Ireland’s new prime minister pledges to fix housing crisis as elections loom

Incoming taoiseach Simon Harris has pledged to fix Ireland’s housing crisis “once and for all” as he seeks to revitalise his Fine Gael party’s jaded image and lead it to a historic fourth term in power.

Harris, who will be voted in as prime minister at the head of Ireland’s three-party coalition on Tuesday after Leo Varadkar’s shock resignation last month, takes office less than a year before a general election.

Despite Ireland’s booming economy, polls suggest that voters have begun to lose faith in the centre-right Fine Gael’s ability to deliver — even with Harris at the helm. An Ireland Thinks poll on Saturday found its support has dropped a point since its last survey in late March and is now at 21 per cent — almost 15 points below its high four years ago.

Ireland’s housing crisis is voters’ top concern. Harris told his party conference on Saturday he would fix the problem by building 250,000 homes within five years — much higher than the government’s current target of building an average of 33,000 homes a year until 2030.

Ireland had full employment, rising incomes, record investment and was saving money to protect against future shocks, “but we want to do more to help families here and now,” said the energetic 37-year-old. “It’s now time to convert that economic success into real and tangible improvements for all of our people.”

Ireland’s fortunes have been transformed since 2011, when Fine Gael took office amid a crisis that led to a humiliating EU and IMF-funded bailout. Since then, investment in public infrastructure had quadrupled and 35,000 new homes would be built this year, Varadkar said on Saturday.

But housing experts say the figures are still too low. Property group Knight Frank estimates that 58,000 units will be needed a year until 2027, while a report by property website Daft.ie found there were just 9,700 second-hand homes for sale nationwide on March 1 — the lowest since 2007.

Eoin Ó Broin, housing spokesperson for the opposition Sinn Féin, whose pledges to resolve the property crisis have made it Ireland’s most popular party, said Harris had “effectively trashed his own government’s housing plan targets”. Harris had “offered nothing new in terms of tackling rising homelessness, rising rents or rising house prices”, he added.

Homelessness levels have reached a record high, with 13,841 people — including 4,170 children — in emergency accommodation. A rise in immigration has also sparked social tensions, with 1,620 asylum seekers living in tents on the street after no state accommodation was available. Harris has vowed to introduce a “fair and firm” immigration system.

“I think there is a degree of frustration . . . while we have so many people at work and public finances that are still in such good condition, of course society wants to know why more homes aren’t being built, why we don’t have infrastructure, why the challenges we have aren’t resolved,” Paschal Donohoe, public expenditure minister, said on Saturday.

Supporters of Fine Gael, which governs with the centrist Fianna Fáil and the Green party, say turning around the housing crisis and resolving other challenges takes time and that until recently Ireland did not have the cash.

Ireland has, however, enjoyed a corporation tax bonanza with revenues more than doubling between 2020 and 2023 to hit €23.8bn last year.

But as Harris takes the helm, the era of tax windfalls could be ending. Corporation tax revenues fell nearly 25 per cent in the first quarter compared with the same period last year, although overall tax revenues were still €350mn higher.

Harris told a packed hall of party members in Galway under the banner “A New Energy” that he would “hit the ground running”.

“We’re not going to promise the sun, moon and stars in the next 11 months. But we can promise some things that we can deliver,” one junior minister told the Financial Times, adding that Harris would have a “laser focus”.

The incoming premier has pledged tax cuts for middle-income earners and aid for small businesses after calls to tackle rising costs. Eoghan O’Mara Walsh, chief executive of the Irish Tourism Industry Confederation, said new labour regulations would add €465mn to his members’ payrolls this year, rising to €1.4bn by 2026 when the minimum wage will increase to €15 an hour.

The party must also reconnect with disillusioned voters and placate those who believe Fine Gael has moved too far from its conservative roots. “Thirteen years in power is a long time,” said the junior minister, acknowledging the party had “got bogged down”.

“[Harris] needs to pick his priorities from the programme for government,” said Charlie Flanagan, a veteran Fine Gael legislator who has served as justice, foreign and children’s minister. “These will have to be housing and health.”

Local council and European polls on June 7 will be Harris’s first electoral test, with Fine Gael projected to lose seats. For the general election, Harris must also find fresh talent: about a third of the party’s deputies, including Flanagan, plan to stand down.

“It’s all up for grabs,” said Declan Tobin, 64, a carpenter and life-long Fine Gael voter from Cork. “This is a new beginning.”

Harris may be comforted by Sinn Féin’s slide in recent polls, but he only has months to make his mark.

“He needs wins,” said Theresa Reidy, a senior politics lecturer at University College Cork. “Time is his biggest enemy.”