Housing Minister James Browne has indicated he will ignore a warning from Central Bank governor Gabriel Makhlouf and press ahead with financial supports for property developers, writes Craig Hughes.

His comments come after it was reported the Government wants banks to ease lending rules for developers, which would reduce the funding a builder has to put up front.

The Government is scrambling to stimulate housing development with Mr Browne describing apartment-building in Dublin as “broken” on RTÉ’s This Week on Sunday.

Planning permissions for apartments dropped by 39% last year, leading to forecasts the Government will again miss its home delivery targets for this year.

BusinessPlus.ie understands grants, guarantees and tax breaks are all being examined by the Department of Housing.

However, they would require the backing of the Department of Finance.

It is understood grants would be considered only where they would help local authorities to assemble and clear sites for housing.

Mr Makhlouf yesterday warned against making further interventions in the housing market, saying: “My very strong advice is there are many significant interventions they are making and have made in the housing market.

“My advice would be to take stock of all of those interventions, make sure they’re all mutually supportive of each other before introducing new ones.”

He said banks were “well capitalised” to lend more if they wanted to so, adding: “I would prioritise making sure land is available for development.

“Infrastructure is what I would put specific focus on… The number one issue in housing is planning.

“Planning is the problem. Changing the law is one thing, making sure the new law is implemented well is another.

“I would put all my energies into making sure planning laws are being implemented in a way that supports the construction of housing.”

The last government passed the Planning and Development Act in its final weeks before being dissolved, with a time-frame published earlier this month to implement it over an 18-month period.

But hours after the governor’s comments, Mr Browne told Virgin Media News the collapse of apartment-building in Dublin “is about financing, not planning”.

The Cabinet Committee on Housing will meet again next Monday, when new proposals will be thrashed out but no decisions are expected for at least another two months.

In a further indication that incentives for developers are being looked at, Mr Browne told RTÉ’s This Week that finance is the issue that is holding back development.

“There is a serious issue here in meeting our targets and that issue is delivery of apartments in Dublin and that’s why we have to look at ever measure we can,” he said.

“It’s the financials – international finance is not investing in apartment-building in Dublin because it is costly and they don’t see an opportunity for profit out of it.

“I think they [tax breaks] have to be looked at… We have to examine the taxation regulatory regime.”

There is a disagreement between Mr Browne’s Fianna Fáil party and Coalition colleagues Fine Gael about giving tax breaks to developers.

Finance Minister Paschal Donohoe has repeatedly stated he does not favour a return to tax breaks used during the Celtic Tiger.

Mr Browne will meet Mr Makhlouf in the weeks after this meeting to discuss Government plans.

Meanwhile, a new ‘Housing Tsar’ – who will oversee housing activation and remove obstacles to delivering large scale projects in urban centres – will not be appointed for another two months.