Committee Reports > List of Committees > Joint > 1980 > Committee on Commercial State-Sponsored Bodies > Report No. 12 - National Building Agency, Limited

APPENDIX I

MEMORANDUM FROM THE NATIONAL BUILDING AGENCY LIMITED

1. The National Building Agency Limited was incorporated with the approval of the Government as a private limited company under the Companies Acts, in December 1960. The share capital of the Company is £100 divided into 100 shares of £1 each. The present shareholders are:-

Directors are appointed by the Minister for the Environment with the concurrence of the Minister for Finance. The term of office of the current Board of Directors expires on 30th June 1980.

The National Building Agency Limited Act, 1963, empowered the Minister for Finance to take up shares of the company and to make advances out of the Central Fund to it. Under the same Act, the Minister for the Environment can guarantee the borrowings of the Agency. Subsequent Acts (National Building Agency Limited (Amendment) Act, 1969 and National Building Agency Limited (Amendment) Act, 1974) increased the limit of two million pounds on the aggregate unpaid borrowings of the Agency set by the 1963 Act to ten and fifteen million pounds respectively.

2. The objectives and powers of the Agency are to be found in its Memorandum and Articles of Association (copy enclosed). Basically, it was set up to carry on the business of a construction agency. In its early years, its main functions were to facilitate industrial expansion by providing houses for executives and workers in industry and to construct houses for State employees such as Gardaí, whose employment would involve regular transfer of residence. Then in 1965, the Government decided that the Agency’s functions should be extended to enable it to provide houses for local authorities at their request and to engage in other activities relating to houses and environmental services assigned to it by the Minister for the Environment, with the agreement, where appropriate, of any other Minister concerned.

When in 1974, the European Coal and Steel Community initiated the programme for assisting—in the form of low interest loans—workers in the coal and steel industries in meeting their housing needs, the Agency was given the responsibility of co-ordinating this programme and distributing the monies made available by the Community.

3. In the period since its inception in December 1960 to 31st December 1978 the Agency has provided a total of 21,448 dwellings in the following categories:-

Other projects completed in the same period were a fishing school at Greencastle, a swimming pool in Limerick and a community hall at Carrickmacross.

As part of its role in the provision of housing for industry, the Agency makes available house purchase loans to applicants approved by the Industrial Development Authority. In addition, loans are provided under the programme sponsored by the E.C.S.C. At 31st December 1978, there were 1,254 dwellings in all mortgaged to the Agency and the amount of capital outstanding on foot of such mortgages was £6,655,410.

4. (a) The capital monies required to meet the Agency’s ongoing programme are made available from:-

—the Department of State concerned, where projects are undertaken for Departments of State. For example, expenditure on the housing schemes being constructed at the Curragh, Collins Barracks and McGee Barracks is met by direct recoupment from the Department of Defence;

—the individual members of the Co-Op group where private housing is being provided;

—the Industrial Development Authority in the case of industrial housing, including the necessary funds from mortgage operations;

—the local authorities concerned where local authority housing is being provided;

—the Health Board or other body from which the order had emanated in the first instance;

—the European Coal and Steel Community in connection with the programme for assisting workers in the coal and steel industry.

For the financial year ended 31st December 1978, the capital monies received were as follows:-

(b) To meet its own operating costs—salaries, consultants’ fees, office expenses etc.—the Agency makes a charge for its services.

For example, for providing a comprehensive service—including site survey, scheme design, presentation to local authority, preparation of tender documents, invitations to tender, contract with builder, supervision of construction, contract management, the finalisation of building accounts and hand over of completed scheme—for a normal suburban housing scheme, the Agency’s current charge to a local authority is five per cent of the building cost plus the cost of site supervision. This works out at about six per cent of the building cost and is below the cost which a local authority would incur if a private consultancy were employed.

In discharging its mortgage functions, the Agency follows the example of local authorities and meets its administrative overhead costs by making loans available at a rate equal to a half per cent higher than the rate at which the money is borrowed from the Industrial Development Authority.

(c) Since its inception, the accounts of the Agency have been audited by the Comptroller and Auditor General. A copy of the audited accounts for 1978, together with the certificate of the Comptroller and Auditor General, are incorporated in the Annual Report for that year (copy enclosed).

5. At the beginning of the year, the Agency had on its books, apart from 1,849 dwellings under construction, commissions involving over seven thousand dwellings. On the basis of output over recent years, this workload represents a five year programme up to 1984.

Shane O’Hanlon

Chairman

January, 1980.