The Irish Independent reports that thousands of homes across the country are still being built -- as a new report warns that 120,000 existing houses are unlikely ever to be sold.

New figures show developers started work on almost 11,000 homes in the last 15 months -- at a time when the property market has collapsed, more than 600 'ghost estates' lie empty and there is a glut of 300,000 unwanted properties. A report into the property bubble says that of the 300,000 homes lying empty, as many as 120,000 homes are unlikely to be sold in the future. And most of these are in counties Roscommon, Cavan, Leitrim and Sligo.

Property experts say some developers are gambling on building in what they feel are the right locations for cheaper prices. But if the gamble fails, and there are no takers, there will be even more empty homes. Environment Minister John Gormley is powerless to halt the building splurge, fearing legal action if he imposes a moratorium on any new homes being constructed. The building of new apartments and houses also comes despite a massive reduction in house prices, major difficulty in getting mortgages and a surge in home repossessions.

New figures show work has begun on 10,942 homes since the start of 2009 -- with more than 7,000 new homes completed this year. While nowhere near the boom levels of almost 90,000 units, the level of building is still extremely high considering the state of the property market.

The Central Statistics Office (CSO) figures show that in Co Roscommon, for example, which has 35 ghost estates, more new homes (161) were built than in the more populous Dun Laoghaire-Rathdown (149) area which has 10 ghost estates.

Yet, despite this, developers are still willing to take a gamble and have been busy building homes in these counties and others which have the greatest oversupply.

In addition to the almost 11,000 new units, thousands more have also been granted planning permission in the past year, meaning that developers are free to begin work on new schemes.

The figures come as a new study from NUI Maynooth says more than 300,000 vacant units are dotted in 620 ghost estates across the country, with a potential oversupply of 120,000 homes.

The study from the National Institute for Regional and Spatial Analysis (NIRSA) found that reckless planning decisions have left one in six houses uninhabited for most of the year in 620 unfinished estates.

It is expected that many of the unsold units will be leased for social housing purposes, meaning the taxpayer could pick up the tab for the reckless pace of development.

The study's author, Professor Rob Kitchin, said there was "quite clearly" no need for more homes to be built in the State in the immediate future.

"The biggest problems are in counties like Leitrim, Roscommon, Longford, Sligo, Monaghan and Cavan," he said.

"Where we think construction needs to take place is for public infrastructure like public transport, schools, water treatment plants and broadband. We're not convinced about houses." The report demands an inquiry into the planning system, saying that generous tax breaks "greatly exacerbated" the situation and that counties with the most vacant stock in 2006 later built the most new housing in the following four years.

They now have the highest levels of oversupply, and have the most land zoned for future use.

Just six local authorities -- Fingal, Kildare, Galway city, Meath, Wicklow and South Dublin -- employed "relatively sensible planning" during the boom years.

The decision by many developers to continue building comes as the Permanent TSB/ESRI house price index published yesterday shows that while the rate of decline is slowing, house prices are still falling.

Prices are now down 35pc from their peak in 2006. Prices are now back to 2002 levels.

Around 1,800 developers are expected to go into the State's bad bank NAMA, but hundreds more are willing to risk building new homes in counties where there is no demand.

Industry sources said that some of the 300,000 units were in locations far from roads, public transport and amenities, meaning they would take longer to sell.

Developers have a legal right to build homes on foot of a grant of planning permission.

"There's nothing that the minister can do in relation to those consents already granted," a department spokesman said.

However, changes to the planning acts, signed into law by President McAleese on Wednesday, would give local authorities the power to refuse permission if there was an excess of empty units, he added.

Currently, city and county managers cannot refuse an application on the basis there is excess housing already available.

The Irish Independent also reports that RTE is to build a multi-million euro infrastructure for digital television in the country, under plans that were approved yesterday.

A week after it emerged that the Broadcasting Authority of Ireland (BAI) is to shelve the commercial tender for digital terrestrial television (DTT), Communications Minister Eamon Ryan said yesterday that RTE would push ahead with its €70m scheme.

Under the terms of the plan, RTE will build a digital service to provide full coverage for the Republic and "significant" coverage in the North. The service will have to be ready on time for the switch-off of the analogue TV service, which is slated to end in 2012.

The infrastructure will involve both terrestrial and satellite coverage. The terrestrial network will be based on 51 transmitter sites covering 98pc of the population. For the remaining 2pc, RTE plans to develop a satellite service that would ensure full coverage nationwide for the first time.

Plans for a roll-out involving a satellite service were revealed earlier this month by RTE but that was pending approval from Mr Ryan's office. That has now been given.

The plan entails making available seven to nine free-to-air channels as well as a number of radio stations.

The state broadcaster had indicated that the channels would include RTE One and RTE Two, TV3, TG4, RTE News Now, RTE One+1, Euronews, RTE Children's and 3e but Mr Ryan raised the possibility of a movie channel being included as well.

It is expected that most houses will not have to upgrade their television but some may require a set-top box. That box could cost between €100 and €200 but the Government will consider a subsidy for pensioners and those on social welfare.

Controversy

Homes that already have a satellite or cable connection would not need to upgrade their equipment. The DTT switchover has been mired in controversy since the contract for a commercial partner was offered to tender some years ago. Several consortia that had bid for the contract then rejected it after the BAI refused to renegotiate the terms despite the recession.

Mr Ryan said that while he regretted that the plans did not include any private investment, the switchover must go ahead and will provide scope to develop rural broadband access.

"Going digital will also free up a valuable spectrum which can be used for broadband and mobile services," he said.

The Irish Times reports that Aer Lingus passengers face possible disruption from next month because of a row between management and cabin crew over the implementation of the company’s controversial €97 million cost-saving plan.

The trade union Impact, which represents cabin crew at the airline, yesterday said it was to ballot members for industrial action as part of an ongoing dispute over revised working hours. Under the terms of the cost-containment plan, which was agreed last March, flight time for cabin crew was to be increased to 850 hours per year.

However, there has been disagreement on how this would work in practice. Impact maintained yesterday that Aer Lingus had proceeded unilaterally to force changes to cabin crew rosters and to terms and conditions of employment.

The union said that the ballot was to give approval for industrial action up to and including strike action. It is understood that initially it would involve a work-to-rule within contract and for withdrawal of flexibility.

The union said that the proposed industrial action would include a withdrawal of labour “should Aer Lingus attempt to take action against any individual Impact cabin crew member”.

It is unclear at present how such industrial action would affect flight services at the airline if it is backed by cabin crew members of Impact.

However, Aer Lingus said last night that it did not anticipate operational disruption as a result of the proposed industrial action.

Details of how the new 850-hour flight-time requirements would work were to be finalised in talks between the union and management at the Labour Relations Commission.

But the union said an arbitration process at the Labour Relations Commission on the issue had been unsuccessful while attempts to resolve it in direct talks between the parties had also failed to produce an agreement.

An Aer Lingus spokesman said last night that 93 per cent of cabin crew had voted a number of months ago to support the cost-containment deal. He said that the company had a mandate and would continue to implement the changes.

Impact said that ballot papers for industrial action were posted to members of its cabin crew branch yesterday and that the ballot would close at 2pm on Monday, August 9th.

It said that in the event of the ballot being passed, a minimum of seven days notice would have to be served to Aer Lingus before industrial action could commence.

This means that any industrial action would not commence until the second half of August at the earliest.

Impact official Christina Carney said that the implementation of the new 850 hours flight-time target was achievable within the terms of existing agreements and contracts of employment of cabin crew.

“We see no reason for the company to breach those contracts and agreements in order to achieve this. However, the airline has proceeded unilaterally to force changes to cabin crew workers’ terms and conditions of employment,” she said.

In a letter to cabin crew members which accompanied the ballot paper, Ms Carney stated: “We regret to have to consider the taking of industrial action, but the company’s behaviour has left us with no choice. The purpose of the action is to protect cabin crew contracts and to ensure that the contracts are honoured and agreements are upheld.”

Initially cabin crew at Aer Lingus voted to reject the company’s cost-saving plan.

However, they later reversed their position following an announcement by Aer Lingus chief executive Christoph Mueller that the airline would make all 1,200 cabin crew redundant and re-employ most on inferior terms and conditions.

The company said 230 cabin crew would be made compulsorily redundant and that they would receive only their statutory entitlements.

The Irish Times also reports that ratings agency Fitch has said it expects the Government guarantee scheme to be extended by the European Commission in December 2010 as Irish banks are likely to continue to need the scheme to attract funding after this date.

The guarantee scheme was introduced in September 2008, covering some €400 billion of bank liabilities. The scheme was scheduled to lapse on September 29th this year but last month the commission extended it until the end of this year.

Unlike the original guarantee scheme, the extension does not include subordinated debt, a secondary form of debt which carries a risk premium. The decision to include subordinated debt in the original scheme was sharply criticised by the Opposition.

A decision on whether to seek a further extension in December has not yet been made by the Department of Finance.

A department spokesman said yesterday that the department has welcomed the extension of the eligible liabilities guarantee until December 2010 and would continue to monitor the situation.

In its semi-annual review of Irish banks, Fitch states that funding is “the most important challenge facing Irish banks” but that it is “manageable”.

It said the fact that Allied Irish Banks and Bank of Ireland had passed the recent stress tests suggests investor confidence has improved towards the banks, which if maintained may improve the banks’ access to funding.

However, the report makes a distinction between Bank of Ireland and AIB.

It says it expects impaired loans to continue to dent the reported operating profits of the institutions, but that “a polarisation” will occur, with certain institutions, including Bank of Ireland, set to return more speedily to a more normalised performance. Others, such as Allied Irish Banks and Anglo Irish Bank, are likely to take longer to successfully implement their restructuring.

Fitch said the ending of the original scheme in September has created some uncertainty as to how the banks will cope. The extension of a lesser guarantee scheme should help issuers when the market becomes easier to access, the report says. But the higher cost of this funding and an increase in the cost of ECB funding will weigh on revenues.

While broadly welcoming Nama, the report states that the substantial losses expected on the sale of loans to Nama will erode a material portion of capital, while restructuring charges are likely to further depress pretax profit at the banks.

The agency predicts a “significantly better, if still muted” performance by the banks in 2011, due to a gradual improvement in the economy, a reduction in loan impairment charges and the absence of losses on the sale of loans to Nama.

The Irish Examiner reports that farmers have been urged to set up additional bank accounts with alternative providers to avoid having their single payments offset against existing debt later this year.

Galway West Fine Gael senator Fidelma Healy Eames said she was advising this course of action arising from the revelation that banks can confiscate people’s money on arrival into their account against monies owing in other accounts.

"This is potentially catastrophic for farmers who are dependent on the single farm premium for their annual budgetary needs.

"Farmers receive one annual single farm premium cheque which they must use to budget for their needs for the whole year. This money may already be committed in many different directions," she said.

Ms Healy Eames said she was not condoning the non-payment of debts, but clearly stating that farmers must remain in control of their financial destiny and retain the ability to self-regulate their finances.

"Banks are now forcing businesses, including farmers, to convert overdrafts into term loans, effectively closing down all credit routes.

"If they also manage to have first call on monies arriving into accounts through the compulsory Electronic Transfer System (ETS), then businesses and families will cease being able to function at all and many will be left destitute," she said.

Ms Healy Eames said the only way round this, in the short-term, is to open a new bank account in a different brand bank and to inform the Department of Agriculture in the payment section in Cavan who will comply once given notice.

"However, opening a new bank account can take some time so it is best to move on this without delay," she said.

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