[Sinn Fein]

23rd June 2003

Sinn Fein makes submission on Private Property and Housing to All Party Oireachtas Committee

Sinn Fein today released its detailed submission dealing with the issue of private property and the right to housing to the All Party Oireachtas Committee on the Constitution. In the submission Sinn Fein argues that, "social justice must be given pre-eminence to the rights of private property".

Sinn Fein outlines its belief that "The protection given to private property in the 1937 Constitution and the contradictions in the relevant articles have acted as a barrier to introducing a right to housing and to controlling the price of land," it reads.

Sinn Fein spokesperson on Housing Arthur Morgan TD said: "Ultimately the land of Ireland belongs to the people of Ireland and that is the underlining theme on which our submission is based. Sinn Fein believes that the constitutional balance must be in favour of the common good over and above the rights of private property."

The submission covers a range of issues concerning private property and the right to housing including Compulsory Purchase Orders, Rezoning and Planning, House prices, the Price of Development land, Section V of the Planning Act and Accessing the countryside.

There are a number of key elements that need to be addressed by the All Party Committee if we are to secure social justice in terms of housing and private property.

Sinn Fein believes that:

Introduction

Sinn Fein believes that the right to housing is a fundamental right and must be enshrined in the constitution. It is also our assertion that the constitution must be amended so as to clarify the articles which deal with the rights of private property. Property rights should be dealt with in a single self-contained article. Social justice must be given pre-eminence to the rights of private property.

The recurrent theme in looking at how various issues are affected by the articles in the constitution which deal with private property is that, in practice, the `social justice' component has been subordinated to the needs of private property especially that of commercial private property.

The privileged position which has been accorded to rights of private property in the Constitution of 1937 is unfortunate and regressive for a people with a history and a tradition dating from Brehon law to the Democratic Programme of the First Dáil, which placed the common good above the rights of private property.

The protection given to private property in the 1937 Constitution and the contradictions in the relevant articles have acted as a barrier to introducing a right to housing and to controlling the price of land. Sinn Fein believes that too broad a discretion has been given to the courts in relation to the limitation of property rights. The negative affect of the prevailing interpretation of this element of the Constitution is increasingly obvious in the housing crisis and the escalating cost of building land which has frustrated the social housing programmes of local authorities.

Successive governments have hidden behind the excuse of constitutional problems when justifying their failure to bring forward legislation, in the common good, to tackle land prices, and to abolish ground rents. We believe that the Oireachtas All Party Committee on the Constitution would be in a far better position to make recommendations on whether it is necessary to amend the Constitution if such legislation had been brought forward and tested legally as was done with Section V of the Planning and Development Act 2000.

Ultimately the land of Ireland belongs to the people of Ireland and that is the underlining theme on which our submission is based. Sinn Fein believes that the constitutional balance must be in favour of the common good over and above the rights of private property.

The right to private property?

Sinn Fein agrees with a right to private property but believes that it is necessary, for the common good, to place limitations on the rights of private property.

Private property has been and remains an instrument of oppression of people the world over. A tool of oppression, it has been used by the landlord against the tenant, monarch against subject, man against woman. Domination of one person over another has been facilitated by the existence of private property.

James Connolly wrote that ``The enemy of our race is private property'' and it is true that the Irish people have historically been oppressed by private property. We believe that they continue to be oppressed by the exaggerated rights accorded to private property in the Constitution.

Irish people have a complex relationship with private property which is deeply influenced by our colonial past. Those who would advocate ever-greater protection to the rights of private property exploit an emotional attachment which Irish people, who fought in a long struggle for land rights, have to the idea of land ownership. Limiting the rights of private property, in the common good, should not in any way be feared by ordinary home owners and farmers who will, along with all the citizens of this State, benefit from the right to social justice and equality being given priority over the rights of private property.

Compulsory Purchase Orders

One of the few practical limitations to private property is the Compulsory Purchase Order.

Many national infrastructure projects would not be possible without compulsory purchase orders. These powers have been used in the past for the building of roadways, railways and canals. The first CPO's used in Ireland allowed for the formation of the Wide Streets Commission and the subsequent construction of streets such as College Street, D'Olier Street, Westmoreland Street, Capel Street and Dorset Street in Dublin.

Currently this power is usually used in road building and where the outcome is not simply in the common good - it is beneficial to economic and commercial development.

The most pertinent issue which needs to be addressed in relation to CPO is what barriers exist to using Compulsory Purchase Orders to procure land for housing. Why should compulsory acquisition of land be permitted to allow public infrastructure to proceed for the greater and common good and yet this same instrument is not used to procure land or buildings for social housing at a time of a severe housing crisis?

We must also examine whether there is a necessity for full compensation in all cases where CPO is used.

Sinn Fein believes that it is not in the common good for it to be necessary, in every case, to pay compensation equal to the market value. Local authorities are impeded from using CPO to procure land for the provision of social housing by prohibitive compensation. Local authorities should have the power to acquire land at a price below the market price where this is necessary for the common good.

Case law tends to support the contention that it is necessary to pay compensation:

In Central Dublin Development Authority V. The Attorney General (1975) Kenny J. found:

``the absence of compensation for this restriction or abolition of rights will make the Act which does this invalid if it is an unjust attack on the property rights''

However: In O'Callaghan v. Commissioners for Public Works it was suggested that the compulsory acquisition process does not in every circumstance require the payment of compensation for it to be constitutional. The suggestion was also made in Dreher v. Irish Land Commission and the Attorney General (1984) and in ESB v. Gormley (1985)

Nevertheless the Supreme Court stated in Re Article 26 and the Planning and Development Bill 1999 (2000):

``There can be no doubt that a person who is compulsorily deprived of his or her property in the interest of the common good should normally be fully compensated at a level equivalent to at least the market value of the acquired property''.

The courts have tended to support the idea that you cannot CPO without just compensation. But if, in reference to what constitutes just compensation, we refer back to Dreher V. Irish Land Commission we may ascertain that changes in compensation regime would be possible. In Dreher V. Irish Land Commission Walsh J stated

``It does not necessarily follow that the market value of lands at any given time is the equivalent of just compensation as there may be circumstances where it could be considerably less than just compensation and others where it might in fact be greater than just compensation''

Sinn Fein asserts that compensation should, where compensation is necessary, be based on existing use value or existing use value plus a stipulated percentage as outlined in the Kenny Report as it is not in the common good for local authorities to be faced with paying the full market value for land which derives much of its value from the actions and decisions of that local authority, e.g. zoning decisions and infrastructural development.

The finding by Costello J. in Hempenstall v. Minister for the Environment (1994) supports the view that for compensation to be based on existing use value or existing use value plus a stipulated percentage as outlined in the Kenny Report is constitutional:

``a change in the law which has the effect of reducing property values cannot in itself amount to infringement of constitutionally protected property rights''.

House Prices and the Housing Crisis

In a state where home ownership is as seen the norm, the ability to buy one's own home is set to become the sole preserve of the wealthy. Rising house prices have made the option of owning their own home unaffordable to many people on average and below average incomes. Those who cannot afford their own home have neither the safety net of social housing nor the protection of tenancy legislation. Successive governments have failed to address the housing crisis.

In this State the Celtic Tiger boom has come and gone but the housing crisis is still here and worse than ever. In every decade of the last century there has been an unmet housing need which successive administrations have failed to resolve. Despite three expert reports from Bacon, a new Planning Act and a Commission on the Private Rented Sector there are still huge problems in the housing sector. These include rising house prices, rising rents, evictions, increasing homelessness and a record 54,000 households waiting for social or public sector housing. Demographic, social and economic factors are bringing at least another 8,200 households onto the waiting list each year.

Current government strategy if actually implemented will mean at least 14 years waiting before the lists are cleared under the best possible circumstances.

In the last 18 months house prices have continued to increase as investors returned to the market driving up prices and pushing already expensive homes out of the reach of first time buyers.

It is notable that the increases in construction costs have not been anything as pronounced as the increase in house prices.

The average cost of a house in Dublin is now €300,000. The average price of a house in the 26 counties as a whole is over €220,000.

Rezoning and Planning

Zoning of land, granting of planning permission and public works, the provision of infrastructure and services all make a significant contribution towards increasing the value of land. This has been termed `betterment' in the Kenny Report and elsewhere. Sinn Fein is of the view that the State is entitled to some compensation for this betterment.

The current situation whereby the State is forced to pay open market prices for land which derives much of its value from this betterment is not reasonable. It is not morally acceptable that developers/speculators should be making huge profits at the cost of the community which is then unable to house its own members. A code of practice should be implemented to ensure that developers/speculators are not profiting from the development of State funded infrastructure by local and/or central government.

Zoning, which has been embroiled in controversy and corruption should be used as a positive mechanism to ensure that an adequate amount of land is made available for social housing.

Recent figures published by the Department of the Environment and Local Government there were over 12,177 hectares of zoned land available for residential housing which could accommodate 327,784 housing units.

The state must have the ability to tackle the problem of landowners whose land has been rezoned for housing but who retain their land as a long term investment. Landowners must not be allowed to profit from decisions which were intended to benefit society and address a severe housing crisis. Local authorities should not be put in the position that they are then forced with paying these same landowners outrageous sums of compensation for hoarded land.

Currently the only provision for penalising or encouragement for those speculators who are sitting on land to release that land for development is the Derelict Sites Act. It is significant for our consideration of how to deal with land speculators within the constraints of the Constitution that this Act has not been declared unconstitutional

Price of Development Land

There is evidence of the hoarding of development land by developers, speculators and builders for the purpose of benefiting from house price increases. The hoarding of building land by a small number of developers has helped to maintain the high price of development land, which has resulted in the current unaffordable house prices.

The high price of development land resulting from the hoarding of this land in and around urban centres has led to unsustainable urban sprawl as people are forced out to commuter belt towns in search of affordable housing.

Local authorities and voluntary housing associations are forced to compete with private developers for land.

There is no sign that that the housing market and the price of building land is about to decrease or stabilise without government intervention. It is in the interest of the common good that the State has the power to redress this inequitable situation.

Section V of the Planning and Development Act 2000

At the end of 2002 the Government introduced legislation to repeal Section V of the Planning and Development Act 2000, illustrating to the people of this State that there was no commitment from the coalition Government to the provision of social housing.

The deletion of the 20% rule means that developers can offer local authorities either other sites or money for not having to have social housing on their developments.

Prior to the deletion of the 20% rule no serious efforts had been made by the coalition to ensure that this vital element of the act was implemented.

Developers are opposed to social integration and will in future manoeuvre to buy off or side line their social housing commitment to unattractive locations thereby segregating those who avail of social and affordable housing into ghettos.

It is significant that the recent Economist property survey showed that house prices dipped in the one year that anti speculation measures were in force.

By giving in to the developers demands the government has dealt a severe blow to their the delivery of social and affordable housing in integrated and sustainable communities.

Access to the Countryside

There is no legal right of way to walk pathways that have been used from time immemorial which traverse private land in the 26 counties. This is in contrast to long standing traditional `right of way' with which most Irish people are familiar, though many may not be aware that they have no legal standing. The EU has commented that there should be a presumption to allow access to the countryside unless there are compelling reasons to do otherwise. Ireland is one of the countries in the EU with the most restrictive access to the countryside.

A case which clearly illustrates the failings in the current law is the dispute which arose in relation to the Old Head of Kinsale. Local people who have walked on the Old Head of Kinsale for time immemorial can no longer do so. The land at the Old Head of Kinsale was bought from Cork County Council by developers who were given permission to develop a golf course on the condition that public access to the land would not be restricted. However it became clear that developers had no intention of allowing the public access to the land.

On the 10th March the Supreme Court issued a judgement which will mean that there will be no public access to the Old Head of Kinsale. The court held that a condition imposed by An Bórd Pleanala granting public access was outside the powers of the Board and void. The judgement found that there was no lawful public access to the Old Head of Kinsale before the golf club building was built and the purpose for which they were developed was unrelated to the question of public access to the Old Head and ruled that the condition of public access imposed by the board was outside their powers.

There is an obvious flaw within the Constitution if the common good element of the private property articles is unable to protect the public's right to access a traditional walkway such as the Old Head of Kinsale.

Differentiating between Personal Private Property and Commercial Private Property

Ownership of a house is promoted in this state not only as a home but as an investment encouraged by various Government incentives.

While many homeowners benefits from mortgage interest rate relief, shared ownership schemes and other tax provisions, there is a need to re-evaluate the role of government in subsidising or defraying housing costs.

Housing as a Right

It is appropriate at this time to outline Sinn Fein's strongly held belief that housing as a right for all should be enshrined in the constitution. It is a fundamental human right as stated in the Universal Declaration of Human Rights:

``Everyone has the right to a standard of living adequate for the health and well-being of himself and of his family, including food, clothing, housing and medical care and necessary social services, and the right to security in the event of unemployment, sickness, disability, widowhood, old age or other lack of livelihood in circumstances beyond his control.''

Unlike the 26 counties, many European countries have adopted the principle of a right to housing.

The International Covenant on Economic, Social and Cultural Rights addressed the right to housing in Article II:

``The States parties to the present Covenant recognizes the right of everyone to an adequate standard of living for himself and his family, including adequate food, clothing and housing, and to the continuous improvement of living conditions. The state parties will take appropriate steps to ensure the realisation of this right, recognizing to this effect the essential importance of international co-operation based of free consent''

Under the above article this State is obliged to take steps to achieve, using the maximum of its potential resources, to achieve the rights outlined in Covenant, including the right to adequate housing.

It is notable that Ireland is among a very small number of countries who have failed to accepet the provisions of Article 31 of the Revised European Social Charter (1996) which came into force in 1999 and which states:

``With a view to ensuring the effective exercise of the right to housing, the parties undertake measures designed:
  • To promote access to housing of an adequate standard:
  • To prevent and reduce homelessness with a view to its gradual elimination:
  • To make the price of housing accessible to those without adequate resources.''

Under the Good Friday Agreement there must now be an equivalent level of protection of human rights between the two parts of Ireland, and this means that the provisions of the Covenant, as already in force in the North under the British Human Rights Act 1998 must be brought in to the 26 counties.

Internationally Ireland has been criticised for our failure to include a right to housing in domestic legislation law and the UN has strongly recommend that the State incorporates economic, social and cultural rights in the proposed amendment to the Constitution as well as other domestic legislation

Ground Rents

Sinn Fein is strongly in favour of the abolition of ground rents but does not believe that it is necessary to amend the constitution to do this. We do not agree that ground rent landlords should be compensated. A legacy of colonialism, ground rents have been unjust from the start, to compensate is to legitimise.

Constitutional difficulties in respect of legislation abolishing Ground rents have never been tested in a court of law.

There are 250,000 ground leases in the 26-County state. The state itself pays ground rents in many cases to English ground landlords. Many ground leases are held in the name of solicitors and other native Irish landlords and interests. The government pays ground rent on many government offices in Dublin and around the state.

The majority of ground leases are of course on private households. People think they own their house, and so they do, but they don't own the land upon which the house is built.

Ground rents are a feudal hangover tax from the days of British colonial rule and their abolition must be facilitated.

It is scandalous that this has not been dealt with since the coming into existence of the 26 county State. Ground rents represent an ongoing injustice against hundreds and thousands of Irish people who have suffered at the hands of land speculators, both native and foreign, avaricious builders and many opportunists in the legal profession since the foundation of the state.

Ground rent is an annual rent paid to a ground landlord, in return for no service whatsoever. The majority of ground rents are charged on foot of leases which are sometime in perpetuity. Other land leases go well into the next century. Others are quite recent in origin, such as those created by builders like McInerneys, which bought tracts of land, built houses which they then sold, but set up a ground leasehold which they retained, upon which the householder may continue to pay an annual rent. Many of the more recent ground leases, which were for 35 or 100 years, are starting to come to an end. When the ground lease is up, people who believed when they bought their houses that they owned them face an appalling choice. If a lease expires, the householder can choose to buy a freehold on their house for one eighth of its value, or sign a new lease for a drastically increased rent. With the value of houses going up and up, people whose leases are due to expire are justifiably angry and concerned. Ground landlords are set to make a financial killing.

At present under the Landlord and Tenants (Ground Rents) Acts, 1967 to 1984, the landlord has a statutory entitlement to one eighth of the value of the house on expiry of the lease. Alternatively, the householder is entitled to renew the ground rent lease for a further 99 years.

Local Irish builders have not only set up ground leases, but they have been amongst the most voracious in demanding the annual rents.

In 1992, McInerneys, under the name of Henry Hunt, (a wholly owned subsidiary company set up to handle McInerneys' ground leases) sold their ground rent portfolio of 3,290 household ground rents to an English property dealer, Ellard Lipson, for £32,000, around £10 per house. (return to English landlord). But even worse was the situation with Irish Life, a government-owned company which, in the early 1980s, facilitated the reinstatement of rack renting landlords by selling 9,000 ground rents in Ireland to a Philip Frederick, a London property dealer, who now trades under the name of Dublin Land Securities.

OTHER

Re: Article 44.2.6 which states:
``The property of any religious denomination or any educational institution shall not be diverted save for necessary public utility and on the payment of compensation.''

This article is open to being used by individuals intent on undermining the public good through land speculation. Sinn Fein believes that the property of religious denominations and educational institutions should not be treated separately to other property. Sinn Fein calls for the deletion of Article 44.2.6.

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