Here are excerpts from a speech in the Assembly by East Antrim Alliance MLA Stewart Dickson on Surety Bonds for New Housing Developments.
Stewart Dickson MLA said: “Recently our attention has been drawn to those who have purchased property in new developments, but have seen the construction sector collapse and their developments left unfinished.
“This leads to a whole range of problems, from devaluation to hazardous road surfaces and environmental health issues. A thorough investigation is required to evaluate the exact costs, consequences and scale of the problem, but we know that there are currently over 2,700 unadopted roads in Northern Ireland. Those who live in affected housing developments are all too aware of the consequences.
“In addition to new housing developments across Northern Ireland, there are historical unadopted roads across Northern Ireland, whether from the west of Larne, to an old development in Whitehead called McCrea’s Brae, to a new development in Greenisland called Farm Lodge Stables and to older developments in the upper part of Jordanstown and Newtownabbey, all of which pose their own unique problems.
“It became clear, as we discussed this issue in the DRD Committee, that a thorough review of the adoption process is needed, and I am pleased that the Committee has called for an Inquiry, and that we are now putting that in place.
“A number of key points need to be considered. First, there has to be an examination of the roles of key stakeholders in the adoption process. We are told that developers are required to consult Roads Service prior to building, and to provide a guarantee bond, but that this does not happen in many cases.
“Another concern is that local authorities do not hold information on property management companies that are no longer in operation. Perhaps we need a mechanism in place to compel the company or administrator to inform local authorities immediately upon insolvency.
“We also need to look at our legislation. It appears that we are slightly ahead of our counterparts in Britain; however, we are behind the Republic of Ireland, as they have put in place statutory provisions empowering residents to compel a local authority to adopt a road. This raises the question of who has the power to compel Roads Service to invoke the bond.
“One of the Roads Service documents we were provided with states that ‘the underlying principle is that a sufficient bond must at all times be available to cover the cost of any outstanding works’. By that rationale, the money should always be there. But obviously this is not the case. We need to look again at how the value of a bond is determined.
“Finally, we need to work towards heightened awareness among buyers of the issues around adoption. Solicitors have a duty to make sure that their clients are aware of these, but it is imperative that buyers know the responsibilities of solicitors, developers, local authorities, and lenders before they decide to make a purchase.
“Unadopted roads, footpaths and sewers are yet another symbol of the continuing economic crisis we face. It is an issue that we must tackle head on. I therefore look forward to my involvement in the Committee inquiry, and I wholeheartedly support today’s motion.
“I would also call on the Minister to ensure that, while the Assembly’s Regional Development Committee is conducting its inquiry, the Department will not take its foot off the pedal when dealing with these matters. This is not an excuse for the Department to do nothing.”