The 1970s and 1980s proved to be a hugely challenging period for the Iveagh Trust as the impact of rent restrictions compounded by spiralling inflation ultimately forced the Trust to sell assets.
Rent Controls – Unintended Consequences
Rental income was held back by the constraints of rent control under the Rent Restrictions Acts of 1960 and 1967. Rents for accommodation with shared facilities were strictly controlled by the law. At Kevin Street a large proportion of the old tenements had communal toilets and laundries and so fell under the restrictive controlled rent legislation. While the rent restrictions were intended to control climbing rents in the private sector, they also had the effect of freezing Iveagh Trust rents that were already set at a very low level – to the point where the future of the Trust itself was called into question.
There was no practical way of matching income with spiralling costs, and losses sustained on the Kevin Street Estate were a significant contributory factor towards the Trust’s deficits. Necessary improvements had to be delayed and the buildings began to deteriorate.
Possibilities of extricating controlled dwellings from the stringencies of the legislation were very limited; they depended on obtaining vacant possession of the premises and vacancies were very slow to arise. Difficulties were made worse in 1974 by a rent strike among the tenants dissatisfied with rent increases in the uncontrolled property at Kevin Street and Bull Alley and also with the introduction of a new form of refuse collection by Dublin Corporation which the tenants considered to be inconvenient.
Meanwhile the number of lodgers at the Iveagh Hostel continued to diminish with attendant loss of revenue. With a deficit of €54,765, 1975 was the worst financial year of the Trust since its inception. In view of the critical position, Trustees decided to form a sub-committee to consider the future role of the Trust. In 1976 the financial deficit reduced to £37,328 and thereafter the overall financial position continued to improve steadily. Financial difficulties, however, remained acute and much essential work could not be done.
In December 1975 the Trustees, very reluctantly, decided to close the Iveagh Play Centre owing to declining attendance and the costs involved in maintaining the Hostel. In 1976 the centre was purchased for £350,000 by the Dublin Vocational Educational Committee for use as a school. The sale enabled the Trust to show a surplus in 1977 and clear indebtedness to the bank. By the late 1970s there were still heavy losses on flats covered by rent restrictions but net rentals were increasing significantly as a result of completed improvement work on Kevin Street and Bull Alley Estates.
Throughout the 1970s, despite financial problems, some modernisation of older properties continued. Between 1972 and 82, for example, 72 self-contained units were created out of 114 flats which formerly had only communal toilet and laundry facilities. Improvements and reconditioning work were funded principally from sales of the Crumlin houses. The entire cost for improvement had to be raised by the Trust, as government grant-aid towards renewal was minimal.
Creating a one-bedroom self-contained unit on the Bull Alley estate, for example, cost £4,100, but the maximum grant was £400. Not only internal facilities required attention; uncharacteristic signs of dilapidation were appearing on the exterior of the old buildings which very evidently needed considerable repair and maintenance to keep them up to customary standards.
In 1975 Lord Moyne resigned as Chairman of the Trustees, a position he had held since 1962, and the third Earl of Iveagh, who had been a Trustee since 1958, succeeded him. Lord Moyne continued as an active and valued Trustee. In the same year Mr. A.E. Thompson retired from the secretaryship after 22 years and Mr. F.P. Stephens took over the administration of the Trust in the midst of its difficulties.
By the early 1980s, 25% of the older Trust property had been modernised, almost entirely through the sale of realisable assets. These funds were now completely exhausted and rental income still held back by the constraints of rent control. Modernisation would have to be seriously curtailed unless fresh funding became available.
The introduction of the Housing (Private Rented Dwelling) Act in July 1982 was crucial for the Trust. Realistic rents were made possible for properties which had been subject to rent control. Characteristically, however, rent increases for the Trust’s dwellings were phased in over a number of years to lighten the immediate burden on tenants.
With this new freedom, improvement work was stepped up in the older properties and they were subsequently let at realistic rents, mainly to young married couples. Self-contained flats were progressively modernised and shared accommodation converted to self-contained units. Financial fortunes, however, continued to fluctuate disturbingly from year to year.