The Daily Star Ireland
A large-scale social housing initiative, encompassing nearly 3,000 planned homes across Ireland — including approximately 2,000 in Dublin — has been placed on hold after the Department of Housing withdrew financial support from key projects. The decision, driven by concerns over value for money, halts several developments that were poised to begin construction under a public-private partnership (PPP) model.
Three weeks prior, the Department declined to move forward with nearly 500 social housing units slated for sites in Dublin, Wicklow, Kildare, and Sligo. These units were part of a PPP bundle managed by a consortium. According to departmental sources, the cost per unit had escalated to over €1 million, nearly double the cost of similar homes built in 2020.
A detailed breakdown reveals that slightly more than half of this cost covered the physical construction of the homes, while the remainder was tied to 25 years of financial, maintenance, and management services under the PPP framework. Despite passing multiple value-for-money assessments since the tendering process began two years ago, the rising costs ultimately triggered government intervention.
The first phase of homes was originally scheduled for delivery in 2027 and 2028. Additionally, a broader tranche of 1,600 more homes planned for Dublin is now also delayed. Industry stakeholders who had already committed resources, labor, and materials are reportedly left in a state of uncertainty and frustration.
Political and Industry Backlash Highlights Broader Concerns
The move has drawn strong criticism from elected officials and industry representatives, who argue the cancellation undermines efforts to tackle the country’s worsening housing crisis.
Rory Hearne, a Social Democrats TD for Dublin North West, described the decision as unjustifiable in the context of a national housing emergency. He argued that halting projects at such an advanced stage ignores the pressing needs of families on long-term housing waiting lists and individuals experiencing homelessness.
Hearne suggested that the initial phase should have proceeded while the government re-evaluated the overall PPP strategy. He advocated for shifting toward direct delivery of housing through local authorities, using the state’s budget surplus to bypass what he described as inefficient private-sector involvement.
Daithí Doolan, Sinn Féin’s group leader on Dublin City Council, also voiced discontent, urging the minister to release the withdrawn funds directly to the council. He maintained that local authorities are equipped to manage the developments independently and more efficiently. Doolan questioned the reliability of the PPP model, describing it as overly dependent on private interests and lacking transparency. He criticized the government for reversing course on a strategy it had previously championed.
According to individuals close to the project, significant investments had already been made in preparation for construction, including workforce mobilization and procurement of materials. They expressed dismay at the sudden policy shift, citing the absence of prior warning and the lack of immediate alternatives.
Paul Sheridan, Director of Main Contracting at the Construction Industry Federation, warned that the decision could have broader consequences for other major infrastructure initiatives operating under PPP structures, such as Metro North. He indicated that construction firms are increasingly considering relocating operations to countries like the UK, Canada, and Northern Europe due to inconsistent project pipelines and uncertainty in domestic procurement processes.
Fianna Fáil TD Paul McAuliffe, representing Dublin North West, acknowledged the high per-unit cost, calling the projected price over a 25-year period unjustifiable. While supportive of government efforts to maintain fiscal oversight, he emphasized the need for an alternative delivery system to avoid indefinite project stagnation.
Department Cites Fiscal Prudence, Commits to Reassessment
In response to growing criticism, the Department of Housing stated that the funding halt followed a thorough review and was based on fiscal prudence and the responsible use of taxpayer money. It acknowledged the potential repercussions for the PPP model but described the pause as necessary to reassess delivery methods.
The Department clarified that the review would focus on social housing initiatives that have yet to reach procurement, aiming to determine more sustainable and cost-effective pathways for future construction bundles. It reiterated its commitment to accelerating housing development across all regions and confirmed ongoing engagement with construction industry stakeholders.
The Department emphasized that a record number of social and affordable homes have been completed in recent years, and pledged continued collaboration with partners to meet the demands of the housing sector while ensuring public funds are used effectively.
