President, distinguished speakers, ladies and gentlemen,

I am pleased to be here this morning to open today'on Multi-Unit Developments. I want to thank the President of the Law Reform Commission, Ms. Justice Catherine McGuinness and the Commission's staff, for their cooperation and work in organising the Conference. I also want to thank our moderator, John Bowman, and the expert speakers and panellists who are participating in today's proceedings for their input and for bringing their expertise to bear on this important subject.

The subject-matter of this Conference could hardly be more topical: in recent months and weeks there has been extensive media comment and discussion of the problems and practical difficulties arising in relation to the management of multi-unit complexes and the operations of property management companies.  Today's turnout demonstrates that the subject is of considerable relevance and importance to very many people.

I welcome all of you who have come here this morning and I want to encourage you to contribute to and participate in today's proceedings, especially later on in the open forum session which is specifically designed to deal with issues and questions that you want to raise having heard from the experts.

This Conference is timely for another reason: significant progress has been made in recent months in identifying and raising awareness of issues relating to the management of multi-unit complexes and the operation of property management companies. The time has now come for Government to develop appropriate legislative responses to address these issues and this Conference will assist in that process.

Last autumn, the National Consumer Agency produced a valuable booklet entitled "Putting Consumers First" which contains essential information and guidance in layman's language for those who have bought an apartment or house in a multi-unit complex or are contemplating doing so. I want to congratulate the Agency for taking this initiative and I am very pleased that Ann Fitzgerald, Executive Chair of the Agency, is here today to provide a consumer protection perspective.

In December, the Office of the Director of Corporate Enforcement launched a draft consultation paper on the governance of property management companies. I can say without hesitation that it is a most valuable information resource for the members and directors of property management companies and I am delighted that Paul Appleby is here today to make a presentation on the company law issues that arise in relation to such companies.

Improved awareness of their rights - and an understanding of the corresponding duties and responsibilities of developers and builders - will encourage apartment owners to assert their rights as company members, become involved in the management of their company and combat abuses and sharp practices. For this reason, I want to encourage the ODCE and the NCA to continue with their important awareness-raising and consumer protection activities in this area.

Shortly before Christmas, I had the pleasure of launching the Law Reform Commission's Consultation paper on Multi-Unit Developments. The great value of this Consultation Paper is, firstly, the overview it provides and, secondly, the detailed consideration it gives to the specific problem areas that the Commission has identified in this area. Commissioner Patricia Rickard Clarke and Professor John Wylie will deal with aspects of the Consultation Paper in their presentations.

The overview of the issues contained in the Law Reform Commission's Paper is particularly useful because it demonstrates how the increasing use of multi-unit complexes for residential purposes is of recent origin in this country. Our lack of familiarity with this mode of dwelling goes far towards explaining the 'understanding deficit' which is a consistent theme throughout the Paper.
It also helps to explain why the current legal framework is ill-suited in many ways for dealing with the problems and difficulties arising in relation to this type of accommodation.

I welcome the emphasis in the Consultation Paper on the cross-cutting nature of the issues arising in this area and the need for Government to address them in a comprehensive, 'joined-up' manner. Clearly this will require action across a number of important policy areas, including the planning and development code, company law, consumer protection law and the development of regulatory structures.

I believe that addressing the problems arising in relation to multi-unit complexes must commence at the initial planning stage. I tend to share the views of those who say that the preponderance of one and two bedroom units in such complexes, together with a general lack of the facilities that families need, has tended to encourage short-term lettings and this has resulted in a more transient residential population that has little interest in, or commitment to, the governance and maintenance of the complex.  Moreover, it is very difficult to engender and develop a sense of community and stakeholder responsibility in such circumstances. 

My colleague, Dick Roche, Minister for the Environment, Heritage and Local Government, has a particular interest in this issue and has already taken action to address the planning dimension. Earlier this month, he published draft guidelines for planning authorities on sustainable urban housing, including new design standards for apartments. The primary purpose of these new guidelines is to ensure that the design and layout of new apartments will provide suitable and comfortable accommodation for a broad range of household types and sizes - including families with children - over the medium to long term. For example, the guidelines recommend that not more than 10% - 15% of units in any new development of 20 or more units should consist of 1-bedroom apartments because of their unsuitability for the needs of families.

The Law Reform Commission's paper also refers to difficulties and delays arising in connection with the taking-in-charge by local authorities of housing estates and imposition of the management company model in 'traditional' housing estates. These matters are also being tackled by Minister Roche and his Department. Relevant statutory provisions have been brought to the attention of city and county managers and they have been advised that under no circumstances should a planning authority require the establishment of a management company for 'traditional' housing estates.

Turning now to the important area of company law, I believe that the task ahead is to reform and adapt the law to meet the particular needs of the directors and members of property management companies.

In this context, I think it is important to bear in mind the voluntary nature of the role of director in property management companies, and the fact that the owners of units within a multi-unit development who make up the company - and from whose ranks the directors are necessarily drawn - may have little or no experience of running a company or complying with the formal requirements of company law. This has to be taken into account in developing new company models for such entities and devising future reporting arrangements.

I also believe that current strike-off provisions which are designed to penalise commercial companies that do not comply with company law requirements - and which may lead eventually to a company's dissolution and the vesting of its assets in the Minister for Finance - are particularly ill-suited to the operation of property management companies. This aspect also needs to be addressed in the ongoing company law reform process.

As regards the development of a regulatory framework, I am pleased to say that the Government has already approved the drafting of legislation to establish a Property Services Regulatory Authority which will operate a licensing system for all property service providers, including property management agents.

Future regulation of property management companies is an important issue that needs to be addressed in a coherent and practical manner. As I mentioned earlier, I am also very conscious of the valuable work that existing statutory bodies such as the National Consumer Agency and the Office of the Director of Corporate Enforcement are doing, and the real and practical contributions they are making to improved governance and consumer awareness in this area. Planning authorities around the country and the Company Registration Office also have important supporting roles to play.

What all of this means is that the future shape of a regulatory system for property management companies and other reforms must be designed in a manner which clearly identifies the tasks to be undertaken while at the same time avoiding duplication and overlap with existing statutory agencies. The reform of company law can also, I believe, play a very important role by specifying more clearly the duties and responsibilities of property management companies.

The Government is determined to address the problems and difficulties arising in relation to property management companies and today's proceedings will assist in the process of shaping its response. In recognition of the wide range of policy areas involved, and the cross-cutting nature of many of the issues, I am pleased to announce that the Governm ent has approved my proposal to establish a high-level, interdepartmental committee, comprising representatives of relevant Departments and Offices, to assist in the development of a coherent legislative response to these issues.

The outcome of today's proceedings will provide a valuable point of departure for this new committee. A key task, among others, will be to identify the key legislative and administrative actions to be taken and to determine a timescale for implementation as soon as possible.

In conclusion, I want again to commend the work of the various bodies represented here today and to thank you for your attendance and participation. This is a policy area which requires, and will benefit from, your input and participation.

Thank you.

 

25 January 2007