Louth cllr says cost of maintaining 80 social houses in Dunleer will be €22 million

The proposed costs of maintaining and managing 80 new social houses in Louth is “better than the contract John Delaney was on at the FAI”, Cllr Ruairí Ó Murchú has told council officials.

The Sinn Féin representative made the comment at last week’s meeting, where he raised the issue of the Social Housing Public-Private Partnership (PPP), which includes a proposal to construct 80 homes in Dunleer.

Cllr. Ó Murchú said the overall project would see the construction of 1500 homes in various parts of the country, including Louth. In the initial tranche, 534 homes are proposed, with an estimated construction cost of €120 million, or €225,000 per house.

He said: “While the construction cost is acceptable, the Comhar Housing consortium has been given a contract for the maintenance and management of all the homes, which is worth €181 million over the 25 year lifespan of the deal.

“This works out at €338,951 per unit over the 25 years or €13,558 per unit per year. In general, the average cost of maintenance and management by an Approved Housing Body is €2,375 a year.

"I would like the council officials to confirm what the breakdown of the proposed maintenance and management contract is for the Dunleer, because, at these prices, we would not be getting bang for buck and the contract seems to be better than the one John Delaney was on at the FAI.

“Forget the rights and wrongs of PPPs, this maintenance and management contract is working out at six times the normal price of AHB contracts.

"For just the 534 houses in the first phase, the contract would cost €149 million more, over the 25 years, than the current average cost and, if you factor in the possibility that all 1500 houses would be managed and maintained at this cost, that is working out at an eye-watering €419 million more expensive over the lifetime of the deal.

“And just focusing on the 80 houses at Dunleer, it would cost €22 million to maintain and manage them over the proposed 25 years, which is a shameful cost.”

Director of Housing, Paddy Donnelly, told the meeting that the houses have nothing to do with the council, but undertook to find out the figures involved.

Chief executive Joan Martin said the scheme came about after the council was asked to put forward land held by the council for consideration for a PPP.

The council was given €9.397 million for the land, which would, Ms Martin said, go to pay off some of the money owed by the local authority on land loans and this was ‘a big benefit’ to the council.

In response, Cllr. Ó Murchú said that while the additional money was welcome for the local authority, his problem was not with the council, but it ‘seems like a very, very expensive form of house building when the government needs bang for their buck in the middle of a housing crisis’.