent. That is a €16 billion difference. Official documents and targets seem to exist in some kind of parallel universe where no one really expects them to happen. They are more fairy stories than strategy. And the risk with the plans coming in the weeks ahead is that these are more endless checklists of stuff that is happening already and stuff that might or might not happen at all. Some central themes and directions are urgently needed. And some convincing messages of actual action to get things done. Investment is built on certainty, yet in key areas such as climate change and housing this is simply missing. The current drift has a cost. The stalling of investment across the economy is in part due to threats of tariffs from Donald Trump . There isn't much the Government can do about that. But it can start to get its own story straight. Lack of clarity about housing policy is causing parts of the construction industry to sit on its hands. With talk of more incentives and tax breaks on the way, and uncertainty on state commitment in areas of social housing, builders wait to see what emerges. House building volumes slipped by 4.3 per cent in the first quarter of this year, compared to the previous three months. Meanwhile, big foreign investors – and their international headquarters – are starting to realise that promises to deliver better energy and water infrastructure are simply not being met. Investment plans, on hold to see how the US/EU talks work out, will restart at some stage. Ireland is at risk of not being in the frame. The first real alarm bell for this was when Intel ditched Oranmore in Co Galway as a possible site for a big new plant in 2021 because the State could not guarantee how long planning would take on vital supporting infrastructure. This followed the seemingly endless planning saga for the Apple data centre in Athenry , also Co Galway. A convincing economic narrative needs a few central points that everyone has signed up to. Read the Central Bank research out this week for a convincing case on how state investment remains low here, despite tripling over the past decade. This is because the economy and population have grown so fast and the economy was already hobbled by years of underinvestment after the financial crash. To allow space for investment to continue to grow – and provide a buffer if the public finances tighten – other parts of the budget need to be under control. This means keeping the budget in surplus and continuing to put away excess corporate taxes in the funds for the future. This needs to be a central part of a coherent strategy. To be credible, the whole Government – including Micheál Martin and Simon Harris – need to explicitly sign up to this. If it is just a creature of the budget departments, then it will be there to be negotiated away during the budget process. It goes without saying that the second leg of any strategy needs to focus on prioritisation and delivery. Many thousands of words have been written about this. And the challenges are significant. But Ireland, for now anyway, is in a uniquely privileged position with a flush Exchequer and room for manoeuvre. The resources are there. Spending them well is the challenge. Ireland can consider how to respond as the Trump story plays out. The odds are that it will continue to do so long after the July 9th talks deadline. But the Government needs a convincing narrative of how it is going to manage what is under its control and use what may prove to be transitory budgetary riches. There are dangers ahead. But we are starting from a good position, with full employment and flush coffers that are the envy of many other countries. The Government needs to start telling a better story – not just to the public and investors, but also to itself.
Irish Times
11 hours ago
- Business
- Irish Times
Delays to housing plan could push it back to September
The Government is discussing a delay to publishing its new housing plan until after the summer. The plan, which is to replace the last coalition's Housing for All approach, was due to be published during July, but it looks as though it could slip into September before it is made publicly available. Senior Government figures said the new plan could not be completed until the publication of a review of how the State is going to fund its multi-year infrastructure delivery programme, which is now expected in late July. That review – of the National Development Plan (NDP) – is expected to add many billions in allocations for roads, public transport, the electricity grid and water infrastructure, among other things. But it needs to be completed before Minister for Housing James Browne publishes the coalition's roadmap for how it will hit its housing targets. READ MORE The potential to push back publication of the housing plan until September is said to have been discussed at a meeting of the Cabinet housing subcommittee. [ No 'special exemptions' for students under latest Rent Pressure Zone system, James Browne says Opens in new window ] While some Government sources believe there is concern about pushing back its publication, others say a delay would have support around the Cabinet table. A final decision on what to do regarding the publication date will have to be made in the coming weeks. It is unlikely that the plan can be unveiled in August, when much of the political system shuts down for the summer break, many civil servants are on leave, and the Dáil is not sitting. A spokeswoman for Mr Browne would not be drawn on a specific date for publication of the report, beyond saying it would be as soon as possible after the publication of the NDP review, which in turn will cover all public capital investment to 2035 and allocate funds from the Apple tax case and AIB share sales, among other sources of capital. Mr Browne's spokeswoman said work on the plan is 'at an advanced stage'. [ The Government is finally showing some political courage in tackling the housing crisis Opens in new window ] 'The next housing plan is due to be published after the publication of the National Development Plan as a matter of priority,' she said. 'This sequencing is necessary, as the housing plan must have certainty around the investment plans and capital programmes for the Department of Housing, Local Government and Heritage before the next plan can be finalised and published.' She said Mr Browne was not waiting for publication of the new plan before pushing forward with measures, including on Rent Pressure Zones reform, planning extensions and exemptions. The previous government also encountered delays when it was seeking to bring forward Housing for All under the former minister for housing, Darragh O'Brien. That document was due to be launched in July 2021, but was ultimately pushed back to September of that year, which drew criticism from the opposition.
RNZ News
6 days ago
- Business
- RNZ News
Government targets affordable housing in Rotorua
Another 39 affordable rentals are planned for completion next year. Photo: 123RF The government hopes to provide more affordable housing in Rotorua, with a plan to deliver 189 homes. Associate Housing Minister Tama Potaka said up to 150 would be social housing homes completed by July 2027, working with Rotorua Lakes Council and community housing providers. A project consisting of 39 affordable rentals would also be delivered in 12 months by Ōwhata Kōhanga Rākau. "Rotorua is a priority location for housing," Potaka said. "We're backing community-led solutions to address the need here, which has seen disproportionate numbers of people in emergency and temporary housing, and about 700 applicants waiting on the social housing register. "Rental affordability has been a long-standing issue. Some whānau have struggled to find an affordable rental home, so they've been limited to emergency and social housing. "The new homes will complement RLC's new Rotorua Housing Plan to enable iwi and hapu housing aspirations, increase housing choice and support diverse housing needs. The plan was developed with extensive local engagement." Sign up for Ngā Pitopito Kōrero , a daily newsletter curated by our editors and delivered straight to your inbox every weekday.
