Part V report analyses performance and opportunities for delivering social and affordable housing

Clúid Housing today announces the publication of Planning Gain and Obligation: Promise and Performance of Part V. The report focuses on Part V of the Planning and Development Act 2000 and examines the effectiveness of this ‘planning gain’ measure in delivering social homes.

The research was compiled by Declan Redmond (Associate Professor, UCD), Mel Reynolds (Architect) and Orla Hegarty (Architect and Assistant Professor, UCD) on behalf of Clúid Housing, as part of Clúid’s Adrian Norridge Research Bursary. The report offers an analysis of the effectiveness of Part V of the Planning and Development Act 2000 and how it has operated since the major reforms made as part of the Urban Regeneration and Housing Act 2015.

The key findings from today’s report launch show that between 2002 and 2020, a total of 19,302 dwellings were provided through the Part V mechanism. Of those, 52% (9,534) were affordable purchase; 29% (5,709) local authority social rented and 19% (3,789) Approved Housing Body (AHB) rented. Over the same time, a total of 70,574 new build social rented homes were built so Part V social, rented units account for 13.4% of the total. Since the reform of Part V in 2015, it has supplied on average one fifth of new build social rented housing.

The research has interrogated development costs and benchmarked Part V to other delivery and market prices in recent years. Broadly speaking, from the seven case studies that were selected for examination as part of this research, the homes acquired did represent good value for money. Nevertheless, the study also found, that there are very wide disparities between local authorities and between projects due to differences of approach and requirements. This is particularly evident in payments for ‘soft’ development costs, profits and private finance.

The report found that current practices lack transparency and argue that there are inadequate systems for negotiating, verifying, and auditing financial arrangements. In many cases, there was an absence of adequate records. The lack of information and official guidance results in uncertainty, delay and additional administrative cost for all stakeholders. The research identifies that there are opportunities for considerable savings and a reduction in the administrative burden through standardisation and better systems of oversight.

In investigating stakeholder perspectives, the report found that since the reforms of 2015, some local authorities have reduced their involvement with AHBs. Whilst this is entirely within the remit of local authorities, where local authorities do want to transfer dwellings under Part V to AHBs, they are only brought in after the Part V agreement has been concluded. This leaves little or no input for AHBs into the dwelling typology, design, or quality control. It also means they have no input on costs and must ascertain at a late stage, whether the costs agreed fit their financial model.

Recommendations
In drawing together this analysis of the current performance of delivering dwellings under Part V arrangements, the research makes some key recommendations including:
• Increasing the yield to 20%.
• Strengthening the role of AHBs;
• Part V should apply to cost rental housing
• Standardising costs;
• Improving the efficiency and effectiveness of Part V including through due diligence; improving process issues; establishing shared services; transparency and certainty; standardisation and quality control.
• Zoning land solely for social and affordable housing
• Improving the knowledge base through publishing information on Existing Use Value and Market Value from a variety of sites and establishing a database that disaggregates construction costs.

We welcome that the recommendations made in this report, to increase the yield of Part V to 20% and to apply Part V to cost rental housing, have been adopted in the recently published Housing for All Plan.

Planning Gain & Planning Obligations
Part V was the first substantive planning gain measure introduced in Ireland and constituted an attempt at land value capture. It is argued in the report, that this was a radical and innovative measure when it was first introduced in the Planning and Development Act of 2000. As a condition of planning permission, up to 20% of a scheme was to be transferred to the local authority or AHB and used for a combination of social rented and/or affordable purchase housing. In 2015, this was changed to a maximum of 10% and only social rented housing was required.

The report states, that, “In an Irish context, this was a hard-won achievement and should not be lightly jeopardised. Indeed, Part V should be retained as part of a toolkit of measures to address the affordable and social housing supply crisis in Ireland.

Commenting on today’s report launch, James O’Halloran, Clúid Housing’s Senior Supply Team Manager, stated: “As recommended in this report, the Government’s recently published ‘Housing for All’ plan makes a commitment to again increase the yield from Part V to 20%. Half of the provision must be used for social housing support and the remainder can be used for an affordable purchase and cost rental housing. In the midst of a housing crisis, this increased Part V contribution will be a crucial component in increasing housing supply and creating mixed-tenure communities. This report makes important recommendations on how the Part V process can be made more efficient, transparent and, importantly, deliver crucial cost savings”.

Co-Author of the report, Declan Redmond commented: “Part V of the Planning and Development Act is important as it’s the first time the State attempted a form of’ land value capture’. It enshrines in law, the ability of the State to obtain land at below market value for the provision of social rented, cost rental and affordable housing. This principle was adjudged by the Supreme Court as compatible with the common good. It is good to see, that after more than 20 years since the passing of Part V, the Housing for All plan proposes a land value sharing policy, whereby the State will recoup some of the uplifts in land values.”

Declan went on to say: “This report shows that Part V has made a modest contribution to the provision of social and affordable housing, but it should be borne in mind that this is just one, of a variety of ways of providing much-needed housing.
https://people.ucd.ie/declan.redmond

Co- Author of the report, Orla Hegarty commented: “Part V makes an important contribution to the housing system, both socially and economically. Recommendations have been made in this report to support the core objectives of integrated communities and value for money. This work for Cluid has been an opportunity to independently interrogate construction and development costs. This is timely, as obtaining value for money is key to both the future success of Part V, and broader government policy towards affordable urban housing.”
https://people.ucd.ie/orla.hegarty

Click here to read the full report.

ENDS
Notes to the Editor:
Communications Manager – Clúid Housing
+353 87 113 5411

About Clúid Housing
Established in 1994, Clúid Housing is an independent, not-for-profit charity. Clúid is one of the largest approved housing bodies (AHBs) in Ireland with over 8,500 properties in management. Clúid leads the way in delivering social housing solutions to those on local authority housing lists. Our team of over 250 professional employees are committed to providing quality housing and services that enable people to create homes and thriving communities. For more information visit www.cluid.ie