The Labour Party’s new policy is a new policy, technically speaking. But it is not a new idea. It is, in fact, almost 50 years old and was first proposed in the Kenny Report of 1973. The report is so old, in fact, that its author, Justice John Kenny, has been dead since 1987. The basic proposal then, as now, was that county councils and local authorities should have the power to compulsory purchase land, and to set the price at which they do so. Here’s the Labour leader making his case:
We want to tackle the price of building land to make housing more affordable.
— The Labour Party (@labour) June 14, 2021
The bill itself, should you wish to read it for yourself, is here.
In his speech to the Dáil, introducing the bill, Kelly told the house that the proposal had been reviewed by a senior counsel, who suggested that it would not be unconstitutional. That is significant, and – with no disrespect intended to the senior counsel in question – should be taken with a grain of salt. After all, the primary reason that the Kenny report has never been implemented is precisely because successive Governments, over 50 years, have been told by their Attorneys General that such a proposal would be unconstitutional, and in conflict with private property rights.
It is also ferociously opposed by farmers who would, in all likelihood, be the main losers. And it is not a new proposal, either – during the formation talks for the present Government, Fianna Fáil and the Greens both pushed for a version of this idea, and were shot down swiftly by Fine Gael, and also by the farming lobby.
And, to be clear, the farmers have a point: They, after all, would be the big losers here, because they would be the only ones asked to take a hit in the name of making housing cheaper. The builders, and the estate agents, and everybody else in the construction chain would keep their margins, and make exactly the same profits as they do now. The people who would lose out would be the landowners. And the landowners, of course, are in many (though by no means all) the poorest people in that whole supply chain.
Nor is it obvious, actually, that land prices are even a top five issue in the housing crisis. There are, after all, no shortage of proposals to build housing. The reality is that time and time again, local councils, with the full and enthusiastic support of their voters, block housing developments, because voters simply are not keen on new housing near them. This proposal goes after farmers, and will be popular with people who are not farmers. But why not bring in a proposal to heavily restrict the right to object to planning permission for housing? That would unlock the supply crisis much more quickly, but of course it is more likely to annoy suburbanites who vote Labour in greater numbers than farmers do.
And how much would it impact the price of a house anyway? Well, the Labour leader himself told the Dáil that he estimated this proposal would (in the future) reduce the price of a new three bedroom house on a greenfield site in county Dublin by….. €30,000. That is not a sum to be sneezed at, of course, but it is also not a sum that is likely to bring the housing crisis to an end overnight. And what’s more, the impact of the bill – the time it takes to filter through the system, take effect, and start impacting the market – might be years, if not a full decade.
Finally, it is not necessarily obvious that this proposal, even were it enacted, would make much difference. Why not? Well, because voters still have power in our democracy. Councillors who suddenly started voting to CPO vast tracts of land, at hugely reduced prices, from farmers, might find that their re-election campaigns become more difficult. Just as, right now, councillors who vote for new housing developments in nice areas find the same thing.
If that all sounds relentlessly negative, and anti-Labour, well, it’s not. The party does deserve credit for putting this idea on the table, and it probably does deserve a full and open debate, with experts and stakeholders weighing in. Don’t expect it to be plain sailing, though, for this proposal. It’s been on the shelf for half a century for very good reasons, after all.